GERDAU S.A.

INFORMATION DISCLOSURE POLICY




SUMMARY

1 OBJECTIVE
2 COVERAGE
3 DEFINITIONS
4 RESPONSIBILITIES OF THE INVESTOR RELATIONS DIRECTOR
5 PROCEDURES FOR EXECUTING THE DISCLOSURE POLICY
6 CONFIDENTIALITY OF INFORMATION
7 POLICIES
8 THIRD PARTIES INVOLVED
9 AGREEMENT RECORD
10 APPROVAL DATE AND VALIDITY


1. OBJECTIVE

Gerdau S.A. is committed to continually improving the way it interrelates with all the people that it comes in contact with, seeking to improve the value of the Securities it issues in the Market and to add value to its patrimony without neglecting its social functions. From the planning phase until the execution of its services or of its production, the pursuit of quality is founded upon respect to clients, to employees, to suppliers, to shareholders and other investors, to creditors, and to society in general.

The present Information Disclosure Policy has the purpose of registering and clarifying the criteria and procedures to be used in the relationship with the investor as it relates to the disclosure of Relevant Acts and Facts. Its objective is to develop a continual flow of information in order to maintain the expectation of the investor on a realist level by means of an efficient announcing of the required information, working from the broadest base possible.


2. COVERAGE

The present Policy should be observed by the Company's direct or indirect Controlling Shareholders, the Administrators, the members of the Fiscal Council, and by any organs with technical or consultative functions created according to company by-laws, or by any person who, by nature of their responsibility, function, or position in the Company, its Parent Company, its subsidiaries or branches, has knowledge of information related to a Relevant Act or Fact.


3. DEFINITIONS

This disclosure policy adopts the following definitions:
Controlling Shareholders: Those defined as such in art. 116 of Law no. 6.404, of 1976 and posterior amendments.
Administrators: The members of the Administrative Council and the Directors of the Company.
Relevant Acts and Facts: Any decision made by Controlling Shareholders, discussion in the General Assembly or by the Company's administrative organs, or any other act or fact of a policy-administrative, technical, negotiation, or economic-financial nature that occurs within or related to the Company's business and that could influence in a considerable way the (i) price quote of the Securities in the Market, (ii) decision of the Market investors to buy, sell, or keep their Securities, or (iii) determination of the Investors to exercise any rights that are inherent to their condition as titleholders of Securities.
Examples of Relevant Acts or Facts:
(i) signing of an agreement or contract to transfer the Company's stock control, even though still in a suspensive or resoluble state.
(ii) change in the Company's control, including that of signing, altering, or rescinding agreements made by shareholders.
(iii) signing, altering, or rescinding stockholder agreements by the Company.
(iv) ingression or leaving of a strategic partner or of one that has an operational, financial, technological, or administrative contract or collaboration.
(v) authorization to negotiate in the Market the Securities issued by the Company.
(vi) decision to carry out the canceling of the registration to operate as an open company.
(vii) acquisition, merger, or split that involves the Company or its subsidiaries.
(viii) buying or selling of assets of significant value.
(ix) transformation or dissolving of the Company.
(x) significant change in the Company's capital makeup.
(xi) changes to the accounting criteria.
(xii) assuming, liquidating beforehand, or renegotiating significant debts.
(xiii) approving a plan that provides the option to buy stocks.
(xiv) alteration in the rights and advantages of the Securities issued by the Company.
(xv) stock split, reverse stock split, or the paying of bonuses.
(xvi) acquisition of Company stocks for keeping in the treasury or for canceling and alienating the stocks purchased in this way.
(xvii) company profit or loss and the payment of dividends or interest on its own capital.
(xviii) signing or canceling of a significant contract, or the unsuccessfulness in being able to carry it out, when the expectation of it going through had been made public.
(xix) approval, alteration, or canceling of a relevant project or its delay in being implanted.
(xx) starting up, retaking, or suspending the manufacturing or selling of products or the providing of services, when this is relevant.
(xxi) invention, change, or development of Company technology or its relevant resources.
(xxii) approval of legislation or norms that significantly affect the Company.
(xxiii) modification of relevant projections announced by the Company.
(xxiv) approval, by the Company's administrative organs, of the realization of a public offer that depends on it being registered with CVM.
(xxv) acquisition of the stock control of an open company .
The events related to a Relevant Act or Fact should have their impact analyzed within the context of the Company's ordinary activities and its dimension, along with the information previously published, and not in an abstract way so as to trivialize the announcements of Relevant Acts or Facts in detriment to the quality of the analysis, by the Market, of the Company's perspectives.

