8-K

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  January 13, 2004

KAISER GROUP HOLDINGS, INC.
(successor issuer to Kaiser Group International, Inc.)
(Exact name of registrant as specified in its charter)
Delaware	File No. 1-12248	54-2014870
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)
12303 Airport Way, Suite 125
Broomfield, Colorado  80021
(Address of principal executive offices, including zip code)
720-889-2770
(Registrant’s telephone number, including area code)

Item 5.Other Events and Regulation FD Disclosure

In a press release dated January 13, 2004, Kaiser Group Holdings, Inc. announced plans for a preferred stock redemption of its Series 1 Redeemable Cumulative Preferred Stock with a redemption date of February 16, 2004.  The Company also announced that it will hold its annual meeting of shareholders on Wednesday, May 5, 2004, at 10:30 a.m. in the auditorium at 9302 Lee Highway, Fairfax, VA 22031.  A copy of this one-page press release is attached to this Report on Form 8-K as Exhibit 99.1.

Item 7.Financial Statements and Exhibits

Exhibit 14.1 – Corporate Code of Conduct

Exhibit 14.2 – Policies on Securities Law Compliance and Transactions in Company Securities

Exhibit 99.1 – Press Release

Exhibit 99.2 – Charter of the Audit Committee of the Board of Directors

Exhibit 99.3 – Corporate Governance Principles

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report on Form 8-K to be signed on its behalf by the undersigned hereunto duly authorized.

		KAISER GROUP HOLDINGS, INC.
		(Registrant)
		/s/ John T. Grigsby, Jr.
		John T. Grigsby, Jr.
		President and Chief Executive Officer
Date:	January 13, 2004

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EX-14.1

Exhibit 14.1

KAISER GROUP HOLDINGS, INC.

CORPORATE CODE OF CONDUCT

ADOPTED December 10, 2003

KAISER GROUP HOLDINGS, INC.

CORPORATE CODE OF CONDUCT

Table of Contents

I.	Offering Business Courtesies
	A.	U.S. Government Customers
	B.	Foreign Government Customers
	C.	Other Customers
II.	Accepting Business Courtesies from Vendors and Suppliers
III.	Trade Secrets and Confidential Information
	A.	Safeguarding Company Information
	B.	Respecting the Information of Others
	C.	Intellectual Property
IV.	Preparation and Submission of Proposals
V.	Employment of U.S. Government Personnel
VI.	Equal Opportunity Employment and Sexual Harassment
VII.	Quality Assurance
VIII.	Labor and Materials Charging
IX.	Unallowable Costs
X.	Reimbursement of Employee Expenses
XI.	Consultants
XII.	Preservation of Company Assets and Cost Consciousness
XIII.	Compliance with Antitrust Laws
XIV.	Environmental Laws and Regulations
XV.	Personal Conflicts of Interest
XVI.	Political Contributions and Activities
XVII.	Doing Business Overseas
	A.	Foreign Corrupt Practices Act Compliance
	B.	Export Control
	C.	U.S. Antiboycott Laws
XVIII.	Government Audits and Investigations

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XIX.	Document Retention and Record Management
XX.	Securities Law Compliance
XXI.	Recording Transactions
XXII.	Kaiser Group Holdings, Inc.’s Ethics Program and Code
	A.	Training
	B.	Reporting
	C.	Discipline
	D.	A Personal Commitment
XXIII.	Amendment, Modification, Waiver and Provisions of the Code

KAISER GROUP HOLDINGS, INC.

CORPORATE CODE OF CONDUCT

POLICY ON STANDARDS OF BUSINESS ETHICS

We expect all employees, officers and directors of Kaiser Group Holdings, Inc. (“Kaiser” or the “Company”) to act ethically in all of their business dealings on behalf of the Company.  We want you to do the right thing — every time.  We never want you to “cut corners,” put the “bottom line” above good values, or place personal or Company-perceived interests above ethical behavior.

The standards of this Corporate Code of Conduct (“Code”) apply to all of us, meaning every full and part-time employee of the Company and its subsidiaries, all members of the Company’s senior management, including the Company’s Chief Executive Officer and Chief Financial Officer, all officers of the Company, and all members of the Company’s Board of Directors, even if such officer or director is not employed by the Company.  This Code is intended as a concise statement of the standards of ethics required of all employees, officers and directors.  It reflects the business culture we intend to maintain at the Company.

As an employee, officer or director of Kaiser, you are expected to observe the strictest of ethical standards.  The ethical standards outlined in this Code will be familiar because they reflect the fundamental values of fairness and integrity that are a part of our daily lives.  As a member of Kaiser’s team, you are expected to adhere to these values and conduct activities free from even the appearance of impropriety.  Your close adherence to this Code will help maintain the Company’s reputation for integrity and fair dealing.

In addition, there are laws and regulations that apply to the Company at times when it is a contractor with the U.S. Government and operates overseas.  It is very important that we at Kaiser make it our business to know and comply with these special rules as applicable.  At times when we are a contractor with the U.S. Government (other than indirectly through Kaiser-Hill Company, LLC) we may establish an Ethics Program that includes an Ethics Committee and a Corporate Ethics Officer, who will be available to answer questions regarding proper conduct under this Code.

Even when there isn’t a specific rule, regulation, or law, you can never be wrong when you do the right thing.  Ask questions if you’re not sure.  If you are ever in doubt as to whether a certain action is permitted by this Code, please ask your supervisor, the Chief Executive Officer or counsel.  All concerns or possible violations of this Code shall be promptly reported to James J. Maiwurm, Squire, Sanders & Dempsey L.L.P. at 703-720-7890 (feel free to call collect), or jmaiwurm@ssd.com.  Mr. Maiwurm is a director of, and counsel to, the Company.  Where possible, it will be the policy of Kaiser to maintain the confidentiality of any employees, officers or directors who report violations of this Code.  Of course, reports can always be made anonymously.  Any violation of the rules and policies of conduct set forth in this Code will result in corrective action up to and including termination of employment or legal action.

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Remember, it is the personal responsibility of everyone at Kaiser to protect one of the Company’s most valuable assets — its integrity.

I.Offering Business Courtesies

It is the policy of Kaiser to treat its customers and others in a fair manner and in accordance with applicable laws and regulations.  We believe that business should be won or lost based on the merits of our services and the record of our performance, not on any unfair or illegal advantage.  Therefore, you must not use gifts, entertainment, favors, hospitality, or other business courtesies to influence customers or their employees:  there must be no giving of business courtesies in order to obtain business or any other thing of value in exchange.

At the same time, it is recognized that modest business courtesies are at times appropriate in the commercial (but not the U.S. Government) marketplace.  In addition, still different rules may apply where Kaiser is dealing with foreign governments and otherwise doing business overseas.  Business courtesies should never be extended under circumstances that might create even the appearance of impropriety or cause embarrassment to the Company.

A.U.S. Government Customers

Employees, officers and directors of the Company are absolutely forbidden from giving anything of value to any U.S. Government employee.  Most federal, state, and local Government employees and officials are permitted to accept items of nominal value such as modest meals, transportation, or advertising or promotional items from a contractor that does business with the Government.  However, these rules vary widely, and the great embarrassment that a violation (however “innocent” or unwitting) could cause the Company makes it important that you do not provide any business courtesies to Government employees.  There are no exceptions to this rule.

B.Foreign Government Customers

In the event that any of Kaiser’s business is conducted overseas, we will require compliance with the special rules that apply in such circumstances.  For example, laws in foreign countries governing the acceptance by foreign government officials of business courtesies may be different – and in fact more lenient – than those of the U.S. Government.  Even so, the U.S. Foreign Corrupt Practices Act (FCPA) (see Section XVII on Doing Business Overseas below), makes it illegal for a U.S. company to corruptly offer or give directly or indirectly to a foreign government official anything of value in return for influencing that official’s decision, action, or omission to assist the U.S. company in obtaining or retaining business or securing an improper advantage.  Kaiser is committed to ensuring compliance with the FCPA.  Before offering a business courtesy to a foreign government employee, official, or representative, you should seek guidance from the Chief Executive Officer or counsel.

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C.Other Customers

We want to be scrupulous in our dealings with all of our customers, even those who are not Government employees.  We should never offer or provide anything to customers if the purpose could even remotely be associated with improperly obtaining favorable treatment for the Company.  Therefore, business courtesies may be extended only if (1) offering the courtesy does not violate any law, regulation, or policy of the recipient or his or her employer; (2) the business courtesy is of a modest and reasonable value (i.e., no more than $25); and (3) the cost of the business courtesy is approved and properly reflected on Company books and records and complies with applicable Company reimbursement policies.

To guard against even the appearance of impropriety or improper motive, and recognizing that it is often acceptable business practice to exchange modest business courtesies, employees, officers or directors shall not offer or give anything of value in excess of $25 to a commercial customer. There are no exceptions to these rules.

II.Accepting Business Courtesies from Vendors and Suppliers

It is our policy to treat all of our suppliers, vendors, and other business associates consistently and impartially and to purchase goods and services solely on the basis of quality, service, and price.  Employees, officers or directors who have responsibilities relating to entities and persons with whom the Company maintains business relationships must be sensitive to situations where accepting business courtesies or gifts, such as meals or tickets to sporting events, might create the appearance of favoritism in the allocation of Company business.

