Alumina : files 'Answer & Counterclaim' in US Court proceedings

Microsoft Word - ASX announcement 2016-25 Counterclaim

ASX Announcement 27 June 2016

Alumina files 'Answer and Counterclaim' in US court proceedings

• Alumina refutes all substantive elements of Alcoa's claim
• Alumina counterclaims that Alcoa's planned 'separation' would breach AWAC joint venture agreements and cannot proceed without Alumina's consent
• Alcoa separation would trigger first option rights for Alumina
• Trial scheduled for 20 September 2016

  Alumina Limited (Alumina) today released its 'answer and counterclaim' filed in response to the 'complaint' recently brought by Alcoa.

  Alumina has refuted all substantive elements of Alcoa's claim and made its own counterclaim. Alumina's counterclaim provides a detailed explanation of Alumina's rights under the AWAC joint venture agreements, and seeks court declarations to both prevent Alcoa taking further steps in its separation without complying with its obligations under the AWAC agreements, and to receive offers to acquire Alcoa's interests in the various AWAC companies under its first option rights.

  The key points of the Alumina filing are as follows:

• The AWAC joint venture arrangements prohibit either party from transferring its interests in the AWAC joint venture agreements without the acceptance and agreement of the other party.

• Under Alcoa's planned separation it is seeking to exit AWAC and will substitute a new unaffiliated legal entity to hold Alcoa's existing interests in the AWAC joint venture.

• Alcoa must obtain Alumina's consent to assign its rights and obligations under the AWAC arrangements to a new legal entity. Alcoa's separation plan would breach the AWAC joint venture agreements, and as currently constituted, Alcoa's planned separation cannot proceed without Alumina's consent.

• Alcoa's reliance on the previous Western Mining Corporation (WMC) demerger as a defence is without merit. The structure currently proposed by Alcoa is fundamentally different to the WMC demerger referred to in Alcoa's complaint.

• Alcoa's separation transaction will trigger various first option rights over Alcoa's AWAC interests in favour of Alumina.

• As a result of the separation, Alumina will seek to assume rights in respect of the sale of its equity share of alumina and bauxite produced by AWAC.

  Alumina is seeking court declarations to:

• prevent Alcoa taking further steps in its separation without Alumina's consent;

• enforce its first option rights to receive offers from Alcoa to acquire Alcoa's AWAC companies; and

• entitle Alumina to exercise rights in respect of the sale of its equity share of AWAC alumina and bauxite production.

Alumina Limited CEO, Peter Wasow, said: "The AWAC joint venture agreements have governed our relationship with Alcoa for over 20 years. We consider that Alcoa's plan to substitute a new entity into the joint venture without our consent is a clear breach of these fundamental agreements. We understand how important the resolution of this matter is for Alcoa's separation and have tried to negotiate with Alcoa to reach an agreement that is commercially acceptable for both parties. Alcoa has chosen instead to bring this matter before the courts. We are committed to pursuing and protecting our rights and the interests of our shareholders through the court process."

A copy of Alumina's redacted answer and counterclaim is attached to this release. Particular attention is drawn to Alumina's counterclaim, which commences on page 25. The counterclaim sets out specific provisions of the AWAC joint venture agreements that are relevant to Alcoa's proposed separation.

Alcoa has applied to the court for various parts of Alumina's answer and counterclaim to remain confidential. The redactions in the attached document are a result of that process.

The Court has set a trial date of 20 September 2016.

Copies of publicly available court documents relevant to the proceeding are available at www.aluminalimited.com

Stephen Foster Company Secretary

27 June 2016

Neither Alumina nor any other person warrants or guarantees the future performance of Alumina or any return on any investment made in Alumina securities. This document may contain certain forward-looking statements, including forward-looking statements within the meaning of the US Private Securities Litigation Reform Act of 1995. The words "anticipate", "aim", "believe", "expect", "project", "estimate", "forecast", "intend", "likely", "should", "could", "will", "may", "target", "plan" and other similar expressions (including indications of "objectives") are intended to identify forward-looking statements. Indications of, and guidance on, future financial position and performance and distributions, and statements regarding Alumina's future developments and the market outlook, are also forward-looking statements.

