Delaware		3334		94-3030279
(State or Other Jurisdiction of Incorporation or Organization)		(Primary Standard Industrial Classification Code Number)		(I.R.S. Employer Identification Number)

27422 Portola Parkway, Suite 350 Foothill Ranch, California 92610-2831 (949) 614-1740 (Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)		John M. Donnan Vice President, General Counsel and Secretary Kaiser Aluminum Corporation 27422 Portola Parkway, Suite 350 Foothill Ranch, California 92610-2831 (949) 614-1740 (Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service)

Troy B. Lewis Mark T. Goglia Jones Day 2727 North Harwood Street Dallas, Texas 75201-1515 Telephone: (214) 220-3939 Facsimile: (214) 969-5100		Joseph A. Hall Davis Polk & Wardwell 450 Lexington Avenue New York, New York 10017 Telephone: (212) 450-4000 Facsimile: (212) 450-4800

Proposed Maximum

Proposed Maximum

Amount of

Title of Each Class of

Amount to be

Offering Price

Aggregate

Registration

Securities to be Registered

Registered

Per Share(1)

Offering Price(1)

Fee

Common Stock, $0.01 par value per share

2,895,648

$38.50

$111,482,448

$11,929

(1)	Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(c) of the Securities Act based on the average of the high and low prices of the Common Stock on the Nasdaq Global Market on September 20, 2006.

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The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

PRELIMINARY PROSPECTUS	Subject to Completion	September 27, 2006

		Per share				Total
Public offering price		$				$
Underwriting discounts and commissions		$				$
Proceeds, before expenses, to the selling stockholder		$				$

UBS Investment Bank	Bear, Stearns & Co. Inc.

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Prospectus summary			1
Risk factors			10
Special note regarding forward-looking statements			23
Use of proceeds			24
Dividend policy			24
Price range of common stock			24
Capitalization			25
Pro forma consolidated balance sheet			26
Selected historical consolidated financial data			29
Management’s discussion and analysis of financial condition and results of operations			31
Recent reorganization			57
Industry overview			60
Business			64
Management			74
Principal and selling stockholders			96
Certain relationships and related transactions			98
Description of capital stock			99
Shares eligible for future sale			108
U.S. federal tax consequences to non-U.S. holders of common stock			110
Underwriting			113
Notice to investors			116
Legal matters			117
Experts			117
Where you can find more information			117
Index to consolidated financial statements			F-1

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•	acts of war or terrorism or the threat of war or terrorism;
•	government regulation in the countries in which we operate, service customers or purchase raw materials;
•	the implementation of controls on imports, exports or prices;
•	the adoption of new forms of taxation;
•	the imposition of currency restrictions;
•	the nationalization or appropriation of rights or other assets; and
•	trade disputes involving countries in which we operate, service customers or purchase raw materials.

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•	diversion of management’s time and attention from our existing business;
•	challenges in managing the increased scope, geographic diversity and complexity of operations;
•	difficulties in integrating the financial, technological and management standards, processes, procedures and controls of the acquired business with those of our existing operations;
•	liability for known or unknown environmental conditions or other contingent liabilities not covered by indemnification or insurance;
•	greater than anticipated expenditures required for compliance with environmental or other regulatory standards or for investments to improve operating results;
•	difficulties in achieving anticipated operational improvements;
•	incurrence of additional indebtedness to finance acquisitions or capital expenditures relating to acquired assets; and
•	issuance of additional equity, which could result in further dilution of the ownership interests of existing stockholders.

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•	volatility in the spot market for primary aluminum and energy costs;

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•	our annual accruals for variable payment obligations to the Union VEBA Trust and Salaried Retiree VEBA Trust;
•	non-cash charges including last-in, first-out, or LIFO, inventory charges and impairments;
•	global economic conditions;
•	unanticipated interruptions of our operations for any reason;
•	variations in the maintenance needs for our facilities;
•	unanticipated changes in our labor relations; and
•	cyclical aspects impacting demand for our products.

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•	the effectiveness of managements’ strategies and decisions;
•	general economic and business conditions, including cyclicality and other conditions in the aerospace and other end markets we serve;
•	developments in technology;
•	new or modified statutory or regulatory requirements;
•	changing prices and market conditions; and
•	the other factors discussed under “Risk factors.”

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•	we are not in default or would not be in default as a result of the dividend; and
•	the amount of the dividends, together with the aggregate amount of all other dividend payments made by us after July 6, 2006, is less than the sum of (1) 50% of our net income for the period from July 6, 2006 to the end of our most recently ended fiscal quarter or if such net income is a deficit, less 100% of such deficit, (2) up to 100% of the proceeds to us from the sale or issuance of any of our equity securities remaining after making any mandatory prepayment under the revolving credit facility and term loan facility from the proceeds, provided that the proceeds are not used to make any investments or other dividend payments, and (3) $2.0 million.

		High				Low
2006:
Third Quarter 2006 (from July 7, 2006 through September 26, 2006)		$	51.00			$	36.50

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				As of
				June 30, 2006
				Historical				Pro forma
(dollars in millions, except share and per share
amounts)
Cash and cash equivalents				$	37.3			$	36.9
Long-term debt, including current portion(1)
	Revolving credit facility			$	—			$	—
	Term loan facility				—				50.0
	Other				1.2				—
		Total long-term debt			1.2				50.0
Stockholders’ equity:
Historical:
	Common Stock, $0.01 par value, 100,000,000 shares authorized; 79,671,531 shares issued and outstanding				0.8				—
	Preferred stock, $0.05 par value, 20,000,000 shares authorized, no shares issued and outstanding				—				—
Pro Forma:
	Common stock, $0.01 par value, 45,000,000 shares authorized; 20,525,660 shares issued and outstanding(2)				—				0.2
	Preferred stock, $0.01 par value, 5,000,000 shares authorized; no shares issued and outstanding				—				—
	Additional capital				538.0				449.8
	Accumulated deficit				(3,635.3	)			—
	Accumulated other comprehensive loss				(8.8	)			—
		Total stockholders’ equity (deficit)			(3,105.3	)			450.0
		Total capitalization		$	(3,104.1	)		$	500.0

(1)	Excludes $4,388.0 million of liabilities subject to compromise. See “Pro forma consolidated balance sheet.”
(2)	Excludes 1,696,562 shares of common stock reserved and available for issuance under our Equity Incentive Plan.

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					As of June 30, 2006
																	Pro forma				Subsequent
									Plan and								opening				plan				Adjusted
									related				Fresh start				balance				related				pro
					Historical				adjustments(1)				adjustments(2)				sheet				adjustments				forma
(dollars in millions)
Assets
Current assets:
	Cash and cash equivalents				$	37.3			$	(23.8	)		$	—			$	13.5			$	23.4	(3)(4)		$	36.9
	Receivables:
		Trade, less allowance for doubtful receivables				114.1				—				—				114.1				—				114.1
		Other				5.7				—				—				5.7				—				5.7
	Inventories					123.1				—				49.1				172.2				—				172.2
	Prepaid expenses and other current assets					34.0				(0.3	)			—				33.7				—				33.7
			Total current assets			314.2				(24.1	)			49.1				339.2				23.4				362.6
Investments in and advances to unconsolidated affiliate						22.7				—				—				22.7				—				22.7
Property, plant, and equipment, net						242.7				(0.9	)			55.1				296.9				—				296.9
Personal injury-related insurance recoveries receivable						963.3				(963.3	)			—				—				—				—
Goodwill and other intangibles						11.4				(11.4	)			39.5				39.5				—				39.5
Other assets						43.6				—				—				43.6				2.1	(4)			45.7
			Total		$	1,597.9			$	(999.7	)		$	143.7			$	741.9			$	25.5			$	767.4

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					As of June 30, 2006
																	Pro forma				Subsequent
									Plan and								opening				plan				Adjusted
									related				Fresh start				balance				related				pro
					Historical				adjustments(1)				adjustments(2)				sheet				adjustments				forma
(dollars in millions)
Liabilities and Stockholders’ Equity
Liabilities not subject to compromise—
	Current liabilities:
		Accounts payable			$	56.1			$	(6.0	)		$	—			$	50.1			$	—			$	50.1
		Accrued interest				1.1				(1.1	)			—				—				—				—
		Accrued salaries, wages, and related expenses				37.0				(3.9	)			(0.2	)			32.9				(4.5	)(3)			28.4
		Other accrued liabilities				61.0				5.8				—				66.8				(20.0	)(3)			46.8
		Payable to affiliate				33.0				—				—				33.0				—				33.0
		Long-term debt— current portion				1.1				(1.1	)			—				—				—				—
		Discontinued operations’ current liabilities				1.5				—				—				1.5				—				1.5
			Total current liabilities			190.8				(6.3	)			(0.2	)			184.3				(24.5	)			159.8
Long-term liabilities						49.0				20.1				38.5	(5)			107.6				—				107.6
Long-term debt						1.2				(1.2	)			—				—				50.0	(4)			50.0
Discontinued operations’ liabilities (liabilities subject to compromise)						73.5				(73.5	)			—				—				—				—
						314.5				(60.9	)			38.3				291.9				25.5				317.4
Liabilities subject to compromise						4,388.0				(4,388.0	)			—				—				—				—
Minority Interests						0.7				(0.7	)			—				—				—				—
Commitments and contingencies
Stockholders’ equity:
	Common stock					0.8				(0.6	)			—				0.2				—				0.2
	Additional paid-in capital					538.0				—				(88.2	)			449.8				—				449.8
	Accumulated deficit					(3,635.3	)			3,450.5				184.8				—				—				—
	Accumulated other comprehensive income (loss)					(8.8	)			—				8.8				—				—				—
		Total stockholders’ equity (deficit)				(3,105.3	)			3,449.9				105.4				450.0				—				450.0
		Total			$	1,597.9			$	(999.7	)		$	143.7			$	741.9			$	25.5			$	767.4

(1)	Reflects effect on July 6, 2006 of implementing our plan of reorganization, including the settlement of liabilities subject to compromise, the distribution of cash and new shares of common stock, and the cancellation of all of our common stock outstanding immediately prior to the effective date of our plan of reorganization. Includes the reclassification of approximately $21.0 million from liabilities subject to compromise to long-term liabilities in respect of certain pension and benefit plans retained by us pending the outcome of the litigation with the PBGC as discussed more fully in Note 12 to our interim consolidated financial statements.
(2)	Reflects the estimated adjustments to be made to adopt fresh start accounting. These adjustments include the write up of inventories and property, plant and equipment to their appraised values and the elimination of accumulated deficit and additional paid-in capital. The fresh start adjustments for intangible assets and stockholders’ equity are based on a yet to be finalized third party appraisal report and are, therefore, subject to change. Additionally, the pro forma

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	adjustments assume that we do not meet the “more likely than not” criteria for recognition of net operating loss carry-forwards.
(3)	Reflects the payment for accrued but unpaid professional fees ($15.0 million), our share of certain success fees ($5.0 million) as well as the initial payment of accrued long-term incentive awards pursuant to our Key Employee Retention Program. See “Management— Executive Compensation— Key Employee Retention Program.”
(4)	Reflects our revolving credit facility, including payment of certain related fees totaling $2.1 million, and borrowings of $50.0 million under our term loan facility.
(5)	Includes an estimated $45.0 million in respect of our annual variable VEBA payment obligation based on an estimate of the discounted cash payments projected in calculating our reorganization value. An actuarial analysis computing the amount of the obligation assuming treatment of the VEBA obligation as a defined benefit plan with a cap has not been computed. Consequently, this estimate is subject to change.

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																								Six months
				Year ended December 31,																				ended June 30,
Statements of income data:				2001(1)				2002				2003				2004				2005				2005				2006
(dollars in millions, except share and per share data)
																									(unaudited)
																								(restated)(2)
Net sales				$	889.5			$	709.0			$	710.2			$	942.4			$	1,089.7			$	544.3			$	689.8
Costs and expenses:
	Cost of products sold				823.4				671.4				681.2				852.2				951.1				477.4				596.4
	Depreciation and amortization				32.1				32.3				25.7				22.3				19.9				10.1				9.8
	Selling, administrative, research and development, and general				93.7				118.6				92.5				92.3				50.9				24.8				30.3
	Other operating charges, net(3)				30.1				31.8				141.6				793.2				8.0				6.2				0.9
		Total costs and expenses			979.3				854.1				941.0				1,760.0				1,029.9				518.5				637.4
Operating income (loss)					(89.8	)			(145.1	)			(230.8	)			(817.6	)			59.8				25.8				52.4
Other income (expense):
	Interest expense(4)				(106.2	)			(19.0	)			(9.1	)			(9.5	)			(5.2	)			(3.2	)			(0.8	)
	Reorganization items(5)				—				(33.3	)			(27.0	)			(39.0	)			(1,162.1	)			(17.1	)			(15.0	)
	Other, net				(68.7	)			(0.9	)			(5.2	)			4.2				(2.4	)			(1.0	)			1.2
Gain (loss) before income taxes and discontinued operations					(264.7	)			(198.3	)			(272.1	)			(861.9	)			(1,109.9	)			4.5				37.8
Provision for income taxes					(523.4	)			(4.4	)			(1.5	)			(6.2	)			(2.8	)			(4.6	)			(6.2	)
Minority interests					(0.2	)			—				—				—				—				—				—
Income (loss) from continuing operations					(788.3	)			(202.7	)			(273.6	)			(868.1	)			(1,112.7	)			(0.1	)			31.6
(footnotes on following page)

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																							Six months
			Year ended December 31,																				ended June 30,
Statements of income data:			2001(1)				2002				2003				2004				2005				2005				2006
(dollars in millions, except share and per share data)
																							(unaudited)
																							(restated)(2)
Discontinued operations:
	Gain (loss) from discontinued operations, net of income taxes, including minority interests			165.3				(266.0	)			(514.7	)			(5.3	)			(2.5	)			13.3				4.3
	Gain from sale of commodity interests			163.6				—				—				126.6				366.2				365.6				—
Income (loss) from discontinued operations(6)				328.9				(266.0	)			(514.7	)			121.3				363.7				378.9				4.3
Cumulative effect on years prior to 2005 of adopting accounting for conditional asset retirement obligations				—				—				—				—				(4.7	)			(4.7	)			—
Net income (loss)			$	(459.4	)		$	(468.7	)		$	(788.3	)		$	(746.8	)		$	(753.7	)		$	374.1			$	35.9
Earnings (loss) per share— basic/diluted(7):
	Income (loss) from continuing operations		$	(9.82	)		$	(2.52	)		$	(3.41	)		$	(10.88	)		$	(13.97	)		$	—			$	0.40
	Income (loss) from discontinued operations		$	4.09			$	(3.30	)		$	(6.42	)		$	1.52			$	4.57			$	4.75			$	0.05
	Loss from cumulative effect on years prior to 2005 of adopting accounting for conditional asset retirement obligations		$	—			$	—			$	—			$	—			$	(0.06	)		$	(0.06	)		$	—
	Net income (loss)		$	(5.73	)		$	(5.82	)		$	(9.83	)		$	(9.36	)		$	(9.46	)		$	4.69			$	0.45
Dividends per common share			$	—			$	—			$	—			$	—			$	—			$	—			$	—
Weighted average shares outstanding (000):
	Basic			80,235				80,578				80,175				79,815				79,675				79,678				79,672
	Diluted			80,235				80,578				80,175				79,815				79,675				79,678				79,672

		As of December 31,																				As of June 30,
Balance sheet data:		2001				2002				2003				2004				2005				2005				2006
(dollars in millions)
																						(unaudited)
																						(restated)(2)
Cash and cash equivalents		$	154.1			$	77.4			$	35.5			$	55.4			$	49.5			$	54.3			$	37.3
Working capital(8)			(44.2	)			183.0				104.9				73.0				119.7				82.0				123.4
Total assets			2,743.7				2,225.4				1,623.5				1,882.4				1,538.9				2,204.0				1,597.9
Long-term debt			678.7				20.7				2.2				2.8				1.2				1.2				1.2
Stockholders’ equity (deficit)			(441.1	)			(1,085.6	)			(1,738.7	)			(2,384.2	)			(3,141.2	)			(2,010.1	)			(3,105.3	)

(1)	Statement of income data and balance sheet data for 2001 reflect our financial results and position prior to our filing for chapter 11 bankruptcy in February 2002. Such data includes the impact of our concluding a valuation allowance was required in respect of recorded tax attributes and from the partial sale of one of our commodity-related interests.
(2)	We restated our operating results for the six months ended June 30, 2005. See Note 6 to our interim consolidated financial statements for information regarding the restatement.
(3)	Other operating charges, net in 2003 and 2004 include certain significant charges associated with the termination of certain pension and post-retirement medical plans, a settlement in respect of a past labor matter and other items. These items are detailed in Note 6 to our audited consolidated financial statements.
(4)	Excludes unrecorded contractual interest expense of $84.0 million in 2002, $95.0 million in each of 2003, 2004 and 2005 and $47.4 million in the six months ended June 30, 2005 and 2006.
(5)	Reorganization items for 2005 includes an approximate $1.1 billion charge as a result of the value of an intercompany note treated as being for the benefit of certain creditors. See Note 1 to our audited consolidated financial statements.
(6)	Income (loss) from discontinued operations includes the operating results associated with commodity interests sold as well as certain significant gains and losses associated with the dispositions. See Note 3 to our audited consolidated financial statements for information in respect of 2003, 2004 and 2005.
(7)	Earnings (loss) per share and share information may not be meaningful because, pursuant to our plan of reorganization, on July 6, 2006, all outstanding equity interests were cancelled without consideration.
(8)	Working capital represents total current assets minus total current liabilities.

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•	all of our material pre-petition debt, pension and post-retirement medical obligations and asbestos and other tort liabilities, along with other pre-petition claims (which in total aggregate in our June 30, 2006 balance sheet approximately $4.4 billion) were addressed and resolved; and

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•	all of the equity interests of our pre-emergence stockholders were cancelled without consideration and our post-emergence equity was issued and delivered to a third party disbursing agent for distribution to certain claimholders.

•	We will adjust our balance sheet to equal the reorganization value of our company;
•	We will reset items such as accumulated depreciation, accumulated deficit and accumulated other comprehensive income (loss) to zero; and
•	We will allocate the reorganization value to our individual assets and liabilities based on their estimated fair value. Such items as current liabilities, accounts receivable, and cash will reflect values similar to those reported prior to emergence. Items such as inventory, property, plant and equipment, long-term assets and long-term liabilities will be significantly adjusted from amounts previously reported. As more fully discussed in the notes to our financial statements, these adjustments may adversely affect our future results.

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																Six months ended
				Year ended December 31,												June 30,
				2003				2004				2005				2005				2006
				(unaudited
Shipments (millions of pounds):
	Fabricated products				372.3				458.6				481.9				244.5				273.5
	Primary aluminum				158.7				156.6				155.6				76.9				77.1
		Total			531.0				615.2				637.5				321.4				350.6
Average realized third party sales price (per pound):
	Fabricated products(2)			$	1.61			$	1.76			$	1.95			$	1.93			$	2.16
	Primary aluminum(3)			$	0.71			$	0.85			$	0.95			$	0.94			$	1.28
(footnotes on following page)

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																Six months ended
				Year ended December 31,												June 30,
				2003				2004				2005				2005				2006
(dollars in millions)
																(unaudited
																(Restated
Net sales:
	Fabricated products			$	597.8			$	809.3			$	939.0			$	471.8			$	590.9
	Primary aluminum				112.4				133.1				150.7				72.5				98.9
		Total net sales		$	710.2			$	942.4			$	1,089.7			$	544.3			$	689.8
Segment operating income (loss)(1):
	Fabricated products(4)(5)			$	(21.2	)		$	33.0			$	87.2			$	40.6			$	61.2
	Primary aluminum(6)				6.7				13.9				16.4				8.2				12.4
	Corporate and other				(74.7	)			(71.3	)			(35.8	)			(16.8	)			(20.3	)
	Other operating charges(7)				(141.6	)			(793.2	)			(8.0	)			(6.2	)			(0.9	)
		Total operating income		$	(230.8	)		$	(817.6	)		$	59.8			$	25.8			$	52.4
Reorganization items				$	(27.0	)		$	(39.0	)		$	(1,162.1	)		$	(17.1	)		$	(15.0	)
Discontinued operations				$	(514.7	)		$	121.3			$	363.7			$	378.9			$	4.3
Loss from cumulative effect on years prior to 2005 of adopting accounting for conditional asset retirement obligation(8)				$	—			$	—			$	(4.7	)		$	(4.7	)		$	—
Net income (loss)(1)				$	788.3			$	(746.8	)		$	(753.7	)		$	374.1			$	35.9
Capital expenditures (excluding discontinued operations)				$	8.9			$	7.6			$	31.0			$	8.6			$	28.1

(1)	We restated our operating results for the six months ended June 30, 2005. See Note 6 to our interim consolidated financial statements for information regarding the restatement.
(2)	Average realized prices for our fabricated products business unit are subject to fluctuations due to changes in product mix as well as underlying primary aluminum prices and are not necessarily indicative of changes in underlying profitability.
(3)	Average realized prices for our primary aluminum business unit exclude hedging revenues.
(4)	Operating results for the six months ended June 30, 2006 include a non-cash LIFO inventory charge of $21.7 million.
(5)	Includes non-cash mark-to-market losses of $1.0 million in the six months ended June 30, 2006. For further discussion regarding mark-to-market matters see Note 13 to our interim consolidated financial statements.
(6)	Includes non-cash mark-to-market gains (losses) totaling $(2.5) million and $7.1 million in the six months ended June 30, 2005 and 2006, respectively. For further discussion regarding mark-to-market matters see Note 13 to our interim consolidated financial statements.
(7)	See Note 14 to our interim consolidated financial statements for a discussion of the components of other operating charges and the business segment to which the items relate.
(8)	See Note 5 to our interim consolidated financial statements for a discussion of the change in accounting for conditional asset retirement obligations.

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•	metal profits in the six months ended June 30, 2006 of approximately $16.6 million (before considering LIFO implications), which is approximately $19.2 million better than the prior year period; and
•	a non-cash LIFO inventory charge of $21.7 million in the six months ended June 30, 2006. There were no LIFO charges in the comparable 2005 period.

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		Six months ended
		June 30,
		2006 vs. 2005
		Operating				Better
Component		income				(worse)				Factor
Sales of production from Anglesey		$	27			$	12			Market price for primary aluminum
Internal hedging with fabricated products segment			(25	)			(22	)		Eliminates in consolidation
Derivative settlements			2				3			Impacted by positions and market prices
Mark-to-market on derivative instruments			8				11			Impacted by positions and market prices
		$	12			$	4

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•	$12 million for medical obligations and VEBA funding for all former and current operating units;
•	$16 million and $20 million, respectively, for reorganization costs; and
•	$18 million and $13 million, respectively, for general and administrative costs.

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						Payments due in
						Less than				2-3				4-5				More than
Contractual obligations		Total				1 year				years				years				5 years
Long-term debt, including capital lease of $0.8(1)		$	2.3			$	1.1			$	1.2			$	—			$	—
Operating leases			7.4				2.6				3.1				1.6				0.1
Total cash contractual obligations(2)		$	9.7			$	3.7			$	4.3			$	1.6			$	0.1

(1)	See Note 9 to our interim consolidated financial statements for information in respect of long-term debt. Long-term debt obligations exclude debt subject to compromise of approximately $847.6 million, which amounts were dealt with in connection with our plan of reorganization. See Notes 2 and 9 to our interim consolidated financial statements for additional information about debt subject to compromise.
(2)	Total contractual obligations excludes future annual variable cash contributions to the VEBAs, which cannot be determined at this time. See “—Off Balance Sheet and Other Arrangements” below for a summary of possible annual variable cash contribution amounts at various levels of earnings and cash expenditures.

•	A commitment to provide one or more defined contribution plans as a replacement for the five defined benefit pension plans for hourly bargaining unit employees at four of our production

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	facilities and one inactive operation that will be terminated pursuant to a court ruling received in July 2006. We anticipate that the replacement defined contribution plans for the production facilities will provide for an annual contribution of one dollar per hour worked by bargaining unit employee and, in certain instances, will include for certain matching of contributions.
•	A defined contribution savings plan for hourly bargaining unit employees at all of our other production facilities. Pursuant to the terms of the defined contribution plan for hourly bargaining unit employees, we will be required to make annual contributions to the Steelworkers Pension Trust on the basis of one dollar per USW employee hour worked at two facilities. We will also be required to make contributions to a defined contribution savings plan for active USW employees that will range from $800 to $2,400 per employee per year, depending on the employee’s age. Similar defined contribution savings plans have been established for non-USW hourly employees subject to collective bargaining agreements. We currently estimate that contributions to all such plans will range from $3 million to $6 million per year.
•	A defined contribution savings plan for salaried and non-bargaining unit hourly employees providing for a match of certain contributions made by employees plus a contribution of between 2% and 10% of their salary depending on their age and years of service.
•	An annual variable cash contribution to the VEBAs. The amount to be contributed to the VEBAs will be 10% of the first $20.0 million of annual cash flow (defined generally as earnings before interest expense, provision for income taxes and depreciation and amortization (“EBITDA”) less cash payments for, among other things, interest, income taxes and capital expenditures (“Cash Payments”)) plus 20% of annual cash flow, as defined, in excess of $20.0 million. Such annual payments will not exceed $20.0 million and will also be limited (with no carryover to future years) to the extent that the payments would cause our liquidity to be less than $50.0 million. Such amounts will be determined on an annual basis and payable no later than March 31 of the following year. However, we have the ability to offset amounts that would otherwise be due to the VEBAs with approximately $12.7 million of excess contributions made to the VEBAs prior to the effective date of our plan of reorganization.