Kickbacks are illegal — and wrong.  Employees, officers or directors may not use their position to derive a personal benefit from a former, current, or prospective supplier or vendor.  Such conduct may also be illegal.  Under the U.S. Anti-Kickback Act applicable to U.S. Government prime contracts and subcontracts, for example, kickbacks are defined as:

any money, fee, commission, credit, gift, business courtesy, thing of value, or compensation of any kind which is provided, directly or indirectly, to any prime or subcontractor, or prime or subcontractor employee, for the purpose of improperly obtaining or rewarding favorable treatment in connection with a prime or subcontract.

The term “subcontractor” can include any vendor or supplier to the Company that supports a federal contract — there is no distinction between those terms.

Company personnel who have direct or indirect responsibilities for dealing with suppliers, vendors, and subcontractors, including purchasing, vendor quality inspection, and engineering source selection and technical personnel, shall not accept anything of value from a supplier, vendor, or subcontractor except nominally valued items such as pens, cups, and calendars.  Working meals, usually lunches during business hours, that are both reasonable in value (i.e., no more than $25) and infrequent also may be accepted.

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III.Trade Secrets and Confidential Information

A.Safeguarding Company Information

Within the Company, information often flows quite freely.  As a result, you may have access to information that the Company regards as confidential or proprietary (i.e., information that the Company does not disseminate publicly or to its competitors).  Such information includes, among other things, the following: internal telephone lists and directories, engineering data, financial data, sales figures, customer lists, potential customer lists, contemplated or planned new products or services, capital investment plans, documents written by Company attorneys or by attorneys retained by the Company, and any other information or data not publicly available.  If you have any doubt whether a given document or piece of information is confidential or proprietary, you should ask your supervisor, the Chief Executive Officer or counsel.

Because the unauthorized release of confidential or proprietary data could harm the Company, the following rules apply:  (1) no employee, officer or director may use, either for his or her own personal benefit or the benefit of others, any such data; (2) no employee, officer or director should disclose such data to any other employee except on a “need to know” basis; and (3) no employee, officer or director should disclose such data to anyone outside the Company, unless specifically authorized to do so by someone empowered to make such an authorization.

B.Respecting the Information of Others

If we expect others to compete fairly and within the rules, we must do so as well.  Therefore, just as we do not want our confidential and proprietary information to be revealed to our competitors, we cannot and will not improperly obtain a competitor’s protected information.  We have a duty to respect the confidentiality of others’ information.  Employees, officers or directors may not acquire confidential or proprietary information (including technology) about other companies through improper means, such as deceit, misrepresentation, or receipt of information obtained from a third party or a present or former employee not authorized to disclose protected information.  Improper acquisition of such information is not only unethical and wrong, it also may be unlawful under federal and state law.

In addition, in the U.S. Government procurement arena, it is unlawful for employees to obtain U.S. Government source selection sensitive, or security-classified documents or information, to which the Company has not been granted access.  If you are not sure whether a particular document or piece of information is source selection sensitive or security-classified, you should ask your supervisor, the Chief Executive Officer or counsel.

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C.Intellectual Property

It is Company policy to protect the Company’s intellectual property rights (i.e., trade secrets, inventions, patents, trademarks and copyrights) zealously.  Each employee, officer and director has a duty to protect the intellectual property of the Company.  In the patent context, for example, that means guarding patented ideas or processes from unauthorized access.  Kaiser also respects the intellectual property of others.  Employees, officers or directors may not misappropriate patents or misuse trademarks of others.  In the area of copyright, this means that you may not make unauthorized copies of any copyrighted materials, including software, documentation, and publications of various kinds.  Kaiser respects and adheres to the limitations specified in its licensing agreements with software suppliers, and expects you to do so as well.  If you find that your work requires you to copy software or other copyrighted materials, first ask your supervisor, the Chief Executive Officer or counsel whether to do so would be within the Company’s licensing rights.

IV.Preparation and Submission of Proposals

All of the proposals that Kaiser furnishes to the U.S. Government and its prime contractor customers contain important certifications and representations.  For example, some of the Company’s proposals for contracts and contract changes or modifications require the submission and certification of cost or pricing data, or information relating to the Company’s prior sales to other customers.  These certifications and representations impose significantly different and stricter disclosure and other legal obligations than we face in the private sector.  Where the law requires disclosure, all employees, officers or directors who are involved in the preparation of a proposal to the U.S. Government or a prime contractor must ensure that all data is current, accurate, and complete as of the date of agreement on contract price.

It is the responsibility of all employees, officers or directors who prepare, sign, or in any way support the Company’s certifications and representations that these important documents be prepared carefully and accurately.  We want to do what’s right.

V.Employment of U.S. Government Personnel

There are very strict laws and regulations that govern both the recruiting and hiring of current and former U.S. Government personnel, including military and civil service employees.  These rules are very complex, and apply not only to personnel whom Kaiser hires as employees, but also to individuals the Company retains as consultants.  We do not want to violate these rules.

It is therefore necessary that, prior to holding employment discussions with, or actually hiring, a current or former U.S. Government employee (or prior to negotiations leading to retention of the individual as a consultant), such contacts and offers of employment be reviewed and approved by the Chief Executive Officer or counsel.  Once a U.S. Government employee is cleared to hold employment or consultant discussions or accept employment or retention with the Company, it is the responsibility of that individual and the supervisor to ensure that no subsequent job or work assignments are made that would violate conflict of interest laws.

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Violations can occur inadvertently if we are uninformed about the particular prohibitions that apply to our employees, consultants, and potential hires.

VI.Equal Opportunity Employment and Sexual Harassment

Kaiser is an equal opportunity employer and does not discriminate on the basis of race, color, religion, sex, age, national origin, sexual preference, disability, veteran status, or any other factors prohibited by law.  The policy applies not only to recruiting and hiring but to all personnel actions, including training, retention, and promotion of existing employees.

In keeping with this policy, the Company will not tolerate sexual harassment by any of its employees.  Sexual harassment includes unwelcome sexual advances, requests for sexual favors, and other verbal or physical contact of a sexual nature when (1) submission to such conduct is made either explicitly or implicitly a term or condition of an individual’s employment; (2) submission to or rejection of such conduct by an individual is used as a basis for employment decisions affecting such individual; or (3) such conduct has the purpose or effect of unreasonably interfering with an individual’s work performance or creating an intimidating, hostile, or offensive work environment.

Sexual harassment may involve co-employees, subordinates, supervisors and even non-employees who are on Company property to conduct business.  Any employee or applicant who feels he or she has been discriminated against or sexually harassed should report that incident to his or her supervisor, the Chief Executive Officer or counsel, without fear of reprisal.  Confidentiality will be maintained to the extent practicable.  Appropriate disciplinary action will be taken for violations of this policy.

VII.Quality Assurance

Quantity, quality, material, testing, and inspection requirements in contracts and subcontracts must always be strictly observed.  It is wrong (and may be against the law) to substitute materials or components covered by purchase orders, drawings, or specifications without the written approval of the customer, to fail to conduct required testing or inspection, or to manipulate or alter test procedures or data.  Therefore, it is very important that you observe testing and inspection requirements scrupulously.  Such requirements may not be changed in any way except with the formal approval of our customers.  It is also critical that our vendors and suppliers likewise be required to meet all quantity, quality, material, testing, and inspection requirements set forth in the Company’s orders.

VIII.Labor and Materials Charging

Labor and materials costs must always be charged accurately and to the appropriate account, regardless of the financial status of the program, project, or contract, or the budget status of a particular account.  It is wrong to do otherwise.  The “bottom line” never justifies compromising our legal obligations or our values.

Labor timesheets and all other business records must be complete and accurate.  Falsification of timesheets or other records will not be tolerated.  It is important to maintain a paper trail of our transactions so that we can explain why we took certain actions.  Correction of

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timesheets or other records can only be accomplished in accordance with our approved procedures and must be supported by appropriate documentation and approvals.

IX.Unallowable Costs

Many costs are “unallowable” for reimbursement from the U.S. Government or other entities.  Determining which costs are allowable or unallowable is a very complicated and subtle endeavor, undertaken by accountants and lawyers.  If you are unsure whether a particular cost is allowable, ask your supervisor for direction.  Our U.S. Government customers rely on us to identify and exclude unallowable costs from proposals or requests for reimbursement.  We have given them our word that we will do so.  Failure to do so, even if unintentional or inadvertent, could lead to significant civil and criminal liability, both for the Company and the individuals involved.

X.Reimbursement of Employee Expenses

Company policies provide for reimbursement of reasonable expenses incurred by employees who travel on business or to Company-sponsored events.  Economies of travel should be practiced at all times in the selection of air carriers, vehicle rentals, accommodations, and expenditures for meals.

XI.Consultants

The Company uses the services of consultants only when it is not cost efficient for employees to perform the required services or where the nature of the services requires a person not otherwise available within the Company.  Consultants, agents, or other representatives under contract shall be required to comply with this Code in the same manner and to the same standards as employees.

XII.Preservation of Company Assets and Cost Consciousness

Every employee, officer and director is charged with the duty to preserve the Company’s assets, and the property, plans, tooling, and equipment that have been furnished by our customers and suppliers.  Treat these things as you would your own property.

Kaiser is, and must continue to be, cost-conscious.  We should never be accused of wasting our customers’ or our Company’s resources.  Materials and services for the conduct of business must be acquired in accordance with the most rigorous procurement standards, obtaining items of appropriate quality at the best possible price.

