<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark one)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended June 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File Number 1-7159
FLORIDA ROCK INDUSTRIES, INC.
(exact name of registrant as specified in its charter)
Florida 59-0573002
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
155 East 21st Street, Jacksonville, Florida 32206
(Address of principal executive offices)
(Zip Code)
904/355-1781
(Registrant's telephone number, including area code)
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
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of August 1, 1997: 9,293,542 shares of $.10 par value
common stock.<PAGE>
FLORIDA ROCK INDUSTRIES, INC.
CONSOLIDATED CONDENSED BALANCE SHEET
(In thousands)
(Unaudited)
June 30, September 30,
1997 1996
ASSETS
Current assets:
Cash and cash equivalents $ 11,282 $ 4,995
Accounts and notes receivable, less
allowance for doubtful accounts of
$1,676 ($1,393 at September 30, 1996) 59,435 52,436
Inventories 23,489 23,475
Prepaid expenses and other 6,531 6,176
Total current assets 100,737 87,082
Other assets 24,685 25,769
Property, plant and equipment, at cost:
Land 107,243 107,644
Plant and equipment 434,067 411,882
541,310 519,526
Less accumulated depreciation,
depletion and amortization (297,744) (285,668)
Net property, plant and equipment 243,566 233,858
$ 368,988 $ 346,709
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short-term notes payable to banks $ 300 $ 1,400
Accounts payable 32,092 28,602
Dividends payable 2,297 -
Accrued income taxes 3,262 3,507
Accrued payroll and benefits 8,560 7,710
Accrued insurance reserve 3,781 2,679
Accrued liabilities, other 5,376 5,445
Long-term debt due within one year 2,586 2,514
Total current liabilities 58,254 51,857
Long-term debt 10,330 16,862
Deferred income taxes 28,394 29,699
Accrued employee benefits 11,498 10,726
Other accrued liabilities 10,587 9,415
Stockholders' equity:
Preferred stock, no par value; 10,000,000
shares authorized, none issued - -
Common stock, $.10 par value; 50,000,000
shares authorized, 9,487,309 shares issued 949 949
Capital in excess of par value 18,353 17,400
Retained earnings 237,231 215,195
Less cost of treasury stock, 217,798
shares (212,928 shares at September
30, 1996) (6,608) (5,394)
Total stockholders' equity 249,925 228,150
$ 368,988 $ 346,709
See accompanying notes.<PAGE>
FLORIDA ROCK INDUSTRIES, INC.
CONSOLIDATED CONDENSED STATEMENT OF INCOME
(Dollars in thousands except per share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
June 30 June 30
1997 1996 1997 1996
Net sales $123,907 $110,331 $331,901 $288,397
Cost of sales 94,600 84,760 259,701 232,462
Gross profit 29,307 25,571 72,200 55,935
Selling, general and
administrative expense 11,006 10,098 31,185 27,412
Operating profit 18,301 15,473 41,015 28,523
Interest expense (239) (647) (754) (1,576)
Interest income 178 136 503 433
Other income, net 225 (1,162) 199 (922)
Income before income taxes 18,465 13,800 40,963 26,458
Provision for income taxes 6,462 4,761 14,337 9,128
Net income $12,003 $ 9,039 $26,626 $17,330
Per common share:
Income $1.29 $.96 $2.86 $1.83
Cash dividends $.25 $.25 $.50 $.50
Weighted average number
of shares 9,338,964 9,418,787 9,323,506 9,475,622
See accompanying notes.<PAGE>
FLORIDA ROCK INDUSTRIES, INC.
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
NINE MONTHS ENDED JUNE, 1997 AND 1996
(In thousands)
(Unaudited)
1997 1996
Cash flows from operating activities:
Net income $26,626 $17,330
Adjustments to reconcile net income to net
cash provided from operating activities:
Depreciation, depletion and amortization 22,985 21,181
Net changes in operating assets and liabilities:
Accounts receivable (7,057) (4,328)
Inventories 347 (451)
Prepaid expenses and other 159 (274)
Accounts payable and accrued liabilities 7,072 3,108
Decrease in deferred income taxes (1,752) (829)
Gain on disposition of property, plant and
equipment (1,328) (1,519)
Other, net 290 1,297
Net cash provided by operating activities 47,342 35,515
Cash flows from investing activities:
Purchase of property, plant and equipment (31,810) (40,014)
Proceeds from the sale of property, plant and
equipment 1,875 1,653
Additions to other assets (816) (1,343)
Proceeds from the disposition of other assets 202 148
Collections of notes receivable 180 126
Net cash used in investing activities (30,369) (39,430)
Cash flows from financing activities:
Proceeds from long-term debt - 6,000
Net increase (decrease) in short-term debt (1,100) 5,000
Repayment of long-term debt (7,033) (996)
Repurchase of Company stock (4,631) (3,027)
Exercise of stock options 4,371 -
Payment of dividends (2,293) (2,372)
Net cash provided by (used in)financing activities(10,686) 4,605
Net increase in cash and cash equivalents 6,287 690
Cash and cash equivalents at beginning of year 4,995 925
Cash and cash equivalents at end of period $11,282 $ 1,615
See accompanying notes.
<PAGE>
FLORIDA ROCK INDUSTRIES, INC.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
JUNE 30, 1997
(Unaudited)
(1) Basis of Presentation
The accompanying consolidated condensed financial statements include
the accounts of the Company and its subsidiaries. These statements
have been prepared in accordance with generally accepted accounting
principles for interim financial information and the instructions to
Form 10-Q and do not include all the information and footnotes
required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary for a
fair presentation of the results for the interim period have been
included. Operating results for the nine months ended June 30, 1997,
are not necessarily indicative of the results that may be expected for
the fiscal year ended September 30, 1997. The accompanying
consolidated financial statements and the information included under
the heading "Management's Discussion and Analysis" should be read in
conjunction with the consolidated financial statements and related
notes of Florida Rock Industries, Inc. for the year ended September
30, 1996.
