Document:

Exhibit

Exhibit 10.3

Kaiser Aluminum 2016 Long-Term Incentive Plan
	
						
	Management Objective:
	The applicable measurable performance objective:

	 
	 
	 

	 
	Ÿ
	for 60% of the Performance Shares is the percentile ranking (“Relative TSR Ranking”) of the total shareholder return (“TSR”) of Kaiser Aluminum Corporation (the “Company”) over the period from January 1, 2016 through December 31, 2018 (the “Performance Period”) compared to the TSR of companies listed on Annex I hereto (each, a “Peer Company”), each of which is a member of the S&P 600 Small Cap Materials Sector index, over the Performance Period; and

	 
	 

	 
	Ÿ
	for 40% of the Performance Shares is the cost performance (“Cost Performance”) of the Company, measured against the Company’s total controllable cost (“Total Controllable Cost”) over the Performance Period.

	 
	 

	 
	TSR Performance Objective

	 
	 

	 
	The Relative TSR Ranking will be based on the Company’s relative stock performance against the Peer Companies, with any dividends being treated as being reinvested on the applicable ex-dividend date. 

	 
	 

	 
	The beginning and ending share prices are determined using the 20 trading day averages preceding the beginning and the end of the applicable performance period, respectively.

	 
	 

	 
	Any Peer Company that is acquired during the Performance Period shall be omitted from the peer group and will not be included in determining the Relative TSR Ranking.

	 
	 

	 
	Any Peer Company that files for bankruptcy, or that has its shares delisted from its primary stock exchange because it fails to meet the exchange listing requirements (other than as a result of its acquisition), during the Performance Period shall remain in the peer group and will be ranked last for purposes of determining the Relative TSR Ranking.

	 
	 

	 
	The Relative TSR Ranking target is the 50th percentile (the “Target TSR Ranking”). The payout for TSR performance at the target level (a multiplier of 1.00x) is 50% of the applicable Performance Shares. The threshold performance required to potentially earn Performance Shares is a Relative TSR Ranking at the 25th percentile. The payout for TSR performance at the threshold level (a multiplier of 0.50x) is 25% of the applicable Performance Shares. If the Relative TSR Ranking is below the 25th percentile, no Performance Shares will be earned. If the Relative TSR Ranking is greater than the 90th percentile, Performance Shares will be earned at the maximum level.  The payout for performance at the maximum level (a multiplier of 2.00x) is 100% of the applicable Performance Shares.

	
						
	 
	The multiplier for Performance Shares based on TSR Percentile Ranking will be determined by straight line interpolation between the measuring points based on the Relative TSR Ranking as follows:

	 
	 
	 
	 

	 
	 
	TSR Percentile Ranking
≤25th percentile
  25th percentile
  50th percentile
  75th percentile
≥90th percentile
	Multiplier
   0.00x
   0.50x
   1.00x
   1.50x
   2.00x

	 
	 
	 

	 
	If the TSR of the Company over the Performance Period is negative, then the multiplier shall be capped at 1.00x.

	 
	 

	 
	Cost Performance Objective 

	 
	 

	 
	The Company’s Cost Performance is measured as a percentage of the average annual increase or decrease in Total Controllable Cost over the Performance Period as compared with the Total Controllable Cost for 2015.  

	 
	 

	 
	Total Controllable Cost shall equal the sum of the Company’s (1) controllable variable conversion cost (“Variable Cost”) and (2) controllable plant overhead and selling, general and administrative expenses (“Overhead Cost”) as more fully described to the Company’s Compensation Committee.

	 
	 

	 
	The Cost Performance target is a 0% annualized cost increase requiring the offset of underlying inflation (the “Target Cost Performance”). The payout for Cost Performance at the target level (a multiplier of 1.00x) is 50% of the applicable Performance Shares. The threshold Cost Performance required to earn Performance Shares is a 3% annualized cost increase. The payout for Cost Performance at the threshold level (a multiplier of 0.50x) is 25% of the applicable Performance Shares. If the Cost Performance is greater than a 3% annualized cost increase, no Performance Shares will be earned. If the Cost Performance is less than or equal to a 3% annualized cost reduction, Performance Shares will be earned at the maximum level.  The payout for performance at the maximum level (a multiplier of 2.00x) is 100% of the applicable Performance Shares.

	 
	 

	 
	The multiplier for Performance Shares based on Cost Performance will be determined by straight line interpolation between the measuring points based on Cost Performance as follows:

	 
	 
	 
	 

	
						
	 
	 
	Cost Performance

>3% annualized cost increase
  0% annualized cost increase
≥3% annualized cost reduction
	Multiplier

   0.00x
   1.00x
   2.00x

	 
	 
	 

	Determination of Number of Performance Shares Potentially Earned:
	The number of Performance Shares earned, if any, will be determined as follows:

	 
	 

	 
	Ÿ
	Following December 31, 2018, the Committee will approve a multiplier (“LTI Multiplier”) equal to the sum of (1) 60% of the multiplier determined based on the Company’s Relative TSR Ranking and (2) 40% of the multiplier determined based on the Company’s Cost Performance.