XIII.Compliance with Antitrust Laws

The antitrust laws of the United States prohibit agreements or actions “in restraint of trade” — restrictive practices that may reduce competition without providing beneficial effects to consumers.  Among those agreements and activities found to be clear violations are agreements or understandings among competitors to fix or control prices; to boycott specified suppliers or customers; to allocate products, territories, or markets; or to limit the production or sale of products or product lines.  Such agreements are against public policy and against the policy of

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Kaiser.  Employees, officers or directors should never engage in discussions of such matters with representatives of other companies.  Employees, officers or directors should report to the Chief Executive Officer or counsel any instance in which such discussions are initiated by other companies.

Antitrust laws also apply to international operations and transactions related to imports to, or exports from, the United States.  Moreover, the international activities of the Company could be subject to antitrust laws of foreign nations or organizations such as the European Union.

Because of the complexity of antitrust laws, it is imperative that senior management be notified so that legal advice can be sought on questions regarding this important subject.

XIV.Environmental Laws and Regulations

Kaiser is committed to protecting the environment and complying with all applicable federal, state, and local environmental laws and regulations.  These laws and regulations contain provisions that control air, water, ground, and noise pollution.  Failure to comply, even inadvertently, can result in the imposition of civil and criminal penalties.  In addition, all employees, officers and directors have a duty not only to obey these laws, but also to use good judgment with regard to environmental issues related to all Company products, processes, buildings, and other properties.  You should take appropriate actions to minimize and, wherever possible, discontinue the use, generation, and disposal of hazardous materials in all operations, and actively pursue recycling and other environmentally friendly waste management practices.

XV.Personal Conflicts of Interest

A conflict of interest occurs when an individual’s private interest interferes in any way with the interests of the Company as a whole.  All employees, officers or directors have a duty to avoid financial, business, or other relationships that are, or may appear to be, at odds with the interests of the Company or that might conflict with the performance of their assigned duties.  You should conduct yourself in a manner that avoids even the appearance of a conflict between your personal interests and those of the Company.

A conflict of interest may arise in any number of ways.  Examples include the following:

•Employment by a competitor, regardless of the nature of the employment.

•Acceptance of gifts, payments, or services from those seeking to do business with the Company.

•Placement of business with a firm owned or controlled by a Kaiser employee or a family member of an employee.

•Ownership of, or substantial interest in, a company which is a customer, competitor, or a supplier of the Company.

•Acting as a consultant to a current or prospective Company customer or supplier.

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Apparent conflicts of interest can arise easily.  Seek guidance.  If you feel that you may be placed in a situation of personal conflict, actual or potential, you should seek guidance from your supervisor, the Chief Executive Officer or counsel.

XVI.Political Contributions and Activities

Except as expressly authorized by applicable law, no Company funds or assets, including work time of any employee or officer, may be donated, contributed, expended, loaned, or otherwise made available directly or indirectly to any political party, any political committee, or any candidate committee or candidate for federal, state, or local office.  No funds or assets of the Company may be used for or contributed to any foreign political party, candidate, or committee.

Thus, by way of example only, employees cannot, during their normal work hours, perform volunteer activities on behalf of a candidate and at the same time receive compensation for their work at the Company.  However, as noted below, employees, officers or directors can perform volunteer activities during non-work hours and on non-Company property.  Also, Company employees, officers or directors cannot use Company facilities (e.g., stationery, telephone, computers, mailing lists) or personnel in connection with any campaign for elective office.  This means that an officer or any other employee cannot, for example, conduct fundraising activities from his or her Company office.

Kaiser strongly encourages its employees, officers or directors to become involved in civic affairs and to participate in political activities.  You must recognize, however, that your involvement and participation must be on an individual basis, on your own time, and at your own expense.  Further, if you speak on public issues, it must be made clear that the comments or statements are those of yours as an individual and not those of the Company.

XVII.Doing Business Overseas

A.Foreign Corrupt Practices Act Compliance

Kaiser employees, officers or directors are expected to adhere to the requirements of the Foreign Corrupt Practices Act.  No employee, officer or director (or consultant or representative engaged by the Company) shall offer, pay, give, promise, or authorize the payment or gift of any money or thing of value to any foreign government official, candidate for foreign public office, official of an international organization, or foreign political party for purposes of influencing any act or decision or inducing any act or omission by such individual, organization, or party in order to assist the Company in obtaining or retaining business or intended to secure an improper advantage.

It is recognized that, in some parts of the world, it may be customary or even necessary for corporations to make “facilitating” payments to lower level foreign government officials whose duties are clerical or ministerial in nature in order to move or expedite a routine matter toward an eventual legal act or decision not involving discretion.  Such facilitating payments may be made only with the prior express advance written approval of the Chief Executive Officer of the Company.

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B.Export Control

It is the policy of Kaiser to comply with all applicable U.S. and foreign laws and regulations pertaining to the export of products and technology on or on behalf of the Company.  U.S. export control law requires Kaiser to:

(1)review whether a proposed export is subject to the International Traffic in Arms Regulation (ITAR) or the Export Administration Regulations (EAR);

(2)determine the specific export licensing controls applicable to a proposed export;

(3)review probable end users and potential end users against lists of prohibited parties issued by the Departments of State, Commerce, and Treasury as appropriate; and

(4)consider prohibitions of any relevant embargo regulations administered by the Office of Foreign Assets Control.

These four criteria provide the basis for determining whether a proposed export requires the prior review and approval of the U.S. Government.  All Company personnel are responsible for ensuring compliance with export control laws and for seeking guidance from counsel.

The definition of an “export” is extremely broad.  Exports include actual shipment abroad of items in the U.S. as provision of knowledge to foreign persons in the United States or abroad and U.S. citizens in foreign countries.  Exportable items and knowledge may include, for example:

•   products

•   commodities

•   hardware

•   software

•   technical data/knowledge

•   technical services

•   models and prototypes

•   test and repair equipment

•   computer data files

•   photographs and performance data

Under the law, a “foreign person” includes:  (1) someone who is not a U.S. citizen or a permanent resident alien; (2) a foreign entity (e.g., corporation, association, partnership, trust, etc.); (3) international organizations; and (4) foreign governments.

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An export can occur either overseas or in the United States.  Examples include:

•sending or taking any controlled defense article or dual use article outside the United States or transferring a defense article to a foreign embassy, agency, or subdivision within the U.S.;

•disclosing (including orally or visually) or transferring technical data to a foreign person within the U.S. or abroad;

•performing a defense service on behalf of or for the benefit of a foreign person in the U.S. or abroad;

•permitting tours of Company facilities attended by foreign persons;

•publication of technical data, presentations at symposia, conferences or meetings, technical discussions, and even casual conversations; and

•transferring information over international communications systems such as the internet, facsimile, and during telephone conversations.

The export regulations are complex.  All employees who participate in export activities are required to be familiar with and follow the Company’s policies for complying with the export laws and regulations.  Violations can result in criminal and civil penalties for the Company and individuals involved, as well as the Company’s loss of export privileges.  Any employee involved in a potential export should seek guidance from the Chief Executive Officer or counsel.

C.U.S. Antiboycott Laws

It is the policy of Kaiser to comply fully with the prohibitions and requirements of the U.S. antiboycott laws – the Export Administration Act (EAA) of 1969 and the Tax Reform Act (TRA) of 1976.  The antiboycott laws are designed to deter U.S. firms from participating in foreign boycotts that the U.S. does not sanction.  The EAA prohibits the Company from furthering, supporting, or participating in any boycott fostered by or imposed by a foreign country against a country friendly to the United States which is not itself the object of any form of embargo by the United States.  The prohibition applies to the Company in its sale, purchase, or transfer of goods or services between the United States and a foreign country, including U.S. exports and imports, financing, freight forwarding and shipping, and certain other transactions that may take place wholly off-shore.  In addition, the antiboycott laws require the Company to make reports of contacts and operations subject to the laws.

All Kaiser employees involved in international business must be alert to any attempt by a foreign customer to include prohibited boycott terms, conditions, or language in any of the Company’s contractual or financial documents.  Employees who ship or receive goods or supplies under an international contract also should be sensitive to any shipping or freight documents that contain prohibited boycott language.  If boycott provisions are detected or suspected, they should be identified immediately to the Chief Executive Officer or counsel.

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XVIII.Government Audits and Investigations

In accordance with laws, regulations, and the terms of our contracts with the Government, Kaiser allows examination and audit of certain Company data.  When such audits occur, Company employees, officers and directors should cooperate fully with Government personnel, so that their work may be completed in the most efficient manner possible.  If, in the course of such an audit, you are requested by Government personnel to provide information or records, you may do so only if authorized by those Company personnel who are responsible for coordinating Kaiser’s response to the audit.  If you are unsure whether the release of the requested information is authorized, do not release it until a determination has been made.

Furthermore, the Company prohibits any employee, director or officer from altering, destroying, mutilating or concealing a record, document, or other object, or attempting to do so, with the intent to impair the object’s integrity or availability for use in an official proceeding or investigation.  Furthermore, the Company prohibits any employee, officer or director from otherwise obstructing, influencing or impeding any official proceeding or any attempts to do so.

XIX.Document Retention and Record Management

Numerous federal and state statutes require the proper retention of many categories of records and documents that are commonly maintained by companies.  In consideration of those legal requirements and the business needs of the Company, all employees, officers and directors must act ethically and responsibly with respect to the retention of documents.

