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                                                                   Exhibit 10.35

                 THE KAISER ALUMINUM & CHEMICAL CORPORATION
                                 RETENTION PLAN

         I.   Purpose

         The purpose of the Plan is to establish a retention program for
designated key employees of the Company. The Plan provides incentives,
contingent upon continued employment, to certain key salaried employees who are
expected to make substantial contributions to provide stability and continuity
of operations. The Plan has been approved by the Boards of Directors of the
Company and the Corporation.

         II.  Definitions

         "Award" means a retention award as determined by the Committee, to be
granted to a Participant, based upon that Participant's continued employment
with the Company.

         "Board" means the Board of Directors of the Company.

         "Cause" means (1) the Participant's gross misconduct or fraud in the
performance of his employment, or (2) the Participant's conviction or guilty
plea with respect to any felony (except for motor vehicle violations).

         "Committee" means the Executive Committee of the Board. The Committee
may delegate any of its powers, duties and responsibilities and any of its
discretionary authorities under the Plan to any Officer.

         "Company" means Kaiser Aluminum & Chemical Corporation.

         "Corporation" means Kaiser Aluminum Corporation.

         "Designated Beneficiary" means the beneficiary or beneficiaries
designated in accordance with Article XI hereof to receive the amount, if any,
payable under the Plan upon the Participant's death.

         "Disability" or "Disabled" means, except as otherwise defined in an
existing employment agreement, permanent and total disability under the
Company's long term disability plan, as determined by the Committee.

         "Good Reason" means, without the Participant's written consent, a
reduction in his base compensation, or eligibility for participation in the
Company's benefit plans, that is not commensurate with a similar reduction among
similarly situated employees or executives at the Participant's salary grade
level.

         "Officer" means an officer of the Company.

         "Participant" means any key employee of the Company designated by the
Board, the Committee or an Officer to participate in the Plan.

         "Payment Date" means the date or series of dates on which an Award or
portion of an Award is payable, as provided in Section VI.

         "Plan" means Kaiser Aluminum & Chemical Corporation Retention Plan.

         "Retention Agreement" means an agreement entered into between the
Company and a Participant providing for participation in the Plan.

         "Vesting Date" means the date or dates on which Participant becomes
vested in all or a portion of his or her Award.

         III. Eligibility

         Participants in the Plan will be selected by the Board, the Committee
and Officers from those key employees of the Company whose efforts are expected
to contribute materially to the efforts and success of the Company. No employee
will be a Participant until he or she has executed a Retention Agreement. No
employee will at any time have the right to be selected as a Participant. Awards
made under the Plan are not in lieu of any other benefits a Participant may be
entitled to receive from the Company; provided, however, that any Retention
Agreement may provide that an Award will be reduced and offset, dollar per
dollar, by any short term incentive and long term incentive cash payments earned
during calendar year 2002.

         IV.  Administration

         The Plan will be administered by the Committee. The Committee, in its
sole discretion, will determine eligibility for participation, and establish the
Award which may be earned by each Participant (which may be expressed in terms
of dollar amount, percentage of salary or any other measurement).

         Except as otherwise expressly provided herein, full power and authority
to construe, interpret, and administer the Plan will be vested in the Committee,
including the power to amend or terminate the Plan as further described in
Article XIV. The Committee may at any time adopt such rules, regulations,
policies, or practices as, in its sole discretion, it determines to be necessary
or appropriate for the administration of, or the performance of its
responsibilities under, the Plan. The Committee may at any time amend, modify,
suspend, or terminate such rules, regulations, policies, or practices.

         V.   Awards; Vesting

         The Company will execute a retention agreement (the "Agreement") that
sets forth the terms and timing of the grant, vesting and payment of an Award.
Subject to the terms of the Agreement, an Award will be earned by and vested in
a Participant based upon continued employment on each Vesting Date. Except as
provided in the terms of the Agreement, Awards will be considered compensation
for purposes of the Company's pension and welfare benefit plans, programs and
arrangements.

         VI.  Payment of Awards

         Awards earned and vested will become payable as provided in the
Retention Agreement. Awards are solely based upon a Participant's continued
employment with the Company and will vest and become payable if the Participant
is employed by the Company on the Vesting Date associated with such payment.

         VII. Termination of Employment

         (a)  In General.

              A Participant will be eligible to receive payment of his or her
Award or portion thereof so long as the Participant is employed by the Company
on the Vesting Date associated with such payment.

         (b)  Death, Disability, Resignation with Good Reason or Termination by
              the Company Without Cause.