The following table shows (in millions of dollars) the estimated amount of variable VEBA payments that would occur at differing levels of EBITDA and Cash Payments in respect of, among other items, interest, income taxes and capital expenditures. The table below does not consider the liquidity limitation, the $12.7 million of advances available to us to offset VEBA obligations as they become due and certain other factors that could effect the amount of variable VEBA payments due and, therefore, should be considered only for illustrative purposes.

		Cash Payments
EBITDA		$25.0				$50.0				$75.0				$100.0
$ 20.0		$	—			$	—			$	—			$	—
40.0			1.5				—				—				—
60.0			5.0				1.0				—				—
80.0			9.0				4.0				0.5				—
100.0			13.0				8.0				3.0				—
120.0			17.0				12.0				7.0				2.0
140.0			20.0				16.0				11.0				6.0
160.0			20.0				20.0				15.0				10.0
180.0			20.0				20.0				19.0				14.0
200.0			20.0				20.0				20.0				18.0

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•	A short-term incentive compensation plan for management, payable in cash, which is based primarily on earnings, adjusted for certain safety and performance factors. Most of our locations have similar programs for both hourly and salaried employees.
•	A stock based long-term incentive plan for key managers. As more fully discussed in Note 15 to our interim consolidated financial statements an initial, emergence-related award was made under this program. Additional awards are expected to be made in future years.

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•	Additional pre-filing date claims were identified through the proof of claim reconciliation process and arose in connection with our actions in the chapter 11 bankruptcy proceedings. For example, while we considered rejection of the Bonneville Power Administration contract to be in our best long-term interests, the rejection resulted in an approximate $75.0 million claim by the Bonneville Power Administration. In the quarter ended June 30, 2006 an agreement with the Bonneville Power Administration was approved by the bankruptcy court under which the claim was settled for a pre-petition claim of $6.1 million.
•	As more fully discussed below, the amount of pre-filing date claims ultimately allowed by the bankruptcy court related to contingent claims and benefit obligations may be materially different from the amounts reflected in our consolidated financial statements.
•	As more fully discussed below, changes in our business plan precipitated by the chapter 11 bankruptcy proceedings resulted in significant charges associated with the disposition of assets.

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•	the timing of when any such conditional asset retirement obligation may be incurred;
•	the ability to accurately identify all materials that may require special handling or treatment;
•	the ability to reasonably estimate the total incremental special handling and other costs;
•	the ability to assess the relative probability of different scenarios which could give rise to a conditional asset retirement obligation; and
•	other factors outside our control including changes in regulations, costs, and interest rates.

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•	actual results for the balance of 2006 vary from that in the six months ended June 30, 2006 and our forecasts due to one or more of the factors cited above or elsewhere in this prospectus for the year ended December 31, 2005;
•	income be distributed differently than expected among tax jurisdictions;
•	one or more material events or transactions occur which were not contemplated; or
•	certain expected deductions, credits or carryforwards not be available;

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•	Claims in Respect of Retiree Medical Obligations. Pursuant to settlements reached with representatives of hourly and salaried retirees in early 2004:

	-	an aggregate of 11,439,900 shares of our common stock were delivered to the Union VEBA Trust and entities that prior to July 6, 2006 acquired from the Union VEBA Trust rights to receive a portion of such shares; and
	-	an aggregate of 1,940,100 shares of our common stock were delivered to the Salaried Retiree VEBA Trust and entities that prior to July 6, 2006 acquired from the Salaried Retiree VEBA Trust rights to receive a portion of such shares.

•	Priority Claims and Secured Claims. All pre-petition priority claims, pre-petition priority tax claims and pre-petition secured claims were paid in full in cash.

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•	Unsecured Claims. With respect to pre-petition unsecured claims (other than the personal injury claims specified below):

	-	all pre-petition unsecured claims of the PBGC against our Canadian subsidiaries were satisfied by the delivery of 2,160,000 shares of common stock and $2.5 million in cash; and
	-	all pre-petition general unsecured claims against us, other than our Canadian subsidiaries, including claims of the PBGC and holders of our public debt, were satisfied by the issuance of 4,460,000 shares of our common stock to a third-party disbursing agent, with such shares to be delivered to the holders of such claims in accordance with the terms of our plan of reorganization (to the extent that such claims do not constitute convenience claims that have been or will be satisfied with cash payments). Of such 4,460,000 shares of common stock, approximately 331,000 shares are being held by the third-party disbursing agent as a reserve pending resolution of disputed claims. To the extent a holder of a disputed claim is not entitled to shares reserved in respect of such claim, such shares will be distributed to holders of allowed claims.

•

Personal Injury Claims. Certain trusts, the PI Trusts, were formed to receive distributions from us, assume responsibility from us for present and future asbestos personal injury claims, present and future silica personal injury claims, present and future coal tar pitch personal injury claims and present but not future noise-induced hearing personal injury claims, and to make payments in respect of such personal injury claims. We contributed to the PI Trusts:

	-	the rights with respect to proceeds associated with personal injury-related insurance recoveries reflected on our consolidated financial statements at June 30, 2006 as a receivable having a value of $963.3 million;
	-	$13.0 million in cash (less approximately $0.3 million advanced prior to July 6, 2006);
	-	the stock of a subsidiary whose primary asset was approximately 145 acres of real estate located in Louisiana and the rights as lessor under a lease agreement for such real property that produces modest rental income; and
	-	75% of a pre-petition general unsecured claim against one of our subsidiaries in the amount of $1,106.0 million, entitling the PI Trusts to a share of the 4,460,000 shares of common stock distributed to unsecured claimholders.

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•	Products sold for aerospace and high strength applications represented 29% of our 2005 fabricated products shipments. We offer various aluminum fabricated products to service aerospace and high strength customers, including heat treat plate and sheet products, as well as cold finish bars and seamless drawn tubes. Heat treated products are distinguished from common alloy products by higher strength, fracture toughness and other desired product attributes.
•	Products sold for general engineering applications represented 44% of our 2005 fabricated products shipments. This market consists primarily of transportation and industrial end customers who purchase a variety of extruded, drawn and forged fabricated products through large North American distributors.
•	Products sold for custom automotive and industrial applications represented 27% of 2005 fabricated products shipments. These products include custom extruded, drawn and forged aluminum products for a variety of applications. While we are capable of producing forged products for most end use applications, we concentrate our efforts on meeting demand for forged products, other than wheels, in the automotive industry.

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Global Commercial Aircraft Build > 50 Seats		U.S. Index of Industrial Production Seasonally Adjusted

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•	Plate (0.025 inch or more)— Plate is used in heavy duty aerospace, machinery and transportation applications. Plate applications include structural sections for rail cars and large ships, structural components and skins of jumbo jets and spacecraft fuel tanks as well as armor protection for military vehicles.
•	Sheet (0.006 to 0.0249 inch)— Sheet is the most widely used form of aluminum. Sheet applications include packaging (beverage cans and closures), home appliances and cookware, automobile panels, aircraft skins and building products such as siding, roofing and awnings.
•	Foil (less than 0.006 inch)— Foil is the thinnest of the flat-rolled aluminum products. Foil applications include flexible packaging, household foil and fin stock for air conditioning, industrial and automotive applications.

•	Rods and Bars— Rods and bars are used in aerospace, and general machinery applications. Examples include rivets, screws, bolts, and machinery parts.
•	Pipes and Tubes— Pipes and tubes are used in aerospace, automotive, building and construction and consumer durable applications. Examples include automotive drive shafts, fluid circulation and control systems for air conditioning, hydraulics and irrigation, and light poles.
•	Profiles (or “shapes”)— Profiles are used in automotive, consumer durable and building and construction applications. Examples include truck trailers, automobile bumpers, heat distribution systems (heat sinks), doors, windows, commercial building facades, ladders and scaffolds.

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•	Leading market positions in value-added niche markets for fabricated products. We have repositioned our business to concentrate on products in which we believe we have strong production capability, well- developed technical expertise and high product quality. We believe that

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	we hold a leading market share position in niche markets that represented approximately 85% of our 2005 net sales from fabricated aluminum products. Our leading market position extends throughout our broad product offering, including plate, sheet, seamless extruded and drawn tube, rod, bar, extrusions and forgings for use in a variety of value-added aerospace, general engineering and custom automotive and industrial applications.
•	Well-positioned growth platform. We have substantial organic growth opportunities in the production of aluminum plate, extrusions and forgings. We are in the midst of a $105 million expansion of our Trentwood facility that will allow us to significantly increase production capacity and enable us to produce thicker gauge aluminum plate. We also have the ability to add presses and other manufacturing equipment at several of our current facilities in order to increase extrusion and forging capacity. Additionally, we believe our platform provides us with flexibility to create additional stockholder value through selective acquisitions.
•	Supplier of choice. We pursue “best-in-class” customer satisfaction through the consistent, on-time delivery of high quality products on short lead times. We offer our customers a portfolio of both highly engineered and industry standard products that is unmatched in breadth and depth by most of our competitors. Our continuous improvement culture is grounded in our production system, the Kaiser Production System, which involves an integrated utilization of application and advanced process engineering and business improvement methodologies such as lean enterprise, total productive maintenance and six sigma. We believe that our broad product portfolio of highly engineered products and the Kaiser Production System, together with our established record of product innovation, will allow us to remain the supplier of choice for our customers and further enhance our competitive position.
•	Blue-chip customer base and diverse end markets. Our fabricated products customers include leading aerospace companies, automotive suppliers and metal distributors, such as A.M. Castle-Raytheon, Airbus Industrie, Boeing, Bombardier, Eclipse Aviation, Reliance Steel & Aluminum and Transtar-Lockheed Martin. We have long-term relationships with our top customers, many of which we have served for decades. Our customer base spans a variety of end markets, including aerospace and defense, automotive, consumer durables, machinery and equipment, and electrical.
•	Financial strength. We have little debt and significant liquidity as a result of our recent reorganization. We also have net operating loss carry-forwards and other significant tax attributes that we believe could together offset in excess of $600 million of otherwise taxable income and may accordingly reduce our future cash payments of U.S. income tax.
•	Strong and experienced management. The members of our senior management team have, on average, 20 years of industry work experience, particularly within the areas of operations, technology, marketing and finance. Our management team has repositioned our fabricated products business and led us through our recent reorganization, creating a focused business with financial and competitive strength.

•

Pursue organic growth. We will continue to utilize our manufacturing platform to increase growth in areas where we are well-positioned such as aluminum plate, forgings and extrusions. For instance, we anticipate that the expansion of our Trentwood facility will enable us to significantly increase our production capacity and enable us to produce thicker gauge aluminum plate, allowing us to capitalize on the significant growth in demand for high quality heat treat aluminum plate products in the market for Aero/ HS products. Further, our well-equipped extrusion and forging

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	facilities provide a platform to expand production as we take advantage of opportunities and our strong customer relationships in the aerospace and industrial end markets.
•	Continue to differentiate our products and provide superior customer support. As part of our ongoing supplier of choice efforts, we will continue to strive to achieve “best-in-class” customer satisfaction. We will also continue to offer a broad portfolio of differentiated, superior-quality products with high engineering content, tailored to the needs of our customers. For instance, our unique T-Form® sheet provides aerospace customers with high formability as well as requisite strength characteristics, enabling these customers to substantially lower their production costs. Additionally, we believe our Kaiser Select® Rod established a new industry benchmark for quality and performance in automatic screw applications. By continually striving for “best-in-class” customer satisfaction and offering a broad portfolio of differentiated products, we believe we will be able to maintain our premium product pricing, increase our sales to current customers and gain new customers, thereby increasing our market share.
•	Continue to enhance our operating efficiencies. During the last five years, we have significantly reduced our costs by narrowing our product focus, strategically investing in our production facilities and implementing the Kaiser Production System. We will continue to implement additional measures to enhance our operating efficiency and productivity, which we believe will further decrease our production costs.
•	Maintain financial strength. We intend to employ debt judiciously in order to remain financially strong throughout the business cycle and to maintain our flexibility to capitalize on growth opportunities.
•	Enhance our product portfolio and customer base through selective acquisitions. We may seek to grow through acquisitions and strategic partnerships. We will selectively consider acquisition opportunities that we believe will complement our product portfolio and add long-term stockholder value.

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•	Spot price. Some of our customers pay a product price that incorporates the spot price of primary aluminum in effect at the time of shipment to a customer. This pricing mechanism typically allows us to pass commodity price risk to the customer.
•	Index-based price. Some of our customers pay a product price that incorporates an index-based price for primary aluminum such as Platt’s Midwest price for primary aluminum. This pricing mechanism also typically allows us to pass commodity price risk to the customer.
•	Fixed price. Some of our customers pay a fixed price. During 2003, 2004, 2005 and the six months ended June 30, 2006, approximately 97.6 million pounds (or approximately 26%), 119.0 million pounds (or approximately 26%), 155.0 million pounds (or approximately 32%) and 103.9 million pounds (or approximately 38%), respectively, of our fabricated products were sold at a fixed price. We bear commodity price risk on fixed-price contracts, which we normally hedge though a combination of financial derivatives and production from Anglesey.

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Location		Manufacturing process		Products
Chandler, Arizona		Drawing		Aero/HS
Greenwood, South Carolina		Forging		Custom
Jackson, Tennessee		Extrusion and drawing		Aero/HS and general engineering
London, Ontario		Extrusion		Custom
Los Angeles, California		Extrusion		General engineering and custom
Newark, Ohio		Extrusion and rolling		Aero/HS and general engineering
Richland, Washington		Extrusion		Aero/HS and general engineering
Richmond, Virginia		Extrusion and drawing		General engineering and custom
Sherman, Texas		Extrusion		Custom
Spokane, Washington		Rolling		Aero/HS and general engineering
Tulsa, Oklahoma		Extrusion		General engineering

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Location		Union		Contract expiration date
Chandler, Arizona		Non-union		NA
Greenwood, South Carolina		Non-union		NA
Jackson, Tennessee		Non-union		NA
London, Ontario		USW Canada		February 2009
Los Angeles, California		Teamsters		May 2009
Newark, Ohio		USW		September 2010
Richland, Washington		Non-union		NA
Richmond, Virginia		USW/ IAM		November 2010
Sherman, Texas		IAM		December 2007
Spokane, Washington		USW		September 2010
Tulsa, Oklahoma		USW		November 2010

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Name		Age		Position(s)
Jack A. Hockema		59		President, Chief Executive Officer and Chairman of the Board; Director
Joseph P. Bellino		56		Executive Vice President and Chief Financial Officer
John Barneson		55		Senior Vice President and Chief Administrative Officer
John M. Donnan		45		Vice President, Secretary and General Counsel
Daniel D. Maddox		46		Vice President and Controller
Daniel J. Rinkenberger		47		Vice President and Treasurer
George Becker		77		Director
Carl B. Frankel		71		Director
Teresa A. Hopp		47		Director
William F. Murdy		64		Director
Alfred E. Osborne, Jr., Ph.D.		61		Director
Georganne C. Proctor		49		Director
Jack Quinn		55		Director
Thomas M. Van Leeuwen		49		Director
Brett E. Wilcox		53		Director

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Name
		Class
Alfred E. Osborne, Jr., Ph.D.			Class I
Jack Quinn			Class I
Thomas M. Van Leeuwen			Class I
George Becker			Class II
Jack A. Hockema			Class II
Georganne C. Proctor			Class II
Brett E. Wilcox			Class II
Carl B. Frankel			Class  III
Teresa A. Hopp			Class  III
William F. Murdy			Class  III

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•	the applicable independence criteria contained in the Nasdaq Marketplace Rules or other applicable criteria of the National Association of Securities Dealers, or NASD;
•	the qualifications to serve as a director as set forth in any applicable corporate governance guidelines adopted by the board of directors and policies adopted by our nominating and corporate governance committee establishing criteria to be utilized by it in assessing whether a director candidate has appropriate skills and experience; and
•	any other qualifications to serve as director imposed by applicable law.

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•	establishing hiring policies for employees or former employees of the independent auditors;
•	reviewing our systems of internal accounting controls;
•	discussing risk management policies;
•	approving related party transactions;
•	establishing procedures for complaints regarding financial statements or accounting policies; and
•	performing other duties delegated to the audit committee by the board of directors from time to time.

•	must satisfy the general independence criteria;
•	may not, other than as a member of the board of directors or a committee thereof, accept any consulting, advisory or other compensatory fee from the company or its subsidiaries (other than fixed amounts of compensation under a retirement plan for prior service, provided such compensation is not contingent on continued service);
•	may not be our affiliate;
•	must not have participated in the preparation of our financial statements at any time during the three years prior to July 6, 2006; and
•	must be able to read and understand fundamental financial statements.

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•	administering plans adopted by the board of directors that contemplate administration by the compensation committee, including our Equity Incentive Plan;
•	overseeing regulatory compliance with respect to compensation matters;
•	reviewing director compensation; and
•	performing other duties delegated to the compensation committee by the board of directors from time to time.

•	evaluating stockholder recommendations for director nominations;
•	assisting in succession planning;
•	considering possible conflicts of interest of members of the board of directors and management and making recommendations to prevent, minimize or eliminate such conflicts of interests;
•	making recommendations to the board of directors regarding the appropriate size of the board of directors; and
•	performing other duties delegated to the nominating and corporate governance committee by the board of directors from time to time.

•	an annual retainer of $30,000 per year;
•	an annual grant of restricted stock having a value equal to $30,000;
•	a fee of $1,500 per day for each meeting of the board of directors attended in person and $750 per day for each such meeting attended by phone; and

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•	a fee of $1,500 per day for each committee meeting of the board of directors attended in person on a date other than a date on which a meeting of the board of directors is held and $750 per day for each such meeting attended by phone.

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						Annual compensation
														Other annual				All other
						Salary				Bonus				compensation				compensation
Name and Principal Position		Year				($)				($)				($)(1)				($)
Jack A. Hockema			2005				730,000				600,000				—				24,276	(2)
President, Chief Executive Officer and			2004				730,000				378,500				—				199,193	(2)(3)(4)
Chairman of the Board			2003				730,000				—				—				365,000	(3)
John Barneson			2005				275,000				150,000				—				23,875	(2)
Senior Vice President and			2004				275,000				94,625				—				81,200	(2)(3)
Chief Administrative Officer			2003				275,000				—				—				125,000	(3)
John M. Donnan			2005				260,000				108,000				—				20,733	(2)
Vice President, General Counsel and			2004				200,000				45,420				—				109,000	(2)(3)
Secretary			2003				200,000				—				—				200,000	(3)
Daniel D. Maddox			2005				200,000				84,000				—				19,720	(2)
Vice President and Controller			2004				200,000				52,990				—				116,000	(2)(3)
			2003				200,000				—				24,721	(5)			200,000	(3)
Edward F. Houff(6)			2005				250,000	(7)			103,125	(8)			—				1,481,526	(2)(9)
Chief Restructuring Officer			2004				400,000				219,625	(8)			—				118,450	(2)(3)
			2003				400,000				125,000	(8)			—				200,000	(3)
Kerry A. Shiba(10)			2005				270,000				114,000				—				20,825	(2)
Executive Vice President and			2004				242,500				68,130				—				115,500	(2)(3)
Chief Financial Officer			2003				190,000				—				—				190,000	(3)

(1)	Excludes perquisites and other personal benefits, which in the aggregate amount do not exceed the lesser of either $50,000 or 10% of the total of annual salary and bonus reported for the named executive officer.
(2)	Includes contributions under our Savings Plan described below made with respect to 2004 and 2005, respectively, in the amount of $16,400 and $23,983 for Mr. Hockema; $18,450 and $5,863 for Mr. Houff; $18,700 and $23,875 for Mr. Barneson; $9,000 and $20,733 for Mr. Donnan; $16,000 and $19,720 for Mr. Maddox; and $20,500 and $20,825 for Mr. Shiba. For additional information, see discussion under “—Retirement Plans— Savings and Investment Plan” below.

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(3)	Includes retention payments made during 2003 and 2004, respectively, under the Retention Plan in the amount of $365,000 and $182,500 for Mr. Hockema; $200,000 and $100,000 for Mr. Houff; $125,000 and $62,500 for Mr. Barneson; $200,000 and $100,000 for Mr. Donnan; $200,000 and $100,000 for Mr. Maddox; and $190,000 and $95,000 for Mr. Shiba. As described in more detail below, the program was not extended beyond March 2004, and no further retention payments were made after March 2004, except for the following withheld amounts. Excludes additional retention payments earned under the Retention Plan with respect to the years 2002, 2003 and 2004, respectively, for each of Messrs Hockema and Barneson as follows: $182,333, $365,000 and $182,500 for Mr. Hockema; and $62,500, $125,000 and $62,500 for Mr. Barneson. Pursuant to the Retention Plan, these additional retention payments were withheld for distribution to Messrs. Hockema and Barneson of one-half upon emergence from chapter 11 bankruptcy and one-half one year thereafter, subject to continued employment on that date. For additional information regarding retention payments made pursuant to the Retention Plan, see discussion under “—Key Employee Retention Program— Retention Plan and Agreements” below.
(4)	Includes $293 paid to Mr. Hockema for unused allowances under our benefit program.
(5)	Includes an auto allowance of $22,217 and personal use of company car of $2,504.
(6)	Mr. Houff’s employment was terminated August 15, 2005. Mr. Houff remained the Chief Restructuring Officer and served as a consultant through July 6, 2006.
(7)	Reflects the base salary paid to Mr. Houff in 2005 through the termination of his employment on August 15, 2005.
(8)	Under the terms of his employment agreement, Mr. Houff was guaranteed a bonus of $125,000 annually. For 2005, Mr. Houff’s bonus was pro rated as of the termination of his employment on August 15, 2005. Includes additional short-term incentive payments made to Mr. Houff in 2004 and 2005 in the amount of $94,625 and $25,000, respectively.
(9)	Includes $1,200,000 in the form of payments made to Mr. Houff in 2005 in connection with the termination of his employment and $275,663 in the form of payments to Mr. Houff under the terms of Mr. Houff’s non-exclusive consulting agreement for services provided in 2005. For additional information, see discussion under “—Employment-Related Contracts— Agreements with Edward F. Houff” below.

(10)	Mr. Shiba resigned effective January 23, 2006.

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•	the participant receives severance compensation or benefit continuation pursuant to a Change in Control Agreement (as described below);
•	the participant’s employment is terminated other than without cause or by the participant for good reason; or
•	the participant declines to sign, or subsequently revokes, a designated form of release.

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•	the participant receives severance compensation or benefit continuation pursuant to the Severance Plan or any other prior agreement;
•	the participant’s employment is terminated other than without cause or by the participant for good reason; or
•	the participant declines to sign, or subsequently revokes, a designated form of release.

•	three times (for Mr. Barneson) or two times (for Messrs. Donnan and Maddox) the sum of his base pay and most recent short-term incentive target;
•	a pro-rated portion of his short-term incentive target for the year of termination; and
•	a pro-rated portion of his long-term incentive target in effect for the year of his termination, provided that such target was achieved.

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		Payouts under non-stock price-based plans
		Inception to				Annual				Annual
Name		date actual(1)				target(2)				maximum(2)
Jack A. Hockema(3)			$3,298,880				$1,500,000				$4,500,000
John Barneson(4)			693,876				350,000				1,050,000
John M. Donnan(5)			208,575				200,000				600,000
Edward F. Houff(6)			670,582				300,000				900,000
Daniel D. Maddox(7)			227,228				100,000				300,000
Kerry A. Shiba(8)			111,716				258,000				774,000

(1)	This column reflects the total amount earned under the Long-Term Incentive Plan from February 2002 through July 6, 2006. Participants were paid one-half of this amount in August 2006, following our emergence from chapter 11 bankruptcy, and will receive the remainder on July 6, 2007, the first anniversary of our emergence from chapter 11 bankruptcy, assuming continued employment at such date.
(2)	The target and maximum payout amounts are per annum.
(3)	Individual amounts earned by year for Mr. Hockema under the Long-Term Incentive Plan were $2,324,557 in 2002 and 2003, $918,818 in 2004, ($240,819) in 2005 and $296,324 in 2006.
(4)	Individual amounts earned by year for Mr. Barneson under the Long-Term Incentive Plan were $466,534 in 2002 and 2003, $214,391 in 2004, ($56,191) in 2005 and $69,142 in 2006.
(5)	Individual amounts earned by year for Mr. Donnan under the Long-Term Incentive Plan were $146,045 in 2002 and 2003, $55,129 in 2004, ($32,109) in 2005 and $39,510 in 2006. The initial target and maximum for Mr. Donnan were $90,000 and $270,000, respectively. These amounts were increased to the levels indicated in the table effective January 2005 in connection with Mr. Donnan’s promotion to General Counsel.
(6)	Individual amounts earned by year for Mr. Houff under the Long-Term Incentive Plan were $486,818 in 2002 and 2003, and $183,764 in 2004.
(7)	Individual amounts earned by year for Mr. Maddox under the Long-Term Incentive Plan were $162,273 in 2002 and 2003, $61,255 in 2004, ($16,055) in 2005 and $19,755 in 2006.
(8)	In connection with his Release Agreement discussed below, Mr. Shiba settled his rights under the Long-Term Incentive Plan for a total of $111,176.