Any record, in paper or electronic format, that is relevant to a threatened, anticipated or actual internal or external inquiry, investigation, matter or lawsuit may not be altered, destroyed, mutilated, discarded, concealed, falsified, or otherwise made unavailable, once you have been made aware of such threatened, anticipated or actual internal or external inquiry, investigation, matter or lawsuit.

When in doubt regarding the retention of any record, you must not discard or alter the record in question and should seek guidance from your supervisor, the Chief Executive Officer or counsel.

XX.Securities Law Compliance

Kaiser’s policy is to comply with all applicable securities laws.  To that end, the Company has adopted Policies on Securities Law Compliance and Transactions in Company Securities, which are incorporated herein by reference.

XXI.Recording Transactions

We have established and maintain a high standard of accuracy and completeness in our financial records.  These records serve as the basis for managing our business, for measuring and fulfilling our obligations to customers, vendors, suppliers, employees, and others, and for our compliance with financial and tax reporting requirements.

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In the preparation and maintenance of records, employees, officers and directors must make and keep books, invoices, records and accounts that, in reasonable detail, accurately and fairly reflect the financial transactions of the Company.  These records must comply with generally accepted accounting practices and principles.  Accounting entries must be promptly and accurately recorded and properly documented.  No accounting entry may intentionally distort or disguise the true nature of any transaction.  The Company prohibits the establishment of any undisclosed or unrecorded funds or assets for any purpose.

You must maintain accurate records of transactions, time reports, expense accounts and other Company records.  You are prohibited from making a representation, either in a document or in oral communication, which is other than fully accurate.  The Company has devised, implemented and maintained a system of internal accounting controls that is sufficient to provide reasonable assurances that financial transactions are properly authorized, executed and recorded.  You must comply with this system and report any incident that you believe is in violation of the requirements of this system.

See “Reporting” in Section XXII.B. below for specific information on reporting violations of this Code, as well as issues regarding accounting, internal accounting controls or auditing matters, or any other issue.

XXII.Kaiser Group Holdings, Inc.’s Ethics Program and Code

A cornerstone of our Company is our commitment to good ethics, and our promise to our customers and vendors to do the right thing — every time.   This Code is intended to make you aware of our expectations and to allow you the opportunity to seek guidance when tough questions arise.

A.Training

The Company will periodically let employees, officers or directors know through memos, meetings, and more formal training about any issues of importance to the Company’s efforts from time to time, especially when it is a contractor with the U.S. Government.

B.Reporting

Any employee, director or officer of the Company having any information or knowledge regarding the existence of any violation or suspected violation of this Code has a duty to report the violation or suspected violation.  Failure to report suspected or actual violations is itself a violation of this Code and may subject you to disciplinary action, up to and including termination of employment or legal action.  The Company will endeavor to keep reports confidential to the fullest extent practicable under the circumstances or you may make such report anonymously.

You are encouraged to submit any concerns, complaints or reports about actual or suspected violations of this Code, accounting, internal accounting controls or auditing matters, harassment, discrimination, or any other issue to James J. Maiwurm of Squire, Sanders & Dempsey L.L.P. at 703-720-7890 (feel free to call collect), or jmaiwurm@ssd.com.  Mr. Maiwurm is presently a director of, and counsel to, the Company.

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In no event will any action be taken against you for making a complaint or reporting, in good faith, suspected or actual violations of this Code.  You may not be reprimanded, discharged, demoted, suspended, threatened, harassed or in any manner discriminated against for, or because of, the reporting of the suspended or action violations of the Code. Furthermore, you will not lose your job for refusing an order you reasonably believe would violate the provisions of this Code, and any retaliation against you is prohibited.

It is important that everyone at the Company know and follow the rules.  There should never be a double standard.  This will undermine the confidence of you and others in the Company.  It affects morale.  It is just wrong to let some people get away with doing the wrong thing.

If you see something that bothers you, tell someone.  Talk to the Company’s Chief Executive Officer or counsel.

C.Discipline

If you’re doing the right thing, it isn’t fair that others who break the rules get away with it.  Kaiser will discipline employees who violate the Code and other Company policies.

Disciplinary action is taken:

•against employees who authorize or participate directly in actions that are a violation of this Code;

•against any employee who may have deliberately failed to report a violation or deliberately withheld relevant and material information concerning a violation of this Code;

•against the violator’s managerial superiors, to the extent that the circumstances of the violation reflect inadequate supervision or a supervisor’s lack of diligence; and

•against any supervisor who retaliates, directly or indirectly, or encourages others to do so, against an employee who reports a violation of this Code.

D.A Personal Commitment

We want to be a Company with whom others want to do business.  We need the personal commitment of each and every one of you to maintain our Company’s reputation as an ethical and responsible corporation.  We each have a key role to play.

Supervisors must make employees aware of both the Company’s commitment to ethical business practices and each individual’s obligation to show good judgment and values.  And you, the employees, are expected to follow their lead.  Our employees, officers and directors are the most important element in maintaining and enforcing this Code and our commitment to ethical practices.

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Always remember that you are the Company.  Any suggestions on how we can improve our company are welcome.

XXIII.Amendment, Modification, Waiver and Provisions of the Code

We reserve the right to amend, modify, waive or terminate these rules and policies at any time for any reason.

We will disclose any waivers of this Code made to executive officers or directors of the Company, subject to the provisions of the Securities Exchange Act of 1934, as amended, and the rules thereunder, and other applicable securities laws and regulations.  Waivers of this Code can only be granted by the Board of Directors.

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EX-14.2

Exhibit 14.2

KAISER GROUP HOLDINGS, INC.

POLICIES ON SECURITIES LAW COMPLIANCE AND

TRANSACTIONS IN COMPANY SECURITIES

Adopted December 10, 2003

The following policies and procedures of Kaiser Group Holdings, Inc. (the “Company”), are intended to emphasize the importance of (i) complying with reporting requirements and other regulations of the Securities and Exchange Commission (“SEC”); (ii) not engaging in purchases or sales of the Company’s securities while in the possession of material, non-public information, commonly referred to as “insider trading;” (iii) not engaging in speculative, short-term transactions (such as short sales or options trading) in Company securities; and (iv) properly reporting to the SEC transactions in the Company’s securities.

The Company expects the strictest compliance with these policies and procedures by all personnel at every level.  Failure to observe them could result in embarrassment of the Company and, in some instances, serious legal difficulties for individual employees and perhaps the Company as well.  Violation of these policies and procedures may result in disciplinary action or termination of employment by the Company.

If you have any doubt as to your responsibilities under these policies and procedures, seek clarification and guidance from the Chief Executive Officer or counsel.  Do not try to resolve uncertainties on your own.

I.Prohibition of Disclosure of Nonpublic Information Concerning The Company; Designated Spokespersons

As stated in the Company’s Corporate Code of Conduct, all nonpublic information concerning the Company is the Company’s property.  It is a violation of corporate policy for an employee, officer or director to disclose corporate information, including information concerning other businesses derived from your employment or relationship with the Company, to individuals outside of the Company except as required in the course of performance of regular corporate duties.  This prohibition applies specifically (but not exclusively) to inquiries about the Company, its clients and customers that may be made by the press, investment analysts or others in the financial community, and even shareholders.  Effective October 23, 2000, the SEC adopted rules (Regulation FD) prohibiting the disclosure of material nonpublic information by publicly held companies without simultaneous public disclosure of the information.  Even non-intentional disclosures of such information must be cured by public disclosure within 24 hours.

The Company’s policy is to comply with SEC Regulation FD and other applicable securities laws and regulations.  To that end, the only persons authorized to speak on behalf of the Company with the press, financial institutions, analysts, stockholders and similar parties are the Chief Executive Officer and the Chief Financial Officer.  All inquiries from the press, members of the financial community and investors should be immediately referred to one of these designated spokespersons.

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II.Prohibition Against Securities Transactions While in Possession of Material Nonpublic Information; Adoption of Trading “Windows”

It is a violation of corporate policy, and of the law, for employees, officers or directors (and members of their immediate families) to buy or sell securities while in the possession of material, nonpublic information concerning the Company.  Rule 10b5-1, adopted by the SEC effective October 23, 2000, emphasizes that, in order to be guilty of illegal “insider trading,” a person need not “use” the material, nonpublic information; it is enough that the person was aware of the information when making a purchase or sale.  This prohibition applies not only to transactions in the Company’s securities, but also to transactions in the securities of other companies that may be significant clients, customers, suppliers, competitors, adverse litigants, or other publicly-held companies with which employees become familiar in the course of their employment with the Company.  The SEC has successfully prosecuted employees of a company who bought stock in another company on the basis of information they learned through their employment.

Background information and additional guidance and procedures are set forth below:

What is “Insider Trading”?  There is no statutory definition of “insider trading”, but in general it consists of purchasing or selling securities while in the possession of information that is (i) nonpublic and (ii) “material”.  This prohibition applies not only to all employees, officers and directors but also to members of their immediate families (spouse, parents, children, and siblings) who receive material, nonpublic information from such employees, officers or directors.  It is also illegal to give “tips” to third parties.  It is possible for an employee to be charged with “insider trading” if a third party trades on the basis of nonpublic material information given to the third party by the employee, even though the employee does not personally gain from the trading.