Any forward-looking statements contained in this document are not guarantees of future performance. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, many of which are beyond the control of Alumina and its directors, officers, employees and agents that may cause actual results to differ materially from those expressed or implied in such statements. Those risks, uncertainties and other factors include (without limitation): (a) material adverse changes in global economic conditions, alumina or aluminium industry conditions or the markets served by AWAC; (b) changes in production or development costs, production levels or sales agreements;

(c) changes in laws, regulations or policies; (d) changes in alumina or aluminium prices or currency exchange rates; (e) Alumina Limited does not hold a majority interest in AWAC and decisions made by majority vote may not be in the best interests of Alumina Limited; and (f) the other risk factors summarised in Alumina's Annual Report 2015. Readers should not place undue reliance on forward-looking statements. Except as required by law, Alumina disclaims any responsibility to update or revise any forward-looking statements to reflect any new information or any change in the events, conditions or circumstances on which a statement is based or to which it relates.

This presentation contains certain non-IFRS financial information. This information is presented to assist in making appropriate comparisons with prior year and to assess the operating performance of the business. Where non-IFRS measures are used, definition of the measure, calculation method and/or reconciliation to IFRS financial information is provided as appropriate or can be found in the Alumina Limited's ASX Full-Year Report for the period ended 31 December 2015.

For investor enquiries: For media enquiries:

Chris Thiris Australia United States Chief Financial Officer Tim Duncan: 0408 441 122 Robert Rendine Phone: [phone] Nerida Mossop: 0437 361 433 Nikki Ritchie

[e-mail] Hinton and Associates:

61 3 9600 1979

Sard Verbinnen & Co: [phone]

EFiled: Jun 24 2016 04:07PM EDT Transaction ID 59192413 Case No. 12385-CB IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

ALCOA INC.,

Plaintiff,

PUBLIC VERSION DATED: JUNE 24, 2016

v.

ALUMINA LIMITED, ALUMINA (USA) INC., and ALUMINA INTERNATIONAL HOLDINGS PTY, LIMITED,

Defendants.

1. No. 12385-CB

   ALUMINA LIMITED, ALUMINA (USA) INC., and ALUMINA INTERNATIONAL HOLDINGS PTY, LIMITED,

   Counterclaim Plaintiffs,

   v.

   ALCOA INC., ALCOA AUSTRALIAN HOLDINGS PTY LTD, ARCONIC INTERNATIONAL HOLDING COMPANY, ASC ALUMINA, INC., REYNOLDS METALS COMPANY, and REYNOLDS METALS EXPLORATION, INC.,

   Counterclaim Defendants.

   ANSWER, DEFENSES, AND COUNTERCLAIMS OF DEFENDANTS ALUMINA LIMITED, ALUMINA (USA) INC., AND ALUMINA INTERNATIONAL HOLDINGS PTY, LTD. TO THE VERIFIED COMPLAINT

   Defendants Alumina Limited, Alumina (USA) Inc., and Alumina International Holdings Pty, Ltd. (collectively, "Defendants"), by their undersigned attorneys, hereby answer the Verified Complaint (the "Complaint") filed by the plaintiff, Alcoa Inc. (the "Plaintiff"),1 as follows:2

   NATURE OF THE ACTION

2. Alcoa brings this action for declaratory relief to forestall continuing threats by Defendants to attempt to interfere with Alcoa's plan to separate its businesses into two companies unless Alcoa gives in to a series of baseless and improper demands.

   ANSWER: Defendants deny the allegations contained in paragraph 1,

   including that Plaintiff is entitled to any relief in the action, except admit that Plaintiff seeks a declaration as described in paragraph 1 and that Plaintiff has announced an intention to separate its business into two companies.

3. In September 2015, Alcoa announced that it plans to enhance shareholder value by separating into two separate publicly traded companies. One company will contain Alcoa's historic "primary products" aluminum, bauxite, mining and refining businesses, as well as certain rolling facilities. The other

4. 1 Unless otherwise noted, capitalized terms in this Answer, Defenses, and Counterclaims of Defendants Alumina Limited, Alumina (USA) Inc., and Alumina International Holdings Pty, Ltd. to the Verified Complaint shall have the meanings set forth in the Complaint.

   2 To avoid any doubt, Defendants deny the allegations of the Complaint except with respect to those specific matters expressly admitted herein.