NJV NJV!!, page-8

As consideration for the sale, Fortescue will pay BC Iron a royalty on 75% of the future iron ore that is mined from the NJV tenements.

Specifically, the royalty is:

 1.0%-2.0% of free-on-board revenue received by Fortescue for direct shipping ore (≥55% Fe); and
 A$0.50-1.50 per tonne for low grade ore (<55% Fe), adjusted for 15% yield loss.

A 50% reduction in the royalty rate will apply to all iron ore mined above 15 million tonnes, and a 75% reduction for all iron ore mined above 25 million tonnes.

Fortescue will initially pay BC Iron 33% of the agreed royalty in cash, until the total amount waived by BC Iron equals A$7.5M. Thereafter, Fortescue will pay BC Iron 100% of the agreed royalty. The amount to be waived by BC Iron is intended to