Case 16-20012 Document 492 Filed in TXSB on 04/01/16 Page 1 of 8 Filed: 04/01/2016 Docket #0492 Date

IN THE UNITED STATES BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF TEXAS CORPUS CHRISTI DIVISION In re: SHERWIN ALUMINA COMPANY, LLC, et al.,1 Debtors.

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Chapter 11 Case No. 16-20012 (Jointly Administered) David R. Jones

NOTICE OF FILING OF CORRESPONDENCE FROM SHERWIN ALUMINA COMPANY, LLC TO NORANDA BAUXITE LIMITED WAIVING CERTAIN PROVISIONS OF BAUXITE SUPPLY AGREEMENT PLEASE TAKE NOTICE THAT on March 31, 2016, counsel to Sherwin Alumina Company, LLC (“Sherwin”), one of the above-captioned debtors and debtors in possession, sent the attached correspondence to counsel to Noranda Bauxite Limited (“Noranda”). PLEASE TAKE FURTHER NOTICE THAT, consistent with the final sentence of paragraph 3 of the attached correspondence, Sherwin hereby files its correspondence with the Court to provide notice that Sherwin has agreed to waive section 2.1.10 of the Bauxite Supply Agreement, dated as of December 29, 2012, between Sherwin and Noranda.

1

The debtors in these chapter 11 cases, along with the last four digits of each debtor’s federal tax identification number, are: Sherwin Alumina Company, LLC (2376); and Sherwin Pipeline, Inc. (9047). The debtors’ service address is: 4633 Highway 361, Gregory, Texas 78359.

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Respectfully Submitted,

Dated: April 1, 2016

/s/ Joshua A. Sussberg Joshua A. Sussberg, P.C. (admitted pro hac vice) KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 601 Lexington Avenue New York, New York 10022 Telephone: (212) 446-4800 Facsimile: (212) 446-4900 Email: [email protected] - and James H.M. Sprayregen, P.C. (admitted pro hac vice) Gregory F. Pesce (admitted pro hac vice) KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 300 North LaSalle Chicago, Illinois 60654 Telephone: (312) 862-2000 Facsimile: (312) 862-2200 Email: [email protected] [email protected] - and Zack A. Clement (TX Bar No. 04361550) ZACK A. CLEMENT PLLC 3753 Drummond Houston, Texas 77025 Telephone: (832) 274-7629 Email: [email protected] Counsel for the Debtors and Debtors in Possession

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Certificate of Service I certify that on April 1, 2016, I caused a copy of the foregoing document to be served by the Electronic Case Filing System for the United States Bankruptcy Court for the Southern District of Texas. /s/ Joshua A. Sussberg One of Counsel

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Exhibit A

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601 Lexington Avenue New York, New York 10022 Joshua A. Sussberg, P.C. To Call Writer Directly: (212) 446-4829 [email protected]

(212) 446-4800

Facsimile: (212) 446-4900

www.kirkland.com

March 31, 2016

Alan Kornberg Paul, Weiss, Rifkind, Wharton & Garrison LLP 1285 Avenue of the Americas New York, New York 10019-6064 Re:

In re Noranda Aluminum Inc. et al., No. 16-10083 (Bankr. E.D. Mo.)

Dear Alan: In an effort to reach a commercial resolution, Sherwin Alumina Company, LLC (“Sherwin”) is prepared to offer Noranda Bauxite Limited (“Noranda”) and its stakeholders with two options. Either of these options will avoid the time and expense associated with an unnecessary trial regarding the attempt to reject the Bauxite Supply Agreement tomorrow. And, most importantly, either choice will ensure the preservation of thousands of jobs for individuals employed by both Sherwin and Noranda. Indeed, the suggestion (in pleadings filed earlier today) that Noranda may be forced to liquidate and shut down if it cannot reject the Bauxite Supply Agreement, is a statement that could not be more incorrect. It is just the opposite. Rejection of the Bauxite Supply Agreement makes a liquidation of Noranda more probable. And the fact that the board (and all of Noranda’s stakeholders) failed to consider this—let alone analyze the effect of rejection on Noranda’s future viability—is irrefutable evidence that Noranda has not satisfied even the lenient business judgment test. But in any event, all of this is rendered moot by Noranda accepting either option below. Option #1. In recognition of Noranda’s (and its stakeholders’) oft-repeated assertions that its forthcoming business plan will include potential third parties to whom Noranda can sell bauxite without continuing to lose money, Noranda now asserts—notwithstanding its prior assertions in Sherwin’s bankruptcy case1—that the Bauxite Supply Agreement prevents Noranda 1

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More specifically, until today, Noranda has taken the position that the Bauxite Supply Agreement is unenforceable against it, as a debtor in possession, and that “it is entitled (and likely required) to prevent the continued depletion of estate assets, by refusing to perform under the current pricing structure of the” Bauxite Supply Agreement. (See Noranda Bauxite Limited’s Expedited Motion for Relief From the Automatic Stay Pursuant to 11 U.S.C. §§ 105(a) and 362(d) [Sherwin Docket No. 234], at § 2.) Noranda has gone so far as to assert that “cannot . . . be forced to continue performing under the [Bauxite Supply] Agreement[].” (Id., at ¶ 14.) Regardless, Sherwin is prepared to render this inconsistent position moot.