What is “Nonpublic” Information?  In general, information is “nonpublic” until it is publicly disseminated, either through the issuance of a press release or through disclosure in the Company’s periodic filings with the SEC.  In addition, information is not considered to be publicly available immediately after its release.  As a general rule, employees should restrict their transactions in Company securities until the third full trading day following the public disclosure or announcement of material information.  Moreover, as discussed below, the Company follows stock exchange guidelines which suggest that transactions in the Company’s securities by employees, officers and directors should take place only during certain “trading windows,” when the risk of even inadvertent “insider trading” is lowest.

What is “Material” Information?  Again, there is no statutory definition of what constitutes “material” information.  In determining whether information is “material”, it is necessary to (i) consider whether there is substantial likelihood that a reasonable investor would consider the information important, i.e., as significantly altering the total mix of information available to him or her, in deciding whether to purchase or sell Company securities, and (ii) take into account, in the case of information concerning events that are uncertain, both the probability that the event will occur and the anticipated magnitude of the event if it occurs.  Information that

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might be “material” includes news of a potential acquisition, merger or disposition; financial information which departs from what the market would expect; significant developments in major litigation; a change in dividend policy; developments concerning significant potential environmental liabilities; or obtaining or losing a major contract.  We emphasize that this list is merely illustrative, and that material information may be either positive or negative.  It is also important to remember that whether a particular event is “material” will always be viewed with the benefit of “20-20 hindsight.”

What are the Penalties?  The Insider Trading and Securities Fraud and Enforcement Act of 1988 prescribes heavy penalties for insider trading violations, including (i) civil penalties of $1,000,000 or three times the profit or loss avoided as a result of the insider trading, whichever is greater, and (ii) criminal penalties with jail sentences of up to ten years.  Liability may extend not only to violators, but to the Company and others as well.  The SEC and Department of Justice have been vigorous in their prosecution of insider trading.

“Trading Windows”.  Stock exchange guidelines suggest that the “insider trading” risks associated with transactions in the Company’s securities are lowest during the period following the release to the public by means of a press release, and publication of quarterly and annual earnings data.  A rule of thumb commonly used is for the “trading window” to last for two weeks commencing on the third full trading day following the issuance of the earnings release.  The Company has adopted a policy of prohibiting directors and officers from trading in Company securities except during these trading windows.  Even during these “trading windows,” if a director or employee has in his or her possession material, nonpublic information, he or she may not engage in purchases or sales of the Company’s securities until the information is disclosed.  Even during the “trading windows,” directors, officers and certain key employees are subject to the additional restrictions set forth below.

The rules adopted by the SEC in October 2000 recognize that directors and officers may avoid insider trading liability if purchases or sales are made – even outside the permitted trading windows – pursuant to a pre-arranged trading plan.  Directors and officers who wish to establish such a trading plan should consult first with the Company’s Chief Executive Officer and counsel.

Additional Restrictions on Directors, Officers and Key Employees.  The Company’s directors, executive officers, and other key employees (who, because of the nature of their responsibilities, are more likely than others to be aware of nonpublic information concerning the Company that might be material), and members of their immediate families shall not engage in transactions in the Company’s securities without prior consultation with the Company’s Chief Executive Officer.  Such consultation shall include a review of the restrictions on insider trading, and the provisions of Section 16(b) of the Securities Exchange Act of 1934 (“Exchange Act”) and SEC Rule 144, discussed below, applicable to directors and certain officers.  If any director, officer or key employee discovers that one or more of his or her immediate family members has transacted in the Company’s securities, such director, officer or key employee shall promptly inform the Company’s Chief Executive Officer of such trading.

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III.           Prohibition Against “Trading” In Company Securities

The Company believes that it is inappropriate for Company personnel to engage in short-term or speculative transactions involving the Company’s securities that may give rise to even an appearance of impropriety.  All transactions in the Company’s securities by employees should be made for investment purposes, and not with a view to a quick profit on a sale.  Therefore, it is the Company’s policy that employees, officers and directors should not engage in “short sales” (i.e., sales of securities not owned) or “sales against the box” (i.e., sales of shares owned but not delivered against the sale) in transactions involving the Company’s securities.  For the same reasons, it is Company policy that no employee, officer or director should purchase, sell or otherwise trade in, “put” or “call” options based on Company securities.

As discussed below, Section 16(b) of the Exchange Act in effect prohibits directors and certain officers from selling Company securities within six months of their purchase, and the foregoing policy is consistent with this rule.  In addition to the Company’s general policy against “short sales,” Section 16(c) of the Exchange Act prohibits directors and officers from making “short sales” of any “equity security” of the Company.  Directors and officers may not sell securities of the Company that they do not own at the time or, if owned, are not delivered within 20 days after the sale.

IV.Accelerated Transaction Reporting Requirements Under Section 16 Of The Exchange Act

Reporting Requirements – Overview.  Section 16(a) of the Exchange Act requires each director and executive officer of the Company to file reports with the SEC setting forth the number of shares of Company “equity securities” (including common stock, preferred stock and other convertible securities, and including derivative securities such as stock options, stock appreciation rights and phantom stock) of which he or she is the “beneficial” owner, and changes in such ownership.  Under the Sarbanes-Oxley Act of 2002, the deadlines for filing reports under Section 16 of the Exchange Act were significantly shortened.  Under prior law, directors and executive officers who engaged in transactions in the Company’s securities normally did not need to file a Form 4 with the SEC until ten days after the end of the month in which the transaction took place.  Now, a Form 4 must be filed with the SEC within two business days after the day on which the transaction takes place.

Reportable Transactions.  Directors and executive officers are required to report any changes in their ownership of Company securities, including transactions effected for their own accounts as well as transactions effected for accounts under employee benefit plans and transactions by family members that are attributed to directors and executive officers.  These procedures apply to any transactions effected by a director or executive officer, by any broker or plan administrator effecting transactions in Company securities for the account of a director or executive officer, and by family members or trusts that hold, purchase or sell Company securities that is attributed to directors and executive officers under the SEC’s “beneficial ownership” rules.  Directors and executive officers should insure that their immediate family members are aware of these rules.  Questions concerning “beneficial ownership” should be referred to the Chief Executive Officer or counsel.

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As described below, virtually all transactions in Company securities must be reported within two business days on Form 4.  There are a few exceptions to the reporting requirements that remain.  These include:

•Purchases by payroll deductions under 401(k) plans and transactions under Section 423 employee stock purchase plans;

•Forfeiture or expiration of stock options or restricted stock;

•Stock splits, stock dividends and distributions of stock purchase rights;

•Transfers pursuant to divorce decrees and domestic relations orders;

•Transactions following termination of insider status, if the insider has not effected a matchable transaction during the previous six months while still an insider; and

•Transactions effected in a fiduciary capacity as a guardian, executor or receiver, during the twelve months following the insider’s appointment to such position.

However, these exemptions are limited, highly technical and subject to change.  All directors and executive officers are urged to discuss with the Chief Executive Officer or counsel transactions that may be exempt as described above.  The obligation to report changes in beneficial ownership on Form 4 may continue for six months after an individual ceases to be a director or officer.

Initial Reports – Form 3.  Initial reports by new directors and executive officers are filed on SEC Form 3.  These forms must be filed within 10 calendar days after becoming a director or executive officer.

Transaction Reports – Form 4.  Subsequent reports of changes in ownership (including changes resulting from option exercises) are generally filed on SEC Form 4.  Form 4 must be filed even if, as a result of balancing purchases, sales and option exercises, there has been no net change in holdings.  Transactions that are subject to the new two business day reporting requirement include the following:

•Stock option exercises;

•Grants of stock options, restricted stock and other equity interests under option or compensation plans, including repricings;

•Open market purchases and sales of Company securities;

•Transactions in Company securities with the Company itself; and

•Participant-directed transactions under employee benefit plans, such as 401(k) plans or SERPs, involving movement of funds into or out of Company securities.

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The rules adopted under the Sarbanes-Oxley Act provided limited relief from the two business day Form 4 deadline for the following transactions, by keying on the date notice of the transaction is given to the reporting person rather than the transaction execution date:

•Transactions pursuant to arrangements to satisfy the affirmative defense conditions of Rule 10b5-1(c), where the reporting person does not select the date of execution; and

•Discretionary transactions (i.e., participant-directed transactions) pursuant to employee benefit plans where the reporting person does not select the date of execution.

The transaction date for these two types of transactions is the date the plan administrator notifies the reporting person of the date of execution, but not later than three business days after the execution date.  The deadline for delayed reporting is no more than five business days, which consist of the maximum three business day notice period plus the two business day reporting period.

Annual Reports  – Form 5.  With the changes under the Sarbanes-Oxley Act, the use of SEC Form 5, utilized for annual reporting of certain types of transactions, is limited, essentially to acquisitions or dispositions of shares through gift or inheritance as well as transactions under qualifying dividend reinvestment plans sponsored by brokers.  Form 5 continues to be due within 45 days after the end of the Company’s fiscal year.

Proxy Statement Disclosure of Delinquent Reports. You should be aware that the Company will continue to be required to report each late or delinquent Section 16 filing in a separate section of its proxy statement.  Moreover, the SEC will have authority to bring enforcement actions against executive officers and directors who do not file reports under Section 16 on a timely basis.

Company Assistance. Although reporting persons are personally responsible for complying with the Section 16 reporting rules, the Company will continue to assist directors and executive officers with their filings.