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•	the fabricated products business unit’s operating income plus depreciation and amortization, as adjusted for extraordinary items, which may be spread over a period of years based upon the recommendation of our chief executive officer and approval of the compensation committee;
•	the fabricated products business unit’s safety performance as measured by total case incident rate;
•	performance of the business to which a participant is assigned; and
•	individual performance objectives.

		Minimum				Target				Maximum
Name		award amount				award amount				award amount
Jack A. Hockema			—			$	500,050			$	1,500,150
Joseph P. Bellino			—			$	175,000			$	525,000
John Barneson			—			$	126,000			$	378,000
John M. Donnan			—			$	117,000			$	351,000
Daniel D. Maddox			—			$	75,000			$	225,000

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•	For our employees who were employed with us on or before January 1, 2004, we contribute in a range from 2% to 10% of the employee’s compensation, based upon the sum of the employee’s age and years of continuous service as of January 1, 2004; and

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•	For our employees who were employed with us after January 1, 2004, we contribute 2% of the employee’s compensation.

•	If our matching contributions to a participant under our Savings Plan are limited in any year, we will make an annual contribution to that participant’s account under our Restoration Plan equal to the difference between:

	•	The matching contributions that we could have made to that participant’s account under our Savings Plan if the Internal Revenue Code did not impose any limitations; and
	•	The maximum contribution we could in fact make to that participant’s account under our Savings Plan in light of the limitations imposed by the Internal Revenue Code.

A participant is required to be making elective contributions under our Savings Plan on the first day of the year in order to receive a matching contribution from us under our Restoration Plan for that year. However, matching contributions under our Restoration Plan are calculated as though the participant elected to make the maximum permissible elective contributions under our Savings Plan sufficient to receive the maximum matching contribution from us under our Savings Plan, without regard for the participant’s actual elective contributions. Participants are immediately vested 100% in our matching contributions to our Restoration Plan.

•

Annual fixed-rate contributions to the participant’s account under our Restoration Plan are made in an amount equal to between 2% and 10% of the participant’s excess compensation, as defined in Section 401(a)(17) of the Internal Revenue Code. The actual fixed-rate contribution percentage is determined based upon the sum of the participant’s age and years of continuous service as of January 1, 2004. If a participant is employed with us after January 1, 2004, the fixed-rate contribution percentage is 2%. A participant is required to be employed on the last day of the year in order to receive the fixed-rate contribution. Further, to the extent that fixed-rate contributions to a participant under our Savings Plan on compensation that is not excess compensation, as defined in Internal Revenue Code Section 401(a)(17), cannot be made under the Savings Plan due to

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	Internal Revenue Code limitations, such fixed-rate contributions will be made to such participant’s account under our Restoration Plan. Participants are vested 100% in our fixed-rate contributions to our Restoration Plan after five years of service, or upon retirement, death, disability or a change of control.

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---

 

•	from August 15, 2005 to February 14, 2006, Mr. Houff received a monthly base fee of $43,200 per month, plus $360 per hour for each hour worked in excess of 120 hours per month, subject to a monthly cap of 200 billable hours;
•	from February 15, 2006 to February 28, 2006, Mr. Houff received a base fee of $22,500, plus $450 per hour for each hour worked in excess of 50 hours, subject to a cap of 75 billable hours;
•	from March 1, 2006 to March 31, 2006, Mr. Houff received a base fee of $33,750, plus $450 per hour for each hour worked in excess of 75 hours, subject to a cap of 100 billable hours;
•	from April 1, 2006 to June 30, 2006, Mr. Houff received a monthly base fee of $22,500, plus $450 per hour for each hour worked in excess of 50 hours per month, subject to a monthly cap of 75 billable hours;
•	during July 2006, until our emergence from chapter 11 bankruptcy, Mr. Houff was paid an hourly fee of $450 for each hour worked.

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		Number of securities								Value of unexercised
		underlying unexercised								in-the-money
		options/SARs								options/SARs
		at fiscal year end (#)								at fiscal year-end ($)
Name		Exercisable				Unexercisable				Exercisable				Unexercisable
Jack A. Hockema			375,770	(1)			28,184	(1)			—	(2)			—	(2)
John Barneson			—				—				—				—
John M. Donnan			—				—				—				—
Edward F. Houff			—				—				—				—
Daniel D. Maddox			35,715	(1)			—				—	(2)			—
Kerry A. Shiba			—				—				—				—

(1)	Represents shares of our then existing common stock underlying stock options.
(2)	No value is shown because the exercise price was higher than the closing price of $0.03 per share for our then existing common stock on the OTC Bulletin Board on December 30, 2005.

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•	a member of the compensation committee (or other board committee performing equivalent functions) of another entity, one of whose executive officers served on our compensation policy committee or our Section 162(m) compensation committee;
•	a director of another entity, one of whose executive officers served on our compensation policy committee or our Section 162(m) compensation committee; or
•	a member of the compensation committee (or other board committee performing equivalent functions) of another entity, one of whose executive officers served as one of our directors.

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•	each named executive officer, as well as Messrs. Bellino and Rinkenberger;
•	each of our directors;
•	all our directors and current executive officers as a group;
•	each person known to us to beneficially own 5% or more of our common stock; and
•	the selling stockholder.

		Shares Beneficially												Shares Beneficially
		Owned												Owned
		Prior to Offering												After Offering
										Number of
Name		Number				%				Shares Offered				Number				%
Directors and Executive Officers(1)(2)
Jack A. Hockema			185,000				*				—				185,000				*
John Barneson			48,000				*				—				48,000				*
Joseph P. Bellino			15,000				*				—				15,000				*
John M. Donnan			45,000				*				—				45,000				*
Edward F. Houff			—				—				—				—				—
Daniel D. Maddox			11,334				*				—				11,334				*
Daniel J. Rinkenberger			24,000				*				—				24,000				*
Kerry A. Shiba			—				—				—				—				—
George Becker			1,039				*				—				1,039				*
Carl B. Frankel			1,213				*				—				1,213				*
Teresa A. Hopp			924				*				—				924				*
William F. Murdy			1,097				*				—				1,097				*
Alfred E. Osborne, Jr., Ph.D.			693				*				—				693				*
Georganne C. Proctor			1,386				*				—				1,386				*
Jack Quinn			1,386				*				—				1,386				*
Thomas M. Van Leeuwen			1,386				*				—				1,386				*
Brett E. Wilcox			1,386				*				—				1,386				*
All directors and current executive officers as a group (15 persons)			338,844				1.7	%							338,844				1.7	%
5% Stockholders
Union VEBA Trust(3)			8,809,900				42.9	%			2,517,955				6,291,945				30.7	%
Asbestos PI Trust(4)			1,113,915				5.4	%			—				1,113,915				5.4	%
Selling Stockholder
Union VEBA Trust(3)			8,809,900				42.9	%			2,517,955				6,291,945				30.7	%

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*	Indicates less than 1%
(1)	The shares held by our executive officers were received under our Equity Incentive Plan. Pursuant to the plan, these shares are restricted and are subject to forfeiture until July 6, 2009 and, consequently, may not be traded in the public market until such date.
(2)	Each of our independent directors received 693 shares of our common stock on August 1, 2006 under our Equity Incentive Plan. Pursuant to the plan, these shares are restricted and are subject to forfeiture until August 1, 2007 and, consequently, may not be traded in the public market until such date. In addition, certain of our directors elected to receive shares of our common stock in lieu of all or a portion of their annual cash retainer, including Messrs. Becker (346 shares), Frankel (520 shares), Murdy (404 shares), Quinn (693 shares), Van Leeuwen (693 shares) and Wilcox (693 shares) and Mmes. Hopp (231 shares) and Proctor (693 shares).
(3)	Shares beneficially owned by the Union VEBA Trust are as reported on its Form 13G filed on July 24, 2006. The number of shares offered and the number and percentage of shares beneficially owned after the offering by the Union VEBA Trust assume that the underwriters do not exercise their option to purchase additional shares from the Union VEBA Trust to cover any over allotment. The principal address of the Union VEBA Trust is c/o National City Bank, as Trustee for Kaiser VEBA Trust, 20 Stanwix Street, Locator 46-25162, Pittsburgh, PA 15222.
(4)	Shares beneficially owned by the Asbestos PI Trust are as reflected on the stock ownership register maintained by Mellon Investor Services LLC, the transfer agent for our common stock. The principal address of the Asbestos PI Trust reflected on the stock ownership register is 325 N. La Salle Dr., Suite 625, Chicago, IL 60610, c/o Frank Gecker, LLP-Francis Gecker.

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•	restricting dividends on the common stock;
•	diluting the voting power of the common stock;
•	impairing the liquidation rights of the common stock; or
•	delaying or preventing a change in control without further action by the stockholders.

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•	July 6, 2016;
•	the repeal, amendment or modification of Section 382 of the Internal Revenue Code in such a way as to render us no longer subject to the restrictions imposed by Section 382;
•	the beginning of a taxable year in which none of the income tax benefits in existence on July 6, 2006 are currently available or will be available;
•	the determination by the board of directors that the restrictions will no longer apply;
•	a determination by the board of directors or the Internal Revenue Service that we are ineligible to use Section 382(l)(5) of the Internal Revenue Code permitting full use of the income tax benefits existing on July 6, 2006; and
•	an election by us for Section 382(l)(5) of the Internal Revenue Code not to apply.

•	the transferor holds 5% or more of the total fair market value of all issued and outstanding equity securities, a 5% stockholder; or
•	as a result of such transfer, either (1) any person or group of persons would become a 5% stockholder, or (2) the percentage stock ownership of any 5% stockholder would be increased.

•	the transferor or transferee obtains the prior written approval of the board of directors;
•	in the case of a 5% Transaction by any holder of equity securities (other than the Union VEBA Trust), prior to such transaction, the board of directors determines in good faith, upon request of the transferor or transferee, that the proposed transfer is a 5% Transaction:

	-	which, together with any 5% Transactions consummated during the previous three years, or since July 6, 2006, if shorter, represent aggregate 5% Transactions involving transfers of less than 45% of our equity securities issued and outstanding at the time of transfer; and
	-	which, together with any 5% Transactions consummated during the previous three years, or since July 6, 2006, if shorter, and all 5% Transactions that the Union VEBA Trust may consummate without breach of the Stock Transfer Restriction Agreement, described below, during the three years following the time of transfer, represent, during any period of three consecutive years during the three years prior to the transfer, or since July 6, 2006, if shorter, and the three years after the

---

 

		transfer, aggregate 5% Transactions involving transfers of less than 45% of the equity securities issued and outstanding at the time of transfer; or

•	in the case of a 5% Transaction by the Union VEBA Trust, such 5% Transaction does not result in a breach of the Stock Transfer Restriction Agreement, so long as, contemporaneously with such 5% Transaction, the Union VEBA Trust delivers to our board of directors a written notice setting forth the number and type of equity securities involved in, and the date of, such 5% Transaction.

---

 

•	the number of shares of common stock to be sold is not more than 45% of the total number of shares of common stock received by the Union VEBA Trust pursuant to the plan of reorganization, less the number of shares included in all other transfers previously effected by the Union VEBA Trust during the preceding 36 months or since July 6, 2006, if shorter; and
•	the shares of common stock to be sold have a market value of not less than $60.0 million on the date the request is made.

•	no such underwritten offering has been previously effected from a shelf registration statement;
•	the demand for such underwritten offering is made by the Union VEBA Trust between March 31, 2007 and April 1, 2008; and
•	the shares of common stock to be sold have a market value of not less than $60.0 million on the date such request is made.

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---

 

---

 

---

 

•	prior to such time, the board of directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;
•	upon consummation of the transaction which resulted in the stockholder becoming an “interested stockholder,” the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced (excluding specified shares); or
•	on or subsequent to such time, the business combination is approved by the board of directors of the corporation and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 662/3% of the outstanding voting stock not owned by the interested stockholder.

•	any merger or consolidation involving the corporation and the interested stockholder;
•	any sale, transfer, pledge or other disposition involving the interested stockholder of 10% or more of the assets of the corporation;
•	subject to exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder;
•	subject to exceptions, any transaction involving the corporation that has the effect of increasing the proportionate share of the stock of any class or series of the corporation beneficially owned by the interested stockholder; and
•	the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits provided by or through the corporation.

•	any person that is the owner of 15% or more of the outstanding voting stock of the corporation, or is an affiliate or associate of the corporation and was the owner of 15% or more of the outstanding voting stock of the corporation at any time within three years immediately prior to the date of determination; and
•	the affiliates and associates of any such person.

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•	indemnify, defend and hold harmless the director or officer to the fullest extent permitted or required by Delaware law, except that, subject to certain exceptions, the director or officer will be indemnified with respect to a claim initiated by such director or officer against us or any other director or officer of the company only if we have joined in or consented to the initiation of such claim;
•	advance prior to the final disposition of any indemnifiable claim any and all expenses relating to, arising out of or resulting from any indemnifiable claim paid or incurred by the director or officer or which the director or officer determines is reasonably likely to be paid or incurred by him or her; and
•	utilize commercially reasonable efforts to cause to be maintained in effect policies of directors’ and officers’ liability insurance providing coverage that is at least substantially comparable in scope and amount to that provided by our policies of directors’ and officers’ liability insurance at the time the parties enter into such indemnification agreement.

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•	one percent of the number of shares of common stock then outstanding, which will equal approximately 205,256 shares immediately after this offering; or
•	the average weekly trading volume of our common stock on the Nasdaq Global Market during the four calendar weeks preceding the date of filing of a notice on Form 144 with respect to the sale, which equals approximately 208,675 shares as of the date of this prospectus.

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•	a citizen or resident of the United States, including an alien individual who is a lawful permanent resident of the United States or meets the “substantial presence” test under section 7701(b)(3) of the Internal Revenue Code;
•	a corporation (or an entity treated as a corporation) created or organized in or under the laws of the United States, any state thereof, or the District of Columbia;
•	an estate, the income of which is subject to U.S. federal income tax regardless of its source; or
•	a trust, if a U.S. court can exercise primary supervision over the administration of the trust and one or more U.S. persons can control all substantial decisions of the trust, or certain other trusts that have a valid election in effect to be treated as a U.S. person pursuant to applicable Treasury Regulations.

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•	the gain is effectively connected with a trade or business carried on by the Non-U.S. Holder within the United States (and, where an income tax treaty applies, is attributable to a U.S. permanent establishment of the Non-U.S. Holder), in which case the branch profits tax discussed above may also apply if the Non-U.S. Holder is a corporation;
•	the Non-U.S. Holder is an individual who holds shares of common stock as capital assets and is present in the United States for 183 days or more in the taxable year of disposition and certain other conditions are met; or
•	we are or have been a “U.S. real property holding corporation” for U.S. federal income tax purposes.

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•	the broker has documentary evidence in its files that the holder is a Non-U.S. Holder and certain other conditions are met; or
•	the holder otherwise establishes an exemption.

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Underwriters			Number of shares
UBS Securities LLC
Bear, Stearns & Co. Inc.
	Total			2,517,955

•	receipt and acceptance of the common stock by the underwriters; and
•	the underwriters’ right to reject orders in whole or in part.

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			No exercise				Full exercise
Per share			$				$
	Total		$				$

•	stabilizing transactions;
•	short sales;
•	purchases to cover positions created by short sales;
•	imposition of penalty bids;
•	syndicate covering transactions; and
•	passive market making.

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•	to legal entities which are authorized or regulated to operate in the financial markets or, if not so authorized or regulated, whose corporate purpose is solely to invest in securities;
•	to any legal entity which has two or more of (1) an average of at least 250 employees during the last financial year; (2) a total balance sheet of more than €43,000,000 and (3) an annual net turnover of more than €50,000,000, as shown in its last annual or consolidated accounts; or
•	in any other circumstances which do not require the publication by the issuer of a prospectus pursuant to Article 3 of the Prospectus Directive.

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		Page
Audited Financial Statements for the Year Ended December 31, 2003, 2004 and 2005
Report of Independent Registered Public Accounting Firm			F-2
Consolidated Balance Sheets as of December 31, 2004 and 2005			F-4
Statements of Consolidated Income (Loss) for the Years Ended December 31, 2003, 2004 and 2005			F-5
Statements of Consolidated Stockholders’ Equity (Deficit) and Comprehensive Income (Loss) for the Years Ended December 31, 2003, 2004 and 2005			F-6
Statements of Consolidated Cash Flows for the Years Ended December 31, 2003, 2004 and 2005			F-7
Notes to Consolidated Financial Statements			F-8
Quarterly Financial Data (Unaudited)			F-63
Five Year Financial Data			F-65
Unaudited Financial Statements for the Three Months and Six Months Ended June 30, 2005 and 2006
Consolidated Balance Sheets (Unaudited) as of December 31, 2005 and June 30, 2006			F-69
Statements of Consolidated Income (Loss) (Unaudited) for the Three Months and Six Months Ended June 30, 2005 and 2006			F-70
Statements of Consolidated Stockholders’ Equity (Deficit) and Comprehensive Income (Unaudited) for the Six Months Ended June 30, 2005 and 2006			F-71
Statements of Consolidated Cash Flows (Unaudited) for the Six Months Ended June 30, 2005 and 2006			F-72
Notes to Consolidated Financial Statements (Unaudited)			F-73

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					December 31,
					2004				2005
					(in millions of
					dollars, except share
					and per share
					amounts)
Assets
Current assets:
	Cash and cash equivalents				$	55.4			$	49.5
	Receivables:
		Trade, less allowance for doubtful receivables of $6.9 and $2.9				97.4				94.6
		Due from affiliate				8.0				—
		Other				5.6				6.9
	Inventories					105.3				115.3
	Prepaid expenses and other current assets					19.6				21.0
	Discontinued operations’ current assets					30.6				—
			Total current assets			321.9				287.3
Investments in and advances to unconsolidated affiliate						16.7				12.6
Property, plant, and equipment— net						214.6				223.4
Restricted proceeds from sale of commodity interests						280.8				—
Personal injury-related insurance recoveries receivable						967.0				965.5
Goodwill						11.4				11.4
Other assets						31.1				38.7
Discontinued operations’ long-term assets						38.9				—
			Total		$	1,882.4			$	1,538.9
Liabilities and Stockholders’ Equity (Deficit)
Liabilities not subject to compromise—
	Current liabilities:
		Accounts payable			$	51.8			$	51.4
		Accrued interest				.9				1.0
		Accrued salaries, wages, and related expenses				48.9				42.0
		Other accrued liabilities				73.7				55.2
		Payable to affiliate				14.7				14.8
		Long-term debt— current potion				1.2				1.1
		Discontinued operations’ current liabilities				57.7				2.1
			Total current liabilities			248.9				167.6
	Long-term liabilities					32.9				42.0
	Long-term debt					2.8				1.2
	Discontinued operations’ liabilities (liabilities subject to compromise)					26.4				68.5
						311.0				279.3
Liabilities subject to compromise						3,954.9				4,400.1
Minority interests						.7				.7
Commitments and contingencies
Stockholders’ equity (deficit):
	Common stock, par value $.01, authorized 125,000,000 shares; issued and outstanding 79,680,645 and 79,671,531 shares					.8				.8
	Additional capital					538.0				538.0
	Accumulated deficit					(2,917.5	)			(3,671.2	)
	Accumulated other comprehensive income (loss)					(5.5	)			(8.8	)
			Total stockholders’ equity (deficit)			(2,384.2	)			(3,141.2	)
			Total		$	1,882.4			$	1,538.9

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				Year ended December 31,
				2003				2004				2005
				(in millions of dollars,
				except share and per share
				amounts)
Net sales				$	710.2			$	942.4			$	1,089.7
Costs and expenses:
	Cost of products sold				681.2				852.2				951.1
	Depreciation and amortization				25.7				22.3				19.9
	Selling, administrative, research and development, and general				92.5				92.3				50.9
	Other operating charges, net				141.6				793.2				8.0
		Total costs and expenses			941.0				1,760.0				1,029.9
Operating income (loss)					(230.8	)			(817.6	)			59.8
Other income (expense):
	Interest expense (excluding unrecorded contractual interest expense of $95.0 in 2003, 2004 and 2005)				(9.1	)			(9.5	)			(5.2	)
	Reorganization items				(27.0	)			(39.0	)			(1,162.1	)
	Other— net				(5.2	)			4.2				(2.4	)
Loss before income taxes and discontinued operations					(272.1	)			(861.9	)			(1,109.9	)
Provision for income taxes					(1.5	)			(6.2	)			(2.8	)
Loss from continuing operations					(273.6	)			(868.1	)			(1,112.7	)
Discontinued operations:
	Loss from discontinued operations, net of income taxes, including minority interests				(514.7	)			(5.3	)			(2.5	)
	Gain from sale of commodity interests				—				126.6				366.2
Income (loss) from discontinued operations					(514.7	)			121.3				363.7
Cumulative effect on years prior to 2005 of adopting accounting for conditional asset retirement obligations					—				—				(4.7	)
Net loss				$	(788.3	)		$	(746.8	)		$	(753.7	)
Earnings (loss) per share— Basic/ Diluted:
	Loss from continuing operations			$	(3.41	)		$	(10.88	)		$	(13.97	)
	Income (loss) from discontinued operations			$	(6.42	)		$	1.52			$	4.57
	Loss from cumulative effect on years prior to 2005 of adopting accounting for conditional asset retirement obligations			$	—			$	—			$	(.06	)
	Net loss			$	(9.83	)		$	(9.36	)		$	(9.46	)
Weighted average shares outstanding (000):
	Basic/ Diluted				80,175				79,815				79,675

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															Accumulated
															other
			Common				Additional				Accumulated				comprehensive
			stock				capital				deficit				income (loss)				Total
			(in millions of dollars)
BALANCE, December 31, 2002			$	.8			$	539.9			$	(1,382.4	)		$	(243.9	)		$	(1,085.6	)
	Net loss			—				—				(788.3	)			—				(788.3	)
	Minimum pension liability adjustment			—				—				—				138.6				138.6
	Unrealized net decrease in value of derivative instruments arising during the year			—				—				—				(1.6	)			(1.6	)
	Reclassification adjustment for net realized gains on derivative instruments included in net loss			—				—				—				(1.0	)			(1.0	)
	Comprehensive income (loss)																			(652.3	)
	Restricted stock cancellations			—				(1.0	)			—				—				(1.0	)
	Restricted stock accretion			—				.2				—				—				.2
BALANCE, December 31, 2003				.8				539.1				(2,170.7	)			(107.9	)			(1,738.7	)
	Net loss			—				—				(746.8	)			—				(746.8	)
	Minimum pension liability adjustment			—				—				—				97.9				97.9
	Unrealized net decrease in value of derivative instruments arising during the year			—				—				—				2.1				2.1
	Reclassification adjustment for net realized losses on derivative instruments included in net loss			—				—				—				2.4				2.4
	Comprehensive income (loss)																			(644.4	)
	Restricted stock cancellations			—				(1.1	)			—				—				(1.1	)
BALANCE, December 31, 2004				.8				538.0				(2,917.5	)			(5.5	)			(2,384.2	)
	Net loss			—				—				(753.7	)			—				(753.7	)
	Minimum pension liability adjustment			—				—				—				(3.2	)			(3.2	)
	Unrealized net decrease in value of derivative instruments arising during the year			—				—				—				(.3	)			(.3	)
	Reclassification adjustment for net realized gains on derivative instruments included in net loss			—				—				—				.2				.2
	Comprehensive income (loss)																			(757.0	)
BALANCE, December 31, 2005			$	.8			$	538.0			$	(3,671.2	)		$	(8.8	)		$	(3,141.2	)

