Keystone Granted Interim Relief from Certain Provisions

Keystone Consolidated Industries, Inc. announced that the U.S. Bankruptcy Court for the Eastern District of Wisconsin granted the company's request for interim relief from certain provisions under the company's Collective Bargaining Agreement with the Independent Steelworkers Alliance, which represents substantially all of the company's hourly active employees at its Peoria facilities.

The interim relief granted relates primarily to obligations to provide medical benefits for current employees and retirees represented by the ISWA. The interim relief will take effect March 15, and continue for six months. The company was also granted interim relief from certain other retiree medical benefit obligations related to certain discontinued operations for a period of 2 months.

The relief granted was part of a compromise reached with representatives of the ISWA, with the support and endorsement of the unsecured creditors' committee. As part of this compromise, the company agreed to allow the ISWA to continue to represent the retirees and agreed to begin negotiations on permanent relief from certain provisions of the collective bargaining agreement and retiree medical benefit obligations. In addition, the ISWA officials promised that the union would continue to work without slowdowns or other "house actions" that could adversely affect production.

The company will seek final approval from the Bankruptcy Court of the previously announced $60 million Debtor in Possession financing agreements on March 15. If the final Debtor in Possession agreements are approved, the funds available pursuant thereto together with the cost savings resulting from the interim relief granted by the court is anticipated to provide sufficient liquidity for the company to continue to operate under the protection of Chapter 11 of the U.S. Bankruptcy Code while the company works to develop a comprehensive plan of reorganization.