e8vk

Item 1.01 Entry into a Material Definitive Agreement

Extension of Expiration Dates for Post Petition Credit Facility and Exit Financing Commitment

As previously disclosed, before Kaiser Aluminum & Chemical Corporation (the “Company”) can emerge from Chapter 11, among other things, the United States District Court (the “District Court”) must adopt or separately affirm the confirmation order in respect of the Company’s and certain of its other debtor subsidiaries joint plan of reorganization (the “Kaiser Aluminum Amended Plan”), which was issued by the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) in February 2006. The District Court has scheduled a hearing for May 11, 2006.

As previously disclosed in its Annual Report on Form 10-K for the year ended December 31, 2005 (the “2005 Form 10-K”), the Company’s current financing arrangement with lenders (the “DIP Facility”) and the commitment that the Company has received from lenders for an exit financing arrangement (the “Exit Financing Commitment”) were both set to expire on May 11, 2006. The Company also previously disclosed that it had begun discussions with the agent bank for the DIP Facility and the Exit Financing Commitment for a short-term extension of both arrangements in case it was unable to emerge before May 11, 2006.

Given that the District Court is not scheduled to hold a hearing on the Kaiser Aluminum Amended Plan until May 11, 2006, the Company concluded that extensions of the DIP Facility and the Exit Financing Commitment were necessary, as, even if the District Court were to adopt or separately affirm the confirmation in respect of the Kaiser Aluminum Amended Plan at the May 11, 2006 hearing (for which there can be no assurances), pursuant to federal procedural requirements, the Company would not be able to emerge until at least ten days after the District Court’s order was entered to assure that any such adoption or affirmation of the Kaiser Aluminum Amended Plan that may be received from the District Court is not stayed. (Note 1 of Notes to Consolidated Financial Statements in the 2005 Form 10-K contains additional discussion regarding the conditions to emergence).

Accordingly, the Company and the lenders under its DIP Facility and its Exit Financing Commitment have subsequently agreed to: (a) an initial extension of the DIP Facility and the Exit Financing Commitment to May 17, 2006; and (b) a further extension of the DIP Facility and the Exit Financing Commitment to the earlier of August 31, 2006 or the emergence date. Copies of the applicable extension agreements are attached hereto and are herein incorporated by reference. On April 14, 2006, the Company received approval from the Bankruptcy Court to enter into the extensions of the DIP Facility and the Exit Financing Commitment to May 17, 2006. The Bankruptcy Court is expected to rule on the further extension of the DIP Facility and the Exit Financing Commitment at or before a regularly scheduled hearing on May 15, 2006. The Company and the lenders ultimately completed the execution of the necessary agreements to extend the DIP Facility and the Exit Financing Commitment initially to May 17, 2006 (and upon approval of the Bankruptcy Court to August 31, 2006) on April 26, 2006.

No assurances can be provided as to whether or when the District Court will adopt or affirm the confirmation order in respect of the Kaiser Aluminum Amended Plan, as to whether a stay may be sought or obtained by a party appealing any such adoption or affirmation order issued by the District Court or as to whether or when the remaining conditions to emergence will be satisfied.

Extension of Expiration Date of Agreement with Edward F. Houff

On April 26, 2006, the Company and Edward F. Houff, its Chief Restructuring Officer entered into an Amended and Restated Non-Exclusive Consulting Agreement (the “Extension”) extending the term of Mr. Houff’s engagement through June 30, 2006, and securing Mr. Houff’s services as Chief Restructuring Officer through the earlier of the Company’s emergence from Chapter 11 and June 30, 2006. Pursuant to the Extension, Mr. Houff will continue to provide services to the Company in exchange for a monthly base fee, plus an additional hourly amount for each hour worked in excess of monthly thresholds, subject to monthly caps, all as more fully set forth in the agreement. In addition, the Company will reimburse Mr. Houff for reasonable and customary expenses incurred while providing consulting services to the Company. A copy of the Extension is attached hereto as Exhibit 10.1 and is herein incorporated by reference.

Item 8.01 Other Events

On April 27, 2006, the Company and the International Brotherhood of Teamsters announced the ratification of a new three-year contract covering approximately 125 union members at the Company’s Los Angeles facility. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits

( c ) Exhibits

* 4.1 Second Amendment to Secured Super-Priority Debtor-In-Possession Revolving Credit And Guaranty Agreement, dated April 26, 2006

* 4.2 Amendment No. 2 to Commitment Letter, dated April 26, 2006

* 4.3 Amendment No. 3 to Commitment Letter, dated April 26, 2006

* 10.1 Amended and Restated Non-Exclusive Consulting Agreement, dated April 26, 2006, with Edward F. Houff

* 99.1 Press Release dated April 27, 2006


*		Included with this filing.

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 hereunto duly authorized.


	KAISER ALUMINUM & CHEMICAL CORPORATION (Registrant)
	By:	/s/ Daniel D. Maddox
Dated: April 28, 2006		Daniel D. Maddox
		Vice President and Controller

INDEX TO EXHIBITS


Exhibit
Number		Description
* 4.1		Second Amendment to Secured Super-Priority Debtor-In-Possession Revolving Credit And Guaranty Agreement, dated April 26, 2006

* 4.2		Amendment No. 2 to Commitment Letter, dated April 26, 2006

* 4.3		Amendment No. 3 to Commitment Letter, dated April 26, 2006

* 10.1		Amended and Restated Non-Exclusive Consulting Agreement, dated April 26, 2006, with Edward F. Houff

* 99.1		Press Release dated April 27, 2006


*		Included with this filing.

EX-4.1 2 h35470exv4w1.htm SECOND AMENDMENT TO SECURED SUPER-PRIORITY DEBTOR-IN-POSSESSION REVOLVING CREDIT AND GUARANTY AGREEMENT exv4w1

Exhibit 4.1

SECOND AMENDMENT TO SECURED SUPER-PRIORITY DEBTOR-IN-
POSSESSION REVOLVING CREDIT AND GUARANTY AGREEMENT

SECOND AMENDMENT TO SECURED SUPER-PRIORITY DEBTOR-IN-POSSESSION REVOLVING CREDIT AND GUARANTY AGREEMENT, dated as of April 26, 2006 (this “Amendment”), to that certain Secured Super-Priority Debtor-In-Possession Revolving Credit and Guaranty Agreement, dated as of February 11, 2005, as amended by that certain First Amendment to Secured Super-Priority Debtor-In-Possession Revolving Credit and Guaranty Agreement, dated as of December 23, 2005 (as amended, supplemented, or otherwise modified from time to time, the “Credit Agreement”; capitalized terms used herein but not otherwise defined herein shall have the meanings given such terms in the Credit Agreement), among Kaiser Aluminum & Chemical Corporation, a Delaware corporation as a debtor and debtor-in-possession in a case pending under Chapter 11 of the Bankruptcy Code (“Company”), Kaiser Aluminum Corporation, a Delaware corporation and a debtor and debtor-in-possession in a case pending under Chapter 11 of the Bankruptcy Code (“Parent”) and each of their respective subsidiaries party thereto (the “Subsidiary Borrowers”, and together with Company and Parent, each a “Borrower” and collectively, “Borrowers”), certain of the direct or indirect subsidiaries of Borrowers party thereto (each a “Guarantor” and collectively, “Guarantors”), the Lenders party thereto and JPMorgan Chase Bank, National Association, as administrative agent for the Lenders (in such capacity, “Agent”).