Chicago

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Washington, D.C.

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Alan Kornberg March 31, 2016 Page 2 from selling bauxite to third-party customers other than Sherwin because obligations remain outstanding under the loan agreement between Sherwin and Noranda.2 (See Bauxite Supply Agreement, § 2.1.10.) Sherwin hereby agrees to waive Section 2.1.10 of the Bauxite Supply Agreement, thereby permitting Noranda to sell bauxite to third parties on market terms, subject in all respects to the terms and conditions set forth in section 3.1.14 of the Bauxite Supply Agreement (including Sherwin’s right to match such third party terms). Sherwin believes that a competitive market test—which would obviate the need for Noranda to reject the Supply Agreement—would allow Noranda to determine the highest and best price offered for bauxite produced by St. Ann. To the extent Noranda is able to secure a price that Sherwin is unable to afford (and not otherwise prepared to match consistent with section 3.1.14 of the Bauxite Supply Agreement), Noranda’s problems will be solved. Sherwin intends to file a notice in its bankruptcy case that it has agreed to waive this contractual provision. Option #2. To the extent that Noranda is not prepared to move forward with Option #1, consistent with overtures by Sherwin and its affiliates before the commencement of the Sherwin and Noranda chapter 11 cases, Sherwin is prepared to acquire, through the assumption of all liabilities, on an expedited basis, substantially all of Noranda’s assets (including the St. Ann mine). Sherwin’s proposal is subject to the completion of standard and customary due diligence regarding Noranda’s third-party creditors and liabilities, the execution of definitive documentation acceptable to Sherwin and Noranda, and approval of the proposed transaction in connection with Sherwin and Noranda’s respective bankruptcy cases. To the extent that Noranda is opposed to an outright sale, Sherwin is prepared to enter into a long-term lease agreement on similar terms. As part of Option #2 under either a sale or long-term lease agreement, Sherwin is prepared to enter into a long-term supply contract with the Gramercy Alumina Refinery on mutually acceptable contractual terms (including pricing terms) that include the pricing adjustments, initial contract term, and renewal term set forth below. •

Pricing Adjustments: Pricing shall be subject to the following modifications: •

2

price adjustments on the index basis set forth in the Bauxite Supply Agreement;

See Debtors’ Reply In Support of Motion Authorizing the Rejection of Bauxite Contract with Sherwin Alumina Co., LLC [Docket No. 584], at ¶ 5 (“Under the Bauxite Contract, as long as any amounts are outstanding under the Glencore Credit Agreement, NBL cannot sell any of the bauxite volume reserved for Sherwin to a party is not NBL’s affiliate or an affiliate of Sherwin.”)

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Alan Kornberg March 31, 2016 Page 3 •

plus or minus changes in diesel fuel prices as measured against an industry benchmark that is mutually acceptable to Sherwin and NBL;

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plus or minus changes in “Bunker C” fuel adjustments;

•

plus or minus changes in levies assessed by the Government of Jamaica.

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Initial Contract Term: 5 years.

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Contract Renewals: Renewable at Gramercy’s option for an initial 5-year term, with labor cost price adjustments as set forth above.

Based on the discovery produced by Noranda to Sherwin to date, and in the absence of Noranda choosing Option #1 to actually test the market, we believe that a middle of the road compromise could be reached based upon our differing views on pricing (which would only work with Sherwin in control of the business, either through a sale or a long-term lease). And, of course, if Noranda is confident that the market can bear a better price, or if it can truly operate long term without a third party source of bauxite (which is not the testimony of Mr. Antoine Liddell), then Noranda should select Option #1 and put its money where its mouth is. Please let us know which of these options is acceptable to Noranda. As you review these options, please be advised Sherwin is prepared to pay $22.75 per dry ton for the next two bauxite shipments. Please let us know if this is acceptable and, consistent with the order entered on Wednesday in Sherwin's chapter 11 case, we can take appropriate action. Please call with any questions.

Sincerely,

/s/ Joshua A. Sussberg

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Alan Kornberg March 31, 2016 Page 4

cc:

Matthew Barr, Counsel to Term DIP Lenders and the Ad Hoc Group of Prepetition Term Lenders John Higgins, Counsel to Noranda Bauxite Limited Eric W. Anderson, Counsel to Bank of America, N.A., as Prepetition ABL Agent and ABL DIP Agent Sharon Levin, Counsel to the Official Committee of Unsecured Creditors