To ensure compliance with the Section 16(a) reporting requirements, which can be quite complex, Sandra D. Narbesky assists with the preparation of Forms 3, 4 and 5 and the timing filing of such forms with the SEC.   Given the new two business day deadline for filing, it is essential that all directors and executive officers who effect transactions in the Company securities report such transactions immediately to Sandra Narbesky so the necessary filings can be made.  These filings are now required to be made electronically.

Furthermore, in order to make it easier for the Company to assist you in complying with the new Section 16 reporting requirements, attached to these policies is a form of “Limited Power of Attorney for Section 16 Reporting Obligations.”  This limited power of attorney would authorize the Company to make filings on your behalf as required under Section 16.  We recommend that you sign the limited power of attorney and return it to Sandra Narbesky as soon as possible.

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In addition, the Sarbanes-Oxley Act requires companies to make Section 16(a) reports available on their website.  The Company currently does not have a website so it is not subject to this requirement. However, if the Company develops a website in the future, we will need to comply with these website posting requirements for all Section 16(a) reports.

V.Recovery Of “Short Swing” Profits Under Section 16 Of The Exchange Act And Restrictions On Sales By Directors And Executive Officers

Recovery of Short-Swing Profits.  Under Section 16(b) of the Exchange Act, any profits realized by a director or officer from any non-exempt purchase and sale, or any non-exempt sale and purchase, of any equity security of the Company within a period of less than six months are required to be paid to the Company.  The terms “purchase” and “sale” are construed broadly for purposes of Section 16(b) and under some circumstances may include innocent transactions such as gifts, as well as transactions by members of the immediate families and households of directors and officers.  Where there are multiple short-swing transactions, sales and purchases are matched to give the greatest possible recovery.  Although most transactions between a director or officer and the Company, such as option grants and exercises and 401(k) Plan purchases, are exempt from short-swing profit recovery, each case must be examined carefully to ensure that it falls within an appropriate exemption.  Directors and officers should consult with the Chief Executive Officer or counsel prior to engaging in any transaction in Company securities to determine if an exemption from Section 16(b) short-swing profit liability is available.  If the Company does not attempt to make a recovery of prohibited short-swing profits, any stockholder of the Company may bring suit on the Company’s behalf, and there are a number of lawyers who regularly monitor filings under Section 16(a) to detect potential short-swing profit violations.

Sales of Company Securities by “Affiliates” - SEC Rule 144.  Any sales or other dispositions of Company securities by persons who are “affiliates” of the Company must be made pursuant to a registration statement filed with the SEC or in a manner consistent with an exemption such as that provided under SEC Rule 144.  “Affiliates” are defined as persons controlling, controlled by or under common control with the Company, and “control” is defined as the possession of the power to direct or cause the direction of the Company’s management and policies.  The Company believes that all directors and executive officers should consider themselves “affiliates” of the Company for this purpose and comply with the restrictions of Rule 144 when selling Company securities.  Accordingly, all directors and executive officers should seek guidance from the Chief Executive Officer or counsel in connection with sales or other dispositions of Company securities.

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KAISER GROUP HOLDINGS, INC.

LIMITED POWER OF ATTORNEY FOR

SECTION 16 REPORTING OBLIGATIONS

Know all by these presents, that the undersigned hereby makes, constitutes and appoints James J. Maiwurm, Sandra D. Narbesky, and John T. Grigsby, Jr., each acting individually, as the undersigned’s true and lawful attorney-in-fact, with full power and authority as hereinafter described on behalf of and in the name, place and stead of the undersigned to:

(1)           prepare, execute, acknowledge, deliver and file Forms 3, 4, and 5 (including any amendments thereto) with respect to the securities of Kaiser Group Holdings, Inc., a Delaware corporation (the “Company”), with the United States Securities and Exchange Commission, any national securities exchanges or automated trading systems, as considered necessary or advisable under Section 16(a) of the Securities Exchange Act of 1934 and the rules and regulations promulgated thereunder, as amended from time to time (the “Exchange Act”);

(2)           seek or obtain, as the undersigned’s representative and on the undersigned’s behalf, information on transactions in the Company’s securities from any third party, including brokers, employee benefit plan administrators and trustees, and the undersigned hereby authorizes any such person to release any such information to the undersigned and approves and ratifies any such release of information; and

(3)           perform any and all other acts which in the discretion of such attorney-in-fact are necessary or desirable for and on behalf of the undersigned in connection with the foregoing.

The undersigned acknowledges that:

(1)           this Limited Power of Attorney authorizes, but does not require, each such attorney-in-fact to act in their discretion on information provided to such attorney-in-fact without independent verification of such information;

(2)           any documents prepared and/or executed by either such attorney-in-fact on behalf of the undersigned pursuant to this Limited Power of Attorney will be in such form and will contain such information and disclosure as such attorney-in-fact, in his or her discretion, deems necessary or desirable;

(3)           neither the Company nor either of such attorneys-in-fact assumes (i) any liability for the undersigned’s responsibility to comply with the requirement of the Exchange Act, (ii) any liability of the undersigned for any failure to comply with such requirements, or (iii) any obligation or liability of the undersigned for profit disgorgement under Section 16(b) of the Exchange Act; and

(4)           this Limited Power of Attorney does not relieve the undersigned from responsibility for compliance with the undersigned’s obligations under the Exchange Act, including without limitation the reporting requirements under Section 16 of the Exchange Act.

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The undersigned hereby gives and grants each of the foregoing attorneys-in-fact full power and authority to do and perform all and every act and thing whatsoever requisite, necessary or appropriate to be done in and about the foregoing matters as fully to all intents and purposes as the undersigned might or could do if present, hereby ratifying all that each such attorney-in-fact of, for and on behalf of the undersigned, shall lawfully do or cause to be done by virtue of this Limited Power of Attorney.

This Limited Power of Attorney shall remain in full force and effect until revoked by the undersigned in a signed writing delivered to each such attorney-in-fact.

IN WITNESS WHEREOF, the undersigned has caused this Limited Power of Attorney to be executed as of this              day of                                                      , 200    .

Signature

Print Name

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EX-99.1

Exhibit 99.1

KAISER GROUP HOLDINGS, INC.
12303 Airport Way, Suite 125
Broomfield, Colorado  80021

FOR IMMEDIATE RELEASE	Press Contact and Investor Contact:
	John T. Grigsby, Jr.
	720/889-2770

KAISER GROUP HOLDINGS ANNOUNCES
DATE OF REDEMPTION FOR PREFERRED STOCK AND
DATE OF ANNUAL MEETING OF SHAREHOLDERS

BROOMFIELD, CO January 13, 2004 - - Kaiser Group Holdings, Inc. (OTCBB:  KGHI) announced today that February 16, 2004 is the date of redemption of $5,276,260 liquidation preference of its Series 1 Redeemable Cumulative Preferred Stock.  The redemption will be on a pro rata basis, in accordance with the terms of the Series 1 Redeemable Cumulative Preferred Stock, which requires at least 30 days’ notice of the redemption.  The Company also announced today that it will hold its annual meeting of shareholders on Wednesday, May 5, 2004 at 10:30 a.m. in the auditorium at 9302 Lee Highway, Fairfax, Virginia, 22031.

EX-99.2

Exhibit 99.2

KAISER GROUP HOLDINGS, INC.

CHARTER OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS

ADOPTED DECEMBER 10, 2003

I.Audit Committee Purpose and Responsibilities

The purpose of the Audit Committee is to assist the Board of Directors in fulfilling its oversight responsibilities by reviewing the financial information provided to stockholders and others, reviewing with management and the independent auditors the systems of internal control that management has established for finance, accounting and legal compliance, selecting and reviewing the performance of the independent auditors, and overseeing the Company’s accounting and financial reporting processes and the audits of the Company’s financial statements.

The Audit Committee will meet its oversight responsibilities by carrying out the enumerated responsibilities listed below in Section III.  The Audit Committee shall be given full and direct access to the Company’s Board Chairman, management and independent auditors as necessary to carry out its responsibilities.  To the extent the Company has an internal audit function, it shall report to the Audit Committee as well as management, and the Audit Committee shall have the right to direct the internal audit function, if any, to perform such tasks as the Audit Committee may deem necessary or appropriate and to report directly to the Audit Committee in respect of such tasks. The Audit Committee shall have the authority to retain, at the Company’s expense, special legal, accounting or other consultants or experts the Audit Committee deems necessary or advisable in the performance of its duties.

The Audit Committee’s function is one of oversight only; both management and the independent auditors have more time and more knowledge of, and detailed information concerning, the Company than do Audit Committee members.  Consequently, in carrying out its oversight responsibilities, the Audit Committee is not providing any expert or special assurance as to the Company’s financial statements or any professional certification as to the independent auditors’ work. The existence and functioning of the Audit Committee do not relieve the Company’s management from its responsibility for preparing financial statements that accurately and fairly present the Company’s financial results and condition, or the independent auditors from their responsibilities relating to the audit or review of financial statements.

II.Audit Committee Composition and Meetings

The Audit Committee shall be comprised of two or more directors, each of whom will be independent as required by Section 10A(m) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and any rules and regulations promulgated thereunder by the Securities and Exchange Commission (the “SEC”).

Audit Committee members shall be appointed by the Board, and may be removed by the Board at any time.  All members of the Audit Committee should be able to read and understand financial statements, including a balance sheet, income statement and cash flow statement.