              In the event of a Participant's termination of employment with the
Company due to (i) death, (ii) Disability, (iii) the Participant's resignation
with Good Reason, or (iv) termination by the Company without Cause prior to the
vesting and/or payment of an Award, the balance of such Award will immediately
vest in full and become payable as soon as practicable in a lump sum to the
Participant or to the Participant's Designated Beneficiary or, if there is none
living, to the estate of the Participant.

         (c)  For Cause; Voluntary Termination Without Good Reason.

              In the event of a Participant's termination of employment with the
Company for any reason other than (i) death, (ii) Disability, (iii) the
Participant's resignation with Good Reason, or (iv) termination by the Company
without Cause, the portion of any Award to the Participant not yet vested will
be immediately forfeited.

         (d)  Repayment of Award.

              If, within ninety (90) days following the initial Vesting Date of
January 15, 2002, a Participant voluntarily terminates employment with the
Company (other than with Good Reason), or is terminated by the Company with
Cause, the Participant will be required to repay to the Company the portion of
his or her Award received in connection with such initial Vesting Date.

         VIII. Non-Alienation of Benefits

         A Participant may not assign, sell, encumber, transfer or otherwise
dispose of any rights or interests under the Plan except by will or the laws of
descent and distribution. Any attempted disposition in contravention of the
preceding sentence will be null and void.

         IX.  No Claim or Right to Plan Participation

         No employee or other person will have any claim or right to be selected
as a Participant under the Plan. Neither the Plan nor any action taken pursuant
to the Plan will be construed as giving any employee any right to be retained in
the employ of the Company.

         X.   Taxes

         The Company will deduct from all amounts paid under the Plan all
federal, state, local and other taxes required by law to be withheld with
respect to such payments.

         XI.  Designation and Change of Beneficiary

         Each Participant may designate one or more persons as the Designated
Beneficiary who will be entitled to receive the amount, if any, payable under
the Plan upon the death of the Participant. Such designation will be in writing
to the Committee. A Participant may, from time to time, revoke or change his or
her Designated Beneficiary without the consent of any prior Designated
Beneficiary by filing a written designation with the Committee. The last such
designation received by the Committee will be controlling; provided, however,
that no designation, or change or revocation thereof, will be effective unless
received by the Committee prior to the Participant's death, and in no event will
it be effective as of a date prior to such receipt.

         XII. Payments to Persons Other Than the Participant

         If the Committee finds that any person to whom any amount is payable
under the Plan is unable to care for his or her affairs because of illness or
accident, or is a minor, or has died, then any payment due to such person or his
or her estate (unless a prior claim therefor has been made by a duly appointed
legal representative) may, if the Committee so directs, be paid to his or her
spouse, a child, a relative, an institution maintaining or having custody of
such person, or any other person deemed by the Committee, in its sole
discretion, to be a proper recipient on behalf of such person otherwise entitled
to payment. Any such payment will be a complete discharge of the liability of
the Company therefor.

         XIII. No Liability of Board or Committee Members or Officers

         No member of the Board or the Committee or any Officer will be
personally liable by reason of any contract or other instrument related to the
Plan executed by such Officer or by such member or on his or her behalf in his
or her capacity as a member of the Board or the Committee, nor for any mistake
of judgment made in good faith, and the Company will indemnify and hold harmless
each employee, Officer, or director of the Company to whom any duty or power
relating to the administration or interpretation of the Plan may be allocated or
delegated, against any cost or expense (including legal fees, disbursements and
other related charges) or liability (including any sum paid in settlement of a
claim with the approval of the Board of Directors) arising out of any act or
omission to act in connection with the Plan unless arising out of such person's
own fraud or bad faith.

         XIV. Termination or Amendment of the Plan

         The Committee may amend, suspend or terminate the Plan at any time;
provided, however, the Plan may not be amended in any way to reduce the benefits
payable hereunder to a Participant or otherwise to impair his or her ability to
receive any amount due hereunder, without the prior written consent of the
Participant. The Plan will automatically terminate when all benefits payable
hereunder have been paid.

         XV.  Establishment of Trust

         The Company's obligations under the Plan may be secured for one or more
Participants by the establishment of a trust for the benefit of one or more
Participants. Such Participants may be paid the Awards from the trust, but if
the trust has insufficient funds, then the balance of the Awards will be paid by
the Company.

         The Plan is not intended to be subject to the Employee Retirement
Income Security Act of 1974, as amended ("ERISA").

         XVI. Governing Law

         The terms of the Plan and all rights thereunder will be governed by and
construed in accordance with the laws of the State of Texas, without reference
to principles of conflict of laws.

         XVII. Effective Date

         The effective date of the Plan is January 15, 2002.

                                      Kaiser Aluminum & Chemical Corporation

                                      By: /S/ John Barneson
                                      Title:___________________________
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