W I T N E S S E T H:

WHEREAS, Borrowers, Guarantors, the Lenders named therein and Agent have entered into the Credit Agreement;

WHEREAS, Borrowers have asked Lenders to extend the Maturity Date of the Credit Agreement (i) initially, to May 17, 2006, and (ii) subsequently, to August 31, 2006; and

WHEREAS, Lenders are willing to consent to both extensions of the Maturity Date of the Credit Agreement and grant such amendment to the Credit Agreement on the terms and subject to the conditions set forth herein;

NOW, THEREFORE, in consideration of the premises and the agreements herein contained, Borrowers, Guarantor, Lenders, and Agent hereby agree as follows:

ARTICLE I
AMENDMENTS TO CREDIT AGREEMENT

Section 1.1 Immediately upon the occurrence of the First Effective Date (as defined in Article II below), the definition of “Maturity Date” in Section 1.01 to the Credit Agreement shall be amended and restated in its entirety as follows:

“Maturity Date” shall mean May 17, 2006.

Section 1.2 Immediately upon the occurrence of the Second Effective Date (as defined in Article II below), the definition of “Maturity Date” in Section 1.01 to the Credit Agreement shall be further amended and restated in its entirety as follows:

“Maturity Date” shall mean August 31, 2006.

Second Amendment

ARTICLE II
CONDITIONS TO CLOSING

Section 2.1 The first date on which each of the following conditions are satisfied shall be the “First Effective Date”:

(a) Second Amendment. Agent shall have received a duly executed counterpart of this Amendment from each of the Borrowers, each of the Guarantors and each of the Lenders;

(b) Second Amendment Fee Letter. Agent shall have received a duly executed counterpart of that certain Second Amendment Fee Letter, dated the date hereof, among Agent, Parent and Company;

(c) Amendment No. 2 to Commitment Letter. Agent shall have received a duly executed counterpart of that certain Amendment No. 2 to Commitment Letter, dated the date hereof, among Agent, Parent, Company, J.P. Morgan Securities Inc. (“JPMSI”) and CIT Group/Business Credit, Inc. (“CIT”);

(d) Amendment No. 1 to Amended and Restated Fee Letter. Agent shall have received a duly executed counterpart of that certain Amendment No. 1 to Amended and Restated Fee Letter, dated the date hereof, among Agent, Parent, Company and JPMSI; and

(e) Extension Stipulation. Agent shall have received a certified copy of a stipulation executed by the Borrowers and Agent and approved by the Bankruptcy Court in substantially the form of Exhibit A attached hereto (the “Extension Stipulation”), which Extension Stipulation shall be in full force and effect and shall not have been vacated, stayed, reversed, modified or amended in any respect.

Section 2.2 The first date on which each of the conditions set forth in Section 2.1 and each of the following additional conditions are satisfied shall be the “Second Effective Date”:

(a) Amendment No. 3 to Commitment Letter. Agent shall have received a duly executed counterpart of that certain Amendment No. 3 to Commitment Letter, dated the date hereof, among Agent, Parent, Company, JPMSI and CIT;

(b) Amendment No. 2 to Amended and Restated Fee Letter. Agent shall have received a duly executed counterpart of that certain Amendment No. 2 to Amended and Restated Fee Letter, dated the date hereof, among Agent, Parent, Company and JPMSI; and

(c) Extension Order. Agent shall have received a certified copy of a final, non-appealable order of the Bankruptcy Court approving this Amendment and the Amendment No. 2 to Amended and Restated Fee Letter referenced in Section 2.2(b), in substantially a form acceptable to the Agent in its sole discretion (the “Extension Order”), which Extension Order shall be in full force and effect and shall not have been vacated, stayed, reversed, modified or amended in any respect.

Second Amendment

ARTICLE III
MISCELLANEOUS

Section 3.1 Effect of Amendment. Except as expressly set forth herein, this Amendment shall not by implication or otherwise limit, impair, constitute a waiver of, or otherwise affect the rights and remedies of Agent or any Lender under the Loan Documents, and shall not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Loan Documents, all of which are ratified and affirmed in all respects and shall continue in full force and effect except that, on and after the effectiveness of this Amendment, each reference to the Credit Agreement in the Loan Documents shall mean and be a reference to the Credit Agreement as amended by this Amendment. Nothing herein shall be deemed to entitle any Borrower to a consent to, or a waiver, amendment, modification or other change of, any of the terms, conditions, obligations, covenants or agreements contained in the Loan Documents in similar or different circumstances. This Amendment is a Loan Document executed pursuant to the Credit Agreement and shall be construed, administered and applied in accordance with the terms and provisions thereof.

Section 3.2 No Representations by Lenders or Agent. Borrowers hereby acknowledge that they have not relied on any representation, written or oral, express or implied, by any Lender or Agent, other than those expressly contained herein, in entering into this Amendment.

Section 3.3 Representations of Borrowers and Guarantors. Each Borrower and Guarantor represents and warrants to Agent and Lenders that, as of the date hereof, as of the First Effective Date and as of the Second Effective Date: (a) (i) it is duly organized and validly existing under the laws of the State of its organization and is duly qualified as a foreign organization and is in good standing in each jurisdiction in which the failure to so qualify would reasonably be expected to have a Material Adverse Effect, and (ii) subject to the entry by the Bankruptcy Court of the Extension Stipulation or the Extension Order, as applicable, it has the requisite corporate power and authority to effect the transactions contemplated hereby, and by the other Loan Documents to which it is a party; (b) the execution, delivery and performance by it of this Amendment (i) is within its organizational powers, has been duly authorized by all necessary organizational action, and does not (A) contravene its charter or by-laws or other constituent documents, (B) violate any law or regulation, or any order or decree of any court or Governmental Authority applicable to it, (C) conflict with or result in a breach of, or constitute a default under, any material indenture, mortgage or deed of trust entered into after the applicable Filing Date or any material lease, agreement or other instrument entered into after the applicable Filing Date binding on it or any of its properties, or (D) result in or require the creation or imposition of any Lien upon any of its property other than the Liens granted pursuant to the Loan Documents, the Order, the Extension Stipulation or the Extension Order; and (ii) does not require the consent, authorization by or approval of or notice to or filing or registration with any Governmental Authority, other than the entry of the Extension Stipulation or the Extension Order, as applicable; (c) this Amendment has been duly executed and delivered by it; and (d) this Amendment is a legal, valid and binding obligation of such Borrower or Guarantor, enforceable against it in accordance with its terms and the Order. Each Borrower and Guarantor further represents and warrants to Agent and Lenders that, as of the date hereof, as of the First Effective Date and as of the Second Effective Date, and after giving effect to this Amendment, (a) the representations and warranties set forth in the Loan Documents are true and correct in all material respects on and as of the date hereof, as of the First Effective Date or as of the Second Effective Date, as applicable, with the same effect as though made on such date, except to the extent that such representations and warranties expressly relate to an earlier date, in which case such

Second Amendment

representations and warranties were true as of such earlier date and (b) no Default or Event of Default has occurred and is continuing.

Section 3.4 Successors and Assigns. This Amendment shall be binding upon the parties hereto and their respective successors and assigns and shall inure to the benefit of the parties hereto and the successors and assigns of Lenders and Agent.

Section 3.5 Headings. Section headings used herein are for convenience only and are not to affect the construction of or be taken into consideration in interpreting this Amendment.

Section 3.6 Severability. Any provision of this Amendment which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

Section 3.7 Counterparts. This Amendment may be executed in any number of counterparts, each of which shall constitute an original, but all of which taken together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Amendment by facsimile shall be effective as delivery of a manually executed counterpart of this Amendment.

Section 3.8 Governing Law. THIS AMENDMENT SHALL IN ALL RESPECTS BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND (TO THE EXTENT APPLICABLE) THE BANKRUPTCY CODE.

Section 3.9 Costs and Expenses. Whether or not the transactions hereby contemplated shall be consummated, Borrowers shall pay all reasonable out-of-pocket expenses (including, without limitation, expenses incurred in connection with due diligence) of Agent associated with this Amendment, including the reasonable out-of-pocket fees and expenses of Agent’s counsel.

