ISG RESOURCES, INC.
X. Xxxxx Xxxxxxx
Chairman and Chief Executive Officer
November 30, 1999 VIA FEDERAL EXPRESS
(000)000-0000
Xx. Xxxxxx X. Xxxx
Utah Clay Technology, Inc.
0000 Xxxxx 0000 Xxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Dear Xx. Xxxx:
This letter (this "Letter Agreement") is written to summarize the principal
terms of a proposal being considered by ISG Resources, Inc., or its assignee
("ISG"), regarding the possible joint venture with Utah Clay Technology, Inc.
("UCT") for the mining, production, and marketing of kaolin clay products, among
other products. In this Letter Agreement, ISG and UCT are sometimes called the
"Parties" and the transaction in general is sometimes called the "Joint
Venture". It is our desire to commence negotiating a Joint Venture Agreement.
Upon receipt of an original executed copy of this Letter Agreement, we will
begin drafting an initial draft of the Joint Venture Agreement.
1. BASIC TRANSACTION
UCT will provide ISG access to all of its mineral deposits along with
consulting and marketing efforts. ISG will provide testing for the kaolin,
within ISG's discretion. ISG will also provide infrastructure to generate
marketable kaolin products, and market those products jointly with UCT. The
closing of this transaction (the "Closing") would occur on or before February 1,
2000.
2. DUE DILIGENCE
a. ISG will continue to perform due diligence on the minerals from UCT's
sites, through grinding and testing. Through this due diligence and input from
UCT, ISG will determine the relevant markets for the potential products
generated from the minerals, and from which ISG will negotiate a long term
agreement with UCT. ISG will continue to perform due diligence to analyze the
UCT minerals for markets including but not limited to: Facing Granules, Sand
Blast, Fillers-Elastimers, Fillers-Masonry, and Pozzolan.
3. OTHER TERMS
a. UCT will make representations and warranties to ISG, and will provide
comprehensive covenants, indemnities and other protections for ISG's benefit.
An INDUSTRIALSERVICESGROUP Company
Corporate Headquarters
000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000, Xxxx Xxxx Xxxx, XX 00000
Exhibit 10.5
Page 1 of 6 Pages
Xx. Xxxxxx X. Xxxx, President
November 30, 1999
Page 2
b. The consummation of the transaction provided for in the Joint Venture
Agreement is subject to ISG's satisfaction with the results of ISG's
investigation (financial, legal, contractual, etc.) of UCT's business and the
negotiation and execution of a mutually agreeable Joint Venture Agreement. The
transaction provided for in the Joint Venture Agreement is also subject to ISG's
satisfaction with the results of its tests on the kaolin in UCT's deposits and a
marketing analysis thereof.
4. ACCESS
During the period from the date this Letter Agreement is signed by UCT (the
"Signing Date") until the date on which either Party provides the other Party
with written notice that negotiations toward the Joint Venture Agreement are
terminated (the "Termination Date"), or until the date on which the Joint
Venture is completed, whichever is later, UCT will afford ISG, and its
representatives full and free access to the mineral deposits, a reasonable
supply of the minerals (kaolin) for testing, and all documents and data related
thereto.
5. EXCLUSIVE DEALING
Until the later of (i) ninety (90) days after the Signing Date or (ii) the
Termination Date:
a. UCT will not, directly or indirectly, through any representative or
otherwise, solicit or entertain offers from, negotiate with or in any
manner encourage, discuss, accept, or consider any proposal of any other
person relating to a joint venture or the sale of UCT, its assets or
business, in whole or in part, whether directly or indirectly, through
purchase, merger, consolidation, or otherwise; and
b. UCT will immediately notify ISG regarding any contact between UCT or
their respective representatives and any other person regarding any such
offer or proposal or any related inquiry.
6. CONFIDENTIALITY
Except as and to the extent required by law, ISG will not disclose or use,
and will direct its representatives not to disclose or use to the detriment of
UCT, any Confidential Information (as defined below) with respect to that
furnished, or to be furnished, by UCT or its respective representatives to ISG
or its representatives at any time or in any manner other than in connection
with its evaluation of the transaction proposed in this Letter Agreement. For
purposes of this Paragraph, "Confidential Information" means any information
about the Company stamped "confidential" or identified in writing as such to ISG
by UCT promptly following its disclosure, unless (i) such information is already
known to ISG or its representatives or to others not bound by a duty of
confidentiality or such information becomes publicly available through no fault
of ISG or its representatives, (b) the use of such information is necessary or
Exhibit 10.5
Page 2 of 6 Pages
Xx. Xxxxxx X. Xxxx, President
November 30, 1999
Page 3
appropriate in making any filing or obtaining any consent or approval required
for the consummation of the Joint Venture, or (c) the furnishing or use of such
information is required by or necessary or appropriate in connection with legal
proceedings. Upon the written request of UCT, ISG will promptly return to UCT or
destroy any Confidential Information in its possession and certify in writing to
UCT that it has done so.
7. DISCLOSURE
Except as and to the extent required by law, without the prior written
consent of the other Party, neither ISG nor UCT will, and each will direct its
representatives not to make, directly or indirectly, any public comment,
statement, or communication with respect to, or otherwise to disclose or to
permit the disclosure of the existence of discussions regarding, a possible
transaction between the Parties or any of the terms, conditions, or other
aspects of the transaction proposed in this Letter Agreement. If a Party is
required by law to make any such disclosure, it must first provide to the other
Party the content of the proposed disclosure, the reasons that such disclosure
is required by law, and the time and place that the disclosure will be made.
