<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ____________ TO ______________
Commission File Number 1-7035
CALMAT CO.
- - --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 95-0645790
- - ------------------------------- ----------------
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) Identification No.)
3200 San Fernando Road, Los Angeles, California 90065
- - ----------------------------------------------- ----------------
(Address of principal executive offices) (ZIP Code)
Registrant's telephone number, including area code (213) 258-2777
----------------
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
YES [X] NO [ ]
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE
PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
YES [ ] NO [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
23,289,325 Common Stock were outstanding at July 31, 1997.
-1-
<PAGE>
CALMAT CO.
INDEX
-----
PART I - FINANCIAL INFORMATION PAGE
Item 1. Financial Statements
(a) Consolidated Balance Sheets:
June 30, 1997 and December 31, 1996 3
(b) Consolidated Statements of Operations:
For the Three and Six Months Ended June 30, 1997 and 1996 4
(c) Consolidated Statements of Cash Flow:
For the Six Months Ended June 30, 1997 and 1996 5
(d) Notes to the Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 10
Item 2. Changes in Securities 10
Item 4. Submission of Matters to a Vote of Security Holders 10-11
Item 6. Exhibits and Reports on Form 8-K 12
Signatures 13
-2-
<PAGE>
CALMAT CO.
CONSOLIDATED BALANCE SHEETS
(amounts in thousands)
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
----------- ------------
ASSETS (unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 5,985 $ 17,127
Cash held in trust for section 1031 exchanges 5,309 8,648
Trade accounts receivable, less allowance
for discounts and doubtful accounts
($5,673 in 1997 and $5,309 in 1996) 69,860 52,558
Income taxes receivable -- 1,395
Inventories 16,951 13,972
Prepaid expenses and other 4,408 4,335
Deferred income taxes 11,867 11,867
Installment notes receivable-current portion 1,284 337
--------- ---------
Total current assets 115,664 110,239
Installment notes receivable and other assets 31,623 28,602
Costs in excess of net assets of business acquired, net 49,565 50,410
Property, plant and equipment, at cost:
Land and deposits 183,656 183,516
Buildings, machinery and equipment 504,217 495,320
Construction in progress 32,830 31,763
--------- ---------
720,703 710,599
Less: Accumulated depreciation and depletion (310,042) (299,134)
--------- ---------
Property, plant and equipment, net 410,661 411,465
--------- ---------
Total assets $ 607,513 $ 600,716
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 24,929 $ 20,208
Accrued liabilities 34,498 34,905
Notes and bonds payable - current portion 91 100
Income taxes payable 895 --
Dividends payable 2,324 2,324
--------- ---------
Total current liabilities 62,737 57,537
Notes and bonds payable - long term portion 115,985 116,233
Other liabilities and deferred credits 39,462 38,429
Deferred income taxes 56,327 56,325
--------- ---------
Total liabilities 274,511 268,524
--------- ---------
Stockholders' equity:
Common stock 23,273 23,240
Additional paid-in capital 42,098 41,521
Retained earnings 267,631 267,431
--------- ---------
Total stockholders' equity 333,002 332,192
--------- ---------
Total liabilities and stockholders' equity $ 607,513 $ 600,716
========= =========
</TABLE>
See accompanying notes to consolidated financial statements.