(2) Inventories
Inventories consisted of the following (in thousands):
June 30, September 30,
1997 1996
Finished products $ 18,396 $ 18,719
Raw materials 4,168 3,825
Parts and supplies 925 931
$ 23,489 $ 23,475
(3) Earnings Per Share
Earnings per share are based on the weighted average number of common
shares outstanding and common stock equivalents, where applicable,
during the periods. Fully diluted earnings per share are not reported
because their effect would have been less than 3% dilutive.
(4) Debt
On June 30, 1997, the Company amended its revolving credit and term
loan agreement. Under the amended agreement, the Company may borrow
up to $75,000,000 on term loans payable in consecutive quarterly
installments of 5% of the original amount commencing September 30,
2000 and a final payment of the unpaid balance on June 30, 2003.
Interest is payable at the prime rate until June 30, 2000 and at 3/8
of 1% above such prime rate thereafter. Alternative interest rates
based on the London interbank rate and/or the reserve-adjusted
certificate of deposit rate are available at the Company's option.
An annual commitment fee of 3/16 of 1% is payable on the unused amount
of the commitment.
(5) Supplemental Disclosures of Cash Flow Information
Cash paid during the nine months ended June 30, 1997 and 1996
for certain expense items are (in thousands):
1997 1996
Interest expense, net of
amount capitalized $ 816 $1,581
Income taxes $15,660 $9,654
The following schedule summarizes noncash investing and financing
activities for the nine months ended June 30, 1997 and 1996
(in thousands):
1997 1996
Additions to property, plant
and equipment from:
Exchanges $ 122 347
Issuing debt $ 116 260
Additions to inventory
from issuing debt $ 360 -
Additions to other assets from
issuing debt $ - 300
Additions to notes receivable
from sales of property, plant
and equipment $ - 6
Addition to notes receivable from
sales of other assets $ 200
Additions to prepaid expenses
from issuing debt $ 96 -
(6) The Company and its subsidiaries are subject to legal proceedings and
claims arising out of their businesses that cover a wide range of
matters. Additional information concerning these matters is presented
in Note 12 to the consolidated financial statements included in the
Company's 1996 Annual Report to stockholders and Item 3 "Legal
Proceedings" of the Company's Form 10-K for fiscal 1996, and such
information is incorporated herein by reference.
MANAGEMENT'S DISCUSSION AND ANALYSIS
Operating Results
For the third quarter and first nine months of fiscal 1997, ended June
30, 1997, consolidated net sales increased 12.3% and 15.1%,
respectively, from the same periods last year. The increase for the
third quarter was primarily attributable to a higher volume of sales
and modest price increases. For the nine months the increase was
primarily attributable to a higher volume of sales, a very mild winter
in our non-Florida markets and modest price increases. Much of the
modest price increases were in response to higher cement and other cost
increases.
Gross profit increased 14.6% for the third quarter and 29.1% for the
first nine months from the same periods last year. The increase in
gross profit is a function of higher revenues and the strong marginal
contribution due to the high fixed cost nature of the business. Gross
profit margin for the third quarter improved to 23.7% from 23.2% and for
the first nine months improved to 21.8% from 19.4% from last year.
These improvements were due primarily to increased volumes as sales
price increases were substantially offset by higher cement and other
cost increases.
Selling, general and administrative expense increased 9.0% for the third
quarter and 13.7% for the first nine months from the same periods last
year. Approximately 50% of the increase was due to increases in profit
sharing and incentive compensation which are linked to profitability.
Selling, general and administrative expense amounted to 8.9% of sales in
current quarter and 9.4% for the first nine months. These are slightly
lower than the same periods last year.
Interest expense for the third quarter declined to $239,000 from
$647,000 and for the first nine months declined to $754,000 from
$1,576,000 last year primarily due to reduced debt. Other income, net
for the first nine months of this year includes a loss of $197,000 on
the sale of an asset. Other income, net for the third quarter and first
nine months of last year include a writedown in the carrying value of
certain real estate of $1,000,000.
Summary and Outlook. The condition of our construction markets remains
good. While residential activity has slowed from last year's pace, the
trend in commercial construction has been robust. Construction
activity overall continues at healthy levels in all segments in most of
our markets. Low inflation and a healthy economy has resulted in
stable to lower interest rates which is favorable for construction
activity and demand.
Financial Condition
The Company continues to maintain its sound financial condition with
sufficient resources to meet anticipated capital expenditures and other
operating requirements.
Other
The Company, as previously reported, commenced construction of the
cement plant, April 7, 1997 despite existing appeals of the air permit
issued by the Florida Department of Environmental Protection and site
permits issued by Alachua County. The Company believes the current
appeals will be dismissed in due course and is proceeding with the
construction of the plant.
While the Company is affected by environmental regulations, such
regulations are not expected to have a major effect on the Company's
capital expenditures or operating results. Additional information
concerning environmental matters is presented Item 3 "Legal Proceedings"
of the Company's Form 10-K for fiscal 1996 and such information is
incorporated herein by reference.
PART II OTHER INFORMATION
Item 1. Legal Proceedings
Note 12 to the consolidated financial statements included in the
Company's 1996 Annual Report to stockholders, and Item 3 "Legal
Proceedings" of the Company's Form 10-K for fiscal 1996 are incorporated
herein by reference.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits. The response to this item is submitted as a separate
section entitled "Exhibit Index" starting on page 9 of this Form
10-Q.