Market: Public place for investors to negotiate, directly or through intermediary agents, the Securities issued by open companies.

Frontline People: The Administrators, the Fiscal Council members, and any other organs with technical or consultative functions, created by a clause in the company by-laws.

Third Parties Involved: Anyone outside the Company that, due to a contract with it, has or could have access to information related to Relevant Acts or Facts.

Securities: The stocks, debentures, subscription bonuses, receipts and subscription rights, commercial papers issued by the Company, certificates of deposits of these Securities, and future contracts and options and other derivatives linked to any of these Securities, negotiated on the Market.


4 - DUTIES AND RESPONSIBILITIES OF THE INVESTOR RELATIONS DIRECTOR

The responsibilities of the Investor Relations Director is as follows:

» Disclose to the Market and communicate to the regulatory and self-regulatory organs any Relevant Act or Fact that occurs or is related to the Company's business, immediately after becoming aware of the fact.

» Insure that the announcement of a Relevant Act or Fact to the Market is complete, simultaneous, and immediate.

» Serve as the Company's main spokesperson on subjects related to the Market.

» Answer the competent organs promptly to their eventual solicitation for further clarifications, corrections, additions, or republication of a Relevant Act or Fact.

» Receive the communication about quantity, characteristics, and form of acquisition of the Securities being negotiated in the Market, issued by the Company and its controlled companies or subsidiaries that are open companies, of which the Frontline People are titleholders, as well as the changes in their positions.

» Follow the negotiation of the Securities issued by the Company and in the case of identifying atypical oscillations in the rates, price quotes, or quantity negotiated, must check the existence of new information about the Company that should be disclosed to the Market.


5. PROCEDURES FOR EXECUTING THE DISCLOSURE POLICY

» The Frontline People should communicate any Relevant Act or Fact of which they have personal knowledge of to the Investor Relations Director, or in his absence to the person indicated by the Investor Relations Director, or in his absence, directly to any member of the Executive Committee, who shall immediately promote its disclosure or submit the subject to the Executive Committee so that it can decide on the need of its announcement.

» If the Administrators verify an omission on the part of the Investor Relations Director in carrying out any one of his assigned duties, they should send a copy of the communication issued referred to above to the other members of the Executive Committee and to the Company's Administration Council in order to immediately take the appropriates steps to disclose the information, if that is the case.

» If the omission persists, the Administrators will only be exempt of responsibility if they immediately communicate a Relevant Act or Fact to CVM.

» The rules mentioned above extend equally to the Controlling Shareholders, when they apply.

» In the case of disclosing a Relevant Act or Fact by any means of communication, including information to the press or in collective or individual meetings with entities of the segment, investors, analysts, or with a select public in the Country or abroad, the same information shall be disclosed simultaneously to the Market.

» The communication of a Relevant Act or Fact to the regulatory and self-regulatory organs should occur immediately after it is made known.

» The disclosure of a Relevant Act or Fact should be done by means of a published announcement in the newspapers used by the Company, where it will contain a summarized description of the Relevant Act or Fact, as long as it shows the Internet address where the complete description of this Relevant Act or Fact can be found.

» A Relevant Act or Fact should also be communicated to the Market by means of a written explanatory document, sent electronically, immediately after its communication to the regulatory and self-regulatory organs.

» The text should be written in clear and precise language that can be understood by the investors in general. This disclosure should be done, whenever possible, before or after the closing of trades on the stock market or by organized over-the-counter market entities.


6 - CONFIDENTIALITY OF INFORMATION

» The Frontline People and those who, due to the nature of their responsibilities, function, or position in the Company, its Parent Company, its subsidiaries or branches, have knowledge of information related to a Relevant Act or Fact, should keep this confidential until this is disclosed to the Market, as well as ensure that their subordinates or third parties under their responsibility do the same.

» While this information is not disclosed to the Market, the people referred to above cannot use this information to obtain for themselves or for others an advantage with the buying and selling of Securities issued by the Company or those linked to it, and the Frontline People should make sure that this violation does not happen through subordinates or third-parties under their responsibility.

» The rules established above equally apply to the Controlling Shareholders, when this is the case.


7. POLICIES

7.1 - Transparency:
Gerdau S.A. is committed to announcing immediately all information related to Relevant Acts and Facts and other information that it considers relevant for the good understanding of its economic-financial, patrimonial, and commercial-business situation.