Section 3.10 Ratification of Guaranties. Each Guarantor hereby consents to this Amendment and hereby confirms and agrees that notwithstanding the effectiveness of this Amendment, the guarantee made by such Guarantor pursuant to Section 9 of the Credit Agreement is, and shall continue to be, in full force and effect and is hereby ratified and confirmed in all respects, except that, on and after the effectiveness of this Amendment, each reference to the Credit Agreement shall mean and be a reference to the Credit Agreement as amended by this Amendment.

[Remainder of this page is intentionally left blank.]

Second Amendment

IN WITNESS WHEREOF, the undersigned have caused this Amendment to be duly executed and delivered as of the date first above written.


BORROWERS:

KAISER ALUMINUM CORPORATION

By:

	Name:	Daniel J. Rinkenberger
	Title:	Vice President and Treasurer

KAISER ALUMINUM & CHEMICAL CORPORATION

By:

	Name:	Daniel J. Rinkenberger
	Title:	Vice President and Treasurer

KAISER ALUMINIUM INTERNATIONAL, INC.

By:

	Name:	Daniel J. Rinkenberger
	Title:	Vice President and Treasurer

KAISER BELLWOOD CORPORATION

By:

	Name:	Daniel J. Rinkenberger
	Title:	Vice President and Treasurer

GUARANTORS:

KAISER ALUMINUM & CHEMICAL INVESTMENT, INC.

By:

	Name:	Daniel J. Rinkenberger
	Title:	Vice President and Treasurer

KAISER ALUMINUM PROPERTIES, INC.

By:

	Name:	Daniel J. Rinkenberger
	Title:	Vice President and Treasurer

Second Amendment


KAISER ALUMINUM TECHNICAL
	SERVICES, INC.

By:

		Name:	Daniel J. Rinkenberger
		Title:	Vice President and Treasurer

ALWIS LEASING, LLC

By:

		Name:	Daniel J. Rinkenberger
		Title:	Vice President and Treasurer

KAISER CENTER, INC.

By:

		Name:	Daniel J. Rinkenberger
		Title:	Vice President and Treasurer

KAISER CENTER PROPERTIES

By:

		Name:	Daniel J. Rinkenberger
		Title:	Vice President and Treasurer

OXNARD FORGE DIE COMPANY, INC.

By:

		Name:	Daniel J. Rinkenberger
		Title:	Vice President and Treasurer

AKRON HOLDING CORPORATION

By:

		Name:	Daniel J. Rinkenberger
		Title:	Vice President and Treasurer

KAISER TEXAS MICROMILL HOLDINGS, LLC

By:

		Name:	Daniel J. Rinkenberger
		Title:	Vice President and Treasurer

Second Amendment


KAISER MICROMILL HOLDINGS, LLC

By:

	Name:	Daniel J. Rinkenberger
	Title:	Vice President and Treasurer

KAISER SIERRA MICROMILLS, LLC

By:

	Name:	Daniel J. Rinkenberger
	Title:	Vice President and Treasurer

KAISER TEXAS SIERRA MICROMILLS, LLC

By:

	Name:	Daniel J. Rinkenberger
	Title:	Vice President and Treasurer

KAE TRADING, INC.

By:

	Name:	Daniel J. Rinkenberger
	Title:	Vice President and Treasurer

KAISER EXPORT COMPANY

By:

	Name:	Daniel J. Rinkenberger
	Title:	Vice President and Treasurer

Second Amendment


JPMORGAN CHASE BANK, NATIONAL ASSOCIATION,
Individually and as Agent and Lender

By:

	Name:	Devin Mock
	Title:	Vice President

1717 Main Street, LL1
Dallas, TX 75201

Second Amendment


		LENDER:

		THE CIT GROUP/BUSINESS CREDIT, INC.

		By:

				Name:
				Title:

Second Amendment


		LENDER:

		MERRILL LYNCH CAPITAL, A DIVISION OF MERRILL LYNCH BUSINESS FINANCIAL SERVICES INC.

		By:

				Name:
				Title:

Second Amendment


		LENDER:

		WACHOVIA BANK, NA

		By:

				Name:
				Title:

Second Amendment


		LENDER:

		BANK OF AMERICA, N.A.

		By:

				Name:
				Title:

Second Amendment


		LENDER:

		WELLS FARGO FOOTHILL, LLC

		By:

				Name:
				Title:

Second Amendment


		LENDER:

		UBS AG, STAMFORD BRANCH

		By:

				Name:
				Title:

Second Amendment


		LENDER:

		GMAC COMMERCIAL FINANCE LLC

		By:

				Name:
				Title:

Second Amendment

EXHIBIT A
Extension Stipulation

(attached hereto)

EX-4.2 3 h35470exv4w2.htm AMENDMENT NO.2 TO COMMITMENT LETTER exv4w2

Exhibit 4.2

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION
131 South Dearborn
Chicago, Illinois 60670

J.P. MORGAN SECURITIES INC.
131 South Dearborn
Chicago, Illinois 60670

THE CIT GROUP/BUSINESS CREDIT, INC.
1211 Avenue of the Americas
New York, New York 10036

April 26, 2006

Kaiser Aluminum Corporation and
Kaiser Aluminum & Chemical Corporation
Exit Credit Facility
Amendment No. 2 to Commitment Letter

Kaiser Aluminum Corporation
Kaiser Aluminum & Chemical Corporation
27422 Portola Parkway, Ste. 350
Foothill Ranch, CA 92610-2831
Attention: Chief Financial Officer


RE:		Commitment Letter, dated January 14, 2005 (the “*Original Commitment Letter”), as amended by that certain Amendment No. 1 to Commitment Letter, dated January 10, 2005 (the “Amendment No. 1 to Commitment Letter”, and the Original Commitment Letter as amended by the Amendment No. 1 to Commitment Letter, the “Commitment Letter”), among Kaiser Aluminum Corporation, a Delaware corporation (“Parent”), Kaiser Aluminum & Chemical Corporation, a Delaware corporation (“Company”), JPMorgan Chase Bank, National Association (“JPMorgan”), J.P. Morgan Securities Inc. (“JPMSI”) and CIT Group/Business Credit, Inc. (“CIT*”)

Ladies and Gentlemen:

Reference is made to the Commitment Letter, pursuant to which JPMSI and CIT agreed to structure and arrange and JPSMI agreed to syndicate (i) a super-priority secured debtor-in-possession revolving credit and letter of credit facility in an aggregate amount of up to $200,000,000 (the “DIP Revolving Commitment”) to the Borrowers as debtors and debtors-in-possession in the currently pending Chapter 11 case of the Borrowers (the “DIP Credit Facility”) and (ii) a senior secured revolving credit and letter of credit facility in an aggregate amount of up to $200,000,000 (the “Revolving Credit Facility”) and a $50,000,000 term loan facility (the “Term Loan Facility” and together with the Revolving Credit Facility, the “Exit Credit Facilities” and the Exit Credit Facilities, with the DIP Credit Facility, each a “Facility” and together, the “Facilities”) to be provided to the Borrowers upon the consummation of a plan of reorganization. Pursuant to the Commitment Letter, JPMorgan and CIT (together, the “Primary Lenders”) also agreed to provide an equal share of the entire principal amount of each Facility and JPMorgan agreed to serve as Administrative Agent for each Facility. Capitalized terms

used herein but not otherwise defined shall have the respective meanings assigned to such terms in the Commitment Letter.