-3-
<PAGE>
CALMAT CO.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, amounts in thousands, except per share data)
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, June 30,
1997 1996 1997 1996
-------- -------- -------- ---------
<S> <C> <C> <C> <C>
Revenues:
Net sales and operating revenues $115,724 $105,038 $204,506 $185,564
Gains on sales of real estate 634 1,149 1,566 1,800
Other income 2,079 495 2,984 1,974
-------- -------- -------- --------
118,437 106,682 209,056 189,338
-------- -------- -------- --------
Costs and expenses:
Cost of products sold and operating expenses 96,425 88,139 176,139 160,806
Selling, general and administrative expenses 11,168 9,990 21,036 19,324
Interest expense 1,919 1,176 3,846 2,277
Other expense 312 445 460 830
-------- -------- -------- --------
109,824 99,750 201,481 183,237
-------- -------- -------- --------
Income before taxes 8,613 6,932 7,575 6,101
Federal and state income taxes 3,127 2,564 2,727 2,257
-------- -------- -------- --------
Net income $ 5,486 $ 4,368 $ 4,848 $ 3,844
======== ======== ======== ========
Weighted average shares outstanding 23,248 23,251 23,245 23,227
======== ======== ======== ========
Per Share Data:
Net income $ 0.24 $ 0.19 $ 0.21 $ 0.17
======== ======== ======== ========
Cash dividends $ 0.10 $ 0.10 $ 0.20 $ 0.20
======== ======== ======== ========
</TABLE>
See accompanying notes to consolidated financial statements.
-4-
<PAGE>
CALMAT CO.
CONSOLIDATED STATEMENTS OF CASH FLOW
(unaudited, amounts in thousands)
<TABLE>
<CAPTION>
Six months ended
June 30,
1997 1996
-------- --------
<S> <C> <C>
OPERATING ACTIVITIES:
Net income $ 4,848 $ 3,844
Depreciation, cost depletion and amortization 17,267 15,141
Other (20,076) (1,317)
-------- --------
Cash provided by operating activities 2,039 17,668
-------- --------
INVESTING ACTIVITIES:
Purchase of property, plant and equipment (18,815) (30,583)
Proceeds from sale of real estate 6,488 1,488
Other (235) 972
-------- --------
Cash used for investing activities (12,562) (28,123)
-------- --------
FINANCING ACTIVITIES:
Notes payable to banks - 14,000
Principal payments on bonds payable (33) (60)
Payment of cash dividends (4,648) (4,637)
Other 723 1,152
-------- --------
Cash (used for) provided by financing activities (3,958) 10,455
-------- --------
Decrease in cash (14,481) -
Decrease in cash held in trust for section 1031 exchanges (3,339) -
-------- --------
Decrease in cash and cash equivalents (11,142) -
Cash and cash equivalents, beginning of period 17,127 -
-------- --------
Cash and cash equivalents, end of period $ 5,985 $ -
======== ========
</TABLE>
See accompanying notes to consolidated financial statements.
-5-
<PAGE>
CALMAT CO.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
1. In the opinion of management, information furnished herein reflects all
adjustments necessary for a fair presentation of the financial position and
results of operations for the interim periods. There have been no changes in
the significant accounting policies as discussed in Note 1 of Notes to
Financial Statements contained in the Company's 1996 Annual Report on Form
10-K.
2. Earnings per common equivalent share (common shares adjusted for dilutive
effect of common stock options) have been computed by dividing net income for
each period by the weighted-average equivalent shares of common stock
outstanding.
3. In February 1997 the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards ("SFAS") No. 128, "Earnings Per Share". SFAS
No. 128 is required to be implemented for financial statements for both
interim and annual periods ending after December 15, 1997. Based on a review
of the requirements of SFAS No. 128, management does not anticipate any
material change in previously reported earnings per share.
4. Certain prior year amounts have been restated to conform to the current
year's presentation.
-6-
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
- - -------------------------------------------------------------------------------
of Operations
- - -------------
Results of Operations
- - ---------------------
The Company reported net income of $5.5 million, or $0.24 per share, for the
second quarter of 1997, compared with $4.4 million, or $0.19 per share, for the
prior year's second quarter. Net income was $4.8 million, or $0.21 per share,
for the six months ended June 30, 1997, compared with $3.8 million, or $0.17 per
share, for the comparable period in 1996.
