US Steel (X)

Note 7. Intangible Assets

Net intangible assets of $5 million at September 30, 2007 are principally comprised of unamortized financing and transaction fees related to the Corporation’s ABL facility. Net financing fees of $7 million related to the secured revolving term loan, previously included in intangible assets, were charged to income upon repayment of the loan in the second quarter of 2007 (Note 8).

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Note 9. Intangible Assets

Computer systems and applications relate to the Corporation’s enterprise resource planning systems for procurement, human resources, and finance.

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Intangible Assets

Intangible assets are comprised of proprietary software costs. Amortization is recorded on the straight-line method with useful lives ranging from 5 to 7 years. U. S. Steel evaluates impairment of its intangible assets on an individual basis whenever circumstances indicate that the carrying value may not be recoverable. Intangible assets deemed to be impaired are written down to their fair value using discounted cash flows and, if available, comparable market values. Intangible asset cost basis at December 31, 2005 and 2004 amounted to $53 million. Accumulated amortization amounted to $24 million and $16 million at December 31, 2005 and 2004, respectively. Amortization expense related to intangible assets over the next five years is expected to be $9 million in 2006, 2007, and 2008, $2 million in 2009 and less than $1 million in 2010.

Intangible Assets

Intangible assets are comprised of proprietary software costs. Amortization is recorded on the straight-line method with useful lives ranging from 4 to 6 years. U. S. Steel evaluates impairment of its intangible assets on an individual basis whenever circumstances indicate that the carrying value may not be recoverable. Intangible assets deemed to be impaired are written down to their fair value using discounted cash flows and, if available, comparable market values. Intangible asset cost basis at December 31, 2004 and 2003 amounted to $53 million and $41 million, respectively. Accumulated amortization amounted to $16 million and $4 million at December 31, 2004 and 2003, respectively. Amortization expense related to intangible assets is expected to be $9 million in 2005, 2006, and 2007, $8 million in 2008 and $2 million in 2009.