Immediately upon the occurrence of the Effective Date (as defined below), the fifth sentence of the fifteenth paragraph of the Commitment Letter shall be amended and restated in its entirety as follow:

Once effective, the Primary Lenders’ commitments and the Lead Arranger’s and Co-Arranger’s agreements with respect to the Term Loan Facility in accordance with the terms of this Commitment Letter shall cease if the Term Loan Facility is not funded for any reason on or before the earliest of (a) the date that is thirty (30) days after the date of the substantial consummation (as defined in Section 1101 of the Bankruptcy Code) of a plan of reorganization of the Borrowers, (b) the date that the Borrowers close an Alternative Financing (as defined in the Fee Letter) and (c) May 17, 2006, and the Primary Lenders’ commitments and the Lead Arranger’s and Co-Arranger’s agreements with respect to the Revolving Credit Facility in accordance with the terms of this Commitment Letter shall cease if the Closing Date of the Revolving Credit Facility does not occur on or before May 17, 2006; provided, however, any termination of the commitments with respect to the Term Loan Facility shall not affect the Primary Lenders’ commitments and the Lead Arranger’s and Co-Arranger’s agreements with respect to the Revolving Credit Facility.

It is acknowledged that the terms and conditions of the Revolving Credit Facility and the Term Loan Facility have been negotiated and are substantially final as of the date hereof. Further, the following specific terms of the Exit Credit Facilities will not be subject to change and are agreed to be as follows, notwithstanding anything to the contrary contained in Exhibit B to the Commitment Letter:

The “Applicable Margin” in the Revolving Credit Facility will be:


	Revolver			Revolver
Availability	ABR Spread			Eurodollar Spread
Category 1 ³ 125,000,000		0.00	%		1.50	%
Category 2 < 125,000,000 and ³ 75,000,000		0.00	%		1.75	%
Category 3 < 75,000		0.25	%		2.00	%

	2.		The Applicable Commitment Fee Rate in the Revolving Credit Facility will be 0.20% per annum.

	3.		The amount of the Term Loan Facility will be $50,000,000.

	4.		The “Applicable Margin” in the Term Loan Facility will be (a) 2.50%, in the case of ABR Loans and (b) 4.25%, in the case of Eurodollar Loans.

	5.		The Term Loan Facility will have a 1% call premium if the term loan is repaid in the first year after closing.

	6.		Subject to evidence reasonably satisfactory to JPMorgan that substantially all of the assets of and related to the ongoing operations (but excluding assets of and related to discontinued operations) of Kaiser Aluminum & Chemical Corporation located in the United States will be transferred to Kaiser Aluminum Fabricated Products, LLC, the Borrower in the Term Loan Facility will be Kaiser Aluminum Fabricated Products, LLC, and the Guarantors in the Term Loan Facility shall be Kaiser Aluminum Corporation, Kaiser Aluminum Investment Corporation, and Kaiser Aluminium International, Inc.

	7.		The Borrowers in the Revolving Credit Facility will be Kaiser Aluminum Corporation, Kaiser Aluminum Investment Corporation, Kaiser Aluminum Fabricated Products, LLC and Kaiser Aluminium International, Inc.

Except as expressly set forth herein, this Amendment No. 2 to Commitment Letter shall not by implication or otherwise limit, impair, constitute a waiver of, or otherwise affect the rights and remedies of any party under the Commitment Letter, and shall not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Commitment Letter, all of which are ratified and affirmed in all respects and shall continue in full force and effect.

This Amendment No. 2 to Commitment Letter is intended to be solely for the benefit of the parties hereto and is not intended to confer any benefits upon, or create any rights in favor of, any person other than the parties hereto. This Amendment No. 2 to Commitment Letter may not be amended or waived except by an instrument in writing signed by you, JPMorgan, JPMSI and CIT. This Amendment No. 2 to Commitment Letter may be executed in any number of counterparts, each of which shall be an original, and all of which, when taken together, shall constitute one agreement. Delivery of an executed signature page of this Amendment No. 2 to Commitment Letter by facsimile transmission shall be effective as delivery of a manually executed counterpart hereof.

This Amendment No. 2 to Commitment Letter shall be governed by, and construed in accordance with, the law of the State of New York. The Borrowers consent to the nonexclusive jurisdiction and venue of the state or federal courts located in the City of New York. Each party hereto irrevocably waives, to the fullest extent permitted by applicable law, (a) any right it may have to a trial by jury in any legal proceeding arising out of or relating to this Amendment No. 2 to Commitment Letter, the Commitment Letter as amended by this Amendment No. 2 to Commitment Letter or the transactions contemplated hereby or thereby (whether based on contract, tort or any other theory) and (b) any objection that it may now or hereafter have to the laying of venue of any such legal proceeding in the state or federal courts located in the City of New York.

This Amendment No. 2 to Commitment Letter is delivered to you on the understanding that neither this Amendment No. 2 to Commitment Letter nor the Commitment Letter nor any of their terms or substance shall be disclosed, directly or indirectly, to any other person except (a) you may disclose the Commitment Letter this Amendment No. 2 to Commitment Letter and their terms and substance to your officers, directors, agents and advisors who are directly involved in the consideration of this matter, (b) you may disclose the Commitment Letter and this Amendment No. 2 to Commitment Letter and their terms and substance to any statutory creditors committee and the representative of the future asbestos claimants in connection with the Borrowers’ Chapter 11 case and any professional advisors of such committee or representative; provided that, the members of such committee and such representative and their respective professional advisors agree to keep the Commitment Letter this Amendment No. 2 to Commitment Letter and any of the terms or substance thereof strictly confidential in accordance with the terms of this paragraph, or (c) as may be compelled in a judicial or administrative proceeding or as otherwise required by law (in which case you agree to inform us promptly thereof). Notwithstanding the foregoing, after this Amendment No. 2 to Commitment Letter has been accepted by you, you may disclose this Amendment No. 2 to Commitment Letter (but not the Fee Letter) with the Bankruptcy Court, as may be required to obtain court approval in connection with any acts or obligations to be taken pursuant to this Amendment No. 2 to Commitment Letter or the transactions contemplated hereby (in which case you agree to inform us promptly thereof), it being understood that any pleadings or filings with respect to the Commitment Letter and this Amendment No. 2 to Commitment Letter shall be acceptable to JPMorgan, JPMSI and CIT.

Immediately upon the satisfaction of each of the conditions contained in Section 2.1 of that certain Second Amendment to Secured Super-Priority Debtor-In-Possession Revolving Credit and Guaranty Agreement dated as of the date hereof among Parent, Company, the other Borrowers party thereto, the Guarantors party thereto, the Lenders party thereto and JPMorgan as Agent for the Lenders, this Amendment No. 2 to Commitment Letter shall become effective (the date on which such conditions are satisfied being the “Effective Date”).

[ remainder of page intentionally left blank ]

If the foregoing correctly sets forth our agreement, please indicate your acceptance of the terms hereof by signing in the appropriate space below and returning to us the executed duplicate of this letter agreement.


		Very truly yours,

		JPMORGAN CHASE BANK, NATIONAL ASSOCIATION

		By:

				Name:

				Title:


		J.P. MORGAN SECURITIES INC.

		By:

				Name:

				Title:


		THE CIT GROUP/BUSINESS CREDIT, INC.