Business segment information for the three and six months ended June 30, 1997
and 1996 is as follows:
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
1997 1996 1997 1996
--------- ---------- --------- ---------
(unaudited, amounts in thousands)
<S> <C> <C> <C> <C>
Revenues:
Construction Materials $110,532 $ 99,425 $194,423 $174,629
Properties - Operations 5,192 5,613 10,083 10,935
Properties - Real Estate Gains 634 1,149 1,566 1,800
Corporate and Other 2,079 495 2,984 1,974
-------- -------- -------- --------
$118,437 $106,682 $209,056 $189,338
======== ======== ======== ========
</TABLE>
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
1997 1996 1997 1996
-------- -------- -------- --------
(unaudited, amounts in thousands)
<S> <C> <C> <C> <C>
Income before income taxes:
Construction Materials $ 9,515 $ 7,538 $ 9,832 $ 7,230
Properties - Operations 2,436 2,483 4,769 4,828
Properties - Real Estate Gains 634 1,149 1,566 1,800
Corporate and Unallocated Expenses, Net (3,524) (3,269) (6,595) (6,018)
Interest Expense (1,919) (1,176) (3,846) (2,277)
Other Income 1,471 207 1,849 538
-------- -------- -------- --------
$ 8,613 $ 6,932 $ 7,575 $ 6,101
======== ======== ======== ========
</TABLE>
Income before income taxes by segment represents total revenues less direct
operating expenses, segment selling, general and administrative expenses and
certain allocated corporate general and administrative expenses. Corporate and
Unallocated Expenses, Net includes corporate administrative expenses and support
expenses not allocated to business segments. Other Income includes interest
income and other miscellaneous items.
-7-
<PAGE>
CALMAT CO.
Construction Materials Division
- - -------------------------------
Sales volumes are shown below.
<TABLE>
<CAPTION>
Amounts in Thousands Three Months Ended Six Months Ended
- - -------------------- June 30, June 30,
1997 1996 1997 1996
------ ------- ------- --------
<S> <C> <C> <C> <C>
Aggregates:
Tons sold to outside customers 5,170 4,643 9,314 8,280
Tons used in ready mixed concrete 789 869 1,473 1,564
Tons used in asphalt 1,472 1,277 2,496 2,228
----- ----- ------ ------
7,431 6,789 13,283 12,072
===== ===== ====== ======
Tons of hot-mix asphalt sold 2,026 1,898 3,482 3,151
===== ===== ====== ======
Yards of ready mixed concrete sold 660 617 1,194 1,170
===== ===== ====== ======
</TABLE>
Revenues in the Construction Materials Division were $110.5 million in the
second quarter of 1997, up $11.1 million, or 11% compared with the corresponding
1996 period. Revenues were $194.4 million in the first six months of 1997, an
increase of $19.8 million, or 11% compared with the same period in 1996. The
revenue increase for the current quarter and six-month period was primarily due
to higher sales volumes for aggregates, asphalt and ready mixed concrete
operations and higher average selling prices for aggregates and ready mixed
concrete operations.
The Division's pre-tax income from operations for the quarter increased to $9.5
million from $7.5 million in the year earlier quarter. The improved earnings
are primarily the result of higher profits from our aggregates operations, due
to 9% higher sales volumes and 7% higher average selling prices. Most of the
earnings improvement from aggregates came from the Company's Southern California
operations. Earnings from ready mixed concrete operations were slightly higher
due to 7% higher sales volumes and 2% higher average selling prices, partially
offset by 3% higher unit production costs. Earnings from asphalt operations
were also slightly higher due to 7% higher sales volumes and 2% lower unit
production costs, partially offset by 2% lower average selling prices.
The Division's pre-tax income from operations for the six months increased to
$9.8 million from $7.2 million in the 1996 period. The improvement was
primarily the result of higher earnings from our aggregates operations, due to
10% higher sales volumes and 8% higher average selling prices. Most of the
earnings improvement from aggregates came from the Company's Southern California
operations. Earnings from the ready mixed concrete operations were slightly
higher due to 2% higher sales volumes and 3% higher average selling prices,
partially offset by 3% higher unit production costs. Earnings from asphalt
operations were essentially flat despite an 11% increase in sales volumes
because of slightly lower average selling prices and slightly higher unit
production costs.