8. COSTS
ISG and UCT will be responsible for and bear all of their own costs and
expenses (including any broker's or finder's fees and the expenses of its
representatives) incurred at any time in connection with pursuing or
consummating the Joint Venture.
9. ENTIRE AGREEMENT
This Letter Agreement constitutes the entire agreement between the parties,
and supersedes all prior oral or written agreements, understandings,
representations and warranties, and courses of conduct and dealing between the
parties on the subject matter hereof. Except as otherwise provided herein, this
Letter Agreement may be amended or modified only by a writing executed by all of
the parties.
10. GOVERNING LAW
This Letter Agreement will be governed by and construed under the laws of
the State of Utah without regard to conflicts of laws principles.
11. TERMINATION
This Letter Agreement will automatically terminate ninety (90) days from
the date hereof, and may be terminated earlier upon written notice by either
party to the other party unilaterally, for any reason or no reason, with or
without cause, at any time; provided, however, that the termination of this
Letter Agreement will not affect the liability of a party for breach of any of
Exhibit 10.5
Page 3 of 6 Pages
Xx. Xxxxxx X. Xxxx, President
November 30, 1999
Page 4
the provisions hereof prior to the termination. Upon termination of the Letter
Agreement, the parties will have no further obligations hereunder, except as
stated in Paragraphs 6, 8, 9 and 10 of this Letter Agreement, which will survive
any such termination.
12. COUNTERPARTS
This Letter Agreement may be executed in one or more counterparts, each of
which will be deemed to be an original copy of this Letter Agreement and all of
which, when taken together, will be deemed to constitute one and the same
agreement.
13. NO LIABILITY
Except as expressly provided in this Letter Agreement (or as expressly
provided in any binding written agreement that the Parties may enter into in the
future), no past or further action, course of conduct, or failure to act
relating to the Joint Venture, or relating to the negotiation of the terms of
the Joint Venture or any Joint Venture Agreement, will give rise to or serve as
a basis for any obligation or other liability on the part of the Parties.
If you are in agreement with the foregoing, please sign and return one copy
of this Letter Agreement to my office. We look forward to working with you.
Sincerely,
/s/ X. Xxxxx Xxxxxxx
X. Xxxxx Xxxxxxx
RSC/cjb
Utah Clay Technology, Inc.:
/s/ Xxxxxx X. Xxxx
------------------
Xxxxxx X. Xxxx
November 30, 1999
Exhibit 10.5
Page 4 of 6 Pages
ISG RESOURCES, INC.
February 10,2000
PERSONAL & CONFIDENTIAL
Xx. Xxxxxx X. Xxxx
Utah Clay Technology, Inc.
0000 Xxxxx 0000 Xxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Re: Extension of Letter Agreement dated November 30, 1999,
("Agreement") between ISG Resources, Inc. ("ISG") and Utah Clay
Technology, Inc. ("UCT")
Gentlemen:
This letter will confirm an extension of the Agreement between ISG and UCT.
ISG, at UCT's request, agrees to extend the Agreement for the period of one and
one-half months beginning February 1, 2000 and ending on March 15, 2000
("Extension Period"). In consideration thereof, UCT agrees that for the
Extension Period ISO will continue to perform due diligence, at its discretion,
to evaluate the potential markets and uses for kaolin products.
Sincerely,
/s/ Xxxxxx X. Xxxxx
Xxxxxx X. Xxxxx
Assistant Secretary
I have read this letter and it accurately reflects the agreement between
ISG and UCT regarding the terms set forth herein.
Utah Clay Technology, Inc.
/s/ Xxxxxx X. Xxxx
By: Xxxxxx Xxxx
Its: President
An INDUSTRIALSERVICESGROUP Company
Corporate Headquarters
000 Xxxx Xxxxx Xxxxxx. Xxxxx 0000, Xxxx Xxxx Xxxx, XX 00000
Exhibit 10.5
Page 5 of 6 Pages
ISG RESOURCES, INC.
June 15, 2000 PERSONAL & CONFIDENTIAL
Xx. Xxxxxx X. Xxxx
Utah Clay Technology, Inc.
0000 Xxxxx 0000 Xxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Re: Letter Agreement for Product Evaluation
Gentlemen:
This letter confirms at UCT's request, that ISG is currently and in the
ongoing process of evaluation and analyzation of UCT's mineral deposits. Through
this evaluation, ISG is testing the characteristics of some of UCT's deposits to
determine the feasibility for marketing and sales of those minerals in modified
form in pozzolanic and cementitious applications. In consideration thereof, UCT
agrees that ISG will continue to perform due diligence, at its discretion, to
evaluate the potential markets and uses for UCT's mineral deposits.
Sincerely,
/s/ Xxxxxx X. Xxxxx
Xxxxxx X. Xxxxx
Associate General Counsel &
Assistant Secretary
I have read this letter and it accurately reflects the agreement between ISG and
UCT regarding the terms set forth herein.
Utah Clay Technology, Inc.
/s/ Xxxxxx X. Xxxx
By: Xxxxxx X. Xxxx
Its: President
An INDUSTRIALSERVICESGROUP Company
Corporate Headquarters
000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000, Xxxx Xxxx Xxxx, XX 00000
Phone (000) 000-0000 Fax (000) 000-0000
Exhibit 10.5
Page 6 of 6 Pages