		By:

				Name:

				Title:


Accepted and agreed to as of the date first written above by:

KAISER ALUMINUM CORPORATION

By:

	Name:	Daniel J. Rinkenberger
	Title:	Vice President and Treasurer

KAISER ALUMINUM & CHEMICAL CORPORATION

By:

	Name:	Daniel J. Rinkenberger
	Title:	Vice President and Treasurer

EX-4.3 4 h35470exv4w3.htm AMENDMENT NO.3 TO COMMITMENT LETTER exv4w3

Exhibit 4.3

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION
131 South Dearborn
Chicago, Illinois 60670

J.P. MORGAN SECURITIES INC.
131 South Dearborn
Chicago, Illinois 60670

THE CIT GROUP/BUSINESS CREDIT, INC.
1211 Avenue of the Americas
New York, New York 10036

April 26, 2006

Kaiser Aluminum Corporation and
Kaiser Aluminum & Chemical Corporation
Exit Credit Facility
Amendment No. 3 to Commitment Letter

Kaiser Aluminum Corporation
Kaiser Aluminum & Chemical Corporation
27422 Portola Parkway, Ste. 350
Foothill Ranch, CA 92610-2831
Attention: Chief Financial Officer


RE:		Commitment Letter, dated January 14, 2005 (the “*Original Commitment Letter”), as amended by that certain Amendment No. 1 to Commitment Letter, dated January 10, 2005 (the “Amendment No. 1 to Commitment Letter”), and by that certain Amendment No. 2 to Commitment Letter, dated the date hereof (the “Amendment No. 2 to Commitment Letter”) (the Original Commitment Letter as amended by the Amendment No. 1 to Commitment Letter and the Amendment No. 2 to Commitment Letter, the “Commitment Letter”), among Kaiser Aluminum Corporation, a Delaware corporation (“Parent”), Kaiser Aluminum & Chemical Corporation, a Delaware corporation (“Company”), JPMorgan Chase Bank, National Association (“JPMorgan”), J.P. Morgan Securities Inc. (“JPMSI”) and CIT Group/Business Credit, Inc. (“CIT*”)

Ladies and Gentlemen:

(together, the “Primary Lenders”) also agreed to provide an equal share of the entire principal amount of each Facility and JPMorgan agreed to serve as Administrative Agent for each Facility. Capitalized terms used herein but not otherwise defined shall have the respective meanings assigned to such terms in the Commitment Letter.

The DIP Facility closed on February 11, 2005. Pursuant to the Amendment No. 1 to Commitment Letter and the Amended and Restated Fee Letter, dated January 10, 2005 (the “Amended and Restated Fee Letter”), we agreed, among other things, to extend the commitments with respect to the Exit Facilities through May 11, 2006. Pursuant to the Amendment No. 2 to Commitment Letter and the Amendment No. 1 to Amended and Restated Fee Letter, dated the date hereof (the “Amendment No. 1 to Fee Letter”), we agreed to extend the commitments with respect to the Exit Facilities through May 17, 2006. You have requested that we amend the Commitment Letter to further extend the commitments with respect to the Exit Facilities through August 31, 2006. We are willing to consent to the amendment of the Commitment Letter and to the extension of the commitments with respect to the Exit Facilities and grant such amendment to the Commitment Letter on the terms and subject to the conditions set forth herein and in the Amended and Restated Letter, as amended by the Amendment No. 1 to Fee Letter, and by that certain Amendment No. 2 to Amended and Restated Fee Letter, dated the date hereof (the “Amendment No. 2 to Fee Letter”) (the Amended and Restated Fee Letter as amended by the Amendment No. 1 to Fee Letter and by the Amendment No. 2 to Fee Letter, the “Fee Letter”). Therefore, in consideration of the premises and the agreements herein contained, we each hereby agree as follows:

Once effective, the Primary Lenders’ commitments and the Lead Arranger’s and Co-Arranger’s agreements with respect to the Term Loan Facility in accordance with the terms of this Commitment Letter shall cease if the Term Loan Facility is not funded for any reason on or before the earliest of (a) the date that is thirty (30) days after the date of the substantial consummation (as defined in Section 1101 of the Bankruptcy Code) of a plan of reorganization of the Borrowers, (b) the date that the Borrowers close an Alternative Financing (as defined in the Fee Letter) and (c) August 31, 2006, and the Primary Lenders’ commitments and the Lead Arranger’s and Co-Arranger’s agreements with respect to the Revolving Credit Facility in accordance with the terms of this Commitment Letter shall cease if the Closing Date of the Revolving Credit Facility does not occur on or before August 31, 2006; provided, however, any termination of the commitments with respect to the Term Loan Facility shall not affect the Primary Lenders’ commitments and the Lead Arranger’s and Co-Arranger’s agreements with respect to the Revolving Credit Facility.

Except as expressly set forth herein, this Amendment No. 3 to Commitment Letter shall not by implication or otherwise limit, impair, constitute a waiver of, or otherwise affect the rights and remedies of any party under the Commitment Letter, and shall not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Commitment Letter, all of which are ratified and affirmed in all respects and shall continue in full force and effect.

This Amendment No. 3 to Commitment Letter is intended to be solely for the benefit of the parties hereto and is not intended to confer any benefits upon, or create any rights in favor of, any

person other than the parties hereto. This Amendment No. 3 to Commitment Letter may not be amended or waived except by an instrument in writing signed by you, JPMorgan, JPMSI and CIT. This Amendment No. 3 to Commitment Letter may be executed in any number of counterparts, each of which shall be an original, and all of which, when taken together, shall constitute one agreement. Delivery of an executed signature page of this Amendment No. 3 to Commitment Letter by facsimile transmission shall be effective as delivery of a manually executed counterpart hereof.

This Amendment No. 3 to Commitment Letter shall be governed by, and construed in accordance with, the law of the State of New York. The Borrowers consent to the nonexclusive jurisdiction and venue of the state or federal courts located in the City of New York. Each party hereto irrevocably waives, to the fullest extent permitted by applicable law, (a) any right it may have to a trial by jury in any legal proceeding arising out of or relating to this Amendment No. 3 to Commitment Letter, the Commitment Letter as amended by this Amendment No. 3 to Commitment Letter or the transactions contemplated hereby or thereby (whether based on contract, tort or any other theory) and (b) any objection that it may now or hereafter have to the laying of venue of any such legal proceeding in the state or federal courts located in the City of New York.

This Amendment No. 3 to Commitment Letter is delivered to you on the understanding that neither this Amendment No. 3 to Commitment Letter nor the Commitment Letter nor any of their terms or substance shall be disclosed, directly or indirectly, to any other person except (a) you may disclose the Commitment Letter this Amendment No. 3 to Commitment Letter and their terms and substance to your officers, directors, agents and advisors who are directly involved in the consideration of this matter, (b) you may disclose the Commitment Letter and this Amendment No. 3 to Commitment Letter and their terms and substance to any statutory creditors committee and the representative of the future asbestos claimants in connection with the Borrowers’ Chapter 11 case and any professional advisors of such committee or representative; provided that, the members of such committee and such representative and their respective professional advisors agree to keep the Commitment Letter this Amendment No. 3 to Commitment Letter and any of the terms or substance thereof strictly confidential in accordance with the terms of this paragraph, or (c) as may be compelled in a judicial or administrative proceeding or as otherwise required by law (in which case you agree to inform us promptly thereof). Notwithstanding the foregoing, after this Amendment No. 3 to Commitment Letter has been accepted by you, you may disclose this Amendment No. 3 to Commitment Letter (but not the Fee Letter) with the Bankruptcy Court, as may be required to obtain court approval in connection with any acts or obligations to be taken pursuant to this Amendment No. 3 to Commitment Letter or the transactions contemplated hereby (in which case you agree to inform us promptly thereof), it being understood that any pleadings or filings with respect to the Commitment Letter and this Amendment No. 3 to Commitment Letter shall be acceptable to JPMorgan, JPMSI and CIT.

Immediately upon the satisfaction of each of the conditions contained in Section 2.2 of that certain Second Amendment to Secured Super-Priority Debtor-In-Possession Revolving Credit and Guaranty Agreement dated as of the date hereof among Parent, Company, the other Borrowers party thereto, the Guarantors party thereto, the Lenders party thereto and JPMorgan as Agent for the Lenders, this Amendment No. 3 to Commitment Letter shall become effective (the date on which such conditions are satisfied being the “Effective Date”).

[ remainder of page intentionally left blank ]


		Very truly yours,

		JPMORGAN CHASE BANK, NATIONAL ASSOCIATION

		By:

				Name:

				Title:


		J.P. MORGAN SECURITIES INC.