	 
	 
	 
	 
	 
	 

	 
	Ÿ
	The number of Performance Shares earned, if any, will equal the sum of the product (rounded down to the nearest whole number) of (1) the total number of Performance Shares granted hereunder and (2) one-half of the LTI Multiplier (rounded to the nearest whole percentage point); provided, however, such number will not exceed the number of Performance Shares granted hereunder.

	 
	 

	 
	The Committee will approve the LTI Multiplier not later than March 15, 2019.

	 
	 

	Administrative Provisions:
	Additional administrative provisions are reflected in the terms of the applicable grant documents.

	 
	 
	 
	 
	 
	 

	 
	The number of Performance Shares earned by any Covered Employee will be subject to any “umbrella plan” adopted by the Company in order to improve the tax efficiency of the Performance Shares granted to such Covered Employee.

Annex I

Peer Company List

	
		
	A. Schulman, Inc.
	KapStone Paper and Packaging Corporation

	AK Steel Holding Corporation
	Koppers Holdings Inc.

	American Vanguard Corporation
	Kraton Performance Polymers Inc.

	Balchem Corp.
	LSB Industries Inc.

	Boise Cascade Company
	Materion Corporation

	Calgon Carbon Corporation
	Myers Industries Inc.

	Century Aluminum Co.
	Neenah Paper, Inc.

	Clearwater Paper Corporation
	Olympic Steel Inc.

	Deltic Timber Corporation
	PH Glatfelter Co.

	Flotek Industries Inc.
	Quaker Chemical Corporation

	Future Fuel Corp.
	Rayonier Advanced Materials Inc.

	Globe Specialty Metals, Inc.
	Schweitzer-Mauduit International Inc.

	Hawkins Inc.
	Stepan Company

	Haynes International, Inc.
	Stillwater Mining Co.

	HB Fuller Co.
	SunCoke Energy Inc.

	Headwaters Incorporated
	TimkenSteel Corporation

	Innospec Inc.
	Tredegar Corp.

	Innophos Holdings Inc.
	Wausau Paper Corp.

	Intrepid Potash, Inc.Exhibit

Exhibit 10.4

[FHLBank Logo]

	
			
	Department:

Corporate Secretary
	Name of Policy:

 2016 Directors’ Compensation Policy
	Department Policy Number:

1

	Effective Date:

January 1, 2016
	Supersedes Revisions:

January 1, 2015
	Authority to Approve and Amend:

Board of Directors

	Next Review Date:

December 11, 2016
	Department Policy Owner:

Corporate Secretary
	 

This policy is designed to set forth expectations for attendance by members of the board of directors of the Federal Home Loan Bank of Atlanta (Bank) at meetings of the board (including eight scheduled board meetings in 2016) and board committees and to ensure that each director is reasonably compensated for the time required of him or her in the performance of official Bank business. 

A.    Director Compensation 

		
	1.
	Effective January 1, 2016, the following annual compensation limits shall apply: 

		
	a)
	Chairman of the Board                     $100,000

		
	b)
	Vice Chairman of the Board                       $95,000

		
	c)
	Chairman of the Audit Committee                   $95,000

		
	d)
	Other Chairmen of Committees (excluding Audit and Executive)       $90,000

		
	e)
	All Other Directors                           $80,000

		
	2.
	Each director shall have the opportunity to be paid an amount equal to approximately one-seventh of such director’s annual limit for actual attendance at each scheduled in-person board meeting and board committee meetings, as further described in Section B. The seventh payment opportunity shall be subject to adjustment as further described in Section C.  

		
	3.
	In determining the above director compensation levels, the board considered a comparative compensation study prepared by a third party with expertise in compensation matters and the compensation paid to directors of other Federal Home Loan Banks in 2015 and anticipated to be paid to such directors in 2016.  The board established the above director compensation levels after evaluating the foregoing data and considering the time that directors are expected to devote to Bank business and the need to ensure the Bank’s future ability to attract qualified directors.  The compensation levels reflect the board’s assessment of appropriate and comparable pay that will allow the Bank to recruit and retain highly qualified directors and compensate them for the time required in performing their duties.

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B.    Attendance

		
	1.
	Each director is strongly encouraged to attend all meetings of the board and board committees on which the director serves, and is expected to attend no less than 75 percent of all such meetings each year. 