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					Year ended December 31,
					2003				2004				2005
					(in millions of dollars)
Cash flows from operating activities:
	Net loss				$	(788.3	)		$	(746.8	)		$	(753.7	)
	Less net (loss) income from discontinued operations					(514.7	)			121.3				363.7
	Net loss from continuing operations, including loss from cumulative effect of adopting change in accounting in 2005					(273.6	)			(868.1	)			(1,117.4	)
	Adjustments to reconcile net loss from continuing operations to net cash used by continuing operations
		Non-cash charges in reorganization items in 2005 and other operating charges in 2004 and 2003				161.7				805.3				1,131.5
		Depreciation and amortization (including deferred financing costs of $4.7, $5.8 and $4.4, respectively)				30.4				28.1				24.3
		Loss from cumulative effect on years prior to 2005 of adopting accounting for conditional asset retirement obligations				—				—				4.7
		Gains— sale of Tacoma facility in 2003; sales of real estate in 2005				(14.5	)			—				(.2	)
		Equity in (income) loss of unconsolidated affiliate, net of distributions				1.0				(4.0	)			1.5
		Decrease (increase) in trade and other receivables				(13.3	)			(30.5	)			9.3
		Decrease (increase) in inventories, excluding LIFO adjustments and other non-cash operating items				10.7				(24.5	)			(9.4	)
		Decrease (increase) in prepaid expenses and other current assets				3.1				.8				—
		Increase (decrease) in accounts payable and accrued interest				8.1				16.4				(2.4	)
		Increase (decrease) in other accrued liabilities				9.8				(18.6	)			(15.0	)
		Increase in payable to affiliates				.2				3.3				.1
		(Decrease) increase in accrued and deferred income taxes				(4.1	)			1.7				(4.3	)
		Net cash impact of changes in long-term assets and liabilities				27.1				(11.5	)			(25.0	)
		Net cash (used) provided by discontinued operations				(29.5	)			64.0				17.9
		Other				(4.0	)			(.4	)			1.3
			Net cash (used) provided by operating activities			(86.9	)			(38.0	)			16.9
Cash flows from investing activities:
	Capital expenditures					(8.9	)			(7.6	)			(31.0	)
	Net proceeds from dispositions: interests in office building complex in 2003, real estate and equipment in 2004, primarily Tacoma facility and real estate in 2005					83.0				2.3				.9
	Net cash provided (used) by discontinued operations; primarily proceeds from sale of Alpart-related capital expenditures in 2003 and commodity interests in 2004 and 2005					(25.0	)			356.7				401.4
			Net cash provided by investing activities			49.1				351.4				371.3
Cash flows from financing activities:
	Financing costs, primarily DIP Facility related					(4.1	)			(2.4	)			(3.7	)
	Repayment of debt					—				—				(1.7	)
	Increase in restricted cash					—				—				(1.5	)
	Net cash used by discontinued operations; primarily increase in restricted cash and payment of Alpart CARIFA loan of $14.6 in 2004 and increase in restricted cash in 2005					—				(291.1	)			(387.2	)
			Net cash used by financing activities			(4.1	)			(293.5	)			(394.1	)
Net (decrease) increase in cash and cash equivalents during the year						(41.9	)			19.9				(5.9	)
Cash and cash equivalents at beginning of year						77.4				35.5				55.4
Cash and cash equivalents at end of year					$	35.5			$	55.4			$	49.5
Supplemental disclosure of class flow information:
	Interest paid, net of capitalized interest of $.2, $.1, and $.6				$	4.0			$	3.8			$	.7
	Less interest paid by discontinued operations, net of capitalized interest of $.9 in 2003					(1.2	)			(.9	)			—
					$	2.8			$	2.9			$	.7
	Income taxes paid				$	46.1			$	10.7			$	22.3
	Less income taxes paid by discontinued operations					(41.3	)			(10.7	)			(18.9	)
					$	4.8			$	—			$	3.4

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	(a)     All of the equity interests of existing stockholders of the Company would be cancelled without consideration.
	(b)     All post-petition and secured claims would either be assumed by the emerging entity or paid at emergence (see “Exit Cost” discussion below).
	(c)     Pursuant to agreements reached with salaried and hourly retirees in early 2004, in consideration for the agreed cancellation of the retiree medical plan, as more fully discussed in Note 9, KACC is making certain fixed monthly payments into Voluntary Employee Beneficiary Associations (“VEBAs”) until emergence and has agreed thereafter to make certain variable annual VEBA contributions depending on the emerging entity’s operating results and financial liquidity. In addition, upon emergence the VEBAs are entitled to receive a contribution of 66.9% of the new common stock of the emerged entity.
	(d)     The PBGC will receive a cash payment of $2.5 and 10.8% of the new common stock of the emerged entity in respect of its claims against KACOCL. In addition, as described in (f) below, the PBGC will receive shares of new common stock based on its direct claims against the Remaining Debtors (other than KACOCL) and its participation, indirectly through the KAAC/ KFC Plan in claims of KFC against KACC, which the Company currently estimates will result in the PBGC receiving an additional 5.4% of the new common stock of the emerged entity (bringing the PBGC’s total ownership percentage of the new entity to approximately 16.2%). The $2.5 cash payment discussed above is in addition to the cash amounts the Company has already paid the PBGC (see Note 9) and that the PBGC has received and will receive from the Liquidating Subsidiaries under the Liquidating Plans.

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	(e)     Pursuant to an agreement reached in early 2005, all pending and future asbestos-related personal injury claims, all pending and future silica and coal tar pitch volatiles personal injury claims and all hearing loss claims would be resolved through the formation of one or more trusts to which all such claims would be directed by channeling injunctions that would permanently remove all liability for such claims from the Debtors. The trusts would be funded pursuant to statutory requirements and agreements with representatives of the affected parties, using (i) the Debtors’ insurance assets, (ii) $13.0 in cash from KACC, (iii) 100% of the equity in a KACC subsidiary whose sole asset will be a piece of real property that produces modest rental income, and (iv) the new common stock of the emerged entity to be issued as per (f) below in respect of approximately $830.0 of intercompany claims of KFC against KACC that are to be assigned to the trust, which the Company currently estimates will entitle the trusts to receive approximately 6.4% of the new common stock of the emerged entity.
	(f)     Other pre-petition general unsecured claims against the Remaining Debtors (other than KACOCL) are entitled to receive approximately 22.3% of the new common stock of the emerging entity in the proportion that their allowed claim bears to the total amount of allowed claims. Claims that are expected to be within this group include (i) any claims of the Senior Notes, the Sub Notes and PBGC (other than the PBGC’s claim against KACOCL), (ii) the approximate $830.0 of intercompany claims that will be assigned to the personal injury trust(s) referred to in (e) above, and (iii) all unsecured trade and other general unsecured claims, including approximately $276.0 of intercompany claims of KFC against KACC. However, holders of general unsecured claims not exceeding a specified small amount will receive a cash payment equal to approximately 2.9% of their agreed claim value in lieu of new common stock. In accordance with the contractual subordination provisions of the indenture governing the Sub Notes and terms of the settlement between the holders of the Senior Notes and the holders of the Revenue Bonds, the new common stock or cash that would otherwise be distributed to the holders of the Sub Notes in respect of their claims against the Debtors would instead be distributed to holders of the Senior Notes and the Revenue Bonds on a pro rata basis based on the relative allowed amounts of their claims.

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			2004				2005
Current assets			$	2.1			$	2.3
Intercompany receivables (payables), net(1)				4.5				4.0
			$	6.6			$	6.3
Liabilities not subject to compromise—
	Current liabilities		$	3.2			$	3.9
	Long-term liabilities			1.2				1.4
Stockholders’ equity (deficit)(1)				2.2				1.0
			$	6.6			$	6.3

(1)	Intercompany receivables (payables), net and stockholders’ equity (deficit) amounts are eliminated in consolidation.

			2003				2004				2005
Costs and expenses—
	Operating costs and expenses		$	.7			$	.5			$	1.5
Operating loss				(.7	)			(.5	)			(1.5	)
All other income (expense), net				.2				.6				.4
Income tax and minority interests				.1				—				—
Equity in income of subsidiaries				—				—				—
Income (loss) from continuing operations				(.4	)			.1				(1.1	)
Discontinued operations(1)				(32.0	)			(58.1	)			—
Net loss			$	(32.4	)		$	(58.0	)		$	(1.1	)

(1)	In 2003 and 2004, the combined non-debtor subsidiary financial information included amounts attributed to Volta Aluminium Company Limited (“Valco”) and Alpart that were sold in 2004 (see Note 3). Non-debtor subsidiary activity in 2005 was nominal.

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			2003				2004				2005
Net cash provided (used) by:
Operating activities—
	Continuing operations		$	(.7	)		$	(.2	)		$	(.3	)
	Discontinued operations(1)			27.3				18.0				—
				26.6				17.8				(.3	)
Investing activities—
	Continuing operations			—				—				—
	Discontinued operations(1)			(26.5	)			(2.9	)			—
				(26.5	)			(2.9	)			—
Financing activities—
	Continuing operations			—				—				—
	Discontinued operations(1)			—				(14.6	)			—
				—				(14.6	)			—
Net decrease in cash and cash equivalents				.1				.3				(.3	)
Cash and cash equivalents, beginning of period				—				.1				.4
Cash and cash equivalents, end of period			$	.1			$	.4			$	.1

(1)	In 2003 and 2004, the combined non-debtor subsidiary financial information included amounts attributed to Volta Aluminium Company Limited (“Valco”) and Alpart that were sold in 2004 (see Note 3). Non-debtor subsidiary activity in 2005 was nominal.

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		December 31,
		2004				2005
Accrued postretirement medical obligation (Note 9)		$	1,042.1			$	1,017.0
Accrued asbestos and certain other personal injury liabilities (Note 11)			1,115.0				1,115.0
Assigned intercompany claims for benefit of certain creditors (see Reorganization Items below)			—				1,131.5
Debt (Note 7)			847.6				847.6
Accrued pension benefits (Note 9)			625.7				626.2
Unfair labor practice settlement (Note 11)			175.0				175.0
Accounts payable			29.8				29.8
Accrued interest			47.5				44.7
Accrued environmental liabilities (Note 11)			30.6				30.7
Other accrued liabilities			41.6				37.2
Proceeds from sale of commodity interests			—				(654.6	)
		$	3,954.9			$	4,400.1

(1)	Other accrued liabilities include hearing loss claims of $15.8 at December 31, 2004 and 2005 (see Note 11).
(2)	The above amounts exclude $26.4 at December 31, 2004 and $68.5 at December 31, 2005 of liabilities subject to compromise related to discontinued operations. The increase between 2004 and 2005 primarily relates to a $42.1 claim settlement in the fourth quarter of 2005 (see Note 3). The balance of the amounts at December 31, 2004 and 2005 were primarily accounts payable.

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		Years ended December 31,
		2003				2004				2005
Professional fees		$	27.5			$	39.0			$	35.2
Interest income			(.8	)			(.8	)			(2.1	)
Assigned intercompany claims for benefit of certain creditors			—				—				1,131.5
Other			.3				.8				(2.5	)
		$	27.0			$	39.0			$	1,162.1

NOTE 2—	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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			December 31,
			2004				2005
Fabricated products—
	Finished products		$	23.3			$	34.7
	Work in process			42.2				43.1
	Raw materials			27.9				26.3
	Operating, repairs and maintenance parts			11.8				11.1
				105.2				115.2
Commodities— Primary aluminum				.1				.1
			$	105.3			$	115.3

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		Year ended
		December 31,
		2003				2004				2005
Gains on sale of real estate and miscellaneous equipment associated with properties with no operations (Note 5)		$	—			$	1.8			$	—
Settlement of outstanding obligations of former affiliate			—				6.3				—
Asbestos and personal injury-related charges (Note 11)			—				(1.0	)			—
Adjustment to environmental liabilities (Note 11)			(7.5	)			(1.4	)			—
All other, net			2.3				(1.5	)			(2.4	)
		$	(5.2	)		$	4.2			$	(2.4	)

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		2003												2004												2005
						Primary												Primary												Primary
		Alumina				Aluminum								Alumina				Aluminum								Alumina				Aluminum
		Interests				Interests				Total				Interests				Interests				Total				Interests				Interests				Total
Net sales		$	637.9			$	26.8			$	664.7			$	546.0			$	.2			$	546.2			$	42.9			$	—			$	42.9
Operating income (loss)			(450.1	)			(58.2	)			(508.3	)			53.6				(59.8	)			(6.2	)			(20.7	)			.7				(20.0	)
Gain on sale of commodity interests			—				—				—				103.2				23.4				126.6				366.2				—				366.2
Income (loss) before income taxes and minority interests			(453.7	)			(57.5	)			(511.2	)			158.2				(35.7	)			122.5				363.4				.7				364.1
Net income (loss)			(459.9	)			(54.8	)			(514.7	)			142.7				(21.4	)			121.3				363.0				.7				363.7

(1)	Alumina interests for the year ended December 31, 2003 include Gramercy/ KJBC impairment charges of $368.0 (see Note 5).
(2)	Primary aluminum interests for the year ended December 31, 2004 includes impairment charges of $33.0 (Valco—Notes 2 and 5).

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(3)	Alumina interests for the year ended December 31, 2005 includes a KBC bauxite supply agreement rejection charge of $42.1 (see below).

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			December 31,
			2004				2005
Current assets			$	50.7			$	69.9
Non-current assets (primarily property, plant, and equipment, net)				36.3				52.9
	Total assets		$	87.0			$	122.8
Current liabilities			$	15.6			$	36.1
Long-term liabilities				21.6				50.1
Stockholders’ equity				49.8				36.6
	Total liabilities and stockholders’ equity		$	87.0			$	122.8

		Year ended December 31,
		2003				2004				2005
Net sales		$	205.5			$	249.2			$	266.2
Costs and expenses			(196.5	)			(223.1	)			(243.9	)
Provision for income taxes			(2.6	)			(7.4	)			(6.7	)
Net income		$	6.4			$	18.7			$	15.6
Company’s equity in income		$	3.3			$	8.2			$	4.8
Dividends received		$	4.3			$	4.5			$	9.0

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			December 31,
			2004				2005
Land and improvements			$	8.2			$	7.7
Buildings				63.8				62.4
Machinery and equipment				459.8				460.4
Construction in progress				6.1				25.0
				537.9				555.5
Accumulated depreciation				(323.3	)			(332.1	)
	Property, plant, and equipment, net		$	214.6			$	223.4

•	In January 2003, the Court approved the sale of the Tacoma facility to the Port of Tacoma (the “Port”). Gross proceeds from the sale, before considering approximately $4.0 of proceeds being held in escrow pending the resolution of certain environmental and other issues, were approximately $12.1. The Port also agreed to assume the on-site environmental remediation obligations. The sale closed in February 2003. The sale resulted in a pre-tax gain of approximately $9.5 (which amount was reflected in Other operating charges (benefits), net—see Note 6). The operating results of the Tacoma facility for 2004, 2003 and 2002 have not been reported as discontinued operations in the accompanying Statements of Consolidated Income (Loss) because such amounts were not material.
•	KACC had a long-term liability, net of estimated subleases income, on an office complex in Oakland, California, in which KACC had not maintained offices for a number of years, but for which it was responsible for lease payments as master tenant through 2008 under a sale-and-leaseback agreement. The Company also held an investment in certain notes issued by the owners of the building (which were included in Other assets). In October 2002, the Company entered into a contract to sell its interests and obligations in the office complex. As the contract amount was less than the asset’s net carrying value (included in Other assets), the Company recorded a non-cash impairment charge in 2002 of approximately $20.0 (which amount was reflected in Other operating charges (benefits), net—see Note 6). The sale was approved by the Court in February 2003 and closed in March 2003. Net cash proceeds were approximately $61.1.
•	In July 2003, with Court approval, the Company sold certain equipment at the Spokane, Washington facility that was no longer required as a part of past product rationalizations. Proceeds from the sale were approximately $7.0, resulting in a net gain of approximately $5.0 after considering sale related costs. The gain on the sale of this equipment has been netted against

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additional impairment charges of approximately $1.1 associated with equipment to be abandoned or otherwise disposed of primarily as a result of product rationalizations (which amounts were reflected in Other operating charges (benefits), net—see Note 6). The equipment that was sold in July 2003 had been previously impaired to a zero basis. The impairment was based on information available at that time and the expectation that proceeds from the eventual sale of the equipment would be fully offset by sale related costs to be borne by the Company.

•	On July 1, 2004, with Court approval, the Company completed the sale of its interests in and related to Alpart for a base purchase price of $295.0 plus certain adjustments of approximately $20.0. The transaction resulted in a gross sales price of approximately $315.0, subject to certain post-closing adjustments, and a pre-tax gain of approximately $101.6. Offsetting the cash proceeds were approximately $14.5 of payments made by KACC to fund the prepayment of KACC’s share of the Alpart-related debt (see Note 7) and $3.3 of transaction-related costs. The balance of the proceeds were held in escrow primarily for the benefit of certain creditors as provided in the AJC and KJC joint plan of liquidation (the “AJC/ KJC Plan”). In accordance with SFAS No. 144, balances and results of operations related to the Company’s interests and related to Alpart have been reported as discontinued operations in the accompanying financial statements (see Note 3). A net benefit of approximately $1.6 was recorded in December 2004 in respect of the Alpart-related purchase price adjustments. Such amounts were collected during the second quarter of 2005.
•	In May 2004, the Company entered into an agreement to sell its interests in and related to the Gramercy facility and KJBC. The sale closed on October 1, 2004 with Court approval. Net proceeds from the sale were approximately $23.0, subject to various closing and post closing adjustments. Such adjustments were insignificant. The transaction was completed at an amount approximating its remaining book value (after impairment charges). A substantial portion of the proceeds were used to satisfy transaction related costs and obligations. As previously reported, the Company had determined that the fair values of its interests in and related to Gramercy/ KJBC was below the carrying values of the assets because all offers that had been received for such assets were substantially below the carrying values of the assets. Accordingly, in the fourth quarter of 2003, KACC adjusted the carrying value of its interests in and related to Gramercy/ KJBC to the estimated fair value, which resulted in a non-cash impairment charge of approximately $368.0 (which amount was reflected in discontinued operations— see Note 3). In accordance with SFAS No. 144, the Company’s interests in and related to the Gramercy facility and KJBC have been reported as discontinued operations in the accompanying financial statements (see Note 3).
•	During 2003, the Company and Valco participated in extensive negotiations with the Government of Ghana (“GoG”) and the Volta River Authority (“VRA”) regarding Valco’s power situation and other matters. Such negotiations did not result in a resolution of such matters. However, as an outgrowth of such negotiations, the Company and the GoG entered into a Memorandum of Understanding (“MOU”) in December 2003 pursuant to which KACC would sell its 90% interest in and related to Valco to the GoG. The Company collected $5.0 pursuant to the MOU. However, a new financial agreement was reached in May 2004 and the MOU was amended. Under the revised financial terms, the Company was to retain the $5.0 already paid by the GoG and $13.0 more was to be paid by the GoG as full and final consideration for the transaction at closing. The Company also agreed to fund certain end of service benefits of Valco employees (estimated to be approximately $9.8) which the GoG was to assume under the original MOU. The agreement was approved by the Court on September 29, 2004. The sale closed on October 29, 2004. As the revised purchase price under the amended MOU was well below the Company’s recorded value for

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	Valco, the Company recorded a non-cash impairment charge of $31.8 in its first quarter 2004 financial statements to reduce the carrying value of its interests in and related to Valco at March 31, 2004 to the amount of the expected proceeds (which amount was reflected in discontinued operations— see Note 3). As a result, at closing there was no material gain or loss on disposition. In accordance with SFAS No. 144, balances and results of operations related to the Company’s interests in and related to Valco have been reported as discontinued operations in the accompanying financial statements (see Note 3).
•	In June 2004, with Court approval, the Company completed the sale of the Mead Facility for approximately $7.4 plus assumption of certain site-related liabilities. The sale resulted in net proceeds of approximately $6.2 and a pre-tax gain of approximately $23.4. The pre-tax gain includes the impact from the sale of certain non-operating land in the first quarter of 2004 that was adjacent to the Mead Facility. The pre-tax gain on the sale of this property had been deferred pending the finalization of the sale of the Mead Facility and transfer of the site-related liabilities. Proceeds from the sale of the Mead Facility totaling $4.0 were held in escrow as Restricted proceeds from sale of commodity interests until the value of the secured claim of the holders of the 7.6% solid waste disposal revenue bonds was determined by the Court (see Note 7). In accordance with SFAS No. 144, the assets, liabilities and operating results of the Mead Facility have been reported as discontinued operations in the accompanying financial statements (see Note 3).
•	In the ordinary course of business, KACC sold non-operating real estate and certain miscellaneous equipment for total proceeds of approximately $1.9. These transactions resulted in pre-tax gains of $1.8 (included in Other income (expense)— see Note 2).

•

In April 2005, the Company completed the sale of its interests in and related to QAL. Net cash proceeds from the sale total approximately $401.4. The buyer also assumed KACC’s obligations in respect of approximately $60.0 of QAL debt (see Note 4). In connection with the completion of the sale, the Company also paid a termination fee of $11.0. After considering transaction costs (including the termination fee and a $7.7 deferred charge associated with a back-up bid fee), the transaction resulted in a gain, net of estimated income tax of $7.9, of approximately $366.2. As described in Note 1, a substantial majority of the proceeds from the sale of the Company’s interests in and related to QAL were held in escrow for the benefit of KAAC’s creditors until the KAAC/ KFC Plan was confirmed by the Court (see Note 1) and became effective. In accordance with SFAS No. 144, balances and results of operations related to the Company’s interests in and related to QAL have been reported as discontinued operations in the accompanying financial statements (see Note 3).

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			Year ended December 31,
			2003				2004				2005
Charges associated with 2004 portion of deferred contribution plans implemented in 2005 (Note 9)—
	Fabricated Products		$	—			$	—			$	(6.3	)
	Corporate			—				—				(.5	)
Pension charge related to terminated pension plans— Corporate (Note 9)				(121.2	)			(310.0	)			—
Charge related to settlement with United Steelworkers of America unfair labor practice allegations—Corporate (Note 11)				—				(175.0	)			—
Settlement charge related to termination of Post-retirement medical benefits plans—Corporate (Note 9)				—				(312.5	)			—
Restructured transmission service agreement—Primary Aluminum (Note 14)				(3.2	)			—				—
Environmental multi-site settlement—Corporate (Note 11)				(15.7	)			—				—
Hearing loss claims—Corporate (Note 11)				(15.8	)			—				—
Gain on sale of Tacoma facility—Primary Aluminum (Note 5)				9.5				—				—
Gain on sale of equipment, net—Fabricated Products (Note 5)				3.9				—				—
Other				.9				4.3				(1.2	)
			$	(141.6	)		$	(793.2	)		$	(8.0	)

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			December 31,
			2004				2005
Secured:
	Post-Petition Credit Agreement		$	—			$	—
	7.6% Solid Waste Disposal Revenue Bonds due 2027			1.6				—
	Other borrowings (fixed rate)			2.4				2.3
Unsecured or Undersecured:
	97/8% Senior Notes due 2002, net			172.8				172.8
	107/8% Senior Notes due 2006, net			225.0				225.0
	123/4% Senior Subordinated Notes due 2003			400.0				400.0
	7.6% Solid Waste Disposal Revenue Bonds due 2027			17.4				17.4
	Other borrowings (fixed and variable rates)			32.4				32.4
Total				851.6				849.9
Less— Current portion				(1.2	)			(1.1	)
	Pre-Filing Date claims included in subject to compromise (i.e. unsecured debt) (Note 1)			(847.6	)			(847.6	)
Long-term debt			$	2.8			$	1.2

•	Replaced the existing post-petition credit facility with a new $200.0 post-petition credit facility (the “DIP Facility”) and
•	Included a commitment, upon the Debtors’ emergence from the Chapter 11 proceedings, for exit financing in the form of a $200.0 revolving credit facility (the “Revolving Credit Facility”) and a fully-drawn term loan (the “Term Loan”) of up to $50.0 (collectively referred to as “Exit Financing”).

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			Year ended December 31,
			2003				2004				2005
Domestic			$	(286.7	)		$	(886.1	)		$	(1,130.7	)
Foreign				14.6				24.2				20.8
	Total		$	(272.1	)		$	(861.9	)		$	(1,109.9	)

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			Federal				Foreign				State				Total
2003 Current			$	—			$	(1.3	)		$	—			$	(1.3	)
	Deferred			—				(.2	)			—				(.2	)
	Total		$	—			$	(1.5	)		$	—			$	(1.5	)
2004 Current			$	—			$	(6.4	)		$	—			$	(6.4	)
	Deferred			—				.2				—				.2
	Total		$	—			$	(6.2	)		$	—			$	(6.2	)
2005 Current			$	—			$	(3.8	)		$	.5			$	(3.3	)
	Deferred			—				.5				—				.5
	Total		$	—			$	(3.3	)		$	.5			$	(2.8	)

		Year ended December 31,
		2003				2004				2005
Amount of federal income tax benefit based on the statutory rate		$	95.2			$	301.7			$	388.5
Increase in valuation allowances			(98.1	)			(304.7	)			(379.8	)
Percentage depletion			6.4				5.1				—
Foreign taxes			(1.5	)			(6.3	)			3.9
Other			(3.5	)			(2.0	)			(15.4	)
Provision for income taxes		$	(1.5	)		$	(6.2	)		$	(2.8	)

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				December 31,
				2004				2005
Deferred income tax assets:
	Postretirement benefits other than pensions			$	396.0			$	398.9
	Loss and credit carryforwards				411.3				348.0
	Pension benefits				243.6				170.5
	Other liabilities				153.7				168.3
	Other				75.0				39.0
	Assigned intercompany claim for benefit of certain creditors				—				443.9
	Valuation allowances				(1,221.3	)			(1,527.1	)
		Total deferred income tax assets— net			58.3				41.5
Deferred income tax liabilities:
	Property, plan, and equipment				(39.0	)			(41.3	)
	Other				(22.0	)			(2.5	)
		Total deferred income tax liabilities			(61.0	)			(43.8	)
Net deferred income tax assets (liabilities)(1)				$	(2.7	)		$	(2.3	)

(1)	These deferred income tax liabilities are included in the Consolidated Balance Sheets as of December 31, 2004 and 2005, respectively, in the caption entitled Long-term liabilities.

