---

TO: Grace Employees

FROM: Hudson La Force, President & CEO

SUBJECT: Grace to Be Acquired by Standard Industries Holdings

To the global Grace team –

Moments ago, we announced that we have entered into a definitive agreement under which Standard Industries Holdings, a privately held global industrial company, will acquire Grace for $70 per share in cash. Standard Industries Holdings’ related investment platform 40 North Management LLC is a long-standing shareholder of Grace and understands our businesses and industry well. Upon close, Grace will be an independent operating unit of Standard Industries Holdings. You can read the press release we issued here.

I want to underscore that this transaction is about positioning Grace for continued innovation and growth as a private company. Standard Industries Holdings’ commitment to invest $7 billion in our company is a clear indication of their confidence in our growth opportunities and ability to deliver value, and a clear testament to the strengths of our talented employees, industry-leading technologies, and deep global customer relationships.

As far as next steps, we expect the transaction to close in the fourth quarter of 2021, at which time we will become a privately held company and our stock will no longer trade on the NYSE. Until then, we remain a publicly traded company. Importantly, it is business as usual and our growth plan and priorities are unchanged. We should all remain focused on our day-to-day responsibilities and delivering value to our customers.

We understand that you will have questions about what this announcement means for you. While we will do our best to answer your questions, please keep in mind that today is just the beginning of the process to complete this transaction and there are many details that are still being determined. We have posted a list of frequently asked questions to help address some of your initial questions. Additionally, we will be holding a virtual town hall Tuesday, April 27 at 10:00 am ET where we will discuss this announcement and what to expect in more detail.

Today's announcement may generate increased attention on Grace from outside parties. Consistent with company policy, if you receive any inquiries from investors, members of the media, or anyone else, please do not respond. Similarly, it is important that you do not post or communicate externally about this matter on social media. Please forward investor-related questions to Jason Hershiser at jason.hershiser@grace.com and media-related questions to Caitlin Leopold at caitlin.leopold@grace.com. Questions from customers or suppliers should be directed to your GLT member who will guide you on the appropriate response.

On behalf of our Board of Directors and the Grace Leadership Team, thank you all for your exceptional commitment to our company. Our growth plan and focus on delivering value for our shareholders and customers are very strong foundations for this next chapter in our 167-year history. Our accomplishments throughout these past few years – including today’s announcement – would not have been possible without your unwavering dedication and we’re counting on you to maintain that focus and momentum.

 

Sincerely,

Hudson La Force
President and Chief Executive Officer

Additional Information and Where to Find It

This communication relates to the proposed transaction involving W. R. Grace & Co. (“Grace” or the “Company”).  In connection with the proposed transaction, Grace will file relevant materials with the U.S. Securities and Exchange Commission (the “SEC”), including Grace’s proxy statement on Schedule 14A (the “Proxy Statement”).  This communication is not a substitute for the Proxy Statement or any other document that Grace may file with the SEC or send to its stockholders in connection with the proposed transaction.  BEFORE MAKING ANY VOTING DECISION, STOCKHOLDERS OF GRACE ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH THE SEC, INCLUDING THE PROXY STATEMENT, WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION.  Investors and security holders will be able to obtain the documents (when available) free of charge at the SEC’s website, http://www.sec.gov, and Grace’s website, www.grace.com.  In addition, the documents (when available) may be obtained free of charge by accessing the Investor Relations section of Grace’s website at investor.grace.com or by contacting Grace’s Investor Relations by email at investor.relations@grace.com.

Participants in the Solicitation

The Company and its directors and executive officers may be deemed to be participants in the solicitation of proxies from the holders of Grace common stock in respect of the proposed transaction.  Information about the directors and executive officers of Grace is set forth in the proxy statement for Grace’s 2020 annual meeting of stockholders, which was filed with the SEC on March 31, 2020, and in other documents filed by Grace with the SEC.  Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the Proxy Statement and other relevant materials to be filed with the SEC in respect of the proposed transaction when they become available.

 

Forward-Looking Statements

Certain statements contained in this communication may contain forward-looking statements, that is, information related to future, not past, events.  Such statements generally include the words “believes,” “plans,” “intends,” “targets,” “will,” “expects,” “suggests,” “anticipates,” “outlook,” “continues,” or similar expressions.  Forward-looking statements include, without limitation, statements regarding:  financial positions; results of operations; cash flows; financing plans; business strategy; operating plans; capital and other expenditures; impact of COVID-19 on Grace’s business; competitive positions; growth opportunities for existing products; benefits from new technology; benefits from cost reduction initiatives; succession planning; markets for securities; the anticipated timing of closing of the proposed transaction and the potential benefits of the proposed transaction.  For these statements, Grace claims the protections of the safe harbor for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.  Grace is subject to risks and uncertainties that could cause actual results or events to differ materially from its projections or that could cause forward-looking statements to prove incorrect.   Factors that could cause actual results or events to differ materially from those contained in the forward-looking statements include, without limitation:  risks related to foreign operations, especially in areas of active conflicts and in emerging regions; the costs and availability of raw materials, energy, and transportation; the effectiveness of Grace’s research and development and growth investments; acquisitions and divestitures of assets and businesses; developments affecting Grace’s outstanding indebtedness; developments affecting Grace’s pension obligations; legacy matters (including product, environmental, and other legacy liabilities) relating to past activities of Grace; its legal and environmental proceedings; environmental compliance costs (including existing and potential laws and regulations pertaining to climate change); the inability to establish or maintain certain business relationships; the inability to hire or retain key personnel; natural disasters such as storms and floods; fires and force majeure events; the economics of our customers’ industries, including the petroleum refining, petrochemicals, and plastics industries, and shifting consumer preferences; public health and safety concerns, including pandemics and quarantines; changes in tax laws and regulations; international trade disputes, tariffs, and sanctions; the potential effects of cyberattacks; the occurrence of any event, change or other circumstance that could give rise to the termination of the merger agreement between Grace and Standard Industries Holdings Inc.’s affiliates; the failure to obtain Grace stockholder approval of the transaction or the failure to satisfy any of the other conditions to the completion of the transaction; risks relating to the financing required to complete the transaction; the effect of the announcement of the transaction on the ability of Grace to retain and hire key personnel and maintain relationships with its customers, vendors and others with whom it does business, or on its operating results and businesses generally; risks associated with the disruption of management’s attention from ongoing business operations due to the transaction; the ability to meet expectations regarding the timing and completion of the transaction; significant transaction costs, fees, expenses and charges; the risk of litigation and/or regulatory actions related to the transaction; other business effects, including the effects of industry, market, economic, political, regulatory or world health conditions (including new or ongoing effects of the COVID-19 pandemic), and other factors detailed in Grace’s Annual Report on Form 10-K filed with the SEC for the fiscal year ended December 31, 2020 and Grace’s other filings with the SEC, which are available at http://www.sec.gov and on Grace’s website at www.grace.com. Our reported results should not be considered as an indication of our future performance.  Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Grace undertakes no obligation to release publicly any revisions to our projections and forward-looking statements, or to update them to reflect events or circumstances occurring after the dates those projections and statements are made.