(b) Reports on Form 8-K. There were no reports on Form 8-K filed
during the three months ended June 30, 1997.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
August 5, 1997 FLORIDA ROCK INDUSTRIES, INC.
RUGGLES B. CARLSON
Ruggles B. Carlson
Vice President-Finance
and Treasurer
(Principal Financial and
Accounting Officer)<PAGE>
FLORIDA ROCK INDUSTRIES, INC.
FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 1997
EXHIBIT INDEX
Page No. in
Sequential
Numbering
(2)(a) Agreement and Plan of Reorganization entered into
as of March 5, 1986 between the Company and
Florida Rock & Tank Lines, Inc. ("FRTL") pursuant
to the distribution pro rata to the Company's
stockholders of 100% of the outstanding stock of
FRTL has previously been filed as Appendix I to
the Company's Proxy Statement dated June 11, 1986.
File No. 1-7159.
(3)(a)(1) Restated Articles of Incorporation of Florida Rock
Industries, Inc., filed with the Secretary of
State of Florida on May 9, 1986. Previously filed
with Form 10-Q for the quarter ended December 31,
1986. File No. 1-7159.
(3)(a)(2) Amendment to the Articles of Incorporation of
Florida Rock Industries, Inc. filed with the
Secretary of State of Florida on February 19,
1992. Previously filed with Form 10-K for the
fiscal year ended September 30, 1993. File No. 1-7159.
(3)(a)(3) Amendments to the Articles of Incorporation of
Florida Rock Industries, Inc. filed with the
Secretary of State of Florida on February 7, 1995.
Previously filed as appendix to the Company's
Proxy Statement dated December 15, 1994.
(3)(b)(1) Restated Bylaws of Florida Rock Industries, Inc.,
adopted December 1, 1993. Previously filed with
Form 10-K for the fiscal year ended September 30,
1993. File No. 1-7159.
(3)(b)(2) Amendment to the Bylaws of Florida Rock
Industries, Inc. adopted October 5, 1994.
Previously filed with Form 10-K for the fiscal
year ended September 30, 1994. File No. 1-7159.
(4)(a) Articles III, VII, and XIII of the Articles of
Incorporation of Florida Rock Industries, Inc.
Previously filed with Form 10-Q for the quarter
ended December 31, 1986 and Form 10-K for the
fiscal year ended September 30, 1993. And
Articles XIV and XV previously filed as appendix
to the Company's Proxy Statement dated December
15, 1994.
File No. 1-7159.
Page No. in
Sequential
Numbering
(4)(b)(1) Amended and Restated Revolving Credit and Term
Loan Agreement dated as of December 5, 1990, among
Florida Rock Industries, Inc.; Continental Bank,
N.A.; Barnett Bank of Jacksonville, N. A.; Sun
Bank, National Association; Crestar Bank; First
Union National Bank of Florida; The First National
Bank of Maryland; Southeast Bank, N. A.; and
Maryland National Bank. Previously filed with
Form 10-K for the fiscal year ended September 30,
1990. File No. 1-7159.
(4)(b)(2) First Amendment dated as of September 30, 1992 to
the Amended and Restated Revolving Credit and Term
Loan Agreement dated as of December 5, 1990.
Previously filed with Form 10-K for the fiscal
year ended September 30, 1992. File No. 1-7159.
(4)(b)(3) Second Amendment dated as of June 30, 1994 to the
Amended and Restated Revolving Credit and Term
Loan Agreement dated as of December 5, 1990.
Previously filed with Form 10-Q for the quarter
ended June 30, 1994. File No. 1-7159.
(4)(b)(4) Third Amendment dated as of June 30, 1997 to the
Amended and Restated Revolving Credit and Term
Loan Agreement dated as of December 5, 1990.
13
(4)(c) The Company and its consolidated subsidiaries have
other long-term debt agreements which do not
exceed 10% of the total consolidated assets of the
Company and its subsidiaries, and the Company
agrees to furnish copies of such agreements and
constituent documents to the Commission upon
request.
(10)(a) Retirement Benefits Agreement between Florida Rock
Products Corporation and Thompson S. Baker dated
September 30, 1964. Previously filed with Form
S-1 dated June 29, 1972. File No. 2-44839.
(10)(b) Retirement Benefits Agreement between Shands &
Baker, Inc., and Thompson S. Baker dated September
30, 1964 and amendment thereto dated September 22,
1970. Previously filed with Form S-1 dated June
29, 1972. File No. 2-44839.
(10)(c) Employment Agreement dated June 12, 1972 between
Florida Rock Industries, Inc. and Charles J.
Shepherdson, Sr. and form of Addendum thereto.
Previously filed with Form S-1 dated June 29,
1972. File No. 2-44839
Page No. in
Sequential
Numbering
(10)(d) Addendums dated April 3, 1974 and November 18,
1975 to Employment Agreement dated June 12, 1972
between Florida Rock Industries, Inc., and Charles
J. Shepherdson, Sr. Previously filed with Form
10-K for the fiscal year ended September 30, 1975.
File No. 1-7159.
(10)(e) Florida Rock Industries, Inc. 1981 Stock Option
Plan. Previously filed with Form S-8 dated March
3, 1982. File No. 2-76407.
(10)(f) Amended Medical Reimbursement Plan of Florida Rock
Industries, Inc., effective May 24, 1976.
Previously filed with Form 10-K for the fiscal
year ended September 30, 1980. File No. 1-7159.