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			Pension benefits												Medical/Life benefits
			2003				2004				2005				2003				2004				2005
Benefit obligations assumptions:
	Discount rate			6.00	%			5.75	%			5.50	%			6.00	%			5.75	%			—
	Rate of compensation increase			4.00	%			3.00	%			3.00	%			4.00	%			4.00	%			—
Net periodic benefit cost assumptions:
	Discount rate			6.00	%			5.75	%			5.75	%			6.75	%			6.00	%			—
	Expected return on plan assets			9.00	%			8.50	%			8.50	%			—				—				—
	Rate of compensation increase			4.00	%			3.00	%			3.00	%			4.00	%			4.00	%			—

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				Pension benefits								Medical/Life benefits
				2004				2005				2004				2005
Change in Benefit Obligation:
	Obligation at beginning of year			$	644.7			$	27.2			$	1,014.0			$	1,042.0
	Service cost				3.8				1.2				7.0				—
	Interest cost				28.6				1.6				58.9				—
	Curtailments, settlements and amendments				(609.6	)			(.2	)			—				—
	Actuarial (gain) loss				(37.0	)			3.4				19.1				—
	Benefits paid				(3.3	)			(1.1	)			(57.0	)			(25.0	)
		Obligation at end of year			27.2				32.1				1,042.0				1,017.0
Change in Plan Assets:
	FMV of plan assets at beginning of year				364.1				14.2				—				—
	Actual return on assets				(13.0	)			2.0				—				—
	Employer contributions				2.4				6.4				57.0				25.0
	Assets for which contributions transferred to the PBGC				(336.0	)			—				—				—
		Benefits paid			(3.3	)			(1.1	)			(57.0	)			(25.0	)
		FMV of plan assets at end of year			14.2				21.5				—				—
	Obligation in excess of plan assets				13.0				10.6				1,042.0				1,017.0
	Unrecognized net actuarial loss				(6.6	)			(9.6	)			—				—
	Unrecognized prior service costs				(.5	)			(1.1	)			—				—
	Adjustment required to recognize minimum liability				6.8				8.9				—				—
	Estimated net liability to PBGC in respect of Terminated Plans				630.0				619.0				—				—
	Intangible asset and other				1.3				1.1				—				—
		Accrued benefit liability		$	644.0			$	628.9			$	1,042.0			$	1,107.0

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			Pension benefits												Medical/Life benefits
			2003				2004				2005				2003				2004				2005
Service cost			$	10.2			$	4.7			$	1.2			$	7.1			$	7.0			$	—
Interest cost				60.7				30.8				1.6				51.3				58.9				—
Expected return on plan assets				(38.6	)			(22.9	)			(1.5	)			—				—				—
Amortization of prior service cost				3.6				2.6				.1				(22.5	)			(21.7	)			—
Amortization of net (gain) loss				16.1				5.0				.4				9.7				24.6				—
Net periodic benefit costs				52.0				20.2				1.8				45.6				68.8				—
Less discontinued operations reported separately				(15.3	)			(7.8	)			—				(11.9	)			(10.2	)			—
	Defined benefit plans			36.7				12.4				1.8				33.7				58.6				—
401K (pension)				—				—				7.2				—				—				—
			$	36.7			$	12.4			$	9.0			$	33.7			$	58.6			$	—

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•	An amount not to exceed $36.0 and payable on emergence from the Chapter 11 proceedings so long as the Company’s liquidity (i.e. cash plus borrowing availability) is at least $50.0 after considering such payments.

---

 

	To the extent that less than the full $36.0 is paid and the Company’s interests in Anglesey are subsequently sold, a portion of such sales proceeds, in certain circumstances, will be used to pay the shortfall.

•	On an annual basis, 10% of the first $20.0 of annual cash flow, as defined, plus 20% of annual cash flow, as defined, in excess of $20.0. Such annual payments shall not exceed $20.0 and will also be limited (with no carryover to future years) to the extent that the payments do not cause the Company’s liquidity to be less than $50.0.
•	Advances of $3.1 in June 2004 and $1.9 per month thereafter until the Company emerges from the Cases. Any advances made pursuant to such agreement will constitute a credit toward the $36.0 maximum contribution due upon emergence.

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		2003				2004				2005
Outstanding at beginning of year ($5.63, $3.34 and $3.14, respectively)			1,454,861				850,140				810,040
Expired or forfeited ($8.86, $7.25 and $2.49, respectively)			(604,721	)			(40,100	)			(318,920	)
Outstanding at end of year ($3.34, $3.14 and $3.57, respectively)			850,140				810,040				491,120
Exercisable at end of year ($3.34, $3.04 and $3.41, respectively)			645,659				781,856				462,936

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---

 

		2003				2004				2005
Balance at beginning of period		$	59.1			$	82.5			$	58.3
Additional accruals			25.6				8.4				.5
Less expenditures			(2.2	)			(32.6	)			(12.3	)
Balance at end of period(1)		$	82.5			$	58.3			$	46.5

(1)	As of December 31, 2004 and 2005, $30.6 and $30.7, respectively, of the environmental accrual was included in Liabilities subject to compromise (see Note 1) and the balance was included in Long-term liabilities.

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---

 

		December 31,
		2004				2005
Liability		$	1,115.0			$	1,115.0
Receivable(1)			967.0				965.5
		$	148.0			$	149.5

		Year ended
		December 31,
														Inception
		2003				2004				2005				to date
Payments made, including related legal costs		$	—			$	—			$	—			$	(355.7	)
Insurance recoveries(2)			18.6				2.7				1.5				267.7
		$	18.6			$	2.7			$	1.5			$	(88.0	)

(1)	The asbestos-related receivable was determined on the same basis as the asbestos-related cost accrual. However, no assurances can be given that KACC will be able to project similar recovery percentages for future asbestos-related claims or that the amounts related to future asbestos-related claims will not exceed KACC’s aggregate insurance coverage. Amounts are stated in nominal dollars and not discounted to present value as the Company cannot currently project the actual timing of payments or insurance recoveries particularly in light of the expected treatment of such items in any plan of reorganization that is ultimately filed. The Company believes that, as of December 31, 2005, it had received all insurance recoveries that it is likely to collect in respect of asbestos-related costs paid. See Note 1.
(2)	Excludes certain amounts paid by insurers into a separate escrow account (in respect of future settlements) more fully discussed below.

---

 

---

 

---

 

---

 

---

 

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Notional

amount of

Carrying/

contracts

market

Commodity

Period

(mmlbs)

value

Aluminum—

Option sale contracts

1/06 through 12/11

84.7

$

1.5

Fixed priced purchase contracts

1/06 through 12/06

15.7

1.1

Notional

amount of

Carrying/

contracts

market

Foreign currency

Period

(mm GBP)

value

Pounds Sterling—

Option sale contracts

1/06 through 12/07

84.0

$

3.2

Fixed priced purchase contracts

1/06 through 12/07

84.0

(4.2

)

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			Year ended December 31,
			2003				2004				2005
Net Sales:
	Fabricated Products		$	597.8			$	809.3			$	939.0
	Primary Aluminum			112.4				133.1				150.7
			$	710.2			$	942.4			$	1,089.7
Equity in income (loss) of unconsolidated affiliate:
	Primary Aluminum		$	3.3			$	8.5			$	4.8
Segment Operating Income (Loss):(1)
	Fabricated Products(2)		$	(21.2	)		$	33.0			$	87.2
	Primary Aluminum			6.7				13.9				16.4
	Corporate and Other			(74.7	)			(71.3	)			(35.8	)
	Other Operating Charges Net (Note 6)			(141.6	)			(793.2	)			(8.0	)
			$	(230.8	)		$	(817.6	)		$	59.8

(1)	In 2004 and 2005, the Company chose to reallocate for segment purposes the amount of post-retirement medical costs charged to the business units so that the Corporate segment began to incur the excess of the total expenses over the amount of VEBA contributions allocable to the Fabricated products business unit and Discontinued operations.
(2)	Operating results for 2003, 2004 and 2005 include LIFO inventory charges of $3.2, $12.1 and $9.3, respectively.

			Year ended December 31,
			2003				2004				2005
Depreciation and amortization:(1)
	Fabricated Products		$	22.8			$	21.8			$	19.6
	Primary Aluminum			1.1				.2				—
	Corporate and Other			1.8				.3				.3
			$	25.7			$	22.3			$	19.9
Capital expenditures:(2)
	Fabricated Products		$	8.9			$	7.6			$	30.6
	Corporate and Other			—				—				.4
			$	8.9			$	7.6			$	31.0

(1)	Depreciation and amortization expense excludes depreciation and amortization expense of discontinued operations of $47.5 in 2003 and $13.1 in 2004.
(2)	Capital expenditures exclude capital expenditures of discontinued operations of $28.3 in 2003 and $3.5 in 2004.

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			December 31,
			2004				2005
Investments in and advances to unconsolidated affiliate:
	Primary Aluminum		$	16.7			$	12.6
	Corporate and Other			—				—
			$	16.7			$	12.6
Segment assets:
	Fabricated Products		$	430.0			$	403.8
	Primary Aluminum			95.5				62.3
	Corporate and Other, including restricted proceeds from the sale of commodity interests in 2004 of $280.8			1,287.4				1,072.8
	Discontinued operations			69.5				—
			$	1,882.4			$	1,538.9

				Year ended
				December 31,
				2003				2004				2005
Income taxes paid:(1)
	Fabricated Products—
		United States		$	.1			$	—			$	—
		Canada			4.7				—				3.4
				$	4.8			$	—			$	3.4

(1)	Income taxes paid excludes income tax paid by discontinued operations of $41.3 in 2003, $10.7 in 2004 and $18.9 in 2005.

				Year ended December 31,
				2003				2004				2005
Net sales to unaffiliated customers:
	Fabricated Products
		United States		$	525.6			$	705.7			$	836.1
		Canada			72.2				103.6				102.9
					597.8				809.3				939.0
	Primary Aluminum
		United States			3.8				—				2.6
		United Kingdom			108.6				133.1				148.1
					112.4				133.1				150.7
				$	710.2			$	942.4			$	1,089.7

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				December 31,
				2004				2005
Long-lived assets:(1)
	Fabricated Products—
		United States		$	193.4			$	204.0
		Canada			17.8				17.6
					211.2				221.6
	Primary Aluminum—
		United Kingdom			16.7				12.6
	Corporate and Other—
		United States			3.4				2.1
				$	231.3			$	236.3

(1)	Long-lived assets include Property, plant, and equipment, net and Investments in and advances to unconsolidated affiliates. Prepared on a going-concern basis— see Note 2.
(2)	Long-lived assets excludes long-lived assets of discontinued operations of $38.9 in 2004.

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				As								As								As
				previously				As				previously				As				previously				As
				reported(1)				restated				reported(1)				restated				reported(1)				restated
				Mar. 31,				Mar. 31,				Jun. 30,				Jun. 30,				Sept. 30				Sept. 30,
				2005				2005				2005				2005				2005				2005
Net sales				$	281.4			$	281.4			$	262.9			$	262.9			$	271.6			$	271.6
Costs and expenses:
	Cost of products sold				242.2				243.0				234.2				234.4				233.7				233.5
	Depreciation and amortization				4.9				4.9				5.2				5.2				4.9				4.9
	Selling, administration, research and development, and general				17.7				12.2				17.0				12.6				17.7				13.2
	Other operating charges, net				6.2				6.2				—				—				.3				.3
		Total costs and expenses			271.0				266.3				256.4				252.2				256.6				251.9
Operating income (loss)					10.4				15.1				6.5				10.7				15.0				19.7
Other income (expense):
	Interest expense (excluding unrecorded interest expense)				(2.1	)			(2.1	)			(1.1	)			(1.1	)			(1.0	)			(1.0	)
	Reorganization items				(7.8	)			(7.8	)			(9.3	)			(9.3	)			(8.2	)			(8.2	)
	Other— net				(.4	)			(.4	)			(.6	)			(.6	)			(.5	)			(.5	)
Income (loss) before income taxes and discontinued operations					.1				4.8				(4.5	)			(.3	)			5.3				10.0
Provision for income taxes					(2.4	)			(2.4	)			(2.2	)			(2.2	)			(1.4	)			(1.4	)
Income (loss) from continuing operations					(2.3	)			2.4				(6.7	)			(2.5	)			3.9				8.6
Income (loss) from discontinued operations					10.6				10.6				368.3				368.3				8.0				8.0
Cumulative effect on years prior to 2005 of adopting accounting for conditional asset retirement obligations					(4.7	)			(4.7	)			—				—				—				—
Net income (loss)				$	3.6			$	8.3			$	361.6			$	365.8			$	11.9			$	16.6
Earnings (loss) per share—
	Basic/ Diluted:
	Income (loss) from continuing operations			$	(.03	)		$	.03			$	(.08	)		$	(.03	)		$	.05			$	.11
	Income (loss) from discontinued operations			$	.13			$	.13			$	4.62			$	4.62			$	.10			$	.10
	Loss from cumulative effect on years prior to 2005 of adopting accounting for conditional asset retirement obligations			$	(.06	)		$	(.06	)		$	—			$	—			$	—			$	—
	Net income (loss)			$	.04			$	.10			$	4.54			$	4.59			$	.15			$	.21
Weighted average shares outstanding (000):
	Basic/ Diluted				79,681				79,681				79,674				79,674				79,672				79,672

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				As								As								As
				previously				As				previously				As				previously				As
				reported(1)				restated				reported(1)				restated				reported(1)				restated
				Mar. 31,				Mar. 31,				Jun. 30,				Jun. 30,				Sept. 30				Sept. 30,
				2005				2005				2005				2005				2005				2005
Liabilities subject to compromise				$	3,952.9			$	3,946.2			$	3,950.4			$	3,938.0			$	3,949.8			$	3,931.7
Stockholders’ equity (deficit):
	Common stock				.8				.8				.8				.8				.8				.8
	Additional capital				538.0				538.0				538.0				538.0				538.0				538.0
	Accumulated deficit				(2,913.9	)			(2,909.2	)			(2,552.3	)			(2,543.4	)			(2,540.4	)			(2,526.8	)
	Accumulated other comprehensive income (loss)				(7.6	)			(5.6	)			(9.0	)			(5.5	)			(10.0	)			(5.5	)
		Total stockholders’ equity (deficit)			(2,382.7	)			(2,376.0	)			(2,022.5	)			(2,010.1	)			(2,011.6	)			(1,993.5	)
		Total liabilities and stockholders’ equity (deficit)		$	1,570.2			$	1,570.2			$	1,927.9			$	1,927.9			$	1,938.2			$	1,938.2

			As								As								As
			previously				As				previously				As				previously				As
			reported(1)				restated				reported(1)				restated				reported(1)				restated
			Mar. 31,				Mar. 31,				Jun. 30,				Jun. 30,				Sept. 30				Sept. 30,
			2005				2005				2005				2005				2005				2005
Cash flows from operating activities:
	Net income (loss)		$	3.6			$	8.3			$	365.2			$	374.1			$	377.1			$	390.7
	Less net income (loss) from discontinued operations			10.6				10.6				378.9				378.9				386.9				386.9
	Net income (loss) from continuing operations, including from cumulative effect of adopting change in accounting in 2005			(7.0	)			(2.3	)			(13.7	)			(4.8	)			(9.8	)			3.8
(Decrease) increase in prepaid expenses and other current assets				(2.5	)			.5				(1.3	)			8.0				.3				7.1
Increase (decrease) in other accrued liabilities				4.8				4.1				2.5				(3.4	)			(8.9	)			(11.8	)
Net cash impact of changes in long-term assets and liabilities				(1.0	)			(8.0	)			(.3	)			(12.6	)			2.6				(14.9	)
Net cash provided (used) by operating activities			$	(8.3	)		$	(8.3	)		$	11.3			$	11.3			$	15.1			$	15.1

---

 

(1)

The “As previously reported” amounts shown above include the effect of the adoption of FIN 47 on December 31, 2005 retroactive to the beginning of the year as discussed in Notes 2 and 4. Such retroactive application is required by GAAP and is not considered a “restatement.” The retroactive impact of the adoption of FIN 47 was a charge of $4.7 in the first quarter of 2005 in respect of the cumulative effect upon adoption and immaterial adjustments to cost of products sold in each quarter of 2005.

---

 

				Quarter ended
				March 31,				June 30,				September 30,
				(restated)(1)				(restated)(1)				(restated)(1)				December 31,
				(In millions of dollars, except share amounts)
2005
	Net sales			$	281.4			$	262.9			$	271.6			$	273.8
	Operating income (loss)				15.1				10.7				19.7				14.3
	Income (loss) from continuing operations				2.4				(2.5	)			8.6				(1,121.2	) (2)
	Income/(loss) from discontinued operations				10.6				368.3	(3)			8.0				(23.2	)
	Cumulative effect on years prior to 2005 of adopting accounting for conditional asset retirement obligations				(4.7	)			—				—				—
	Net income (loss)				8.3				365.8				16.6				(1,144.4	)
	Basic/diluted earnings (loss) per share(6)
	Income (loss) from continuing operations				.03				(.03	)			.11				(14.07	)
	Income (loss) from discontinued operations				.13				4.62				.10				(.29	)
	Loss from cumulative effect on years prior to 2005 of adopting accounting for conditional asset retirement obligations				(.06	)			—				—				—
	Net income (loss)				.10				4.59				.21				(14.36	)
	Common stock market price:(6)
		High			.12				.09				.07				.05
		Low			.05				.06				.01				.03

				Quarter ended
				March 31,				June 30,				September 30,				December 31,
2004
	Net sales			$	210.2			$	230.1			$	244.4			$	257.7
	Operating income (loss)				(10.3	)			(4.4	)			(160.5	)			(624.4	)
	Loss from continuing operations				(22.6	)			(14.8	)			(173.2	)(4)			(657.5	)(5)
	Income (loss) from discontinued operations				(41.4	)			39.0				103.7				20.0
	Net income (loss)				(64.0	)			24.2				(69.5	)			(637.5	)
	Basic/diluted earnings (loss) per share(6)
	Loss from continuing operations				(.28	)			(.19	)			(2.17	)			(8.25	)
	Income (loss) from discontinued operations				(.52	)			.49				1.30				.25
	Net income (loss)				(.80	)			.30				(.87	)			(8.00	)
	Common stock market price:(6)
		High			.15				.10				.08				.10
		Low			.08				.02				.03				.04

(1)	As more fully discussed in Note 16 of Notes to Consolidated Financial Statements, the Company has restated its financial statements for the quarters ended March 31, 2005; June 30, 2005; and September 30, 2005, to reflect a different treatment for cash payments to the VEBAs and change in accounting for derivative financial instruments.

---

 

(2)	Includes a non-cash reorganization charge of $1,131.5 related to assignment (for the purposes of determining distribution under the KAAC/ KFC Plan) of the value of an intercompany claim to certain third-party creditors (see Note 1 of Notes to Consolidated Financial Statements).
(3)	Includes a gain of approximately $366.2 in respect of the sale of the Company’s interests in and related to QAL.
(4)	Includes a non-cash pension charge of $155.5 (see Note 6 of Notes to Consolidated Financial Statements).
(5)	Includes a non-cash pension charge of $154.5, a non-cash charge related to termination of post-retirement medical benefits plan of $312.5 and a related non-cash charge of $175.0 related to a settlement with the United Steel Workers of America (see Note 6 of Notes to Consolidated Financial Statements).
(6)	Earnings (loss) per share and market price may not be meaningful because the equity interests of the Company’s existing stockholders are expected to be cancelled without consideration pursuant to the Kaiser Aluminum Amended Plan.

---

 

					December 31,
					2001				2002				2003				2004				2005
					(in millions of dollars)
Assets
Current assets:
	Cash and cash equivalents				$	154.1			$	77.4			$	35.5			$	55.4			$	49.5
	Receivables					66.8				62.5				80.5				111.0				101.5
	Inventories					138.3				103.8				92.5				105.3				115.3
	Prepaid expenses and other current assets					20.6				27.0				23.8				19.6				21.0
	Discontinued operations’ current assets					379.4				245.9				193.7				30.6				—
		Total current assets				759.2				516.6				426.0				321.9				287.3
Investments in and advances to unconsolidated affiliate						18.9				15.2				13.1				16.7				12.6
Property, plant, and equipment— net						294.4				255.3				230.1				214.6				223.4
Restricted proceeds from sale of commodity interests						—				—				—				280.8				—
Personal injury-related insurance recoveries receivable						501.2				484.0				465.4				967.0				965.5
Goodwill						11.4				11.4				11.4				11.4				11.4
Other assets						149.9				126.3				43.7				31.1				38.7
Discontinued operations’ long-term assets						1,008.7				816.6				433.8				38.9				—
		Total			$	2,743.7			$	2,225.4			$	1,623.5			$	1,882.4			$	1,538.9
Liabilities and Stockholders’ Equity
Liabilities not subject to compromise—
Current liabilities:
		Accounts payable and accruals			$	274.4			$	93.7			$	98.4			$	175.3			$	149.6
		Accrued postretirement medical benefit obligation— current portion				62.0				60.2				32.5				—				—
		Payable to affiliate				10.9				11.2				11.4				14.7				14.8
		Long-term debt— current portion				173.5				.9				1.3				1.2				1.1
		Discontinued operations’ current liabilities				282.6				167.6				177.5				57.7				2.1
			Total current liabilities			803.4				333.6				321.1				248.9				167.6
	Long-term liabilities					808.8				55.7				59.4				32.9				42.0
	Accrued postretirement medical benefit obligation					642.2				—				—				—				—
	Long-term debt					678.7				20.7				2.2				2.8				1.2

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					December 31,
					2001				2002				2003				2004				2005
					(in millions of dollars)
	Discontinued operations’ liabilities, including liabilities subject to compromise and minority interests					251.0				226.4				208.7				26.4				68.5
						3,184.1				636.4				591.4				311.0				279.3
Liabilities subject to compromise						—				2,673.9				2,770.1				3,954.9				4,400.1
Minority interests						.7				.7				.7				.7				.7
Stockholders’ equity:
		Common stock				.8				.8				.8				.8				.8
		Additional capital				539.1				539.9				539.1				538.0				538.0
		Accumulated deficit				(913.7	)			(1,382.4	)			(2,170.7	)			(2,917.5	)			(3,671.2	)
		Accumulated other comprehensive income (loss)				(67.3	)			(243.9	)			(107.9	)			(5.5	)			(8.8	)
			Total stockholders’ equity			(441.1	)			(1,085.6	)			(1,738.7	)			(2,384.2	)			(3,141.2	)
			Total		$	2,743.7			$	2,225.4			$	1,623.5			$	1,882.4			$	1,538.9

(1)	Prepared on a “going concern” basis. See Notes 1 and 2 of Notes to Consolidated Financial Statements for a discussion of the possible impact of the Cases. Also, as more fully discussed in Note 1 of Notes to Consolidated Financial Statements, the Company expects that, upon emergence from the Cases, fresh start accounting would be applied which would adversely affect comparability of the December 31, 2005 balance sheet to the balance sheet of the entity upon emergence.
(2)	The Selected Consolidated Financial Data should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and the notes thereto. The consolidated financial data has been derived from the audited consolidated financial statements.

