VALHI, INC.
                              Three Lincoln Centre
                          5430 LBJ Freeway, Suite 1700
                               Dallas, Texas 75240


                                  July 26, 2002

Board of Directors
Tremont Corporation
1999 Broadway
Suite 4300
Denver, Colorado 80202

Gentlemen:

         Valhi, Inc.  ("Valhi") directly and indirectly owns 5,154,588 shares of
the common stock of Tremont Corporation ("Tremont'"), representing approximately
80% of the 6,424,858  shares of Tremont  currently  outstanding.  Of such shares
held  directly  and  indirectly  by  Valhi,  NL  Industries,   Inc.   ("NL"),  a
majority-owned  subsidiary of Valhi,  indirectly  owns  1,036,167 of the Tremont
shares.  Approximately  94% of the 115,118,917  outstanding  shares of Valhi are
held by Contran Corporation and related entities.

         Valhi  proposes for your  consideration  a merger of Valhi and Tremont,
pursuant to which  stockholders of Tremont (including NL) other than Valhi would
receive  between 2 shares and 2.5 shares of Valhi  common stock for each Tremont
share held.

         While  equity   investments   in  Valhi  and  Tremont  offer   existing
stockholders  similar  characteristics,  with  a  significant  portion  of  each
company's assets  represented by their respective direct and indirect  interests
in NL, Valhi believes that the  combination of Valhi and Tremont would produce a
number of benefits to Tremont stockholders including, among other things:

*        Based on the historical  average daily trading volumes through July 25,
         2002,  Valhi's average daily trading volume was 10 times the volume for
         Tremont since January 1, 2002,  and 15 times for the past three months.
         As a result, a combination will provide shareholders the opportunity to
         achieve  improved  marketability  of their shares through the increased
         trading  volume  and  increased  public  market  float of the  combined
         entity;

*        The opportunity to achieve diversification through an indirect interest
         in Valhi's component  products,  waste management and other businesses;
         and

*        The opportunity to achieve cost efficiencies through the combination of
         corporate administrative functions.

         Your consideration and response to this proposal will be appreciated.

                                                     Sincerely,


                                                     /s/ Steven L. Watson
                                                     Steven L. Watson, President