(10)(g) Amendment No. 1 to Amended Medical Reimbursement
Plan of Florida Rock Industries, Inc. effective
July 16, 1976. Previously filed with Form 10-K
for the fiscal year ended September 30, 1980.
File No. 1-7159.
(10)(h) Tax Service Reimbursement Plan of Florida Rock
Industries, Inc. effective October 1, 1976.
Previously filed with Form 10-K for the fiscal
year ended September 30, 1980. File No. 1-7159.
(10)(I) Amendment No. 1 to Tax Service Reimbursement Plan
of Florida Rock Industries, Inc. Previously filed
with Form 10-K for the fiscal year ended September
30, 1981. File No. 1-7159.
(10)(j) Amendment No. 2 to Tax Service Reimbursement Plan
of Florida Rock Industries, Inc. Previously filed
with Form 10-K for the fiscal year ended September
30, 1985. File No. 1-7159.
(10)(k) Summary of Management Incentive Compensation Plan
as amended effective October 1, 1992. Previously
filed with Form 10-K for the fiscal year ended
September 30, 1993. File No. 1-7159.
(10)(l) Florida Rock Industries, Inc. Management Security
Plan. Previously filed with Form 10-K for the
fiscal year ended September 30, 1985. File No. 1-7159.
(10)(m) Various mining royalty agreements with FRTL or its
subsidiary, none of which are presently believed
to be material individually, but all of which may
Page No. in
Sequential
Numbering
be material in the aggregate. Previously filed
with Form 10-K for the fiscal year ended September
30, 1986. File No. 1-7159.
(10)(n) Florida Rock Industries, Inc. 1991 Stock Option
Plan. Previously filed with Form 10-K for the
fiscal year ended September 30, 1992. And
February 1, 1995 Amendment to Florida Rock
Industries, Inc. 1991 Stock Option Plan.
Previously filed as appendix to the Company's
Proxy Statement dated December 15, 1994. File No.
1-7159.
(10)(o) Form of Split Dollar Insurance Agreement and
Assignment of Life Insurance Policy as collateral
between Florida Rock Industries, Inc. and each of
Edward L. Baker and John D. Baker, II with
aggregate face amounts of $5.4 million and $8.0
million, respectively. Previously filed with Form
10-Q for the quarter ended December 31, 1996.
(10)(p) Florida Rock Industries, Inc. 1996 Stock Option
Plan. Previously filed as appendix to the
Company's Proxy Statement dated December 18, 1995.
File No. 1-7159.
(11) Computation of Earnings Per Common Share. 30
(27) Financial Data Schedule. <PAGE>
<PAGE>
THIRD AMENDMENT DATED AS OF JUNE 30, 1997
TO THE
AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN AGREEMENT
DATED AS OF DECEMBER 5, 1990
AS AMENDED BY
THE FIRST AMENDMENT DATED AS OF SEPTEMBER 30, 1992, AND
THE SECOND AMENDMENT DATED AS OF JUNE 30, 1994
- - - - - - - - - -
THIS THIRD AMENDMENT DATED AS OF JUNE 30, 1997, TO THE AMENDED
AND RESTATED REVOLVING CREDIT AND TERM LOAN AGREEMENT DATED AS OF
DECEMBER 5, 1990, as amended (the "Agreement"), is entered into
among FLORIDA ROCK INDUSTRIES, INC., a Florida corporation (the
"Company"), BANK OF AMERICA ILLINOIS (formerly known as Continental
Bank N.A.), an Illinois banking corporation having its principal
office at 231 South LaSalle Street, Chicago, Illinois 60697 (in
its individual capacity, "BAI"), as agent (in such capacity, the
"Agent"), BARNETT BANK, N.A. ("Barnett"), SUNTRUST BANK, CENTRAL
FLORIDA, N.A. ("SunTrust"), CRESTAR BANK, N.A. ("Crestar"), FIRST
UNION NATIONAL BANK, (successor by merger to First Union National
Bank of Florida) ("FUNB"), and THE FIRST NATIONAL BANK OF MARYLAND
("FNBM"). BAI, Barnett, SunTrust, Crestar, FUNB and FNBM are
hereinafter collectively referred to as the "Banks" and individually
as a "Bank".
Recitals:
The Company has requested that the Banks modify the Agreement
as set forth herein. Capitalized terms not otherwise defined
herein have the meanings assigned to them in the Agreement.
Therefore, in consideration of any loan or advance or grant of
credit heretofore or hereafter made to the Company by the Banks,
and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree that
the Agreement is hereby amended as follows:
1. Schedule I, as referred to in paragraph 2.1(a)(ii) and
attached to the Agreement, is amended in its entirety in the form
of Schedule I attached to this Third Amendment.
2. Schedule II, as referred to in paragraph 8.4 and attached
to the Agreement, is amended in its entirety in the form of
Schedule II attached to this Third Amendment.
3. Schedule III, as referred to in paragraph 6.7 and
attached to the Agreement, is amended in its entirety in the form
of Schedule III attached to this Third Amendment.
4. Schedule IV, as referred to in paragraph 6.11 and
attached to the Agreement, is amended in its entirety in the form
of Schedule IV attached to this Third Amendment.
5. Schedule V, as referred to in paragraph 6.12 and attached
to the Agreement, is amended in its entirety in the form of
Schedule V attached to this Third Amendment.
6. Schedule VI, as referred to in paragraphs 6.6 and
8.1(c)and attached to the Agreement, is amended in its entirety in
the form of Schedule VI attached to this Third Amendment.