Properties Division
- - -------------------
Revenues in the Properties Division, excluding gains on sales of real estate,
were $5.2 million in the second quarter of 1997, down $0.4 million from revenues
of $5.6 million in the corresponding 1996 period, and $10.1 million in the first
six months of 1997, down $0.8 million from revenues of $10.9 million in the
first six months of 1996. The decrease in revenue for the current quarter and
six-month period was primarily due to decreased revenue from landfill operations
and developed properties which, in turn, was caused by recent sales of such
properties.
-8-
<PAGE>
CALMAT CO.
Properties Division - continued
- - -------------------
The Division's pre-tax income from operations was $3.1 million for the second
quarter compared with $3.6 million in the prior year's second quarter. Included
in the current quarter are $0.6 million of gains from real estate sales,
compared with gains of $1.1 million in the prior year's quarter. Pre-tax
income from operations was $6.3 million in the first six months of 1997 compared
with $6.6 million in the prior period. Gains from real estate sales of $1.6
million are included in 1997 versus gains of $1.8 million in 1996.
Other
- - -----
Interest expense was $0.7 million higher in the second quarter of 1997 compared
with the prior year's quarter, and $1.6 million higher in the first six months
of 1997, compared with the prior year, due to higher levels of average debt
outstanding and higher weighted-average interest rates. The higher average
interest rate results from a long-term debt refinancing accomplished in late
1996 at favorable long-term rates.
Other income in the second quarter and in the first six months of 1997 includes
a $1.1 million refund received as settlement of a prior year tax claim of a
former subsidiary.
Liquidity and Capital Resources
- - -------------------------------
Cash and cash equivalents were $6.0 million at June 30, 1997 compared with $17.1
million at December 31, 1996. Cash provided by operating activities was $2.0
million for the six months ended June 30, 1997. Cash used for investing
activities was $12.6 million, including $18.8 million used for the purchase of
property, plant and equipment. Cash used for financing activities was $4.0
million.
Working capital totaled $52.9 million at June 30, 1997, up from $52.7 million at
December 31, 1996. Current ratios were 1.8 and 1.9 at June 30, 1997 and
December 31, 1996, respectively.
Total consolidated long-term and short-term borrowings at June 30, 1997 and
December 31, 1996 were $116.1 million and $116.3 million, respectively. Debt as
a percent of total capitalization was 25.8% and 25.9%, at June 30, 1997 and
December 31, 1996, respectively.
-9-
<PAGE>
CALMAT CO.
Part II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
- - ---------------------------
In March and September of 1995, unfair labor practice claims were filed against
the Company, alleging that the Company had committed certain unfair labor
practices relating to the Southern California I.U.O.E. Local 12 labor strike,
which began in July 1995. The Regional Director of the National Labor
Relations Board (NLRB) ruled that the allegations against the Company were
without merit and dismissed the case. The I.U.O.E. Local 12 appealed the case
to the NLRB Office of Appeals. On May 23, 1997 an NLRB Administrative Law
Judge recommended a ruling in favor of the I.U.O.E. Local 12. The Company has
filed exceptions to the recommendation and is awaiting the decision of the
NLRB. Management continues to believe that the Company will ultimately prevail
in this proceeding, but if unsuccessful, the Company intends to appeal the
matter to the Federal Circuit Court of Appeal. The Company is unable, at this
time, to estimate the total damages that could result if the Company ultimately
does not prevail in this matter.
ITEM 2. CHANGES IN SECURITIES
- - -------------------------------
At its regularly scheduled meeting on July 22, 1997, the Board of Directors of
the Company approved an amendment to the Rights Agreement, originally adopted
on September 22, 1987. The amendment includes an extension of the Rights Plan
for ten years, a provision for a cashless exercise of the Rights, and a
provision requiring the concurrence of a majority of the continuing directors
to amend or supplement the Rights Plan whenever approval is required for a
redemption of the Rights.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
- - -------------------------------------------------------------
The annual meeting of stockholders of the Company was held in Los Angeles,
California on May 27, 1997. Items that were submitted to a voting of
stockholders included 1) a proposal to elect thirteen directors, all of whom
were elected, 2) a proposal to ratify the selection of Coopers and Lybrand
L.L.P. as the Company's independent auditors for 1997, which was passed and 3)
two stockholder proposals, one recommending that the Directors engage the
services of an investment banker to explore all alternatives to enhance the
value of the Company, including possible sale or merger of the Company, and one
recommending that the Directors receive a minimum of fifty percent of their
compensation in Company stock. Both stockholder proposals were defeated.
