Keller Files Notice with the Pension Benefit Guaranty Corporation to Terminate Pension Plan

The Keller Manufacturing Company, Inc. ("Keller") (Pink
Sheets:KMFI) announced today that it has initiated formal action with
the Pension Benefit Guaranty Corporation ("PBGC") to terminate The
Keller Manufacturing Company, Inc. Employees' Pension Plan ("Plan") in
what is known as a "distress termination." Keller's board of directors
has determined that Keller can no longer afford to maintain the Plan.
Further, Keller's board has determined that the business associated
with its recently acquired 85% interest in Paragon Door Designs, Inc.
("Paragon") cannot support the ongoing liabilities associated with the
Plan. Accordingly, Keller has asked the PBGC to approve the
termination of the Plan. Keller is hopeful that it will be able to
work with the PBGC to finally resolve all Plan liabilities pursuant to
terms which are acceptable to the PBGC and affordable for Keller and
its new subsidiary Paragon. However, there can be no assurance that
the PBGC will approve the termination of the Plan or that the PBGC
will be willing to work with Keller and Paragon to resolve this
liability in a manner which will allow them to continue to do business
with Keller maintaining an ownership interest in Paragon. It is
possible that the PBGC will require Keller or Paragon, or both, to
liquidate their business and assets and contribute the proceeds toward
the Plan liability.
   The Plan's actuaries have calculated an accrued pension liability
of $3,957,368 at December 31, 2005, up from $3,881,320 at December 31,
2004. However, based on the alternative actuarial methodology used by
the PBGC for calculating the pension plan liability on a "termination
basis", this accrued pension liability may be substantially higher.
   The initial determination by the Plan's actuaries is that
retirement benefits for approximately 98% of the participants in the
Plan should be fully guaranteed by the PBGC and not reduced as a
result of the distress termination (this is subject to review and
approval by the PBGC). The Plan's actuaries also believe that a small
portion of the retirement benefits for those Plan participants who had
earnings over $170,000 annually (less than 2% of the Plan
participants) will not be fully guaranteed by the PBGC. The Plan's
actuaries estimate that these higher wage earners will experience a
minimal reduction in their guaranteed benefits (less than 5%). Keller
is communicating directly with all Plan participants regarding the
termination action and the impact it may have on their benefits, if
any.
   Keller anticipates finalizing its 2005 audited financial
statements and releasing them to shareholders during the second
quarter along with a letter which will provide, if available, an
update on the Plan termination.
   The news release contains certain statements that are
"forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934, as amended. Those statements may include statements regarding
the intent, belief or current expectations of the Company or its
officers with respect to (i) the termination of the Company's employee
pension plan, (ii) the Company's strategic plans, (iii) the policies
of the Company regarding capital expenditures, dividends, financing
and other matters, and (iv) industry trends affecting the Company's
financial condition or results of operations. Readers of this news
release are cautioned that reliance on any forward-looking statement
involves risks and uncertainties. Although the Company believes that
the assumptions on which the forward-looking statements contained
herein are based are reasonable, any of those assumptions could prove
to be inaccurate given the inherent uncertainties as to the occurrence
or nonoccurrence of future events. There can be no assurance that the
forward looking statements contained in this news release will prove
to be accurate. The inclusion of a forward-looking statement herein
should not be regarded as a representation by the Company that the
Company's objectives will be achieved.