7. In the definitions, "Conversion Date" is changed from
"June 30, 1997" to "June 30, 2000"; and "Available Commitment(s)" and
"Unavailable Commitment(s)" are deleted in their entirety.
8. Section 2.1(a)(I)is hereby amended to read as follows:
"(a) Revolving Loans. To make loans (collectively
called the "Revolving Loans" and individually called a "Revolving
Loan") to the Company, which Revolving Loans the Company may pay,
prepay and reborrow during the period from the date hereof to, but
not including, the Conversion Date, in such amounts as the Company
may from time to time request, but not exceeding in the aggregate
at any one time outstanding the amount (such Bank's "Commitment")
set forth on Schedule I attached to this Third Amendment."
9. Section 2.1(a)(ii) is hereby deleted in its entirety.
10. In Section 3.1(b), the phrase "one-half of one percent
(1/2%) is hereby amended to read " three-eighths of one percent
(3/8 %)."
11. In Section 3.1(c), the phrase "five-eighths of one
percent (5/8%) is hereby amended to read "one-half of one percent
(1/2%)."
12. Section 3.3 is hereby amended to read as follows:
"3.3 Commitment Fee. The Company shall pay in
immediately available funds to the Agent, for the account of each
Bank, a commitment fee equal to 3/16 of 1% per annum on the daily
average of the amount of the unused portion of the Commitment of
such Bank. The commitment fee shall be computed on the basis of
the actual number of days elapsed in a year of 360 days. The
commitment fee shall begin to accrue on (and including) June 30,
1997, and shall be paid quarterly thereafter on the last day of
September, December, March and June of each year."
13. Section 4.4 is hereby amended to read as follows:
"4.4 Reduction or Termination of the Credit. The
Company may from time to time, upon at least three Banking Days'
prior written or telephonic notice received by the Agent (which
shall promptly advise each Bank thereof), permanently reduce the
amount of the Commitments, but only upon payment of the unpaid
principal amount of the Revolving Loans, if any, in excess of the
then reduced amount of the Credit, plus (I) accrued interest to the
date of such payment on the principal amount being repaid, (ii) any
amount required to indemnify the Bank pursuant to Section 2.7 in
respect of such payment, and (iii) the commitment fee on the amount
of each Bank's Commitment so reduced which is accrued but unpaid
through the date of such reduction, it being understood that at no
time may the unpaid principal amount of the Revolving Loans exceed
the aggregate Commitments. Any such reduction shall be in a
minimum amount of $1,000,000 and in an integral multiple of
$100,000. The Company may at any time on like notice terminate the
Credit upon payment in full of (a) the Revolving Loans, (b) accrued
interest thereon to the date of such payment,(c)any amount required
to indemnify the Banks pursuant to Section 2.7 in respect of such
payment, and (d) any other liabilities of the Company hereunder.
The Company shall promptly confirm any telephonic notice of
reduction or termination of the Credit in writing."
14. Section 6.4 is hereby amended to read as follows:
"6.4 Financial Statements. The Company has heretofore
furnished to each Bank the consolidated condensed financial
statements of the Company and its Subsidiaries dated March 31,
1997, and the consolidated financial statements of the Company and
its Subsidiaries dated as of September 30, 1996, reported on by
Deloitte & Touche LLP, independent certified public accountants.
Such financial statements were prepared in accordance with GAAP
applied on a consistent basis, are complete and correct and fairly
present the consolidated financial condition and the consolidated
results of operations of the Company and the Subsidiaries as of
the dates indicated. The balance sheet and notes contained in the
consolidated condensed financial statements dated March 31, 1997,
show all liabilities, either direct or contingent, which would
normally be reported in accordance with GAAP as of the date thereof
of the Company and the Subsidiaries."
15. Section 6.5 is hereby amended to read as follows:
"6.5 No Material Adverse Changes. There has been no
material adverse change in the condition, financial or otherwise,
of the Company and Subsidiaries, taken and considered together,
since March 31, 1997."
16. Section 8.1(b) is hereby amended to read as follows:
"(b) Short Term Indebtedness of the Company, provided
that such indebtedness in an aggregate amount does not at any time
exceed 20% of Consolidated Tangible Net Worth and is not
outstanding for more than 270 days in the aggregate during any
12-month period; provided, further, that if there is an unused
portion of the Commitment which in the aggregate is equal to or
greater than such outstanding Short Term Indebtedness of the
Company for a period of 90 consecutive days, then, only for
purposes of determining the number of days that Short Term
Indebtedness is outstanding, such Indebtedness shall be deemed to
have been reduced by the amount of such unused Commitment during
such period;"
17. Section 9.2(d) is hereby amended to read as follows:
"(d) Opinion. An opinion of LeBoeuf, Lamb, Greene &
MacRae L.L.P., counsel to the Company, addressed to the Agent and
the Banks."
18. Section 11.6 is hereby amended to read as follows:
"11.6 Bank of America Illinois and Affiliates. With
respect to Bank of America Illinois' commitment and any Loans by
Bank of America Illinois under this Agreement and any Note and any
interest of Bank of America Illinois in any Note, Bank of America
Illinois shall have the same rights and powers under this Agreement
and such Note, as any other Bank and may exercise the same as
though it were not the Agent. Bank of America Illinois and its
affiliates may accept deposits from, lend money to, and generally
engage, and continue to engage, in any kind of business with the
Company as if Bank of America Illinois were not the Agent.
19. The Company hereby represents and warrants to each of the
Banks that there is no existing Event of Default, or event, which
with the lapse of time or the giving of notice, or both, could
become an Event of Default, under the Agreement.
20. This Amendment shall become effective as of June 30,
1997.