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				Year ended December 31,
				2001				2002				2003				2004				2005
				(in millions of dollars, except share
				amounts)
Net sales				$	889.5			$	709.0			$	710.2			$	942.4			$	1,089.7
Costs and expenses:
	Cost of products sold				823.4				671.4				681.2				852.2				951.1
	Depreciation and amortization				32.1				32.3				25.7				22.3				19.9
	Selling, administrative, research and development, and general				93.7				118.6				92.5				92.3				50.9
	Other operating charges, net				30.1				31.8				141.6				793.2				8.0
		Total costs and expenses			979.3				854.1				941.0				1,760.0				1,029.9
Operating income (loss)					(89.8	)			(145.1	)			(230.8	)			(817.6	)			59.8
Other income (expense):
	Interest expense (excluding unrecorded contractual interest expense of $84.0 in 2002 and $95.0 in 2003, 2004 and 2005, respectively)				(106.2	)			(19.0	)			(9.1	)			(9.5	)			(5.2	)
	Reorganization items				—				(33.3	)			(27.0	)			(39.0	)			(1,162.1	)
	Other— net				(68.7	)			(.9	)			(5.2	)			4.2				(2.4	)
Loss before income taxes and discontinued operations					(264.7	)			(198.3	)			(272.1	)			(861.9	)			(1,109.9	)
Provision for income taxes					(523.4	)			(4.4	)			(1.5	)			(6.2	)			(2.8	)
Minority interests					(.2	)			—				—				—				—
Income (loss) from continuing operations					(788.3	)			(202.7	)			(273.6	)			(868.1	)			(1,112.7	)
Discontinued operations:
	Loss from discontinued operations, net of income taxes and minority interests				165.3				(266.0	)			(514.7	)			(5.3	)			(2.5	)
	Gain from sale of commodity interests				163.6				—				—				126.6				366.2
Income (loss) from discontinued operations					328.9				(266.0	)			(514.7	)			121.3				363.7
Cumulative effect on years prior to 2005 of adopting accounting for conditional asset retirement obligations					—				—				—				—				(4.7	)
Net loss				$	(459.4	)		$	(468.7	)		$	(788.3	)		$	(746.8	)		$	(753.7	)
Earnings (loss) per share— Basic/ Diluted: (3)
	Loss from continuing operations			$	(9.82	)		$	(2.52	)		$	(3.41	)		$	(10.88	)		$	(13.97	)
	Income (loss) from discontinued operations			$	4.09			$	(3.30	)		$	(6.42	)		$	1.52			$	4.57
	Loss from cumulative effect on years prior to 2005 of adopting accounting for conditional asset retirement obligations			$	—			$	—			$	—			$	—			$	(.06	)
	Net loss			$	(5.73	)		$	(5.82	)		$	(9.83	)		$	(9.36	)		$	(9.46	)

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			Year ended December 31,
			2001				2002				2003				2004				2005
			(in millions of dollars, except share
			amounts)
Dividends per common share			$	—			$	—			$	—			$	—			$	—
Weighted average shares outstanding (000): (3)
	Basic			80,235				80,578				80,175				79,815				79,675
	Diluted			80,235				80,578				80,175				79,815				79,675

(1)	Prepared on a “going concern” basis. See Notes 1 and 2 of Notes to Consolidated Financial Statements for a discussion of the possible impact of the Cases.
(2)	The Selected Consolidated Financial Data should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and the notes thereto. The consolidated financial data has been derived from the audited consolidated financial statements.
(3)	Earnings (loss) per share and share information may not be meaningful because, pursuant to the Kaiser Aluminum Amended Plan, the equity interests of the Company’s existing stockholders are expected to be cancelled without consideration.

---

 

				December 31,				June 30,
				2005				2006
				(unaudited)
				(in millions of dollars)
Assets
Current assets:
	Cash and cash equivalents			$	49.5			$	37.3
	Receivables:
		Trade, less allowance for doubtful receivables of $2.9 at both periods			94.6				114.1
		Other			6.9				5.7
	Inventories				115.3				123.1
	Prepaid expenses and other current assets				21.0				34.0
		Total current assets			287.3				314.2
	Investments in and advances to unconsolidated affiliate				12.6				22.7
	Property, plant, and equipment— net				223.4				242.7
	Personal injury-related insurance recoveries receivable				965.5				963.3
	Goodwill				11.4				11.4
	Other assets				38.7				43.6
		Total		$	1,538.9			$	1,597.9
Liabilities and Stockholders’ Equity (Deficit)
Liabilities not subject to compromise—
	Current liabilities:
		Accounts payable		$	51.4			$	56.1
		Accrued interest			1.0				1.1
		Accrued salaries, wages, and related expenses			42.0				37.0
		Other accrued liabilities			55.2				61.0
		Payable to affiliate			14.8				33.0
		Long-term debt— current potion			1.1				1.1
		Discontinued operations’ current liabilities			2.1				1.5
		Total current liabilities			167.6				190.8
	Long-term liabilities				42.0				49.0
	Long-term debt				1.2				1.2
	Discontinued operations’ liabilities (liabilities subject to compromise)				68.5				73.5
					279.3				314.5
Liabilities subject to compromise					4,400.1				4,388.0
Minority interests					.7				.7
Commitments and contingencies
Stockholders’ equity (deficit):
	Common stock				.8				.8
	Additional capital				538.0				538.0
	Accumulated deficit				(3,671.2	)			(3,635.3	)
	Accumulated other comprehensive income (loss)				(8.8	)			(8.8	)
		Total stockholders’ equity (deficit)			(3,141.2	)			(3,105.3	)
		Total		$	1,538.9			$	1,597.9

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				Quarter ended								Six months ended
				June 30,								June 30,
				2005				2006				2005				2006
				(restated)								(restated)
				(unaudited)
				(in millions of dollars except share and per share amounts)
Net sales				$	262.9			$	353.5			$	544.3			$	689.8
Costs and expenses:
	Cost of products sold				234.4				324.2				477.4				596.4
	Depreciation and amortization				5.2				5.0				10.1				9.8
	Selling, administrative, research and development, and general				12.6				15.0				24.8				30.3
	Other operating charges				—				.9				6.2				.9
		Total costs and expenses			252.2				345.1				518.5				637.4
Operating income					10.7				8.4				25.8				52.4
Other income (expense):
	Interest expense (excluding unrecorded contractual interest expense of $23.7 for both quarters and $47.4 for both six-month periods)				(1.1	)			—				(3.2	)			(.8	)
	Reorganization items				(9.3	)			(8.6	)			(17.1	)			(15.0	)
	Other— net				(.6	)			(.1	)			(1.0	)			1.2
Income (loss) before income taxes and discontinued operations					(.3	)			(.3	)			4.5				37.8
(Provision) benefit for income taxes					(2.2	)			.8				(4.6	)			(6.2	)
Income (loss) from continuing operations					(2.5	)			.5				(.1	)			31.6
Discontinued operations:
	Income (loss) from discontinued operations, net of income taxes				2.7				(3.0	)			13.3				4.3
	Gain from sale of commodity interests, net of income taxes of $8.5				365.6				—				365.6				—
Income (loss) from discontinued operations					368.3				(3.0	)			378.9				4.3
Cumulative effect on years prior to 2005 of adopting accounting for conditional asset retirement obligations					—				—				(4.7	)			—
Net income (loss)				$	365.8			$	(2.5	)		$	374.1			$	35.9
Earnings (loss) per share— Basic/ Diluted:
	Income (loss) from continuing operations			$	(.03	)		$	.01				—			$	.40
	Income (loss) from discontinued operations			$	4.62			$	(.04	)		$	4.75			$	.05
	Loss from cumulative effect on years prior to 2005 of adopting accounting for conditional asset retirement obligations			$	—			$	—			$	(.06	)		$	—
	Net income (loss)			$	4.59			$	(.03	)		$	4.69			$	.45
Weighted average shares outstanding (000):
	Basic/ Diluted				79,674				79,672				79,678				79,672

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															Accumulated
															other
			Common				Additional				Accumulated				comprehensive
			stock				capital				deficit				income (loss)				Total
			(restated)
			(unaudited)
			(in millions of dollars)
BALANCE, December 31, 2004			$	.8			$	538.0			$	(2,917.5	)			(5.5	)		$	(2,384.2	)
	Net income			—				—				374.1				—				374.1
	Unrealized net increase in value of derivative instruments arising during the period (including net increase in value of $.1 for the quarter ended June 30, 2005)			—				—				—				(.2	)			(.2	)
	Reclassification adjustment for net realized losses on derivative instruments included in net income (including net realized losses of $.1 for the quarter ended June 30, 2005)			—				—				—				.2				.2
	Comprehensive income (loss)																			374.1
BALANCE, June 30, 2005			$	.8			$	538.0			$	(2,543.4	)		$	(5.5	)		$	(2,010.1	)

															Accumulated
															other
			Common				Additional				Accumulated				comprehensive
			stock				capital				deficit				income (loss)				Total
			(unaudited)
			(in millions of dollars)
BALANCE, December 31, 2005			$	.8			$	538.0			$	(3,671.2	)		$	(8.8	)		$	(3,141.2	)
	Net income (same as Comprehensive income)			—				—				35.9				—				35.9
BALANCE, June 30, 2006			$	.8			$	538.0			$	(3,635.3	)		$	(8.8	)		$	(3,105.3	)

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					Six months ended
					June 30,
					2005				2006
					(restated)
					(unaudited)
					(in millions of dollars)
Cash flows from operating activities:
	Net income				$	374.1			$	35.9
	Less net income from discontinued operations					378.9				4.3
	Net income (loss) from continuing operations					(4.8	)			31.6
	Adjustments to reconcile net income (loss) from continuing operations to net cash provided by operating activities:
		Depreciation and amortization (including deferred financing costs of $2.6 and $.9, respectively)				12.7				10.7
		Loss from cumulative effect on years prior to 2005 of adopting accounting for conditional asset retirement obligations				4.7				—
		Gain on sale of real estate				—				(1.6	)
		Equity in (income) loss of unconsolidated affiliate, net of distributions				2.2				(10.1	)
		Decrease (increase) in trade and other receivables				2.0				(18.3	)
		Increase in inventories				(10.0	)			(7.8	)
		Decrease (increase) in prepaid expenses and other current assets				8.0				(14.5	)
		(Decrease) increase in accounts payable and accrued interest				(5.2	)			4.7
		(Decrease) increase in other accrued liabilities				(3.4	)			.7
		(Decrease) increase in payable to affiliate				(2.7	)			18.2
		Increase (decrease) in accrued and deferred income taxes				.6				(.5	)
		Net cash impact of changes in long-term assets and liabilities				(12.6	)			(8.0	)
		Net cash provided by discontinued operations				19.6				8.5
		Other				.2				—
		Net cash provided by operating activities				11.3				13.6
Cash flows from investing activities:
	Capital expenditures, net of accounts payable of $1.6 in 2006					(8.6	)			(28.1	)
	Net proceeds from sale of real estate					—				1.0
	Net cash provided by discontinued operations; primarily proceeds from sale of QAL in 2005					401.4				—
			Net cash provided (used) by investing activities			392.8				(27.1	)
Cash flows from financing activities:
	Financing costs, primarily DIP Facility related					(3.6	)			(.2	)
	Repayment of debt					(1.6	)			—
	Decrease (increase) in restricted cash					(3.4	)			1.5
	Net cash used by discontinued operations (primarily increase in restricted cash)					(396.6	)			—
			Net cash (used) provided by financing activities			(405.2	)			1.3
Net decrease in cash and cash equivalents during the period						(1.1	)			(12.2	)
Cash and cash equivalents at beginning of period						55.4				49.5
Cash and cash equivalents at end of period					$	54.3			$	37.3
Supplemental disclosure of class flow information:
	Interest paid, net of capitalized interest of $.2 and $1.0				$	.6			$	—
	Income taxes paid				$	12.8			$	1.2
	Less income taxes paid by discontinued operations					(10.4	)			—
					$	2.4			$	1.2

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																Pro
																forma
																opening				Subsequent
								Plan and related				Fresh start				balance				plan related				Adjusted
				Historical				adjustments				adjustments				sheet				adjustments				pro forma
Assets
Current assets:
	Cash and cash equivalents			$	37.3			$	(23.8	)(a)		$	—			$	13.5			$	23.4	(c, d)		$	36.9
	Receivables:
		Trade, less allowance for doubtful receivables			114.1				—				—				114.1				—				114.1
		Other			5.7				—				—				5.7				—				5.7
	Inventories				123.1				—				49.1	(b)			172.2				—				172.2
	Prepaid expenses and other current assets				34.0				(.3	)(a)			—				33.7				—				33.7
		Total current assets			314.2				(24.1	)			49.1				339.2				23.4				362.6
Investments in and advances to unconsolidated affiliate					22.7				—				—				22.7				—				22.7
Property, plant, and equipment—net					242.7				(.9	)(a)			55.1	(b)			296.9				—				296.9
Personal injury-related insurance recoveries receivable					963.3				(963.3	)(a)			—				—				—				—
Goodwill and other intangibles					11.4				(11.4	)(a)			39.5	(b)			39.5				—				39.5
Other assets					43.6				—				—				43.6				2.1	(d)			45.7
		Total		$	1,597.9			$	(999.7	)		$	143.7			$	741.9			$	25.5			$	767.4
Liabilities and Stockholders’ Equity
Liabilities not subject to compromise—
	Current liabilities:
		Accounts payable		$	56.1			$	(6.0	)(a)		$	—			$	50.1			$	—				50.1
		Accrued interest			1.1				(1.1	)(a)			—				—				—				—
		Accrued salaries, wages, and related expenses			37.0				(3.9	)(a)			(.2	)(b)			32.9				(4.5	)(c)			28.4
		Other accrued liabilities			61.0				5.8	(a)			—				66.8				(20.0	)(c)			46.8
		Payable to affiliate			33.0				—				—				33.0				—				33.0
		Long-term debt— current portion			1.1				(1.1	)(a)			—				—				—				—

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																Pro
																forma
																opening				Subsequent
								Plan and related				Fresh start				balance				plan related				Adjusted
				Historical				adjustments				adjustments				sheet				adjustments				pro forma
		Discontinued operations’ current liabilities			1.5				—				—				1.5				—				1.5
		Total current liabilities			190.8				(6.3	)			(.2	)			184.3				(24.5	)			159.8
	Long-term liabilities				49.0				20.1	(a)			38.5	(b, e)			107.6				—				107.6
	Long-term debt				1.2				(1.2	)(a)			—				—				50.0	(d)			50.0
	Discontinued operations’ liabilities (liabilities subject to compromise)				73.5				(73.5	)(a)			—				—				—				—
					314.5				(60.9	)			38.3				291.9				25.5				317.4
Liabilities subject to compromise					4,388.0				(4,388.0	)(a)			—				—				—				—
Minority Interests					.7				(.7	)(a)			—				—				—				—
Commitments and contingencies
Stockholders’ equity:
	Common stock				.8				(.6	)(a)			—				.2				—				.2
	Additional capital				538.0				—				(88.2	)(b)			449.8				—				449.8
	Accumulated deficit				(3,635.3	)			3,450.5	(a)			184.8	(b)			—				—				—
	Accumulated other comprehensive income (loss)				(8.8	)							8.8	(b)			—				—				—
		Total stockholders’ equity (deficit)			(3,105.3	)			3,449.9				105.4				450.0				—				450.0
		Total		$	1,597.9			$	(999.7	)		$	143.7			$	741.9			$	25.5			$	767.4

(a)	Reflects impacts on the Effective Date of implementing the Plan including the settlement of liabilities subject to compromise and related payments and distributions of cash and new shares of common stock and the cancellation of predecessor common stock (see Note 2).
(b)	Reflects the estimated adjustments to reflect “Fresh Start” reporting. These include the write up of Inventories and Property, plant and equipment to their appraised values and the elimination of accumulated deficits and additional paid in capital. The fresh start adjustments for intangible assets and stockholders’ equity are based on a not yet finalized third party appraisal report and are, therefore, subject to change. Such changes could be significant. Additionally, the pro forma adjustments assume that the Company does not meet the “more likely than not” criteria for recognition of net operating loss carryforwards (more fully discussed in Note 10).

(c)	Reflects the payments for accrued but unpaid professional fees ($15.0), the Company’s share of certain success fees ($5.0) as well as the initial payment of accrued long-term incentive related to the Key Employee Retention Plan. See Notes 2 and 15 for additional discussion of these items.

(d)	Reflects a new revolving credit facility including payment of certain fees totaling $2.1 and term loan borrowings of $50.0 (see Note 9). Approximately $1.6 of the fees were paid on the Effective Date. The balance of the fees were paid in early August 2006, when the term loan proceeds were received.

(e)	Includes an estimated $45.0 in respect of the Company’s annual variable VEBA obligation based on an estimate of the discounted cash payments projected in calculating the reorganization value. An actuary analysis computing the amount of the obligation based on treating it as a defined

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	benefit plan with a cap (see Note 11) has not been completed. As such this amount is subject to change.

•	the Company owns directly 100% of the issued and outstanding shares of capital stock of Kaiser Aluminum Investments Company, a newly-formed Delaware corporation (“KAIC”), which is intended to function as an intermediate holding company.
•	KAIC owns 49% of the ownership interests of Anglesey Aluminium Limited and 100% of the ownership interests of each of:

	-	Kaiser Aluminum Fabricated Products, LLC, a newly-formed Delaware limited liability company (“KAFP”), which holds the assets and liabilities associated with the Company’s fabricated products business unit (excluding those assets and liabilities associated with the London, Ontario facility);
	-	Kaiser Aluminum Canada Limited, a newly-formed Ontario corporation (“KACL”), which holds the assets and liabilities of the London, Ontario operations and certain former KACC Canadian subsidiaries that were largely inactive;
	-	Kaiser Aluminum & Chemical Corporation, LLC, a newly-formed Delaware limited liability company (“KACC, LLC”), which, as a successor by merger, holds the remaining non-operating assets and liabilities of KACC not assumed by KAFP;
	-	Kaiser Aluminium International, Inc., Trochus Insurance Co., Ltd., and Kaiser Bauxite Company

NOTE 2—	REORGANIZATION PROCEEDINGS OF PREDECESSOR

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	(a)	Claims in Respect of Retiree Medical Obligations. Pursuant to settlements reached with representatives of hourly and salaried retirees:

	•	an aggregate of 11,439,900 shares of the Company’s common stock, par value $0.01 per share, (the “Common Stock”) were delivered to a voluntary employees’ beneficiary association (“VEBA”) trust that provides benefits for certain eligible retirees of KACC represented by the United Steelworkers (the “USW”) and certain other unions and their surviving spouses and eligible dependents (the “Union VEBA”) and entities that prior to the Effective Date acquired from the Union VEBA rights to receive a portion of such shares; and
	•	an aggregate of 1,940,100 shares of Common Stock were delivered to a VEBA trust that provides benefits for certain eligible retirees of KACC and their surviving spouses and eligible dependents (the “Salaried Retiree VEBA” and, together with the Union VEBA, the “VEBAs”) and entities that prior to the Effective Date acquired from the Salaried Retiree VEBA rights to receive a portion of such shares.

	(b)	Priority Claims and Secured Claims. All pre-petition priority claims, pre-petition priority tax claims and pre-petition secured claims were paid in full in cash.

	(c)	Unsecured Claims. With respect to pre-petition unsecured claims (other than the personal injury claims specified below):

	•	all pre-petition unsecured claims of the PBGC against the Company’s Canadian debtor affiliates were satisfied by the delivery of 2,160,000 shares of Common Stock and $2.5 in cash; and
	•	all pre-petition general unsecured claims against the Company, KACC and their remaining debtor subsidiaries, other than Canadian debtor subsidiaries, including claims of the PBGC and holders of public debt, were satisfied by the issuance of 4,460,000 shares of Common Stock to a third-party disbursing agent, with such shares to be delivered to the holders of such claims in accordance with the terms of the Plan (to the extent that such claims do not

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		constitute convenience claims that have been or will be satisfied with cash payments). Of such 4,460,000 shares of Common Stock, approximately 331,000 shares are being held by the third-party disbursing agent as a reserve pending resolution of disputed claims; to the extent a holder of a disputed claim is not entitled to shares reserved in respect of such claim, such shares will be distributed to holders of allowed claims.

(d) Personal Injury Claims. Certain trusts (the “PI Trusts”) were formed to receive distributions from the Company, assume responsibility from the Company for present and future personal injury liabilities (including those resulting from alleged pre-petition exposures to asbestos, silica and coal tar pitch volatiles and noise-induced hearing loss), and to make payments in respect of such personal injury claims. The Company contributed to the PI Trusts:

	•	the rights with respect to proceeds associated with personal injury-related insurance recoveries that were reflected on the Company’s financial statements at June 30, 2006 as a receivable having a value of $963.3 (see Note 12);
	•	$13.0 in cash, less approximately $.3 advanced prior to the Effective Date, which was paid on the Effective Date;
	•	the stock of a subsidiary whose primary assets was approximately 145 acres of real estate located in Louisiana and the rights as lessor under a lease agreement for such real property that produces modest rental income; and
	•	75% of a pre-petition general unsecured claim against KACC in the amount of $1.1 billion entitling certain of the PI Trusts to a share of the 4,460,000 shares of Common Stock distributed to unsecured claimholders.

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•	liabilities incurred after the date each entity filed for reorganization;
•	pre-Filing Date liabilities that are or were expected to be paid in full, including priority tax and employee claims and certain environmental liabilities; and
•	pre-Filing Date liabilities that were approved for payment by the Bankruptcy Court and that are or were expected to be paid (in advance of a plan of reorganization) over the next twelve-month period in the ordinary course of business, including certain employee related items (salaries, vacation and medical benefits), claims subject to a currently existing collective bargaining agreements, and certain postretirement medical and other costs associated with retirees.

---

 

		December 31,				June 30,
		2005(1)				2006(1)
Accrued postretirement medical obligation (Note 11)		$	1,017.0			$	1,005.6
Accrued asbestos and certain other personal injury liabilities (Note 12)			1,115.0				1,115.0
Assigned intercompany claims for benefit of certain creditors			1,131.5				1,131.5
Debt (Note 9)			847.6				847.6
Accrued pension benefits (Note 11)			626.2				625.5
Unfair labor practice settlement (Note 12)			175.0				175.0
Accounts payable			29.8				31.6
Accrued interest			44.7				44.7
Accrued environmental liabilities (Note 12)			30.7				29.4
Other accrued liabilities			37.2				36.7
Proceeds from sale of commodity interests			(654.6	)			(654.6	)
		$	4,400.1			$	4,388.0

(1)

The above amounts exclude $68.5 at December 31, 2005 and $73.5 at June 30, 2006 of liabilities subject to compromise related to discontinued operations. Approximately $42.1 of the excluded amounts at December 31, 2005 and June 30, 2006 relate to a claim settled in the fourth quarter of 2005 (see Note 7). The balance of the amounts at December 31, 2005 and June 30, 2006 were primarily accounts payable.

		Quarter ended								Six months
		June 30,								ended June 30,
		2005				2006				2005				2006
Professional fees		$	12.5			$	9.2			$	20.5			$	16.2
Interest income			(.5	)			(.7	)			(.8	)			(1.4	)
Other			(2.7	)			.1				(2.6	)			.2
		$	9.3			$	8.6			$	17.1			$	15.0

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		December 31,				June 30,
		2005				2006
Current assets		$	2.3			$	2.6
Intercompany receivables (payables), net(1)			4.0				4.1
		$	6.3			$	6.7
Liabilities not subject to compromise— Current liabilities		$	3.9			$	3.5
Long-term liabilities			1.4				1.2
Stockholders’ equity (deficit)(1)			1.0				2.0
		$	6.3			$	6.7

(1)	Intercompany receivables (payables), net and stockholders’ equity (deficit) amounts are eliminated in consolidation.

