Description of 2012-2014 Long-Term Incentive Umbrella Plan Under the Amended and Restated 2006 Equity and Performance Incentive Plan

2012-2014 Performance Goal and Award Pool            

The performance goal for the Company's three year performance period beginning with the Company's fiscal year 2012 and extending through the fiscal year 2014 (the "LTI Performance Period") shall be an average of $5.0 million per year over the LTI Performance Period in Net cash provided by operating activities, as reported in the Company's Statements of Consolidated Cash Flows (“Cash Flow”). The maximum value of shares of common stock issuable, subject to the exercise of negative discretion by the Company's Compensation Committee, upon reaching the performance goal shall equal 15% of the aggregate Cash Flow over the LTI Performance Period.

The purpose of establishing the maximum pool under Company's 2012-2014 Long-Term Incentive Umbrella Plan (the "2012-2014 LTI Umbrella Plan") is to improve tax efficiency with respect to the Company's incentive programs and achieve an Internal Revenue Code Section 162(m) "performance based" exemption for annual bonus amounts earned by the designated participants identified below, during the LTI Performance Period. The 2012-2014 LTI Umbrella Plan is authorized by and subject to the terms of the Kaiser Aluminum Corporation Amended and Restated 2006 Equity and Performance Incentive Plan.

The specified maximum pool allocations, as established and defined below are subject to the Company's Compensation Committee's authority to reduce, but not increase, the amount of the actual bonus earned and payable to each designated participant under the 2012-2014 LTI Umbrella Plan. It is anticipated that the payouts to the covered employees under the 2012-2014 LTI Umbrella Plan will be reduced by the Company's Compensation Committee through the exercise of negative discretion, which is permitted under Section 162(m). The Company's Compensation Committee's exercise of negative discretion with respect to one participant's award under the bonus pool shall not result in an increase in the amount payable to another participant under the bonus pool.    

The 2012-2014 LTI Umbrella Plan only applies to the calculation and award of incentive awards, if any. There will be no duplication of benefits created by the 2012 LTI Umbrella Plan.

The 2012-2014 LTI Umbrella Plan will not increase any benefits that may be payable under any severance and/or change in control agreements