21. As modified herein, all provisions of the Agreement shall
remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Third
Amendment to be duly executed by their duly authorized officers,
all as of the day and year first above written.
FLORIDA ROCK INDUSTRIES, INC.
By:/s/James J. Gilstrap
Title: Vice President
Address:
Post Office Box 4667
Jacksonville, Florida 32201
Facsimile No.: 904/355-0817
Telephone No.: 904/355-1781
<PAGE>
BANK OF AMERICA ILLINOIS
By:/s/ Steve A. Aronowitz
Title: Managing Director
Address:
335 Madison Avenue
New York, New York 10017
Attn: Robert P. McKillip
Vice President
Facsimile No.: 212/503-7771
Telephone No.: 212/503-7935
BARNETT BANK, N.A.
By:/s/ Susan S. Delgado
Title: Vice President
Address:
24th Floor, Barnett Tower
50 North Laura Street
Jacksonville, Florida 32202
Attn: Susan S. Delgado
Vice President
Corp. Banking
Facsimile No.: 904/791-5645
Telephone No.: 904/791-7570
<PAGE>
SUNTRUST BANK, CENTRAL
FLORIDA, N.A
By:/s/ H. Robert Neinken
Title: Senior Vice President
Address:
200 South Orange Avenue Tower
6th Floor
Orlando, Florida 32801
Attn: H. Robert Neinken
Sr. Vice President
Facsimile No.: 407/237-6817
Telephone No.: 407/237-5258
CRESTAR BANK, N.A.
By:/s/ William F. Lindlaw
Title: Vice President/Manager
Address:
1445 New York Avenue N. W.
5th Floor
Corporate Trust Division
Washington, D.C. 20005
Attn: William F. Lindlaw
Vice President/Manager
Facsimile No.: 202/879-6137
Telephone No.: 202/879-6432
FIRST UNION NATIONAL BANK
By: /s/ Charles N. Kauffman
Title: Vice President
Address:
225 Water Street
Jacksonville, Florida 32202
Attn: Charles N. Kauffman
Vice President
Commercial Banking
Facsimile No.: 904/361-2417
Telephone No.: 904/361-3662
THE FIRST NATIONAL BANK OF
MARYLAND
By:/s/ Jerome A. Ratcliffe
Title: Vice President
Address:
25 South Charles Street,
18th Floor, National Division
Baltimore, Maryland 21201
Attn:William J. Frank
Assistant Vice President
Facsimile No.: 410/545-2047
Telephone No.: 410/244-4206
<PAGE>
SCHEDULE I
Bank of America Illinois $15,875,000
Barnett Bank, N.A. 15,875,000
SunTrust Bank, Central 15,875,000
Florida, N.A.
First Union National Bank 15,875,000
Crestar Bank, N.A. 7,500,000
The First National Bank of 4,000,000
Maryland
TOTALS $75,000,000
<PAGE>
SCHEDULE II
FLORIDA ROCK INDUSTRIES, INC.
Certain Notes Receivable
As of March 31, 1997
Howat Concrete Company, Inc. $5,000,000
<PAGE>
SCHEDULE III
FLORIDA ROCK INDUSTRIES, INC.
LITIGATION
March 31, 1997
Below is a true and correct description of all litigation
currently pending against the Company or any of the subsidiaries
except (I) litigation in which the amount of controversy is less
that $100,000.00 and (ii) litigation in which the Company believes
that it's potential liability or that of any subsidiary, as the
case may be, is covered by insurance (the reference to insurance
coverage above includes issues reserves for under the Company's
self-insured retention provisions of it's insurance program).
1. Leonard Mark Eagle vs. Coventry Home Assn., et al.
Parents of a minor child, who was killed when a retaining wall
fell on him, are seeking damages against the designer, developer
and/or builder of the retaining wall. A company subsidiary
owned the land, but sold it prior to its development and did not
participate in the development. The Company intends to file a
motion for summary judgment and expects to be dismissed from the
lawsuit.
2. Kelly Frush vs. S & G Concrete.
Plaintiff seeks $1,750,000 in damages for personal injuries she
suffered as a result of here vehicle being struck in the rear by
a Company ready mix concrete truck.
3. Tracy L. McKay vs. Salisbury Towing Corp.
Plaintiff, a former employee of Salisbury Towing Corp., is
seeking damages for injuries suffered his back while working
aboard a Company tug boat. Plaintiff is claiming $500,000 in
compensatory damages.
4. D.C. Metro Area Transit Authority.
The Arundel Corporation (TAC) was a venture partner in
Mergentime, Steers & Arundel, a joint venture that contracted
with the Washington Metro Area Transit Authority (WMATA) to
construct a portion of the subway system in Washington, D. C.
WMATA has filed a claim against the joint venture for alleged
deficiencies in certain isolation pads used in the project. The
scope of the damages is undetermined at this time but TAC's
share of any damages shall be limited to 35% of those of the
joint venture.