The results of the voting are detailed below:
Shares of outstanding and entitled to vote: 23,244,812
Total shares voted: 22,107,427
% of shares outstanding: 95.107
Items submitted to a vote:
--------------------------
1. To elect thirteen directors, comprising the entire Board of Directors, to
serve during the ensuing year and until their successors are elected or
appointed:
-10-
<PAGE>
<TABLE>
<CAPTION>
Nominees Broker
- - -------- For Withheld Non-Votes
----------- ------------- ------------
<S> <C> <C> <C>
Argue, J.C. 21,132,350 975,077 -0-
% of votes cast 95.589 4.411
% of shares outstanding 90.912 4.195
Brown, A. 21,127,984 979,434 -0-
% of votes cast 95.570 4.430
% of shares outstanding 90.893 4.214
Brown, D.R. 21,150,901 958,193 -0-
% of votes cast 95.673 4.334
% of shares outstanding 90.992 4.122
Conger, H. M. 21,143,634 963,793 -0-
% of votes cast 95.640 4.360
% of shares outstanding 90.961 4.146
Dezember, R. S. 21,110,884 996,543 -0-
% of votes cast 95.492 4.508
% of shares outstanding 90.820 4.287
Gerstell, A. F. 21,059,058 1,048,369 -0-
% of votes cast 95.258 4.742
% of shares outstanding 90.597 4.510
Grant, R. A. 21,148,184 959,243 -0-
% of votes cast 95.661 4.339
% of shares outstanding 90.980 4.127
Huston, W. T. 21,142,184 965,243 -0-
% of votes cast 95.634 4.366
% of shares outstanding 90.954 4.153
Landry, E.A. 21,151,301 957,793 -0-
% of votes cast 95.675 4.332
% of shares outstanding 90.994 4.120
Lee, T.L. 21,149,184 958,243 -0-
% of shares outstanding 95.666 4.335
% of votes cast 90.985 4.122
Linden, T. M. 21,136,050 971,377 -0-
% of votes cast 95.606 4.394
% of shares outstanding 90.928 4.179
Nelson, G. R. 21,129,500 979,593 -0-
% of votes cast 95.576 4.431
% of shares outstanding 90.900 4.214
</TABLE>
-11-
<PAGE>
Nominees- continued
- - -------------------
<TABLE>
<CAPTION>
Broker
For Withheld Non-Votes
---------- --------- ----------
<S> <C> <C> <C>
Peeler, S. T. 21,094,322 1,013,105 -0-
% of votes cast 95.417 4.583
% of shares outstanding 90.749 4.358
</TABLE>
2. To ratify the selection of Coopers and Lybrand L.L.P. as independent auditors
for 1997:
<TABLE>
<CAPTION>
Broker
For Against Absentees Non-Votes
---------- ------- --------- ---------
<S> <C> <C> <C> <C>
22,009,365 57,664 40,398 -0-
% of votes cast 99.556 .261 .183
% of shares outstanding 94.685 .248 .174
</TABLE>
3. To act upon two proposals submitted by stockholders:
Stockholder's Proposal on Sale or Merger of Company
---------------------------------------------------
<TABLE>
<CAPTION>
Broker
For Against Absentees Non-Votes
----------- ----------- ---------- ----------
<S> <C> <C> <C> <C>
4,622,840 14,672,876 314,582 2,497,129
% of votes cast 23.574 74.822 1.604 -
% of shares outstanding 19.888 63.123 1.353 10.743
</TABLE>
Stockholder's Proposal on Stock Compensation
--------------------------------------------
<TABLE>
<CAPTION>
Broker
For Against Absentees Non-Votes
----------- ----------- ---------- ----------
<S> <C> <C> <C> <C>
2,590,543 16,682,350 337,405 2,497,129
% of votes cast 13.210 85.069 1.721 -
% of shares outstanding 11.145 71.768 1.452 10.743
</TABLE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
- - ------------------------------------------
(a) Exhibit 4.3: Amendment #2, dated as of July 22, 1997, to the Rights
Agreement, dated as of September 22, 1987, between CalMat Co., a
Delaware corporation, and First Chicago Trust Company of New York, a
national banking association, as Rights Agent.