		
	2.
	The Bank will pay a fee only for a director’s actual attendance at no less than 75 percent of the board meetings (including scheduled board meetings, new director orientation, joint meetings of the Affordable Housing Advisory Council and board or committee, board strategy sessions, and board teleconferences) and meetings of each committee of the board (including any ad hoc committee established by the board for a specific purpose) on which the director serves during each interim period, as identified below. In the event two or more committees on which a director serves

		
	3.
	 are scheduled to meet concurrently, only one committee meeting will be required for the purpose of calculating the director’s attendance. Interested directors are not required to attend board or committee meetings that are devoted exclusively to director election matters.  As ex officio members of all committees, the Chairman and Vice Chairman of the board are encouraged, but not required, to attend committee teleconferences and unscheduled committee meetings (meetings added after the 2016 board and committee meeting schedule is approved by the board).

		
	4.
	The first interim period shall begin on  December 14, 2015 and end on the last day of the first scheduled in-person board meeting for 2016. Each successive interim period shall begin on the calendar day immediately following a scheduled board meeting through and including the day of the next scheduled board meeting, with the seventh interim period ending on December 11, 2016 after the seventh scheduled in-person board meeting, as follows:  

	
			
	Interim Period
	Start Date
	End Date

	 
	 
	 

	First 
	 December 14, 2015
	January 28, 2016

	Second
	January 29, 2016
	March 31, 2016

	Third
	April 1, 2016
	May 26, 2016

	Fourth
	May 27, 2016
	July 28, 2016

	Fifth
	July 29, 2016
	September 25, 2016

	Sixth
	September 26, 2016
	October 26, 2016

	Seventh
	October 27, 2016
	December 11, 2016

 
The foregoing start and end dates will be adjusted to correspond to any changes in the board meeting schedule. 

		
	5.
	Participation by telephone for in-person meetings is discouraged unless necessary to attain a quorum. The Bank will not pay a separate fee for a director’s attendance at meetings other than those described above.

		
	6.
	The Bank will not advance the payment of fees to any director.

C.    Performance

		
	1.
	Compensation paid to directors must reflect the time required of them in the performance of official Bank business. The time required will be measured principally by attendance and participation at board and board committee meetings, as described above, and secondarily by performance of other duties. These other duties include time spent: (a) preparing for board meetings; (b) chairing meetings as appropriate; (c) reviewing materials sent to directors on a periodic basis; (d) attending other related events such as management conferences, FHLBank System meetings, and director training; and (e) fulfilling the responsibilities of directors. 

Page 2 of 3

		
	2.
	Before the seventh payment is made, the Governance and Compensation Committee (GCC) shall review the cumulative attendance and performance of each director during 2016 and, in consultation with the Chairman, recommend to the board a reduction, elimination or increase in the final payment opportunity. No increase shall exceed the applicable compensation limit. In the event a director serves on the board for only a portion of a calendar year, the final payment for such director shall be subject to the same cumulative attendance and performance review through the director’s final date of service. 

D. Expenses

		
	1.
	In accordance with the Bank’s normal reimbursement policy, the Bank will reimburse a director’s travel expenses and any registration fees incurred in connection with attendance at any board or board committee meeting, the Council of FHLBanks’ directors conference, PricewaterhouseCoopers’ audit committee conference, any seminar or event specifically identified in the director education plan, and provided the director is the Bank’s designated representative, meetings of the FHLBank Chairs/Vice Chairs and Council of FHLBanks’ board of representatives.  Please consult the Bank’s Travel and Entertainment Policy for a more detailed explanation regarding expense reimbursement. 

		
	2.
	The Bank will reimburse a director’s registration fees and travel expenses incurred in connection with any other meeting, hearing, ceremony, continuing education seminar, or other event only if the Chairman determines that the meeting is relevant to the Bank’s business activities or the director’s duties as a board member and the director attends the meeting at the request of, or with the approval of, the Chairman. The Vice Chairman shall approve all such fees and expenses for the Chairman. These amounts will be reimbursable to the extent provided for such purpose in the Bank’s annual budget and in accordance with the Bank’s Travel and Entertainment Policy. The Bank will not pay a fee for a director’s participation in these types of activities, and in accordance with 12 CFR Part 1261, the Bank will not reimburse directors for entertainment expenses at these events. 

		
	3.
	The Bank will pay the transportation and other ordinary travel expenses, including meals and incidental activities, of one guest of a director to attend board or shareholder meetings only as specified in advance by the Bank.    

		
	4.
	A board member may invite a guest to Bank-sponsored board dinners or receptions held in connection with board meetings at the expense of the Bank, so long as such guest otherwise pays his or her own transportation and travel expenses.

		
	5.
	Amounts paid by the Bank for any of the foregoing director or guest expenses will be reported as compensation to the director to the extent of and in compliance with applicable Internal Revenue Service laws and regulations and such expenses are in addition to the compensation limits identified on page 1.  

 

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