		Quarter								Six months
		ended								ended
		June 30,								June 30,
		2005				2006				2005				2006
Costs and expenses— Operating costs and expenses		$	.6			$	.2			$	.7			$	(.1	)
Operating income (loss)			(.6	)			(.2	)			(.7	)			.1
All other income (expense), net			.1				.2				.1				.3
Income (loss) from continuing operations			(.5	)			—				(.6	)			.4
Discontinued operations			—				—				—				—
Net income (loss)		$	(.5	)		$	—			$	(.6	)		$	.4

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			Six months
			ended
			June 30,
			2005				2006
Net cash provided (used) by:
Operating activities—
	Continuing operations		$	(.3	)		$	—
	Discontinued operations			—				—
				(.3	)			—
Financing activities—
	Continuing operations			—				.2
	Discontinued operations			—				—
				—				.2
Net increase (decrease) in cash and cash equivalents				(.3	)			.2
Cash and cash equivalents, beginning of period				.4				.4
Cash and cash equivalents, end of period			$	.1			$	.6

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---

 

---

 

---

 

---

 

			December 31,				June 30,
			2005				2006
Fabricated products—
	Finished products		$	34.7			$	31.9
	Work in process			43.1				40.4
	Raw materials			26.3				39.4
	Operating supplies and repairs and maintenance parts			11.1				10.8
				115.2				122.5
Commodities— Primary aluminum				.1				.6
			$	115.3			$	123.1

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				Quarter								Six months
				As								As
				previously				As				previously				As
				reported(1)				restated				reported(1)				restated
				June 30,				June 30,				June 30,				June 30,
				2005				2005				2005				2005
Net sales				$	262.9			$	262.9			$	544.3			$	544.3
Costs and expenses:
	Cost of products sold				234.2				234.4				476.4				477.4
	Depreciation and amortization				5.2				5.2				10.1				10.1
	Selling, administrative, research and development, and general				17.0				12.6				34.7				24.8
	Other operating charges, net				—				—				6.2				6.2
		Total costs and expenses			256.4				252.2				527.4				518.5
Operating income					6.5				10.7				16.9				25.8
Other income (expense):
	Interest expense (excluding unrecorded interest expense)				(1.1	)			(1.1	)			(3.2	)			(3.2	)
	Reorganization items				(9.3	)			(9.3	)			(17.1	)			(17.1	)
	Other— net				(.6	)			(.6	)			(1.0	)			(1.0	)
Income (loss) before income taxes and discontinued operations					(4.5	)			(.3	)			(4.4	)			4.5
Provision for income taxes					(2.2	)			(2.2	)			(4.6	)			(4.6	)
Loss from continuing operations					(6.7	)			(2.5	)			(9.0	)			(.1	)
Income from discontinued operations					368.3				368.3				378.9				378.9
Cumulative effect on years prior to 2005 of adopting accounting for conditional asset retirement obligations					—				—				(4.7	)			(4.7	)
Net income				$	361.6			$	365.8			$	365.2			$	374.1
Earnings (loss) per share— Basic/ Diluted:
	Loss from continuing operations			$	(.08	)		$	(.03	)		$	(.11	)		$	—
	Income from discontinued operations			$	4.62			$	4.62			$	4.75			$	4.75
	Loss from cumulative effect on years prior to 2005 of adopting accounting for conditional asset retirement obligations			$	—			$	—			$	(.06	)		$	(.06	)
	Net income			$	4.54			$	4.59			$	4.58				4.69
Weighted average shares outstanding (000):
	Basic/ Diluted				79,674				79,674				79,678				79,678

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				As
				previously				As
				reported(1)				restated
				June 30,				June 30,
				2005				2005
Liabilities subject to compromise				$	3,950.4			$	3,938.0
Stockholders’ equity (deficit):
	Common stock				.8				.8
	Additional capital				538.0				538.0
	Accumulated deficit				(2,552.3	)			(2,543.4	)
	Accumulated other comprehensive income (loss)				(9.0	)			(5.5	)
		Total stockholders’ equity (deficit)			(2,022.5	)			(2,010.1	)
		Total liabilities and stockholders’ equity (deficit)		$	1,927.9			$	1,927.9

			As
			previously				As
			reported(1)				restated
			June 30,				June 30,
			2005				2005
Cash flows from operating activities:
	Net income		$	365.2			$	374.1
	Less net income from discontinued operations			378.9				378.9
	Net income (loss) from continued operations, including from cumulative effect of adopting change in accounting in 2005			(13.7	)			(4.8	)
(Decrease) increase in prepaid expenses and other current assets				(1.3	)			8.0
Increase in other accrued liabilities				2.5				(3.4	)
Net cash impact of changes in long-term assets and liabilities				(.3	)			(12.6	)
Net cash used by operating activities			$	11.3			$	11.3

(1)

The “As previously reported” amounts shown above include the effect of the adoption of FIN 47 on December 31, 2005 retroactive to the beginning of the year as discussed in Note 5. Such retroactive application is required by GAAP and is not considered a “restatement.” The retroactive impact of the adoption of FIN 47 was a charge of $4.7 in the first quarter of 2005 in respect of the cumulative effect upon adoption.

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		Quarter ended								Six months ended
		June 30,								June 30,
		2005				2006				2005				2006
Net sales		$	—			$	—			$	42.9			$	—
Operating income (loss)			(.2	)			(3.2	)			11.2				(3.2	)
Gain on sale of commodity interests			365.6				—				365.5				—
Income (loss) before income taxes			369.9				(3.2	)			383.1				4.3
Net income (loss)			368.3				(3.0	)			378.9				4.3

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			December 31,				June 30,
			2005				2006
Land and improvements			$	7.7			$	7.9
Buildings				62.4				62.5
Machinery and equipment				460.4				461.3
Construction in progress				25.0				50.3
				555.5				582.0
Accumulated depreciation				(332.1	)			(339.3	)
	Property, plant, and equipment, net		$	223.4			$	242.7

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			December 31,				June 30,
			2005				2006
Secured:
	Post-Petition Credit Agreement		$	—			$	—
	Other borrowings (fixed rate)			2.3				2.3
Unsecured or Undersecured:
	97/8% Senior Notes due 2002, net			172.8				172.8
	107/8% Senior Notes due 2006, net			225.0				225.0
	123/4% Senior Subordinated Notes due 2003			400.0				400.0
	7.6% Solid Waste Disposal Revenue Bonds due 2007			17.4				17.4
	Other borrowings (fixed and variable rates)			32.4				32.4
Total				849.9				849.9
Less— Current portion				(1.1	)			(1.1	)
	Pre-Filing Date claims included in subject to compromise (i.e. unsecured debt) (Note 2)			(847.6	)			(847.6	)
Long-term debt			$	1.2			$	1.2

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•	A commitment to provide one or more defined contribution plan(s) as a replacement for the five defined benefit pension plans for hourly bargaining unit employees at four of the Company’s production facilities and one inactive operation (the “Hourly DB Plans”) that will, as more fully discussed in Note 12, be terminated pursuant to a court ruling received in July 2006. It is anticipated that the replacement defined contribution plans for the production facilities will provide for an annual contribution of one dollar per hour worked by bargaining unit employee and, in certain instances, will include for certain matching of contributions.
•	A defined contribution savings plan for hourly bargaining unit employees (the “Hourly DC Plan”) at all of the Company’s other production facilities (not covered by the Hourly DB Plans). Pursuant to the terms of Hourly DC Plan, the Company will be required to make annual contributions to the Steelworkers Pension Trust on the basis of one dollar per USW employee hour worked at two facilities. The Company will also be required to make contributions to a defined contribution

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	savings plan for active USW employees that will range from eight hundred dollars to twenty-four hundred dollars per employee per year, depending on the employee’s age. Similar defined contribution savings plans have been established for non-USW hourly employees subject to collective bargaining agreements. The Company currently estimates that contributions to all such plans will range from $3.0 to $6.0 per year.
•	A defined contribution savings plan for salaried and non-bargaining unit hourly employees (the “Salaried DC Plan”) providing for a match of certain contributions made by employees plus a contribution of between 2% and 10% of their salary depending on their age and years of service.
•	An annual variable cash contribution to the VEBAs. The amount to be contributed to the VEBAs will be 10% of the first $20.0 of annual cash flow (as defined; in general terms, the principal element of cash flow are earnings before interest expense, provision for income taxes and depreciation and amortization less cash payments for, among other things, interest, income taxes and capital expenditures), plus 20% of annual cash flow, as defined, in excess of $20.0. Such annual payments will not exceed $20.0 and will also be limited (with no carryover to future years) to the extent that the payments would cause the Company’s liquidity to be less than $50.0. Such amounts will be determined on an annual basis and payable no later than March 31st of the following year. However, the Company has the ability to offset amounts that would otherwise be due to the VEBAs with approximately $12.7 of excess contributions made to the VEBAs prior to the Effective Date. There was a provision that allowed for the VEBAs to request certain advances of up to $8.5 during the first two years after the Effective Date, but, pursuant to an agreement between the VEBAs and the Department of Labor, the VEBAs have indicated that they do not intend to exercise such rights.
•	A short term incentive compensation plan for management payable in cash and which is based primarily on earnings, adjusted for certain safety and performance factors. Most of the Company’s locations also have similar programs for both hourly and salaried employees.
•	A stock based long term incentive plan for key managers. As more fully discussed in Note 15 an initial, emergence-related award was made under this plan. Additional awards are expected to be made in future years.

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		Quarter								Six months
		ended								ended
		June 30,								June 30,
		2005				2006				2005				2006
Service cost		$	.2			$	.3			$	.5			$	.6
Interest cost			.3				.3				.6				.7
Expected return on plan assets			(.3	)			(.4	)			(.5	)			(.8	)
Amortization of prior service cost			.1				.1				.1				.1
Amortization of net (gain) loss			.1				.1				.1				.2
Defined benefit plans			.4				.4				.8				.8
401K			1.7				1.9				3.4				4.1
		$	2.1			$	2.3			$	4.2			$	4.9

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			Quarter								Six months
			ended								ended
			June 30,								June 30,
			2005				2006				2005				2006
Cost of products—
	Fabricated products segment		$	1.4			$	1.6			$	2.8			$	3.4
Selling, administrative, research and development and general expense—
	Fabricated products segment			.2				.1				.3				.3
	Corporate segment			.1				.2				.3				.4
Other operating charges (Note 13)				—				—				5.6				—
			$	1.7			$	1.9			$	9.0			$	4.1

•	an amount not to exceed $36.0 and payable on emergence from the Chapter 11 proceedings so long as the Company’s liquidity (i.e. cash plus borrowing availability) was at least $50.0 after considering such payments; and
•	advances of $3.1 in June 2004 and $1.9 per month thereafter until the Company emerged from the Chapter 11 proceedings. Any advances made pursuant to such agreement constitute a credit toward the $36.0 maximum contribution due upon emergence.

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NOTE 12—	COMMITMENTS AND CONTINGENCIES

---

 

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		December 31,				June 30,
		2005				2006
Liability		$	1,115.0			$	1,115.0
Receivable(1)			965.5				963.3
		$	149.5			$	151.7

(1)

The asbestos-related receivable was determined on the same basis as the asbestos-related cost accrual. Amounts are stated in nominal dollars and not discounted to present value as the Company could not reasonably project the actual timing of payments or insurance recoveries particularly in light of the Plan. The Company believes that, as of June 30, 2006, it had received all insurance recoveries that it is likely to collect in respect of asbestos-related costs paid. See Note 2.

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Notional

amount of

Carrying/

contracts

market

Commodity

Period

(mmlbs)

value

Aluminum—

Option sale contracts

1/11 through 12/11

48.9

$

5.7

Fixed priced purchase contracts

7/06 through 12/07

58.7

(.7

)

Fixed priced sales contracts

1/07 through 12/09

43.1

(2.8

)

Notional

amount of

Carrying/

contracts

market

Foreign currency

Period

(mm)

value

Pounds Sterling—

Option sale contracts

7/06 through 12/07

63.0

$

.2

Fixed priced purchase contracts

7/06 through 12/07

63.0

5.9

Euro Dollars—

Fixed priced purchase contracts

7/06 through 1/08

5.7

.1

Notional

amount of

Carrying/

contracts

market

Energy

Period

(mmbta)

value

Natural Gas—

Fixed priced purchase contracts(a)

7/06 through 6/07

1,180,000

$

(1.1

)

(a)	When the hedges in place as of June 30, 2006 are combined with price limits in the Company’s physical supply agreement, the Company’s exposure to increases in natural gas prices has been

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	substantially limited for approximately 19% of the natural gas purchases for July 2006 through September 2006, approximately 11% of the natural gas purchases for October 2006 through December 2006 and approximately 15% of the natural gas purchases for January 2007 through March 2007.

•	Approximately 517,000 shares of restricted Common Stock were issued to executive officers and other key employees. Approximately 480,000 of the shares of restricted Common Stock are subject to a three year cliff vesting requirement that lapses on July 6, 2009. The remainder vest ratably over a three year period. Pursuant to SFAS No 123-R, the grants will result in the Company recognizing non-cash compensation expense during the three year period on a roughly ratable basis. Total compensation expense over the three year vesting period, subject to forfeitures, is expected to be in the range of $20.0-$23.0.
•	The Company’s board of directors terminated the Company’s supplemental employee retirement plan (the “SERP” more fully described below) and funded payments totaling approximately $2.3. The SERP has been replaced by a non-qualified defined contribution plan (the “Restoration Plan”) and will restore certain benefits for key employees who would suffer a loss of benefits under the Company’s defined contribution plan were it not for the limitations imposed by the Internal Revenue Code.
•	The Company paid $.5 in July 2006 to certain officers in respect of deferred retention payments. During August 2006, the Company expects to pay $4.8 in respect of the pre-emergence long term incentive plan. Another $4.7 of long term incentive payments is due in July 2007.
•	Certain employment agreements between the Company and members of management became effective. Additionally, other members of management continue to retain certain pre-emergence contractual arrangements. In particular, the terms of the severance and change in control agreements implemented as a part of the key employee retention plan (the “KERP”) survive after the Effective Date for a period of one year and two years, respectively, unless superseded by another agreement.

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•	Pursuant to the retention plan, retention payments were paid between September 2002 and March 31, 2004, except that 50% of the amounts payable to certain senior officers were withheld until the Company’s emergence from Chapter 11 proceedings or as otherwise agreed pursuant to the KERP (see Successor discussion above).
•	The severance and change in control plans generally provided for severance payments of between six months and three years of salary and certain benefits, depending on the facts and circumstances and the level of employee involved (see Successor discussion above).
•	The completion incentive plan lapsed without any amounts being due.
•	The SERP generally provided additional non-qualified pension benefits for certain active employees at the time that the KERP was approved, who would suffer a loss of benefits based on Internal Revenue Code limitations, so long as such employees were not subsequently terminated for cause or voluntarily terminated their employment prior to reaching their retirement age.
•	The long-term incentive plan generally provided for incentive awards to key employees based on an annual cost reduction target. Payment of such long-term incentive awards generally will be made: (a) 50% upon emergence and (b) 50% one year from the date the Debtors emerged from the Chapter 11 proceedings. At June 30, 2006, approximately $9.5 was accrued in respect of the KERP long-term incentive plan.

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				Quarter ended								Six months ended
				June 30,								June 30,
				2005				2006				2005				2006
Net Sales:
	Fabricated Products			$	227.4			$	302.9			$	471.8			$	590.9
	Primary Aluminum				35.5				50.6				72.5				98.9
				$	262.9			$	353.5			$	544.3			$	689.8
Segment Operation Income (Loss):
	Fabricated Products(1)			$	15.2			$	16.2			$	40.6			$	61.2
	Primary Aluminum				5.4				3.7				8.2				12.4
	Corporate and Other				(9.9	)			(10.6	)			(16.8	)			(20.3	)
	Other Operating Charges (Note 14)				—				(.9	)			(6.2	)			(.9	)
				$	10.7			$	8.4			$	25.8			$	52.4
Depreciation and amortization:
	Fabricated Products			$	5.0			$	5.0			$	9.9			$	9.7
	Corporation and Other				.2				—				.2				.1
				$	5.2			$	5.0			$	10.1			$	9.8
Income taxes paid:(2)
	Fabricated Products—
		United States		$	—			$	.2			$	—			$	.2
		Canada			.6				.6				2.4				1.0
				$	.6			$	.8			$	2.4			$	1.2

(1)	Operating results for the quarter and six-month periods ended June 30, 2006 include a LIFO inventory charge of $21.7.
(2)	Income taxes paid exclude foreign income tax paid by discontinued operations of $1.7 and $10.4 for the quarter and six-month periods ended June 30, 2005.

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Securities and Exchange Commission registration fee			$	11,929
NASD filing fee				11,649
Accounting fees and expenses				*
Legal fees and expenses				*
Printing and engraving expenses				*
Transfer agent and registrar fees and expenses				*
Miscellaneous expenses				*
	Total			*

*	To be provided by amendment.

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•	indemnify, defend and hold harmless the director or officer to the fullest extent permitted or required by Delaware law, except that, subject to certain exceptions, the director or officer will be indemnified with respect to a claim initiated by such director or officer against the Company or any other director or officer of the Company only if the Company has joined in or consented to the initiation of such claim;
•	advance prior to the final disposition of any indemnifiable claim any and all expenses relating to, arising out of or resulting from any indemnifiable claim paid or incurred by the director or officer or which the director or officer determines is reasonably likely to be paid or incurred by him or her; and
•	utilize commercially reasonable efforts to cause to be maintained in effect policies of directors’ and officers’ liability insurance providing coverage that is at least substantially comparable in scope and amount to that provided by the Company’s policies of directors’ and officers’ liability insurance at the time the parties enter into such indemnification agreement.

Number				Exhibit title
	1	.1		Form of Underwriting Agreement.*
	2	.1		Purchase Agreement, dated as of May 17, 2004, among Kaiser Aluminum & Chemical Corporation (“KACC”), Kaiser Bauxite Company (“KBC”), Gramercy Alumina LLC and St. Ann Bauxite Limited (incorporated by reference to Exhibit 2.1 to the Report on Form 8-K, dated as of October 1, 2004, filed by Kaiser Aluminum Corporation (“KAC”)).
	2	.2		Purchase Agreement, dated as of October 29, 2004, between KACC and the Government of the Republic of Ghana (incorporated by reference to Exhibit 2.1 to the Report on Form 8-K, dated as of October 29, 2004, filed by KAC).

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Number				Exhibit title
	2	.3		Purchase Agreement, dated as of October 28, 2004, among KACC, Kaiser Alumina Australia Corporation (“KAAC”) and Alumina & Bauxite Company Ltd. (incorporated by reference to Exhibit 2.5 to the Report on Form 10-Q for the quarterly period ended September 30, 2004, filed by KAC).
	2	.4		Third Amended Joint Plan of Liquidation for Alpart Jamaica Inc. (“AJI”) and Kaiser Jamaica Corporation (“KJC”), dated February 25, 2005 (incorporated by reference to Exhibit 99.1 to the Report on Form 10-K for the period ended December 31, 2004, filed by KAC).
	2	.5		Modification to the Third Amended Joint Plan of Liquidation for AJI and KJC, dated April 7, 2005 (incorporated by reference to Exhibit 2.2 to the Report Form 8-K dated December 19, 2005, filed by KAC).
	2	.6		Second Modification to the Third Amended Joint Plan of Liquidation for AJI and KJC, dated November 22, 2005 (incorporated by reference to Exhibit 2.3 to the Report Form 8-K dated December 19, 2005, filed by KAC).
	2	.7		Third Modification to the Third Amended Joint Plan of Liquidation for AJI and KJC, dated December 19, 2005 (incorporated by reference to Exhibit 2.4 to the Report Form 8-K dated December 19, 2005, filed by KAC).
	2	.8		Third Amended Joint Plan of Liquidation for KAAC and Kaiser Finance Corporation (“KFC”), dated February 25, 2005 (incorporated by reference to Exhibit 99.3 to the Report on Form 10-K for the period ended December 31, 2004, filed by KAC).
	2	.9		Modification to the Third Amended Joint Plan of Liquidation for KAAC and KFC, dated April 7, 2005 (incorporated by reference to Exhibit 2.6 to the Report on Form 8-K dated December 19, 2005, filed by KAC).
	2	.10		Second Modification to the Third Amended Joint Plan of Liquidation for KAAC and KFC, dated November 22, 2005 (incorporated by reference to Exhibit 2.7 to the Report on Form 8-K dated December 19, 2005, filed by KAC).
	2	.11		Third Modification to the Third Amended Joint Plan of Liquidation for KAAC and KFC, dated December 19, 2005 (incorporated by reference to Exhibit 2.8 to the Report on Form 8-K dated December 19, 2005, filed by KAC).
	2	.12		Second Amended Joint Plan of Reorganization for KAC, KACC and Certain of Their Debtor Affiliates, dated as of September 7, 2005 (incorporated by reference to Exhibit 99.2 to the Report on Form 8-K, dated as of September 8, 2005, filed by KAC).
	2	.13		Modifications to the Second Amended Joint Plan of Reorganization for KAC, KACC and Certain of Their Debtor Affiliates Pursuant to Stipulation and Agreed Order between Insurers, Debtors, Committee and Future Representatives (incorporated by reference to Exhibit 2.2 to the Report on Form 8-K, dated as of February 1, 2006, filed by KAC).
	2	.14		Modification to the Second Amended Joint Plan of Reorganization for KAC, KACC and Certain of Their Debtor Affiliates, dated as of November 22, 2005 (incorporated by reference to Exhibit 2.3 to the Report on Form 8-K, dated as of February 1, 2006, filed by KAC).
	2	.15		Third Modification to the Second Amended Joint Plan of Reorganization for KAC, KACC and Certain of Their Debtor Affiliates, dated as of December 16, 2005 (incorporated by reference to Exhibit 2.4 to the Report on Form 8-K, dated as of February 1, 2006, filed by KAC).
	2	.16		Order Confirming the Second Amended Joint Plan of Reorganization of KAC, KACC and Certain of Their Debtor Affiliates (incorporated by reference to Exhibit 2.5 to the Report on Form 8-K, dated as of February 1, 2006, filed by KAC).
	2	.17		Order Affirming the Confirmation Order of the Second Amended Joint Plan of Reorganization of KAC, KACC and Certain of Their Debtor Affiliates, as modified (incorporated by reference to Exhibit 2.6 to the Registration Statement on Form 8-A, dated as of July 6, 2006, filed by KAC).

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Number				Exhibit title
	2	.18		Special Procedures for Distributions on Account of NLRB Claim, as agreed by the National Labor Relations Board, the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL-CIO, CLC (formerly known as the United Steelworkers of America, AFL-CIO, CLC) (the “USW”) and the Company pursuant to Section 7.8e of the Second Amended Joint Plan of Reorganization of KAC, KACC and Certain of Their Debtor Affiliates, as modified (incorporated by reference to Exhibit 2.7 to the Registration Statement on Form 8-A, dated as of July 6, 2006, filed by KAC).
	3	.1		Amended and Restated Certificate of Incorporation of KAC (incorporated by reference to Exhibit 3.1 to the Registration Statement on Form 8-A, dated as of July 6, 2006, filed by KAC).
	3	.2		Amended and Restated Bylaws of KAC (incorporated by reference to Exhibit 3.2 to the Registration Statement on Form 8-A, dated as of July 6, 2006, filed by KAC).
	5	.1		Opinion of Jones Day.*
	10	.1		Senior Secured Revolving Credit Agreement, dated as of July 6, 2006, among KAC, Kaiser Aluminum Investments Company, Kaiser Aluminum Fabricated Products, LLC (“KAFP”), Kaiser Aluminium International, Inc., certain financial institutions from time to time party thereto, as lenders, J.P. Morgan Securities Inc., The CIT Group/ Business Credit, Inc. and JPMorgan Chase Bank, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.2		Term Loan and Guaranty Agreement, dated as of July 6, 2006, among KAFP, KAC and certain indirect subsidiaries of the Company listed as “Guarantors” thereto, certain financial institutions from time to time party thereto, as lenders, J.P.Morgan Securities Inc., JPMorgan Chase Bank, N.A., as administrative agent, and Wilmington Trust Company, as collateral agent (incorporated by reference to Exhibit 10.2 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.3		Description of Compensation of Directors (incorporated by reference to Exhibit 10.3 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.4		2006 Short Term Incentive Plan for Key Managers (incorporated by reference to Exhibit 10.4 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.5		Employment Agreement, dated as of July 6, 2006, between KAC and Jack A. Hockema (incorporated by reference to Exhibit 10.5 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.6		Employment Agreement, dated as of July 6, 2006, between KAC and Joseph P. Bellino (incorporated by reference to Exhibit 10.6 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.7		Employment Agreement, dated as of July 6, 2006, between KAC and Daniel D. Maddox (incorporated by reference to Exhibit 10.7 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.8		Form of Director Indemnification Agreement (incorporated by reference to Exhibit 10.8 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.9		Form of Officer Indemnification Agreement (incorporated by reference to Exhibit 10.9 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.10		Form of Director and Officer Indemnification Agreement (incorporated by reference to Exhibit 10.10 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.11		2006 Equity and Performance Incentive Plan (incorporated by reference to Exhibit 99.1 to the Registration Statement on Form S-8 (Registration Statement No. 333-135613), dated as of July 6, 2006, filed by KAC).
	10	.12		Form of Executive Officer Restricted Stock Award (incorporated by reference to Exhibit 10.12 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).