(b) Exhibit 27. Financial Data Schedule.
(c) No reports on Form 8-K were filed during the quarter ended June 30,
1997.
-12-
<PAGE>
CALMAT CO.
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, Registrant
has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
CALMAT CO.
---------------------------------
(Registrant)
Date: August 8, 1997 By: /s/ H. James Gallagher
---------------------------------
H. James Gallagher,
Executive Vice President, Finance,
Chief Financial Officer and
Treasurer
Date: August 8, 1997 By: /s/ Brent L. Stumme
---------------------------------
Brent L. Stumme
Vice President, Corporate Controller
-13-
<PAGE>
EXHIBIT 4.3
AMENDMENT #2 dated as of July 22, 1997, to the RIGHTS
AGREEMENT dated as of September 22, 1987, between CALMAT CO., a
Delaware corporation (the "Company"), and FIRST CHICAGO TRUST
COMPANY OF NEW YORK, a national banking association, as Rights
Agent (the "Rights Agent").
WHEREAS, the Company and the Rights Agent entered into that certain
Rights Agreement dated as of September 22, 1987 (as amended, the "Rights
Agreement"); and
WHEREAS, the Company and the Rights Agent amended the Rights Agreement
on October 26, 1992 (Amendment No. 1); and
WHEREAS, the Company and the Rights Agent deem it desirable to further
amend the Rights Agreement as set forth herein.
NOW THEREFORE, pursuant to Section 26 of the Rights Agreement and in
consideration of the promises and mutual covenants set forth in the Rights
Agreement and this Amendment, the parties hereby agree as follows:
Section 1. Amendments to Rights Agreement. The Rights Agreement is
-------------------------------
hereby amended as follows:
(a) Clause (i) of Section 7(a) is hereby revised to read, in its
entirety, as follows:
"(i) the close of business on September 30, 2007 (the "Final
Expiration Date"),"
(b) Section 11 is hereby amended by adding the following at the end
thereof:
"(n) (i) The Board of Directors of the Company may, at its
option, at any time after a Person becomes an Acquiring Person,
mandatorily exchange all or part of the then outstanding and
exercisable Rights (which shall not include Rights that shall have
become null and void and nontransferable pursuant to the provisions of
Section 11(a)(ii)(B)) for consideration per Right consisting of either
one-half of the securities that would be issuable
<PAGE>
at such time upon the exercise of one Right in accordance with Section
11(a)(ii) or, if applicable, the cash consideration specified in
Section 11(a)(iii) (the consideration issuable per Right pursuant to
this Section 11(n)(i) being the 'Exchange Consideration'). If the
Board of Directors of the Company elects to exchange all the Rights
for Exchange Consideration pursuant to this Section 11(n)(i) prior to
the physical distribution of the Rights Certificates, the Corporation
may distribute the Exchange Consideration in lieu of distributing
Right Certificates, in which case for purposes of this Rights
Agreement holders of Rights shall be deemed to have simultaneously
received and surrendered for exchange Right Certificates on the date
of such distribution.