7.2. - Carrying out the Immediate Disclosure of a Relevant Act or Fact:
This commitment will only not cover exceptional situations where confidentiality is imperative in order to protect the Company's legitimate interests that include strategic issues of competitiveness. In these cases, the person making this decision will be the Investor Relations Director together with the area that has the information, or by the Executive Committee or, in last instance, by the Administrative Council.


7.3 - Legal and Ethical Duty:
Gerdau S.A. will disclose its information with quality, trustworthiness, and especially with impartiality, not favoring certain people or institutions. Its ethics and professionalism should also permeate the correct way of handling communication so that it keeps the facts, whether negative or positive, from being unduly underestimated or overestimated.


7.4 - Disclosure of Information about the Negotiation of Frontline People
(A) Communication of the Titleholders of the Company's Securities

The Frontline People should communicate the following, in writing, to the Investor Relations Director and to the regulatory and self-regulatory organs:
» Immediately after being admitted to the position, the quantity of Securities issued by Gerdau S.A. and by controlled companies or subsidiaries that are open companies that they own at that time, as well as those owned by their spouse, unless they are separated in fact or judicially from their spouse, or of any dependent listed in their annual income tax statement.
» The changes made to the positions mentioned above, within a timeframe of 10 (ten) days after the ending of the month in which the change occurred, indicating the balance of the position during the period.


(B) Data to Show on the Titleholder Certificate

The communication should include the following:
» Name and qualification of the titleholder, stating their CPF (individual registration) or CNPJ (National Register of Legal Entities) number.
» Quantity, by specie and class in the case of stocks, and specific characteristics in the case of other Securities, beyond identifying the issuing company.
» Form, price and date of the transactions.
7.5 - Comments on Rumors:
It is Gerdau S.A. policy not to comment on rumors, answering these type of questions by simply stating, "It is our policy not to comment on rumors or speculations." However, if hearsay or rumors are affecting the price or volume of negotiations with the Securities issued by the Company, this could raise the need to make an official statement negating or confirming the information. This option should be evaluated by the Investor Relations Director and decided upon by the Executive Committee or the Administrative Council, as is the case.


8. THIRD PARTIES INVOLVED

The contracting of Third Parties Involved should include rules that guarantee the confidentiality of information that could constitute as a Relevant Act or Fact, as well as abiding by the norms defined by the Securities Commission - CVM, as it relates to the Negotiation of the Company's Securities.


9. AGREEMENT RECORD

» The Frontline People and the Controlling Shareholders must sign the Agreement Record of the Information Disclosure Policy, according to the model annexed. This document will be filed in the Company's headquarters during the time this person has a tie with it, and for at least five years afterwards.

» The Company will also keep an abbreviated list of the signers and their respective qualifications, showing their position or function, address, and their CNPJ (National Register of Legal Entities) or CPF (individual registration) number. The Company shall keep this list up-to-date.


10. APPROVAL DATE AND VALIDITY

This Policy was approved in a meeting of the Company's Administrative Council held on July 25, 2002 and will have effect beginning August 1, 2002.


Rio de Janeiro - July 25, 2002
The Administration



(Annex to the Information Disclosure Policy)

GERDAU S.A.

AGREEMENT RECORD TO THE INFORMATION DISCLOSURE POLICY

By this present instrument, ________________________ (name and complete qualification of the signer), under the condition of ____________________(indicate the position, function, or relation in the company), declares, for legal purposes, to be completely aware of the Information Disclosure Policy for GERDAU S.A., an open company located at Av. Joćo XXIII, 6.777, Distrito Industrial de Santa Cruz, Rio de Janeiro, RJ, registered with a CNPJ/MF number of 33.611.500/0001-19, approved in the meeting held by the Company's Administrative Council on July 25, 2002, which establishes the criteria related to the disclosure of a Relevant Act or Fact, to communicating titleholders, to negotiating Securities, and to the maintenance of secrecy of relevant information, hereby being obliged to abide by and carry out the rules stated in this Policy.

The present Agreement Record is signed with 2 (two) copies of equal content and form and one is to be filed at the Company Headquarters, in the presence of the 2 (two) witnesses who have also signed below.

Rio de Janeiro, _____________________
(complete name of the signer)


Testimonies:

1. ____________________ (Name, RG, CPF)

2. _____________________(Name, RG, CPF)