The Audit Committee shall meet at least four times annually, or more frequently as circumstances dictate.  As part of its effort to foster communication, the Audit Committee should meet privately in executive session at least annually with each of management and the independent auditors to discuss any matters the Audit Committee or either of these groups believe should be discussed privately.  In addition, the Audit Committee should communicate with management and the independent auditors quarterly to review the Company’s financial statements and significant findings based upon the auditors limited review procedures. If an Audit Committee Chair is not designated or present, a majority of the members of the Audit Committee may designate a Chair.

III.Audit Committee Responsibilities and Duties

A.Review Procedures

1.Review and reassess the adequacy of this Charter at least annually.  Submit the Charter to the Board for approval and have the document published at least every three years in accordance with SEC regulations.

2.Review the Company’s annual audited financial statements, related disclosures, and annual reports, including the “Management’s Discussion and Analysis of Financial Condition and Results of Operation” portion of the Company’s Annual Report on Form 10-K, prior to filing or distribution.  Review should include discussion with management and the independent auditors of significant issues regarding accounting principles, practices, and judgments, including those matters required to be discussed under Statement on Auditing Standards No. 61 (“SAS No. 61”).

3.Review with financial management and the independent auditors the Company’s quarterly financial results prior to the release of earnings and the Company’s quarterly financial statements and reports on Form 10-Q prior to filing or distribution, including any certification, report, or opinion therein.  Discuss any significant changes to the Company’s accounting principles and any items required to be communicated by the independent auditors in accordance with SAS No. 61.  The Chair of the Audit Committee may represent the entire Audit Committee for purposes of this review.

4.Consider and approve, if appropriate, major changes to the Company’s financial reporting processes and controls.  Discuss significant financial risk exposures and the steps management has taken to monitor, control, and report such exposures.  Review significant findings prepared by the independent auditors together with management’s responses.

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B.Control Processes

5.Consider and approve, if appropriate, major changes to the Company’s auditing and accounting principles and practices as suggested by the independent auditors or management.

6.Review the disclosures made by the Company’s Chief Executive Officer and Chief Financial Officer regarding compliance with their certification requirements under the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder, including the Company’s internal controls for financial reporting and disclosure controls and procedures.

7.Following completion of the annual audit, review separately with the independent auditors any significant disagreements between management and the independent auditors or difficulties encountered in connection with the course of the audit.

8.Make and approve recommendations to change or improve the financial and accounting practices followed by the Company in accounting for and reporting its financial results of operations in accordance with generally accepted accounting principles and evaluate the implementation of such changes or improvements.

C.Independent Auditors

9.The independent auditors are ultimately accountable to the Audit Committee and the Board.  The Audit Committee shall review the independence and performance of the auditors and shall have the sole authority to retain the independent auditors or terminate the auditors when circumstances warrant, including the sole authority to approve all audit engagement fees and terms and all non-audit services to be provided by the independent auditors.  More specifically, the Audit Committee must pre-approve all non-audit services to be provided by the independent auditors in accordance with the attached Statement of Policy on the Pre-Approval of Engagements for Non-Audit Services.

10.On an annual basis, the Audit Committee shall obtain a formal written statement from the independent auditors delineating all relationships between the independent auditors and the Company and shall review discuss with the independent auditors all significant relationships they have with the Company that could impair the auditors’ independence.  The Audit Committee is responsible for determining the independence of the auditors.

11.Review the independent auditors’ audit plan:  discuss scope, staffing, locations, reliance upon management, and general audit approach.

12.Prior to releasing the year-end earnings, discuss the results of the audit with the independent auditors.  Discuss certain matters required to be communicated to audit committees in accordance with SAS No. 61.

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13.Consider the independent auditors’ judgments about the quality and appropriateness of the Company’s accounting principles as applied in its financial reporting.

14.Periodically consult with the independent auditors out of the presence of management about internal controls and the fullness and accuracy of the Company’s financial statements.

D.Legal Compliance

15.On at least an annual basis, review with the Company’s counsel any legal matters that could have a significant impact on the organization’s financial statements, the Company’s compliance with applicable laws and regulations, and inquiries received from regulators or governmental agencies.

E.Other Audit Committee Responsibilities

16.Annually prepare a report to stockholders as required by the SEC that discloses whether the Audit Committee has reviewed the financial statements with management and discussed SAS No. 61 and Independence Standards Board Standard No. 1 with the independent accountants, and if the Audit Committee has recommended to the Board that the audited financial statements be included in the Form 10-K. The report should be included in the Company’s annual proxy statement.

17.Oversee the Company’s policies and procedures regarding compliance with applicable laws and regulations and with the Company’s Corporate Code of Conduct.

18.Engage such independent professional advisors and counsel as the Audit Committee determines are necessary or appropriate, with due regard to cost, to carry out its functions as set forth in this Charter.  The Company shall provide appropriate funding for the payment of such services.

19.Approve all related party transactions, as defined by relevant NASDAQ rules, to which the Company is a party.

20.Establish procedures for (a) the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls, disclosure procedures or auditing matters and (b) the confidential, anonymous submission by employees, officers or directors of concerns regarding questionable accounting or auditing matters.

21.Perform any other activities consistent with this Charter, the Company’s Bylaws, and governing law, as the Audit Committee or the Board deems necessary or appropriate, including but not limited to the Company’s legal and regulatory compliance.

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22.Maintain minutes of meetings and periodically report to the Board on significant results of the foregoing activities.

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KAISER GROUP HOLDINGS, INC.

AUDIT COMMITTEE OF THE BOARD OF DIRECTORS

STATEMENT OF POLICY ON THE

PRE-APPROVAL OF ENGAGEMENTS FOR NON-AUDIT SERVICES

The Sarbanes-Oxley Act of 2002 (the “Act”) vests the Audit Committee of the Board of Directors (the “Board”) with the responsibility to appoint and to oversee the work of the independent auditors of the Company.  Under the Act and under rules (the “SEC Rules”) the Securities and Exchange Commission (the “SEC”) has issued pursuant to the Act, that responsibility includes in particular the requirement that the Audit Committee review and pre-approve all audit and non-audit services performed by the independent auditors.  In exercising that responsibility with respect to proposed engagements for non-audit services, it is the policy of the Audit Committee to give paramount consideration to the question of whether the engagement of the independent auditors to perform those services is likely to create a risk that independence of the independent auditors may be compromised.  To that end, the Audit Committee will endeavor to exercise its discretion in a manner that will avoid or minimize the risk of compromising the independence of the independent auditors.

In making this determination, the Committee is mindful of the guidance provided by the SEC:  “The Commission’s principles of independence with respect to services provided by auditors are largely predicated on three basic principles, violations of which would impair the auditor’s independence:  (1) an auditor cannot function in the role of management, (2) an auditor cannot audit his or her own work, and (3) an auditor cannot serve in an advocacy role for his or her client.”  Thus, in evaluating whether a proposed engagement presents a material risk of compromising the independence of the independent auditors, the factors the Audit Committee will typically consider will include whether the service in question is likely to cause the independent auditors to function in a management role, to be put in the position of auditing its own work, or to serve in an advocacy role for the Company.  In addition, the Audit Committee believes that the risk of such compromise may increase in direct proportion to the volume of non-audit services performed by the independent auditors.  Accordingly, it is the policy of the Audit Committee that, in the absence of very strong countervailing considerations, the total amount of fees payable to the independent auditors on account of non-audit services with respect to any fiscal year should not exceed the total amount of audit fees plus audit-related fees (as both such terms are used in the SEC Rules) plus tax-compliance/return-preparation services payable to the independent auditors with respect to such year.  Solely for purposes of the preceding sentence, amounts payable with respect to audit-related services and tax-compliance/return-preparation services will not be considered fees payable on account of non-audit services.  This policy is adopted with the intent to maintain Audit Committee flexibility in circumstances under which the proposed engagement is likely to provide the Company with benefits that substantially outweigh the risk to independence.

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In order to assist the Audit Committee in applying this policy, any officer or other employee of the Company who proposes to engage the independent auditors to perform non-audit services will be expected to submit such a proposal in writing to the Audit Committee accompanied by the following supporting materials:

1.A description of the services proposed to be provided by the independent auditors.

2.A description of the extent, if any, to which the non-audit services in question are likely to cause the independent auditors to function in the role of management, to recommend actions by the Company that the independent auditors may be called upon to review in its role as the Company’s independent auditors, or to serve as an advocate for the Company.

3.A description of the qualifications of the independent auditors that demonstrate its capability to perform the non-audit services in question.

4.The name or names of service providers who were considered as alternatives to the independent auditors to perform the services in question, and a description of the qualifications of each such alternative service provider relating to its capability to perform the services in question.

5.A detailed explanation of the benefits that the Company is expected to enjoy as a result of engaging the independent auditors, rather than an alternative service-provider, to perform the non-audit service in question.

6.An estimate of the amount of fees that the independent auditors is likely to be paid for performance of the non-audit services in question.

The Audit Committee will typically be inclined to approve requests to engage the independent auditors to provide those types of non-audit services that are closely related to the audit services performed by the independent auditors, such as audit-related services, tax-compliance/return-preparation services, and “due diligence” services relating to transactions that the Company may be considering from time to time.  Because such non-audit services bear a close relationship to the audit services provided by the independent auditors, the Audit Committee believes that they will not ordinarily present a material risk of compromising the independence of the independent auditors, subject to the Audit Committee’s policy concerning the total amount payable to the independent auditors for non-audit services with respect to any fiscal year.

