Substantial Synergies — Based on discussions between both parties, expected synergies are now estimated at US$1.6 billion, up from the previously estimated US$1 billion. This will be comprised of US$500 million in purchasing synergies, US$570 million in marketing and trading, US$470 million in manufacturing and process optimization, and US$60 in SG&A. Further unquantified synergies are also anticipated from innovation, transfer of knowledge and cost. By the end of the first year, approximately 40% of the synergies are expected to have been achieved on an annualized basis; 30% the following year and the balance thereafter.

Corporate Governance — Certain special governance mechanisms designed to favor integration of Arcelor and Mittal Steel will be put in place for an initial period of three years. These mechanisms will apply to both Arcelor and Mittal Steel pending merger of the two entities and then to the resulting combined entity (the new company). After the initial 3 years, the new company's corporate governance will be reviewed in order to reflect the best standards of corporate governance for comparable companies, and in particular the NYSE standards, as applicable to foreign private issuers, and the Luxemburg Code of Governance.

Following completion of the tender offer, Mittal Steel, Arcelor and the new company will each be governed by an identical Board of Directors (BoD) and an identical Management Board (MB). Each BoD will be a non-executive board and day-to-day management of the group will be entrusted to the relevant MB.

Board of Directors — Each initial BoD will be composed of 18 non-executive members, the majority of whom will be independent. Six members will be nominated by Mittal Steel, three of whom will be independent. Six members will be from the existing Arcelor Board. Three members will be from the Arcelor Board representing existing Arcelor major shareholders. A further three members will be employee representatives.

All directors will be elected by the general meeting of shareholders for a period of three years. All shares in the new company will have identical voting and economic rights.

Chairman and President — Each BoD will appoint a Chairman and a President. Initially, the Chairman position will be held by Mr. Kinsch and the President position will be held by Mr. Mittal. Upon the retirement of Mr. Kinsch, Mr. Mittal will assume the role of Chairman and the successor to the Presidency will be proposed by Mr. Kinsch.

For a period of 3 years, the agenda of each company BoD meeting shall be jointly agreed by the Chairman and the President and shall include any matters proposed to be included on the agenda jointly by the Chairman and the President.

Voting — For a period of 3 years, the Mittal family shall vote in shareholders' meeting in accordance with the position expressed by the Company BoD, unless Mr. L. N. Mittal opposes any such decision, in which case the Mittal family shall have the right to vote at such meeting as it sees fit.

Board Committees — Each BoD will appoint two committees: an Audit Committee composed solely of Independent Directors; and an Appointments and Remuneration Committee composed of 4 members. Membership on the Appointments and Remuneration Committee will include the President (for as long as there is a President and thereafter an Independent Director), the Chairman and 2 Independent Directors (one nominated by each of Mittal and Arcelor). The Committee will be chaired by an independent director. Decisions will be made by a simple majority vote with no member having a casting vote. This Committee will be in charge of making recommendations to each BoD relating to the appointment of the members of the BoD, and the appointment and remuneration of the members of the MB.

Management Board — Each MB will comprise the current four members from the Arcelor management board plus an additional three members nominated by Mittal Steel's current Board of Directors. Aditya Mittal will join the Arcelor Mittal MB; other Mittal Steel executives will be named to the MB in due course.

During a period of three years, the appointment and remuneration of main subsidiaries' CEOs and board members and heads of the main business units and corporate functions will be decided by the Company MB unanimously.

Standstill — The Mittal family has agreed to a standstill at its level of ownership following completion of the Revised Offer and any subsequent offer or compulsory buy-out, or at a ceiling of 45% of the then issued Company shares if and when the Mittal family's holding falls below 45%. The Mittal family will be entitled to cross such thresholds in certain circumstances, such as with the consent of a majority of the independent directors or in case of passive crossing of such thresholds.

Lock up — The Mittal family has agreed to a 5-year lock-up, subject to certain exceptions, including the right to dispose of up to 5% of the new company share capital after the 2nd year.

Other provisions — In consideration of the revision of the terms of Mittal Steel's offer and of the corporate governance rules set forth above, Arcelor has agreed not to solicit or enter into, entertain or pursue any discussion or negotiation with any third party relating to, any acquisition proposal relating to Arcelor shares, other than in the context of the filing by a third party of a superior offer taking the form of a takeover bid for the entire share capital of Arcelor.

The agreement does not provide for any break-up fee. However, in the event that shares are issued under the Strategic Alliance Agreement announced by Arcelor on May 26, 2006, the corporate governance rules set forth above shall terminate.

Confirmation of Social Commitments — Consistent with the Arcelor/Mittal model, the combined company will respect fully all of Arcelor's social and industrial commitments, maintain and use reasonable efforts to further expand the role of innovation and R&D, continue to partner with public laboratories and universities, and continue investments to maintain the high performance levels of existing facilities.

There will be no restructuring plan, collective layoffs or other employee reduction plans within Arcelor in the EU as a result of the integration of the Mittal and Arcelor groups over and above Arcelor's announced restructuring plans and in connection with the implementation of the remedy package agreed upon with the EU antitrust authorities.

Arcelor and Mittal Steel intend to continue promoting employee share ownership in line with best corporate practices for continental European listed companies.

Dofasco — Arcelor and Mittal have not been able to reach agreement as to the ultimate disposition of the Dofasco Group. Discussion of this question will continue following successful completion of the tender offer.

The Offer — Mittal Steel expects to formally file the documentation relating to its revised offer with the AFM, the CSSF, the CBFA, the AMF, the CNMV and the SEC shortly, and to publish a supplemental prospectus following the regulatory review.

It is expected that, as a result of the amendment to the terms of the offer, the closing date for the tender offer, currently scheduled for July 5th, will be postponed by a few days. The new date for the closing of the tender offer will be communicated to the market after approval by the relevant market authorities.

The offer continues to be conditional on acceptance of more than 50% of the total share capital and voting rights in Arcelor, on a fully diluted basis; and approval at an extraordinary general meeting of shareholders of Mittal Steel Co. In light of the change to the terms of the offer, the Mittal Steel shareholders' meeting, currently scheduled for June 30th, will be postponed to later in July to allow Mittal Steel shareholders sufficient time to become familiar with the terms of the new offer.

The parties will consider jointly the need for a tender offer for outstanding shares of Arcelor Brazil under applicable laws and regulations, in particular in light of the new terms of the transaction.

Stock Exchange Listings — The new company will retain listings on the NYSE and in Paris, Amsterdam, Brussels, Luxembourg and Madrid.

Domicile and Headquarters — The new company will be incorporated, domiciled and headquartered in Luxembourg.