		By:

				Name:

				Title:


		THE CIT GROUP/BUSINESS CREDIT, INC.

		By:

				Name:

				Title:


Accepted and agreed to as of the date first written above by:

KAISER ALUMINUM CORPORATION

By:

		Name:

		Title:


KAISER ALUMINUM & CHEMICAL CORPORATION

By:

		Name:

		Title:

EX-10.1 5 h35470exv10w1.htm AMENDED AND RESTATED NON-EXCLUSIVE CONSULTING AGREEMENT exv10w1

Exhibit 10.1

AMENDED AND RESTATED NON-EXCLUSIVE CONSULTING AGREEMENT

This Amended and Restated Non-Exclusive Consulting Agreement (“Agreement”) is entered into and effective as of the 26^th of April, 2006, to amend and restate the Non-Exclusive Consulting Agreement entered into effective as of the 16th day of August, 2005, between Edward F. Houff (“Consultant” or “Houff”), and Kaiser Aluminum & Chemical Corporation, a corporation with offices located at 27422 Portola Parkway, #350, Foothill Ranch, CA 92610-2831 (“Kaiser”).

WHEREAS, effective August 15, 2005, Kaiser has terminated Consultant as a Kaiser employee “Without Cause,” and such termination constitutes a “Pro-Rating Event” for the purposes of determining Consultant’s entitlement to severance and termination benefits under the Key Employment Retention Program (“KERP”) approved by the Bankruptcy Court in Kaiser’s chapter 11 proceedings, including Consultant’s Severance Agreement, Retention Agreement and Change in Control Severance Agreement (a summary listing of such benefits and the references thereto is attached to this Agreement and incorporated herein by reference); and

WHEREAS, Consultant acknowledges that as a result of termination of Consultant’s employment Consultant is not entitled to any benefits under his Change in Control Severance Agreement (the “CIC Agreement”) and, in recognition of the foregoing, has, by execution of this Agreement, permanently waived and released Kaiser from and against any and all claims for “Change in Control” and “Tax Gross-Up” termination benefits in connection with the KERP, including any claims for benefits under his CIC Agreement; and

WHEREAS, Kaiser desires to have Consultant perform certain services for Kaiser as set forth herein, and Consultant is willing to perform such services;

NOW THEREFORE, in consideration of the mutual promises contained herein the parties hereto agree as follows:

Term

The term of this Agreement shall commence as of August 1, 2005 and shall continue in effect through June 30, 2006. Termination of this Agreement, except for cause, before June 30, 2006, may occur only by mutual consent or the death or permanent and total disability of Consultant as a result of bodily injury, disease or mental disorder. This Agreement may be renewed for such term, and upon such terms and conditions, as the parties may agree in a further writing.

Services

2.1 Consultant shall perform non-exclusive consulting services for Kaiser primarily in the nature of the services provided when consultant was Chief Restructuring Officer and Senior Vice President of Kaiser, which employment ended on August 15, 2005. A listing of subject areas in which Kaiser and Consultant have agreed that Consultant will provide services to the Company is attached to this Agreement and incorporated herein by reference. To the extent any services will not be completed by the expiration of the term of this Agreement and Consultant and Kaiser have not agreed to the terms of an extension, Consultant shall fully cooperate with Kaiser in all matters relating to the winding up of Consultant’s pending work on behalf of Kaiser and the orderly transfer of any such pending work to other employees or representatives of Kaiser as may be designated by Kaiser.

2.2 Any additional services by Consultant beyond those referenced in paragraph 2.1 above shall be performed by Consultant as agreed between Consultant and Kaiser and as authorized by Kaiser’s CEO, Jack A. Hockema, or such other person as Consultant may agree.

2.3 Consultant shall at all times act in accordance with his own best judgment, experience and expertise as an independent Consultant. Consultant shall routinely communicate the status and progress of the services being performed by Consultant to Kaiser’s CEO, General Counsel, CFO, senior management and outside professionals, as appropriate, and solicit input and direction with respect to tactical and strategic decisions required to be made in connection with the services to be performed that are likely to affect the business, operations or liabilities of Kaiser and its affiliates both during and after emergence.

2.4 Consultant may perform consulting services for persons other than Kaiser so long as such other consulting services do not present an actual conflict of interest for Consultant. Consultant agrees to inform Kaiser when consulting services are being performed for others, and will provide a certification that no conflict exists. Consultant will use his best efforts to arrange his schedule and other work to ensure that Kaiser work remains a priority for Consultant’s work, resources and time. Should Consultant request a waiver of any potential conflict with respect to either interest or time, Kaiser will not unreasonably withhold its consent to waiver.

2.5 Upon the effective date of Kaiser’s plan of reorganization and its emergence from Chapter 11, Consultant will resign as Chief Restructuring Officer of Kaiser and the delegation of authority granted to Consultant shall terminate and be of no further force or effect. Except as set forth in the preceding sentence, Kaiser’s emergence from Chapter 11 will have no effect on this Agreement or the consulting services to be performed.

Fees and Reimbursements/Invoices

3.1 For the initial term of the Agreement (through February 14, 2006), Consultant’scompensation will be as follows:

3.1.1 A base fee of $43,200 per month (“Base Fee”), exclusive of expenses, for which Consultant will provide up to 120 hours of services. Travel time that is not covered by other work will be counted at one-half the number of hours, and there will be no premium for weekend or holiday work. This amount will be pro-rated for the partial months of August 2005 and February 2006.

3.1.2 Monthly hours worked in excess of 120, up to a maximum of 200 (“Additional Fee”), exclusive of expenses, will be billed at $360 per hour, subject to the same terms and conditions for travel, weekend and holiday work as provided in paragraph 3.1.1.

3.1.3 Regardless of the number of hours actually worked in any month, Consultant agrees that Kaiser will not be charged for any work in excess of 200 hours per month, exclusive of expenses.

3.2 After the initial term of the Agreement, Consultant’s compensation will be as follows:

3.2.1 The prorated Base Fee for February 15, 2006, through February 28, 2006, shall be $22,500, exclusive of expenses, for which Consultant will provide up to 50 hours of services. Travel time that is not covered by other work will be counted at one-half the number of hours, and there will be no premium for weekend or holiday work. The Additional Fee during this period for hours worked in excess of 50, up to a maximum of 75, exclusive of expenses, will be billed at $450 per hour, subject to the same terms and conditions for travel, weekend and holiday work as provided above.


*Amended and Restated Non-Exclusive Consulting Agreement*
2		*Edward. F. Houff*

3.2.2 The prorated Base Fee for March 1, 2006, through March 31, 2006, shall be $33,750, exclusive of expenses, for which Consultant will provide up to 75 hours of services. Travel time that is not covered by other work will be counted at one-half the number of hours, and there will be no premium for weekend or holiday work. The Additional Fee during this period for hours worked in excess of 75, up to a maximum of 100, exclusive of expenses, will be billed at $450 per hour, subject to the same terms and conditions for travel, weekend and holiday work as provided above.

3.2.3 The prorated Base Fee for April 1, 2006, through April 30, 2006, shall be $22,500, exclusive of expenses, for which Consultant will provide up to 50 hours of services. Travel time that is not covered by other work will be counted at one-half the number of hours, and there will be no premium for weekend or holiday work. The Additional Fee during this period for hours worked in excess of 50, up to a maximum of 75, exclusive of expenses, will be billed at $450 per hour, subject to the same terms and conditions for travel, weekend and holiday work as provided above.