<PAGE>
SCHEDULE IV
SUBSIDIARIES OF FLORIDA ROCK INDUSTRIES, INC.
as of March 31, 1997
SUBSIDIARY PERCENTAGE OF VOTING STOCK
OWNED BY COMPANY
PART A - SIGNIFICANT SUBSIDIARIES
The Arundel Corporation 100
PART B - OTHER SUBSIDIARIES
Administrative & Accounting, Inc. 100
Cardinal Concrete Co., Inc. 100
Concrete Engineering, Inc.100
D C Materials, Inc. 100
Falcon Concrete Corp 100
Florida Rock Concrete, Inc 100
Hughes Properties, Inc. 100
Maryland Rock Industries, Inc 100
Mule Pen Quarry Corporation 100
Virginia Concrete Company, Inc. 100
The following companies are wholly owned
subsidiaries of The Arundel Corporation:
ARL Development Corporation (a wholly owned
subsidiary of TBS Enterprises, Inc.) 100
ARL Materials, Inc. 100
ARL Services, Inc. 100
Arundel Risk Managers, Inc. 100
Arundel Sand & Gravel Company 100
BWIP, Inc. 100
LanDel/Arundel, Inc. 100
Maryland Stone, Inc. 100
Patapsco Properties, Inc. 100
S & G Concrete Company 100
S & G Prestress Company 100
Sadler Materials Company 100
Salisbury Towing Corporation 100
Scenic Hills, Inc. (a wholly owned sub-
sidiary of TBS Enterprises, Inc.) 100
TBS Enterprises, Inc. 100
Tidewater Materials Corporation 100
Tidewater Quarries, Inc. 100
<PAGE>
SCHEDULE V - PART A
FLORIDA ROCK INDUSTRIES, INC. ("FRI")
NOTES, ADVANCES AND INVESTMENTS
(except to joint ventures and subsidiaries
reflected in Schedule V - Parts B and C)
As of March 31, 1997
Trade Accounts receivable converted $ 36,169
to Notes receivable
Notes, accounts and advances
receivable from officers and employees 35,500
Note from sale of auto 3,289
Pablo Creek Country Club stock 120,000
Rio Pinar Country Club stock 500
Note receivable, Myakka River Estates 2,275
Florida Rock Industries, Inc. and
Maryland Rock Industries, Inc.
Industrial Revenue Bonds
Repurchased by the Company:
Marion County, Florida 1,000,000
Putnam County, Florida 1,000,000
Putnam County, Florida 200,000
Duval County, Florida 400,000
St. Marys County, Maryland 3,750,000
Notes receivable:
Howat Concrete Co., Inc. 5,000,000
CTI, DC, Inc. 218,600
Notes, advances and investments of The Arundel
Corporation and its subsidiaries:
Notes, accounts and advances receivable
from officers and employees 429
Dev Credit Corporation 1,650
Investment Homestead Village 100
Bethlehem Steel Corporation 1,454
PNC-Mortgages Receivable 101,207
PNC-Mortgages Receivable 115,010
J. William Parker 68,000
Phoenix Development Corporation 56,500
(Note Receivable from sale of real estate.
Such note is classified as real estate
investment under GAAP)
SCHEDULE V (PART B)
FLORIDA ROCK INDUSTRIES, INC. ("FRI")
LOANS, ADVANCES AND INVESTMENTS
IN CORPORATIONS AND JOINT VENTURES
LESS THAN 80% OWNED
(excludes Florida Rock Industries, Inc.'s equity
in net income or loss of such corporations)
As of March 31, 1997
LOANS, ADVANCES
AND INVESTMENTS
Leesburg Sand Company, Inc. $1,500
(a 50% owned corporation)
Receivable due from Leesburg Sand
Company, Inc. In the normal course
of business on items paid by FRI for $10,000
Leesburg. Reimbursement received
on a monthly basis. Estimated
<PAGE>
SCHEDULE V - PART C
FLORIDA ROCK INDUSTRIES, INC. ("FRI")
LOANS, ADVANCES AND INVESTMENTS IN CORPORATIONS
AND JOINT VENTURES 80% OR MORE OWNED AS OF
March 31, 1997
(excludes Florida Rock Industries, Inc.'s equity
in net income or loss of such corporations)
Net advances
to(from)
Subsidiaries of FRI: Investment Subsidiary
VIRGINIA CONCRETE COMPANY, INC. $ 7,582,781 ($66,935,961)
CARDINAL CONCRETE COMPANY 16,000 (13,566,825)
D C MATERIALS, INC. 1,000 (335,090)
CONCRETE ENGINEERING, INC. 5,000 233,546
MARYLAND ROCK INDUSTRIES, INC. 1,000 0
HUGHES PROPERTIES, INC. 100 (28,801)
ADMINISTRATIVE&ACCOUNTING, INC. 1,000 840,907
FALCON CONCRETE CORPORATION 25,000 7,889,601
FLORIDA ROCK CONCRETE, INC. 26,340,676 (32,952,897)
THE ARUNDEL CORPORATION 85,947,606 6,965,049
MULE PEN QUARRY CORPORATION 9,659,232 10,124,128
Subsidiaries of The Arundel Corporation:
ARL SERVICES, INC. 1,000 662,757
CHESAPEAKE MARINE PARTNERSHIP 3,403,403 (2,040,156)
SCHEDULE V - PART C
FLORIDA ROCK INDUSTRIES, INC. ("FRI")
LOANS, ADVANCES AND INVESTMENTS IN CORPORATIONS
AND JOINT VENTURES 80% OR MORE OWNED AS OF
March 31, 1997
(excludes Florida Rock Industries, Inc.'s equity
in net income or loss of such corporations)
(Page 2)
Net advances
to (from)
Investment Subsidiary
ARUNDEL SAND & GRAVEL COMPANY 500 (114,017)
S&G CONCRETE CO. 900,500 531,839
PATAPSCO PROPERTIES, INC. 60,173 (67,918)
MARYLAND ROCK INDUSTRIES, INC.(a) -0- (3,143,543)
ARUNDEL RISK MANAGEMENT, INC. 100 (33,963)
SADLER MATERIALS CORPORATION 1,835,065 31,428,976