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Number				Exhibit title
	10	.13		Form of Non-Employee Director Restricted Stock Award (incorporated by reference to Exhibit 10.13 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.14		Restoration Plan (incorporated by reference to Exhibit 10.14 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.15		Amendment to Amended and Restated Non-Exclusive Consulting Agreement, dated as of June 30, 2006, between KACC and Edward F. Houff (incorporated by reference to Exhibit 10.15 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.16		Amended and Restated Non Exclusive Consulting Agreement between KACC and Edward F. Houff, dated April 26, 2006 (incorporated by reference to Exhibit 10.1 to the Report on Form 8-K, dated as of April 27, 2006, filed by KAC).
	10	.17		Release Agreement between KACC and Edward F. Houff, dated August 15, 2005 (incorporated by reference to Exhibit 10.2 to the Report on Form 10-Q for the quarterly period ended June 30, 2005, filed by KAC).
	10	.18		Amended Employment Agreement, dated October 1, 2004, between KACC and Edward F. Houff (incorporated by reference to Exhibit 10.1 to the Report on Form 10-Q for the quarterly period ended September 30, 2004, filed by KAC).
	10	.19		Stock Transfer Restriction Agreement, dated as of July 6, 2006, between KAC and National City Bank, in its capacity as the trustee for the trust that provides benefits for certain eligible retirees of Kaiser Aluminum & Chemical Corporation represented by the USW, the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America and its Local 1186, the International Association of Machinists and Aerospace Workers, the International Chemical Workers Union Council of the United Food & Commercial Workers, and the Paper, Allied-Industrial, Chemical and Energy Workers International Union, AFL-CIO, CLC and their surviving spouses and eligible dependents (the “Union VEBA Trust”) (incorporated by reference to Exhibit 4.1 to the Registration Statement on Form 8-A, dated as of July 6, 2006, filed by KAC).
	10	.20		Registration Rights Agreement, dated as of July 6, 2006, among KAC, the Union VEBA Trust and the other parties thereto (incorporated by reference to Exhibit 4.2 to the Registration Statement on Form 8-A, dated as of July 6, 2006, filed by KAC).
	10	.21		Director Designation Agreement, dated as of July 6, 2006, between KAC and the USW (incorporated by reference to Exhibit 4.3 to the Registration Statement on Form 8-A, dated as of July 6, 2006, filed by KAC).
	10	.22		Key Employee Retention Plan (effective September 3, 2002) (incorporated by reference to Exhibit 10.26 to the Report on Form 10-K for the period ended December 31, 2002, filed by KAC).
	10	.23		Form of Retention Agreement for the KACC Key Employee Retention Plan (effective September 3, 2002) for John Barneson and Jack A. Hockema (incorporated by reference to Exhibit 10.27 to the Report on Form 10-K for the period ended December 31, 2002, filed by KAC).
	10	.24		Severance Plan (effective September 3, 2002) (incorporated by reference to Exhibit 10.30 to the Report on Form 10-K for the period ended December 31, 2002, filed by KAC).
	10	.25		Form of Severance Agreement for the Severance Plan (effective September 3, 2002) for John Barneson, Edward F. Houff, Daniel D. Maddox, John M. Donnan and Certain Other Executive Officers (incorporated by reference to Exhibit 10.31 to the Report on Form 10-K for the period ended December 31, 2002, filed by KAC).
	10	.26		Form of Change in Control Severance Agreement for John Barneson (incorporated by reference to Exhibit 10.32 to the Report on Form 10-K for the period ended December 31, 2002, filed by KAC).

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Number				Exhibit title
	10	.27		Form of Change in Control Severance Agreement for Daniel D. Maddox, John M. Donnan and Certain Other Executive Officers (incorporated by reference to Exhibit 10.33 to the Report on Form 10-K for the period ended December 31, 2002, filed by KAC).
	10	.28		Description of Short-Term Incentive Plan (incorporated by reference to Exhibit 10.20 to the Report on Form 10-K for the period ended December 31, 2004, filed by KAC).
	10	.29		Description of Long-Term Incentive Plan (incorporated by reference to Exhibit 10.21 to the Report on Form 10-K for the period ended December 31, 2004, filed by KAC).
	10	.30		Settlement and Release Agreement dated October 5, 2004 by and among the Debtors and the Creditors’ Committee (incorporated by reference to Exhibit 10.2 to the Report on Form 10-Q for the quarterly period ended September 30, 2004, filed by KAC).
	10	.31		Amendment, dated as of January 27, 2005, to Settlement and Release Agreement dated as of October 5, 2004, by and among the Debtors and the Creditors’ Committee (incorporated by reference to Exhibit 10.23 to the Report on Form 10-K for the period ended December 31, 2004, filed by KAC).
	10	.32		Settlement Agreement dated October 14, 2004, between KACC and the Pension Benefit Guaranty Corporation (incorporated by reference to Exhibit 10.3 to the Report on Form 10-Q for the period ended September 30, 2004, filed by KAC).
	10	.33		Release between KACC and Kerry A. Shiba (incorporated by reference to Exhibit 10.1 to the Report on Form 8-K, dated as of March 14, 2006, filed by KAC).
	21	.1		List of Subsidiaries of Kaiser Aluminum Corporation.**
	23	.1		Consent of Deloitte & Touche LLP.**
	23	.2		Consent of Jones Day (included in Exhibit 5.1).
	23	.3		Consent of Wharton Levin Ehrmantraut & Klein, P.A.**
	23	.4		Consent of Heller Ehrman LLP.**
	24	.1		Power of Attorney.**

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	/s/ DELOITTE & TOUCHE LLP

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				December 31,
				2004				2005
				(in millions of
				dollars, except share
				amounts)
ASSETS
Investment in KACC				$	(192.5	)		$	(944.0	)
	Total			$	(192.5	)		$	(944.0	)
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities				$	—			$	—
Intercompany note payable to KACC, including accrued interest (Note 3)					2,191.7				—
Stockholders’ equity (deficit):
	Common stock, par value $.01, authorized 125,000,000 shares; issued and outstanding 79,680,645 and 79,671,531 shares				.8				.8
	Additional capital				538.0				2,735.2
	Accumulated deficit				(2,917.5	)			(3,671.2	)
	Accumulated other comprehensive income (loss)				(5.5	)			(8.8	)
		Total stockholders’ equity			(2,384.2	)			(944.0	)
		Total		$	(192.5	)		$	(944.0	)

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		December 31,
		2003				2004				2005
		(in millions of dollars)
Equity in income (loss) of KACC		$	(788.1	)		$	(746.6	)		$	(753.5	)
Administrative and general expense			(.2	)			(.2	)			(.2	)
Interest expense on intercompany note (excluding unrecorded contractual interest expense of $153.6 in 2003 and 2004, and $25.6 in 2005 respectively— Note 3)			—				—				—
Net loss		$	(788.3	)		$	(746.8	)		$	(753.7	)

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				December 31,
				2003				2004				2005
				(in millions of dollars)
Cash flows from operating activities:
	Net loss			$	(788.3	)		$	(746.8	)		$	(753.7	)
	Adjustments to reconcile net income to net cash used for operating activities:
	Equity in loss of KACC				788.1				746.6				753.5
	Accrued interest on intercompany note payable to KACC				—				—				—
		Net cash used by operating activities			(.2	)			(.2	)			(.2	)
Cash flows from investing activities:
	Investment in KACC				—				—				—
		Net cash used by investing activities			—				—				—
Cash flows from financing activities:
	Operating cost advances from KACC				.2				.2				.2
		Net cash provided by financing activities			.2				.2				.2
Net (decrease) increase in cash and cash equivalents during the year					—				—				—
Cash and cash equivalents at beginning of year					—				—				—
Cash and cash equivalents at end of year				$	—			$	—			$	—

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1.	REORGANIZATION PROCEEDINGS

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	(a) All of the equity interests of existing stockholders of the Company would be cancelled without consideration.
	(b) All post-petition and secured claims would either be assumed by the emerging entity or paid at emergence (see “Exit Cost” discussion below).
	(c) Pursuant to agreements reached with salaried and hourly retirees in early 2004, in consideration for the agreed cancellation of the retiree medical plan, as more fully discussed in Note 8, KACC is making certain fixed monthly payments into Voluntary Employee Beneficiary Associations (“VEBAs”) until emergence and has agreed thereafter to make certain variable annual VEBA contributions depending on the emerging entity’s operating results and financial liquidity. In addition, upon emergence the VEBAs are entitled to receive a contribution of 66.9% of the new common stock of the emerged entity.
	(d) The PBGC will receive a cash payment of $2.5 and 10.8% of the new common stock of the emerged entity in respect of its claims against KACOCL. In addition, as described in (f) below, the PBGC will receive shares of new common stock based on its direct claims against the Remaining Debtors (other than KACOCL) and its participation, indirectly through the KAAC/ KFC Plan in claims of KFC against KACC, which the Company currently estimates will result in the PBGC receiving an additional 5.4% of the new common stock of the emerged

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	entity (bringing the PBGC’s total ownership percentage of the new entity to approximately 16.2%). The $2.5 cash payment discussed above is in addition to the cash amounts the Company has already paid to the PBGC (see Note 9 of Notes to Kaiser’s Consolidated Financial Statements) and that the PBGC has received and will receive from the Liquidating Subsidiaries under the Liquidating Plans.
	(e) Pursuant to an agreement reached in early 2005, all pending and future asbestos-related personal injury claims, all pending and future silica and coal tar pitch volatiles personal injury claims and all hearing loss claims would be resolved through the formation of one or more trusts to which all such claims would be directed by channeling injunctions that would permanently remove all liability for such claims from the Debtors. The trusts would be funded pursuant to statutory requirements and agreements with representatives of the affected parties, using (i) the Debtors’ insurance assets, (ii) $13.0 in cash from KACC, (iii) 100% of the equity in a KACC subsidiary whose sole asset will be a piece of real property that produces modest rental income, and (iv) the new common stock of the emerged entity to be issued as per (f) below in respect of approximately $830.0 of intercompany claims of KFC against KACC that are to be assigned to the trust, which the Company currently estimates will entitle the trusts to receive approximately 6.4% of the new common stock of the emerged entity.
	(f) Other pre-petition general unsecured claims against the Remaining Debtors (other than KACOCL) are entitled to receive approximately 22.3% of the new common stock of the emerging entity in the proportion that their allowed claim bears to the total amount of allowed claims. Claims that are expected to be within this group include (i) any claims of the Senior Notes, the Sub Notes and PBGC (other than the PBGC’s claim against KACOCL), (ii) the approximate $830.0 of intercompany claims that will be assigned to the personal injury trust(s) referred to in (e) above, and (iii) all unsecured trade and other general unsecured claims, including approximately $276.0 of intercompany claims of KFC against KACC. However, holders of general unsecured claims not exceeding a specified small amount will receive a cash payment equal to approximately 2.9% of their agreed claim value in lieu of new common stock. In accordance with the contractual subordination provisions of the indenture governing the Sub Notes and terms of the settlement between the holders of the Senior Notes and the holders of the Revenue Bonds, the new common stock or cash that would otherwise be distributed to the holders of the Sub Notes in respect of their claims against the Debtors would instead be distributed to holders of the Senior Notes and the Revenue Bonds on a pro rata basis based on the relative allowed amounts of their claims.

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2.	BASIS OF PRESENTATION

3.	INTERCOMPANY NOTE PAYABLE

4.	RESTRICTED NET ASSETS

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	(1)     for purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective; and
	(2)     for the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at the time shall be deemed to be the initial bona fide offering thereof.

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	KAISER ALUMINUM CORPORATION

	By:	/s/     Jack A. Hockema

	Jack A. Hockema
	Chief Executive Officer

Signature		Title		Date
/s/  Jack A. Hockema   Jack A. Hockema		President, Chief Executive Officer and Chairman of the Board (Principal Executive Officer)		September 27, 2006
/s/  Joseph P. Bellino   Joseph P. Bellino		Executive Vice President and Chief Financial Officer (Principal Financial Officer)		September 27, 2006
/s/  Daniel D. Maddox   Daniel D. Maddox		Vice President and Controller (Principal Accounting Officer)		September 27, 2006
George Becker		Director
/s/  Carl B. Frankel   Carl B. Frankel		Director		September 27, 2006
/s/  Teresa A. Hopp   Teresa A. Hopp		Director		September 27, 2006
/s/  William F. Murdy   William F. Murdy		Director		September 27, 2006
/s/  Alfred E. Osborne, Jr., Ph.D.   Alfred E. Osborne, Jr., Ph.D.		Director		September 27, 2006
/s/  Georganne C. Proctor   Georganne C. Proctor		Director		September 27, 2006
/s/  Jack Quinn   Jack Quinn		Director		September 27, 2006

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Signature		Title		Date
/s/  Thomas M. Van Leeuwen   Thomas M. Van Leeuwen		Director		September 27, 2006
/s/  Brett E. Wilcox   Brett E. Wilcox		Director		September 27, 2006

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Number				Exhibit title
	1	.1		Form of Underwriting Agreement.*
	2	.1		Purchase Agreement, dated as of May 17, 2004, among Kaiser Aluminum & Chemical Corporation (“KACC”), Kaiser Bauxite Company (“KBC”), Gramercy Alumina LLC and St. Ann Bauxite Limited (incorporated by reference to Exhibit 2.1 to the Report on Form 8-K, dated as of October 1, 2004, filed by Kaiser Aluminum Corporation (“KAC”)).
	2	.2		Purchase Agreement, dated as of October 29, 2004, between KACC and the Government of the Republic of Ghana (incorporated by reference to Exhibit 2.1 to the Report on Form 8-K, dated as of October 29, 2004, filed by KAC).
	2	.3		Purchase Agreement, dated as of October 28, 2004, among KACC, Kaiser Alumina Australia Corporation (“KAAC”) and Alumina & Bauxite Company Ltd. (incorporated by reference to Exhibit 2.5 to the Report on Form 10-Q for the quarterly period ended September 30, 2004, filed by KAC).
	2	.4		Third Amended Joint Plan of Liquidation for Alpart Jamaica Inc. (“AJI”) and Kaiser Jamaica Corporation (“KJC”), dated February 25, 2005 (incorporated by reference to Exhibit 99.1 to the Report on Form 10-K for the period ended December 31, 2004, filed by KAC).
	2	.5		Modification to the Third Amended Joint Plan of Liquidation for AJI and KJC, dated April 7, 2005 (incorporated by reference to Exhibit 2.2 to the Report Form 8-K dated December 19, 2005, filed by KAC).
	2	.6		Second Modification to the Third Amended Joint Plan of Liquidation for AJI and KJC, dated November 22, 2005 (incorporated by reference to Exhibit 2.3 to the Report Form 8-K dated December 19, 2005, filed by KAC).
	2	.7		Third Modification to the Third Amended Joint Plan of Liquidation for AJI and KJC, dated December 19, 2005 (incorporated by reference to Exhibit 2.4 to the Report Form 8-K dated December 19, 2005, filed by KAC).
	2	.8		Third Amended Joint Plan of Liquidation for KAAC and Kaiser Finance Corporation (“KFC”), dated February 25, 2005 (incorporated by reference to Exhibit 99.3 to the Report on Form 10-K for the period ended December 31, 2004, filed by KAC).
	2	.9		Modification to the Third Amended Joint Plan of Liquidation for KAAC and KFC, dated April 7, 2005 (incorporated by reference to Exhibit 2.6 to the Report on Form 8-K dated December 19, 2005, filed by KAC).
	2	.10		Second Modification to the Third Amended Joint Plan of Liquidation for KAAC and KFC, dated November 22, 2005 (incorporated by reference to Exhibit 2.7 to the Report on Form 8-K dated December 19, 2005, filed by KAC).
	2	.11		Third Modification to the Third Amended Joint Plan of Liquidation for KAAC and KFC, dated December 19, 2005 (incorporated by reference to Exhibit 2.8 to the Report on Form 8-K dated December 19, 2005, filed by KAC).
	2	.12		Second Amended Joint Plan of Reorganization for KAC, KACC and Certain of Their Debtor Affiliates, dated as of September 7, 2005 (incorporated by reference to Exhibit 99.2 to the Report on Form 8-K, dated as of September 8, 2005, filed by KAC).
	2	.13		Modifications to the Second Amended Joint Plan of Reorganization for KAC, KACC and Certain of Their Debtor Affiliates Pursuant to Stipulation and Agreed Order between Insurers, Debtors, Committee and Future Representatives (incorporated by reference to Exhibit 2.2 to the Report on Form 8-K, dated as of February 1, 2006, filed by KAC).
	2	.14		Modification to the Second Amended Joint Plan of Reorganization for KAC, KACC and Certain of Their Debtor Affiliates, dated as of November 22, 2005 (incorporated by reference to Exhibit 2.3 to the Report on Form 8-K, dated as of February 1, 2006, filed by KAC).

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Number				Exhibit title
	2	.15		Third Modification to the Second Amended Joint Plan of Reorganization for KAC, KACC and Certain of Their Debtor Affiliates, dated as of December 16, 2005 (incorporated by reference to Exhibit 2.4 to the Report on Form 8-K, dated as of February 1, 2006, filed by KAC).
	2	.16		Order Confirming the Second Amended Joint Plan of Reorganization of KAC, KACC and Certain of Their Debtor Affiliates (incorporated by reference to Exhibit 2.5 to the Report on Form 8-K, dated as of February 1, 2006, filed by KAC).
	2	.17		Order Affirming the Confirmation Order of the Second Amended Joint Plan of Reorganization of KAC, KACC and Certain of Their Debtor Affiliates, as modified (incorporated by reference to Exhibit 2.6 to the Registration Statement on Form 8-A, dated as of July 6, 2006, filed by KAC).
	2	.18		Special Procedures for Distributions on Account of NLRB Claim, as agreed by the National Labor Relations Board, the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, AFL-CIO, CLC (formerly known as the United Steelworkers of America, AFL-CIO, CLC) (the “USW”) and the Company pursuant to Section 7.8e of the Second Amended Joint Plan of Reorganization of KAC, KACC and Certain of Their Debtor Affiliates, as modified (incorporated by reference to Exhibit 2.7 to the Registration Statement on Form 8-A, dated as of July 6, 2006, filed by KAC).
	3	.1		Amended and Restated Certificate of Incorporation of KAC (incorporated by reference to Exhibit 3.1 to the Registration Statement on Form 8-A, dated as of July 6, 2006, filed by KAC).
	3	.2		Amended and Restated Bylaws of KAC (incorporated by reference to Exhibit 3.2 to the Registration Statement on Form 8-A, dated as of July 6, 2006, filed by KAC).
	5	.1		Opinion of Jones Day.*
	10	.1		Senior Secured Revolving Credit Agreement, dated as of July 6, 2006, among KAC, Kaiser Aluminum Investments Company, Kaiser Aluminum Fabricated Products, LLC (“KAFP”), Kaiser Aluminium International, Inc., certain financial institutions from time to time party thereto, as lenders, J.P. Morgan Securities Inc., The CIT Group/ Business Credit, Inc. and JPMorgan Chase Bank, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.2		Term Loan and Guaranty Agreement, dated as of July 6, 2006, among KAFP, KAC and certain indirect subsidiaries of the Company listed as “Guarantors” thereto, certain financial institutions from time to time party thereto, as lenders, J.P.Morgan Securities Inc., JPMorgan Chase Bank, N.A., as administrative agent, and Wilmington Trust Company, as collateral agent (incorporated by reference to Exhibit 10.2 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.3		Description of Compensation of Directors (incorporated by reference to Exhibit 10.3 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.4		2006 Short Term Incentive Plan for Key Managers (incorporated by reference to Exhibit 10.4 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.5		Employment Agreement, dated as of July 6, 2006, between KAC and Jack A. Hockema (incorporated by reference to Exhibit 10.5 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.6		Employment Agreement, dated as of July 6, 2006, between KAC and Joseph P. Bellino (incorporated by reference to Exhibit 10.6 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.7		Employment Agreement, dated as of July 6, 2006, between KAC and Daniel D. Maddox (incorporated by reference to Exhibit 10.7 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).

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Number				Exhibit title
	10	.8		Form of Director Indemnification Agreement (incorporated by reference to Exhibit 10.8 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.9		Form of Officer Indemnification Agreement (incorporated by reference to Exhibit 10.9 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.10		Form of Director and Officer Indemnification Agreement (incorporated by reference to Exhibit 10.10 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.11		2006 Equity and Performance Incentive Plan (incorporated by reference to Exhibit 99.1 to the Registration Statement on Form S-8 (Registration Statement No. 333-135613), dated as of July 6, 2006, filed by KAC).
	10	.12		Form of Executive Officer Restricted Stock Award (incorporated by reference to Exhibit 10.12 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.13		Form of Non-Employee Director Restricted Stock Award (incorporated by reference to Exhibit 10.13 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.14		Restoration Plan (incorporated by reference to Exhibit 10.14 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.15		Amendment to Amended and Restated Non-Exclusive Consulting Agreement, dated as of June 30, 2006, between KACC and Edward F. Houff (incorporated by reference to Exhibit 10.15 to the Report on Form 8-K, dated as of July 6, 2006, filed by KAC).
	10	.16		Amended and Restated Non Exclusive Consulting Agreement between KACC and Edward F. Houff, dated April 26, 2006 (incorporated by reference to Exhibit 10.1 to the Report on Form 8-K, dated as of April 27, 2006, filed by KAC).
	10	.17		Release Agreement between KACC and Edward F. Houff, dated August 15, 2005 (incorporated by reference to Exhibit 10.2 to the Report on Form 10-Q for the quarterly period ended June 30, 2005, filed by KAC).
	10	.18		Amended Employment Agreement, dated October 1, 2004, between KACC and Edward F. Houff (incorporated by reference to Exhibit 10.1 to the Report on Form 10-Q for the quarterly period ended September 30, 2004, filed by KAC).
	10	.19		Stock Transfer Restriction Agreement, dated as of July 6, 2006, between KAC and National City Bank, in its capacity as the trustee for the trust that provides benefits for certain eligible retirees of Kaiser Aluminum & Chemical Corporation represented by the USW, the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America and its Local 1186, the International Association of Machinists and Aerospace Workers, the International Chemical Workers Union Council of the United Food & Commercial Workers, and the Paper, Allied-Industrial, Chemical and Energy Workers International Union, AFL-CIO, CLC and their surviving spouses and eligible dependents (the “Union VEBA Trust”) (incorporated by reference to Exhibit 4.1 to the Registration Statement on Form 8-A, dated as of July 6, 2006, filed by KAC).
	10	.20		Registration Rights Agreement, dated as of July 6, 2006, among KAC, the Union VEBA Trust and the other parties thereto (incorporated by reference to Exhibit 4.2 to the Registration Statement on Form 8-A, dated as of July 6, 2006, filed by KAC).
	10	.21		Director Designation Agreement, dated as of July 6, 2006, between KAC and the USW (incorporated by reference to Exhibit 4.3 to the Registration Statement on Form 8-A, dated as of July 6, 2006, filed by KAC).
	10	.22		Key Employee Retention Plan (effective September 3, 2002) (incorporated by reference to Exhibit 10.26 to the Report on Form 10-K for the period ended December 31, 2002, filed by KAC).
	10	.23		Form of Retention Agreement for the KACC Key Employee Retention Plan (effective September 3, 2002) for John Barneson and Jack A. Hockema (incorporated by reference to Exhibit 10.27 to the Report on Form 10-K for the period ended December 31, 2002, filed by KAC).

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Number				Exhibit title
	10	.24		Severance Plan (effective September 3, 2002) (incorporated by reference to Exhibit 10.30 to the Report on Form 10-K for the period ended December 31, 2002, filed by KAC).
	10	.25		Form of Severance Agreement for the Severance Plan (effective September 3, 2002) for John Barneson, Edward F. Houff, Daniel D. Maddox, John M. Donnan and Certain Other Executive Officers (incorporated by reference to Exhibit 10.31 to the Report on Form 10-K for the period ended December 31, 2002, filed by KAC).
	10	.26		Form of Change in Control Severance Agreement for John Barneson (incorporated by reference to Exhibit 10.32 to the Report on Form 10-K for the period ended December 31, 2002, filed by KAC).
	10	.27		Form of Change in Control Severance Agreement for Daniel D. Maddox, John M. Donnan and Certain Other Executive Officers (incorporated by reference to Exhibit 10.33 to the Report on Form 10-K for the period ended December 31, 2002, filed by KAC).
	10	.28		Description of Short-Term Incentive Plan (incorporated by reference to Exhibit 10.20 to the Report on Form 10-K for the period ended December 31, 2004, filed by KAC).
	10	.29		Description of Long-Term Incentive Plan (incorporated by reference to Exhibit 10.21 to the Report on Form 10-K for the period ended December 31, 2004, filed by KAC).
	10	.30		Settlement and Release Agreement dated October 5, 2004 by and among the Debtors and the Creditors’ Committee (incorporated by reference to Exhibit 10.2 to the Report on Form 10-Q for the quarterly period ended September 30, 2004, filed by KAC).
	10	.31		Amendment, dated as of January 27, 2005, to Settlement and Release Agreement dated as of October 5, 2004, by and among the Debtors and the Creditors’ Committee (incorporated by reference to Exhibit 10.23 to the Report on Form 10-K for the period ended December 31, 2004, filed by KAC).
	10	.32		Settlement Agreement dated October 14, 2004, between KACC and the Pension Benefit Guaranty Corporation (incorporated by reference to Exhibit 10.3 to the Report on Form 10-Q for the period ended September 30, 2004, filed by KAC).
	10	.33		Release between KACC and Kerry A. Shiba (incorporated by reference to Exhibit 10.1 to the Report on Form 8-K, dated as of March 14, 2006, filed by KAC).
	21	.1		List of Subsidiaries of Kaiser Aluminum Corporation.**
	23	.1		Consent of Deloitte & Touche LLP.**
	23	.2		Consent of Jones Day (included in Exhibit 5.1).
	23	.3		Consent of Wharton Levin Ehrmantraut & Klein, P.A.**
	23	.4		Consent of Heller Ehrman LLP.**
	24	.1		Power of Attorney.**