3.2.4 The prorated Base Fee for May 1, 2006 through June 30, 2006, shall be $22,500 monthly, exclusive of expenses, for which Consultant will provide up to 50 hours of services per month. Travel time that is not covered by other work will be counted at one-half the number of hours, and there will be no premium for weekend or holiday work. The Additional Fee during this period for hours worked in excess of 50 per month, up to a maximum of 75 hours per month, exclusive of expenses, will be billed at $450 per hour, subject to the same terms and conditions for travel, weekend and holiday work as provided above.

3.3 Both parties agree that Consultant is not an employee for state or federal tax purposes. Consultant shall be solely responsible for payment of all FICA and federal, state and local income taxes payable on compensation received hereunder. All travel time in connection with this Agreement will be prorated as required and compensated at the above rates. In addition, upon submission of proper documentation, Kaiser will reimburse Consultant for all reasonable and customary expenses incurred while providing consulting services. The term “reasonable and customary” shall mean expenses incurred consistent with Kaiser’s corporate policies on reimbursement of travel and related expenses and also include costs for telephone, fax and mobile phone charges when used for Kaiser business, but shall not include any costs or expenses incurred by Consultant to provide his own working environment (office space, parking, etc.).

3.4 Consultant’s compensation and expense reimbursement shall be paid as follows:

3.4.1 Beginning in September 2005 and each month thereafter during the term of the Agreement, Consultant’s Base Fee will be paid automatically by Kaiser by wire transfer monthly on the first business day between the first and fifth day of the month.

3.4.2 Beginning in September 2005 and each month thereafter during the term of the Agreement, by the fifth day of the month, Consultant will provide an invoice for the previous month that provides a summary of time and activities as to the Base Fee, and a reasonably detailed description of services and time, rounded up to the nearest tenth of the hour for any Additional Fee earned during the previous month. Consultant will also submit a reasonably detailed schedule of expenses for reimbursement including receipts. Bills and receipts may be submitted electronically.

3.4.3 Statements for services and requests for expense reimbursement shall be submitted to


*Amended and Restated Non-Exclusive Consulting Agreement*
3		*Edward. F. Houff*

Kaiser Aluminum & Chemical Corp
Attn: John M. Donnan, Vice President and General Counsel
27422 Portola Parkway, #350
Foothill Ranch, CA 92610-2831
Fax: (949) 614-1867
john.donnan@kaiseraluminum.com

3.4.4 Kaiser will promptly review the statements submitted with respect to the Additional Fee and requests for expense reimbursement, and will pay all undisputed Additional Fee and expense reimbursement amounts within 30 days of Kaiser’s receipt of such statement. Kaiser may request additional information concerning the content of the Base Fee description and time but may not withhold payment of the Base Fee. Questions regarding any Additional Fee and/or expenses will be addressed promptly with a view toward reaching an agreement, and payment for any questioned Additional Fee and/or expense amounts will be paid on the later of 30 days after the statement was received or 10 days after the questions are resolved.

Independent Contractor

4.1 Consultant shall perform services hereunder as an independent contractor and not as an employee. He shall have no power or authority to act for, legally represent, or commit Kaiser in any way unless Kaiser expressly authorizes him to do so.

4.2 Consultant understands and agrees that during the period of this Agreement and any extensions thereto he is not entitled to participate in or accrue benefits, and Consultant hereby expressly waives any claim to participate in or accrue benefits, under Kaiser’s employee benefit plans, including but not limited to KRP, Plan B, Severance Pay and Benefits Continuation, Personal Choice, Life Insurance, Sick Leave with Salary Continuation, Long Term Disability, Accidental Death and Dismemberment, Medical and Dental plans for services performed hereunder, except as he is entitled to receive any such benefits as a result of his termination without cause as an employee on August 15, 2005. For the avoidance of doubt, the parties agree that any and all benefits to which Consultant may be entitled must derive, if at all, from his term of employment at Kaiser, and not from his service as a Consultant. In addition, Consultant is not entitled to participate in any employee bonus plans as a result of his service as a Consultant.

Protection of Confidential Information

5.1 All work product of Consultant in the performance of this Agreement, including without limitation, analyses, reports, photographs, data and other information, including any inventions or discoveries made by Consultant, shall be the property of Kaiser and shall be considered Confidential Information. Any information disclosed to Consultant by Kaiser or others in connection with service for Kaiser under this Agreement shall also be considered Confidential Information, and shall, as between Kaiser and Consultant, be the property of Kaiser.

5.2 Except as Kaiser may authorize in writing, Consultant shall not disclose any Confidential Information or use it for any purpose other than the performance of his services under this Agreement. Promptly upon Kaiser’s request, and in any event upon the termination of this Agreement, Consultant shall deliver to Kaiser all such material (including all copies made thereof) which Consultant has in his possession.


*Amended and Restated Non-Exclusive Consulting Agreement*
4		*Edward. F. Houff*

5.3 Upon termination of this Agreement for any reasons, Consultant will, except as otherwise agreed to in writing by the parties, return to Kaiser all property belonging to Kaiser, including without limitation, computer equipment, computer programs, cellular telephones, beepers or other property belonging to Kaiser, and documents, property and data of any nature and in any form, including electronic or magnetic form, reflecting any confidential information described above.

Applicable Law/Entire Agreement

6.1 This Agreement shall in all respects be governed by and construed in accordance with the laws of the State of Texas, except that conflicts of laws/provisions of Texas law shall not be applied for the purpose of making other law applicable.

6.2 This Agreement, the Severance Agreement, the Retention Agreement and that certain Release executed pursuant to the terms of the Severance Agreement constitute the entire agreement and supersedes all prior agreements and understandings, both written and oral, between the parties relating to Consultant’s activities as a Consultant and the termination of Consultant’s employment with Kaiser, including, but not limited to the effect of such termination under the KERP and related agreements. It may not be amended, supplemented or superseded except by a written agreement signed by both parties.

Dispute Resolution

7.1 If a dispute arises out of or related to this Agreement, and if the dispute cannot be settled through direct discussions, then Kaiser and Consultant agree to first endeavor to settle the dispute in an amicable and good faith manner by mediation before a mutually agreeable mediator, before having recourse to any other proceeding or forum.

7.2 Any controversy or claim arising out of or relating to this Agreement or the breach thereof that cannot be resolved by good faith mediation shall on the written request of the complaining party served on the other within thirty (30) calendar days of the event which forms the basis of the controversy or claim, be submitted and resolved by final and binding arbitration in a manner consistent with the rules of the American Arbitration Association. Service of the written demand for arbitration shall be made by certified mail, with a return receipt requested. Time is of the essence. If the request is not served within said thirty (30) days of the date a cause of action arises, the complaining party’s claim(s) shall be forever waived and barred before any and all forums, including, without limitation, arbitration or judicial forums. The Arbitrator shall have no authority to alter, amend, modify or change any of the terms of the Agreement. The decision of the Arbitrator shall be final and binding and judgment thereon may be entered in any court having jurisdiction thereof. The parties shall equally divide all costs of the arbitration, but the parties shall bear their own expenses for attorney’s fees and witness costs.

7.3 The parties intend that the dispute resolution procedures outlined herein are mandatory and shall be the exclusive means of resolving all disputes, between Consultant and Kaiser and/or Kaiser’s employees, directors, officers, officers or managers involving or arising out of this Agreement. However, this provision does not prevent either Party from first seeking injunctive relief if necessary to enforce the terms of this Agreement.

Notices


*Amended and Restated Non-Exclusive Consulting Agreement*
5		*Edward. F. Houff*

All notices, correspondence, consents, requests, demands, and other communications hereunder shall be in writing and shall be deemed to have been duly given when actually received. Such notices may be given personally, by registered or certified mail, by email, or by facsimile transmission:


	if to Consultant:		Edward F. Houff
			Emergence Strategies LLC
			204 East Montgomery Street
			Baltimore MD 21230
			Fax: 800-853-3676
			Phone: 410.659.9991
			Email: efh446@gmail.com
	if to Kaiser:		Kaiser Aluminum & Chemical Corp.
			Attn: John M. Donnan, Vice President and General Counsel
			27422 Portola Parkway, #350
			Foothill Ranch, CA 92610-2831
			Phone: (949) 614-1767
			Fax: (949) 614-1867
			john.donnan@kaiseraluminum.com

or to such other address as either party shall have last designated by notice to the other party hereto.