Between meetings of the Audit Committee, the Chairman of the Audit Committee is authorized to review and, where consistent with this policy, to pre-approve non-audit services proposed to be performed by the independent auditors that are budgeted for fees of $25,000 or less.  The Chairman shall report any pre-approval decisions to the Audit Committee as soon as practicable and in any event at its next scheduled meeting.

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EX-99.3

Exhibit 99.3

KAISER GROUP HOLDINGS, INC.

CORPORATE GOVERNANCE PRINCIPLES

FOR

THE BOARD OF DIRECTORS

Adopted

December 10, 2003

A.  INTRODUCTION

The Board of Directors of Kaiser Group Holdings, Inc. has adopted these governance principles to assist it in following corporate practices that serve the best interests of the Company and its stockholders.  The Board intends these Principles to serve as a flexible framework within which the Board may conduct its business, and not as a set of binding legal obligations.  The Principles should be interpreted in the context of all applicable laws, the Company’s charter documents and other governing legal documents. Although the Company is not subject to the rules of The Nasdaq Stock Market, Inc. (“NASDAQ”), because its securities are not traded on a NASDAQ market, the Board has determined to use the NASDAQ rules relevant to corporate governance as a guideline, recognizing that, given the Company’s history and limited operations, complete compliance with such rules is not presently practicable.  See Section G for definitions of certain terms used in these Principles.

B.  ROLES AND RESPONSIBILITIES

1.Role of Senior Management.  Senior management, led by the Chief Executive Officer, is responsible for running the Company’s day-to-day operations and appropriately informing the Board of the status of such operations.

2.Role of the Board of Directors.  The Board oversees management’s performance on behalf of the Company’s stockholders.  Its primary duties are to: (i) review and approve corporate strategies; (ii) monitor and evaluate management’s systems for internal control, financial reporting and public disclosure; (iii) establish corporate governance standards; (iv) set standards for director qualification; (v) oversee the Chief Executive Officer who, with senior management, runs the Company on a daily basis; and (vi) monitor management’s performance to ensure that the Company operates in an effective, efficient and ethical manner.

3.Formal Evaluation of Performance and Compensation of CEO.  The Board of Directors is responsible for the annual evaluation of the performance of the Chief Executive Officer.  The Board has delegated decisions with respect to compensation of the Chief Executive Officer to the Outside Directors based on recommendations from the Compensation Committee of the Board.  All members of the Compensation Committee shall be Independent Directors.  The Compensation Committee will consult with the Chief Executive Officer with respect to the

evaluation of all Officers.  The Compensation Committee shall conduct its business in accordance with applicable law, the Company’s charter documents and these Principles.

C.  BOARD COMPOSITION AND SELECTION OF DIRECTORS

1.Size of the Board.  The number of directors that constitutes the Board shall be fixed from time to time in the manner prescribed by the Bylaws of the Company.  The Board shall periodically review its size to ensure that the current number of members most effectively supports the Company.

2.Proportion of Independent Directors.  A majority of the members of the Board shall be, in the judgment of the Board, independent as determined in accordance with the NASDAQ rules.

3.Selection of New Directors.  The Company’s stockholders annually elect the directors who will serve on the Company’s Board.  The Board is responsible for nominating individuals to present to the stockholders as candidates for Board membership and for selecting members to fill Board vacancies.  Given the small size of the Board, the Company’s limited operations, and the nature and number of its stockholders, the Board has determined not to establish a Nominating and Governance Committee. The Board considers the mix of director characteristics, experiences and diverse perspectives and skills that are most appropriate to meet the Company’s needs.  The Board will consider potential nominees submitted by stockholders in accordance with applicable law and the Company’s Bylaws as in effect from time to time.

4.Outside Directors Who Change their Present Job Status.  An Outside Director shall inform the Chairman of the Board of any principal occupation change, including retirement.  The director shall offer his or her resignation, subject to acceptance by the full Board.  The Chairman of the Board shall advise the Board of such change in status, and the Board shall determine the continued appropriateness of Board membership under these circumstances.

5.Retirement Policy.  The Board has adopted a retirement policy for directors under which a director must resign from the Board when he or she reaches age 72 or prior to the next annual meeting of stockholders.  The Board, in consultation with management and the retiring member, shall determine on which of the above dates the resignation shall become effective and may waive the policy under special circumstances.

D.  BOARD PROCEDURES

1.Selection of Chairman and Chief Executive Officer.  The Board of Directors shall select and appoint the Chairman of the Board and the Chief Executive Officer.

2.Lead Independent Director.  If the Chairman of the Board is not an Independent Director, then the Board shall designate a Lead Independent Director to coordinate among the other Independent Directors.

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3.Attendance at Board Meetings.  The Board has four regularly scheduled meetings each fiscal year, plus special meetings as required.  Each Board member shall make every effort to:  attend each Board meeting, preferably in person but in special circumstances via telephone conference call or other electronic means; devote the necessary time to service as a Board member; and review, in advance, meeting materials so as to be prepared for such meetings to the extent necessary to perform and carry out such director’s duties.

4.Time Commitment and Board Service.  Each Board member is expected to ensure that his or her other existing and planned future commitments do not materially interfere with such member’s service on the Company’s Board.

5.Executive Sessions.  The Independent Directors shall meet regularly, not less often than twice per year, in executive sessions without management and may, at their discretion, request that legal counsel attend such executive sessions.

6.Conflicts of Interest.

•Director Conflicts of Interest.  A director’s other relationships, including business, family or those with non-profits, could occasionally give rise to the perception that the director has a material, personal interest on a particular issue involving the Company.  The Board, after consulting with counsel if the Board deems necessary or appropriate, shall determine on a case-by-case basis whether a conflict of interest actually exists.  The Board shall take appropriate steps to identify such potential conflicts and to ensure that all directors voting on an issue are disinterested with respect to that issue.  For example, a Board member shall discuss his or her service on another board with the Chairman of the Board if there is a potential for a conflict of interest.  If the Chairman, in consultation with counsel as appropriate, identifies a potential conflict, then the Chairman shall raise the issue with the Audit Committee and the full Board if appropriate.

•Officer Conflicts of Interest.  An Officer’s other relationships, including business, family, or those with non-profits, could occasionally give rise to the perception that the individual has a material, personal interest on a particular issue involving the Company.  The Board has delegated the task of evaluating certain conflicts of interest to the Audit Committee of the Board.  The Audit Committee, after consulting with counsel if the committee deems necessary or appropriate, shall determine on a case-by-case basis whether a conflict of interest actually exists.

7.Availability of Outside Advisors.  The Board and its Committees may retain independent, outside advisors of its choosing at the Company’s expense, which may include legal, accounting, investment banking and any other independent advisors as deemed necessary or appropriate by the Board.  The Board need not obtain management’s consent to retain independent, outside advisors but should promptly advise management of such retention.

8.Access to Information and Employees.  The Board shall have complete, unfettered access to any information about the Company that it deems necessary or appropriate to carry out its

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duties, which includes, among other things, access to the Company’s employees (senior management, in particular), documents and the Company’s facilities.

9.Corporate Governance Principles and Self-Evaluation.  The Board shall review these Principles at least every two years and make such amendments as are necessary.  The Board shall conduct an annual self-evaluation to determine whether it and its committees are functioning effectively.

E.  BOARD COMMITTEES

1.Number and Composition of Committees.  The Company’s Board currently has two committees:  Audit and Compensation.  From time to time the Board may form a new committee or disband a current committee depending upon the circumstances. The Company’s Audit Committee and Compensation Committee shall consist solely of Independent Directors.  Each of these Committees shall have not less than two members.

2.Appointment and Term of Service of Committee Members.  The Board shall appoint Committee members and Committee chairpersons (if any), who shall serve until their resignation or until the Board appoints a successor.

3.Committee Proceedings.  The agendas and meeting minutes of the committees shall be shared with the full Board (if requested).  The committee members shall periodically report to the Board on significant matters discussed by the committees.

F.  BOARD COMPENSATION

Outside Directors shall receive directors’ fees as determined by the Board from time to time.  Each member is reimbursed for reasonable out-of-pocket expenses incurred in performing his or her duties as a director, including expenses incurred to attend director education seminars.  In order to maintain independence for members of the Audit Committee, directors who are members of the Audit Committee shall receive only directors’ fees, which may be in the form of cash, stock options and/or stock of the Company or other in-kind consideration ordinarily available to directors, and all of the regular benefits that other directors receive.  Due to the Audit Committee’s time commitment and responsibilities to the Company, Audit Committee members may receive directors’ fees that are greater than those paid to other directors.  It is appropriate for management to report from time to time to the Compensation Committee on the status of Board compensation in relation to other similarly situated U.S. companies to ensure that the Company’s Board compensation is appropriate and competitive.

G.  DEFINITIONS

1.Independent Director.  “Independence” of a director for membership on a Board Committee will be affirmatively determined according to these Principles and applicable rules of The Nasdaq Stock Market, Inc., with the goal of assuring that directors have no relationship to the Company that may interfere with the exercise of their independence from management, the Company and the independent auditors.

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2.Principles.  “Principles” means these corporate governance principles adopted by the Board as of the date first written above, and as may be amended from time to time to conform with applicable rules and regulations.

3.Officer.  An “Officer” means an individual who is deemed an executive officer for purposes of Section 16 of the Securities Exchange Act of 1934.

4.Outside Director.  An “Outside Director” means any director who is not currently an employee of the Company.

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