(ii) Any action of the Board of Directors of the Company
ordering the exchange of any Rights pursuant to Section 11(n)(i) shall
be irrevocable and, immediately upon the taking of such action and
without any further action and without any notice, the right to
exercise any such Right pursuant to Section 11(a)(ii) shall terminate
and the only right thereafter of a holder of such Right shall be to
receive the Exchange Consideration in exchange for each such Right
held by such holder or, if the Exchange Consideration shall not have
been paid or issued, to exercise any such Right pursuant to Section
13. The Company shall promptly give public notice of any such
exchange; provided, however, that the failure to give, or any defect
-------- -------
in, such notice shall not affect the validity of such exchange. The
Company promptly shall mail a notice of any such exchange to all
holders of such Rights at their last addresses as they appear upon the
registry books of the Rights Agent. Any notice which is mailed in the
manner herein provided shall be deemed given, whether or not the
holder receives the notice. Each such notice of exchange will state
the method by which the exchange of the Rights for the Exchange
Consideration will be effected and, in the event of any partial
exchange, the number of Rights which will be exchanged. Any partial
exchange shall be effected pro rata based on the number of Rights
(other than Rights which shall have become null and void and
nontransferable pursuant to the provisions of Section 11(a)(ii)(B))
held by each holder of Rights."
<PAGE>
(c) The third sentence of Section 26 is hereby revised to read, in
its entirety, as follows:
"Notwithstanding anything contained in this Agreement to the contrary,
(1) no supplement or amendment shall be made which changes the
Redemption Price, the Purchase Price or the number of Common Shares
for which a Right is exercisable and (2) during any time that the
approval of Continuing Directors is required for a redemption of the
Rights as provided under Section 23(a), any amendment or supplement to
this Agreement can only be effected if there are Continuing Directors
then in office and such amendment or supplement shall have been
approved by a majority of such Continuing Directors."
Section 2. Amendment to Right Certificate. The Rights Agent is
-------------------------------
hereby directed, immediately prior to any Distribution Date, to make such
amendments to the form of Right Certificate, attached to the Rights Agreement,
to conform with the Rights Agreement as amended by this Amendment and any
subsequent amendments.
Section 3. Full Force and Effect. Except as expressly amended
----------------------
hereby, the Rights Agreement shall continue in full force and effect in
accordance with the provisions thereof on the date hereof.
Section 4. Governing Law. This Amendment shall be governed by and
--------------
construed in accordance with the law of the State of Delaware applicable to
contracts to be made and performed entirely within such State.
Section 5. Counterparts. This Amendment may be executed in any number
-------------
of counterparts and each of such counterparts shall for all purposes be deemed
to be an original, and all such counterparts shall together constitute but one
and the same instrument.
IN WITNESS WHEREOF, the Company and the Rights Agent have caused this
Amendment to be duly executed as of the day and year first above written.
<PAGE>
CALMAT CO.
By: /s/ PAUL STANFORD
-------------------------------------------------
Name: Paul Stanford
Title: Executive Vice President, General Counsel
and Secretary
FIRST CHICAGO TRUST COMPANY OF NEW YORK, as Rights
Agent.
By: /s/ JAMES R. KUZMICH
-------------------------------------------------
Name: James R. Kuzmich
Title: Assistant Vice President
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 11,294
<SECURITIES> 0
<RECEIVABLES> 75,533
<ALLOWANCES> (5,673)
<INVENTORY> 16,951
<CURRENT-ASSETS> 115,664
<PP&E> 720,703
<DEPRECIATION> (310,042)
<TOTAL-ASSETS> 607,513
<CURRENT-LIABILITIES> 62,737
<BONDS> 115,985
0
0
<COMMON> 23,273
<OTHER-SE> 309,729
<TOTAL-LIABILITY-AND-EQUITY> 607,513
<SALES> 204,506
<TOTAL-REVENUES> 209,056
<CGS> 176,139
<TOTAL-COSTS> 196,421
<OTHER-EXPENSES> 460
<LOSS-PROVISION> 754
<INTEREST-EXPENSE> 3,846
<INCOME-PRETAX> 7,575
<INCOME-TAX> 2,727
<INCOME-CONTINUING> 4,848
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,848
<EPS-PRIMARY> .21
<EPS-DILUTED> .21
</TABLE>