MARYLAND STONE, INC. 50,000 7,030,947
S&G PRESTRESS COMPANY 1,265,535 0
LANDEL/ARUNDEL, INC. 592,889 594,674
SALISBURY TOWING CORP. 1 (515,719)
BWIP, INC. 1,000 (1,020,388)
TBS ENTERPRISES, INC. 18,372,227 4,578,295
TIDEWATER QUARRIES, INC. 4,252,522 10,624,323
TIDEWATER MATERIALS CORPORATION 1,144,503 (830,366)
(a) Company is owned 100% by Florida Rock Industries
SCHEDULE V - PART C
FLORIDA ROCK INDUSTRIES, INC. ("FRI")
LOANS, ADVANCES AND INVESTMENTS IN CORPORATIONS
AND JOINT VENTURES 80% OR MORE OWNED AS OF
March 31, 1997
(excludes Florida Rock Industries, Inc.'s equity
in net income or loss of such corporations)
(Page 3)
INTERCOMPANY ADVANCES AMONG FLORIDA ROCK INDUSTRIES, INC. ("FRI")
AND ITS SUBSIDIARIES
S&G Prestress Company FRI $ 2,528
ARL Development Corp. FRI 5,526,203
TBS Enterprises, Inc. FRI 3,216,000
LanDel/Arundel, Inc. FRI 422,901
FRI S&G Concrete 4,434,132
Sadler Materials Corp. FRI 23,149,610
Tidewater Materials Corp. FRI 3,761,618
Tidewater Quarries, Inc. FRI 21,123,161
The Arundel Corporation Virginia Concrete Co. 827,718
Salisbury Towing Corp. Sadler Materials Corp. 77,907
Sadler Materials Corp. Tidewater Materials Corp. 197,408
Sadler Materials Corp. Tidewater Quarries, Inc. 7,572,858
Tidewater Quarries, Inc. Tidewater Materials Corp. 1,858,797
GUARANTEES
FRI has guaranteed a loan payable of Tidewater Quarries, Inc., a
wholly-owned subsidiary of The Arundel Corporation. Such debt is
reflected as debt in FRI's consolidated financial statements and in
Schedule VI of this agreement:
SOVRAN BANK, N.A. $2,019,000
The only other guarantees that FRI and its subsidiaries currently
have outstanding other than the guarantees listed above, are
guarantees under certain Industrial Revenue Bonds. The bonds are
carried in the Company's consolidated financial statements as funded
indebtedness.
Note: Excluded from this Schedule are guarantees of the types
described in Section 8.3(e) and (f) of this Amended and
Restated Revolving Credit and Term Loan Agreement and
guarantees of letters of credit issued on behalf of certain
subsidiaries.
<PAGE>
SCHEDULE VI
FLORIDA ROCK INDUSTRIES, INC. ("FRI")
INDEBTEDNESS
March 31, 1997
Lender Secured By Amount
FLORIDA ROCK INDUSTRIES, INC.
Industrial Revenue Bonds:
Marion County, Florida(a) Real estate, plant & equipment $2,000,000
Putnam County, Florida(a) Real estate, plant & equipment 2,000,000
Putnam County, Florida(a) Real estate, plant & equipment 1,000,000
Duval County, Florida(a) Real estate, plant & equipment 1,700,000
Osceola County, Florida(a) Real estate, plant & equipment 1,200,000
Unsecured Bank Loans:
Revolving Credit Agreement None -0-
Barnett Bank None 100,000
First Union National Bank of Florida None 100,000
SunTrust Bank, Central Florida, N.A. None 100,000
Other Unsecured Debt:
Oakland Concrete 420,000
Tyner 64,444
D.M. Faircloth 1,000,000
Power Concrete 572,372
10,256,816
MARYLAND ROCK INDUSTRIES, INC.
Industrial Revenue Bond:
St. Mary's County, Maryland(a) Real estate, plant & equip. 6,000,000
THE ARUNDEL CORPORATION AND ITS SUBSIDIARIES:
Industrial Revenue Bonds Richmond Plant 2,019,000
Secured Debt
Sherman Real Estate 62,500
Robert & Lucy Hughes Real Estate 379,953
C. Hargis Merrill Real Estate 993,528
C. Hargis Merrill Real Estate 4,464
1,440,445
GRAND TOTAL $19,716,261
(a) The Company has repurchased a portion of these bonds. See
Schedule V-Part A for a listing of the bonds repurchased.
<PAGE>
<PAGE>
Exhibit (11)
FLORIDA ROCK INDUSTRIES, INC.
COMPUTATION OF EARNINGS PER COMMON SHARE
THREE MONTHS NINE MONTHS
ENDED JUNE 30 ENDED JUNE 30
1997 1996 1997 1996
Net income $12,003,000 $ 9,039,000 $26,626,000 $17,330,000
Common shares:
Weighted average shares
outstanding during the
period 9,210,353 9,415,094 9,229,687 9,462,592
Shares issuable under
stock options which are
potentially dillutive
and affect primary
earnings per share 128,611 3,693 93,819 13,030
Maximum potential shares
includable in computa-
tion of primary earnings
per share 9,338,964 9,418,787 9,323,506 9,475,622
Additional shares issu-
able under stock options
which are potentially
dillutive and affect
fully diluted earnings
per share 80,835 7,426 87,070 , , -
Maximum potential shares
included in computation
of fully diluted
earnings per share 9,419,799 9,426,213 9,410,576 9,475,622
Primary earnings per
common share $1.29 $.96 $2.86 $1.83
Fully diluted earnings
per common share (a) $1.29 $.96 $2.86 $1.83
(a) Fully diluted earnings per common share are not presented
the income statement since the potential effect would have
been less than 3% dilutive.
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