Waiver

Failure of either Kaiser or Consultant to enforce at any time any of the provisions of this Agreement shall in no way be construed to be a waiver of such provisions nor in any way affect the validity of this Agreement or any part thereof or the right of either party thereafter to enforce each and every provision thereof. The waiver of any provisions of this Agreement or any breach thereof shall not constitute waiver of any subsequent breach of the same or any other provisions of this Agreement.

10.

Knowing and Voluntary Waiver

Consultant understands and agrees that he:

	a.		Has carefully read and fully understands all of the provisions of this Agreement, the KERP and agreements entered into by Consultant under the KERP, including Consultant’s Severance Agreement, Retention Agreement and CIC Agreement and the effect of his termination of Employment under this Agreement, the KERP and Consultant’s Severance Agreement, Retention Agreement and CIC Agreement.

	b.		Has had an opportunity to negotiate the terms of this Agreement.

	c.		Is, through this Agreement, waiving right to employee benefits and/or any future claim to benefits set forth in paragraph 4.2 of this Agreement, stemming from activities as a Consultant during the period of this Agreement on and after August 1, 2005.

	d.		Knowingly and voluntarily intends to be legally bound by the terms of this Agreement.


*Amended and Restated Non-Exclusive Consulting Agreement*
6		*Edward. F. Houff*

Was advised and hereby is advised in writing to consider the terms of this Agreement and consult with an attorney of his choice prior to executing this Agreement.

11.

Survival

The obligations of Consultant under Section 5, 6 and 7 of this Agreement shall survive termination or expiration of this Agreement.

IN WITNESS WHEREOF, the parties have executed this Consulting Agreement as of the date first set forth above.


CONSULTANT:	KAISER ALUMINUM & CHEMICAL CORP.

	By:

Edward F. Houff		John M. Donnan
		Vice President and General Counsel


*Amended and Restated Non-Exclusive Consulting Agreement*
7		*Edward. F. Houff*

List of Subject Areas as to which Kaiser Desires and Consultant Agrees to Provide Services


n		Regularly Scheduled Omnibus and Special bankruptcy court hearings
n		Disclosure Statement, POR, Solicitation, Confirmation hearings — complete
n		Hearings and appellate work relating to bankruptcy issues, including stay proceedings
n		PBGC Appeal of Distress Termination
n		Insurance coverage litigation and settlements
n		Trentwood environmental matters and criminal investigation
n		Senior/Sub Note/Gramercy Subordination Litigation and liquidating plan confirmation and appeals, including stay proceedings
n		Asbestos and other Tort Claim resolution and negotiations
n		Asbestos workers’ compensation
n		Communications with committees and futures representatives
n		C11 communications with the Board
n		New Board Search Committee — complete
n		Environmental reorganization matters — complete
n		Claims resolution issues
n		Monument Select litigation — complete
n		Testimony and/or declarations as required to support particular pleadings
n		Other assignments as agreed



EFH Initials		JMD Initials


*Amended and Restated Non-Exclusive Consulting Agreement*
8		*Edward. F. Houff*

SUMMARY OF BENEFITS DUE AND REFERENCES
TO APPLICABLE BENEFIT AGREEMENTS


n	All benefits that are due and payable to Consultant under the Kaiser Key Employee Retention Program (KERP), Consultant’s Severance Agreement (“Severance Agreement”), Consultant’s Retention Agreement, each as approved by the Bankruptcy Court in 2002 in Kaiser’s chapter 11 proceedings, for a “Termination Without Cause” and a “Pro-Rating Event,” as those terms are used in the appropriate documents that generally describe and are specific to Edward F. Houff, will be paid as and when due under those plans and agreements as a result of Mr. Houff’s termination effective August 15, 2005.

n	No material change or alteration to such benefits is intended from the KERP and related plans and agreements that were approved by the Bankruptcy Court

n	These severance benefits include, as of the termination on August 15, 2005
	q	Base pay times a multiplier of 2
	q	Withheld retention payments equaling $400,000
	q	“Welfare benefits” for 2 years as provided for in the Severance Agreement and all other benefits provided by the severance plan implemented at part of the KERP (note: does NOT include car lease continuation)
	q	Normal end of service benefits and rights as a Kaiser employee (e.g. unused vacation days for 2005, accrued but unused for 2006) unrelated to Severance Agreement

n	Deferred benefits under the KERP/Severance program
	q	LTI for 2002 through 2004 calculated and paid in accordance with the LTI program and KERP (half at emergence, half at emergence + 1 yr)

n	Other bargained for benefits
	q	$25,000 one-time moving expense payment (to be paid upon the earlier of an actual move or upon termination of the Agreement) (complete)
	q	2005 Short-Term Incentive Compensation, prorated for the period from January 1 to August 15, 2005, not to exceed $25,000, to be paid before March 15, 2006. (complete)



EFH Initials		JMD Initials


*Amended and Restated Non-Exclusive Consulting Agreement*
9		*Edward. F. Houff*

EX-99.1 6 h35470exv99w1.htm PRESS RELEASE exv99w1

Exhibit 99.1

FOR IMMEDIATE RELEASE

For Information: Geoff Mordock
Telephone: (213) 489-8271

Kaiser Aluminum and Teamsters Announce Ratification of New Three-Year Labor Contract

FOOTHILL RANCH, Calif. – April 27, 2006 – Kaiser Aluminum and the International Brotherhood of Teamsters today announced the ratification of a new three-year contract covering approximately 125 union members at the company’s Los Angeles facility. The agreement, which calls for typical industry-level wage increases, will commence on May 1, 2006.

“This agreement is the culmination of diligent efforts by the Teamster leadership and Kaiser Aluminum,” said Jack A. Hockema, president and CEO of Kaiser Aluminum. “It is indicative of the strong working partnership that both organizations have developed and our shared objective of positioning Kaiser Aluminum for long-term success.”

“The new contract provides our members with a competitive wage and benefit package,” said Sean Harren, International Brotherhood of Teamsters. “We’re happy to have this contract in place so that Teamsters at the Los Angeles facility can help contribute to the future of Kaiser Aluminum.”

“This contract is the last of several that have been ratified over the last year by hourly employees at Kaiser Aluminum union-affiliated facilities, leaving the company with no pending labor contract expirations until April 2007,” added Hockema. “It provides a strong foundation going forward and will be a key factor to our success as the company emerges from bankruptcy.”

Kaiser Aluminum (OTCBB: KLUCQ) is a leading producer of fabricated aluminum products for aerospace and high-strength, general engineering, automotive, and custom industrial applications. The Los Angeles facility, located in the City of Commerce, Calif., manufactures extruded aluminum products for general engineering and custom industrial applications.

F-1039

Company press releases may contain statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. The company cautions that any such forward-looking statements are not guarantees of future performance and involve significant risks and uncertainties, and that actual results may vary materially from those expressed or implied in the forward-looking statements as a result of various factors.

-----END PRIVACY-ENHANCED MESSAGE-----


Delaware	1-3605	94-0928288
(State of incorporation)	(Commission File Number)	(I.R.S. Employer Identification Number)


27422 Portola Parkway, Suite 350
Foothill Ranch, California		92610-2831
(Address of Principal Executive Offices)		(Zip Code)

o		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o		Pre-commencement communications pursuant to Rule 13e-4 (c) under the Exchange Act (17 CFR 240.13e-4(c))