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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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                                   FORM 10-K
                 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

       FOR THE FISCAL YEAR ENDED JULY 31, 2000 COMMISSION FILE NO. 0-8675
                            ------------------------

                         OIL-DRI CORPORATION OF AMERICA
             (Exact name of Registrant as specified in its Charter)

                                               
                    DELAWARE                                     36-2048898
        (State or other jurisdiction of             (I.R.S. Employer Identification No.)
         incorporation or organization)
      410 NORTH MICHIGAN AVENUE, SUITE 400
               CHICAGO, ILLINOIS                                 60611-4213
    (Address of principal executive offices)                     (Zip Code)

          The Registrant's telephone number, including area code: (312) 321-1515

          Securities registered pursuant to Section 12(b) of the Act:

                                         NAME OF EACH EXCHANGE
         TITLE OF EACH CLASS              ON WHICH REGISTERED
         -------------------             ---------------------
                                     
Common Stock, par value $.10 per share   New York Stock Exchange

          Securities registered pursuant to Section 12(g) of the Act:

                                      NONE
                                (Title of Class)

     Number of Shares of each class of the Registrant's Common Stock outstanding
as of September 29, 2000:

     Common Stock -- 5,470,435 shares (including 1,281,769 treasury shares)
             Class B Stock -- 1,765,083 shares (including 342,241 treasury
shares)
             Class A Common Stock -- 0 shares

     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 by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of the Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. X

     Aggregate market value of the Registrant's Common Stock owned by
non-affiliates -- $35,950,460 (based on the closing price on September 29,
2000).
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                      DOCUMENTS INCORPORATED BY REFERENCE

     The following documents are incorporated herein by reference:

     1. The Registrant's Proxy Statement for its 2000 Annual Meeting of
Stockholders ("Proxy Statement"), which will be filed with the Securities and
Exchange Commission not later than November 28, 2000 (120 days after the end of
the Registrant's fiscal year ended July 31, 2000), is incorporated into Part III
of this Annual Report on Form 10-K, as indicated herein.

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                                    CONTENTS

                                                                         PAGE
                                                                   
PART I
ITEM 1:    Business....................................................    4-9
ITEM 2:    Properties..................................................  10-11
ITEM 3:    Legal Proceedings...........................................     11
ITEM 4:    Submission Of Matters To A Vote Of Security Holders.........     11
EXECUTIVE OFFICERS OF THE COMPANY......................................     12

PART II
ITEM 5:    Market For Registrant's Common Equity And Related
           Shareholder Matters.........................................     13
ITEM 6:    Selected Financial Data.....................................  14-15
ITEM 7:    Management Discussion And Analysis Of Financial Condition
           And The Results Of Operations...............................  16-19
ITEM 7A:   Quantitative And Qualitative Disclosures About Market
           Risk........................................................     19
ITEM 8:    Financial Statements And Supplementary Data.................  20-40
ITEM 9:    Changes In And Disagreements With Accountants On Accounting
           And Financial Disclosure....................................     40

PART III
ITEM 10:   Directors And Executive Officers Of The Registrant..........     41
ITEM 11:   Executive Compensation......................................     41
ITEM 12:   Security Ownership Of Certain Beneficial Owners And
           Management..................................................     41
ITEM 13:   Certain Relationships And Related Transactions..............     41

PART IV
ITEM 14:   Exhibits, Financial Statement Schedules, And Reports On Form
           8-K.........................................................  42-44
SIGNATURES.............................................................  45-46
INDEPENDENT AUDITOR'S REPORT ON SCHEDULES..............................     47
SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS.......................     48
EXHIBIT INDEX..........................................................     49

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                                     PART I

ITEM 1. BUSINESS

     Oil-Dri Corporation of America was incorporated in 1969 in Delaware as the
successor to an Illinois corporation incorporated in 1946 which was the
successor to a partnership which commenced business in 1941. Except as otherwise
indicated herein or as the context otherwise requires, references herein to
"Registrant" or to "Company" are to Oil-Dri Corporation of America and its
subsidiaries. The Registrant is a leader in developing, manufacturing and
marketing sorbent products and related services for the consumer, fluids
purification, agricultural, and industrial and automotive markets. The
Registrant's products are principally produced from clay minerals and, to a
lesser extent, other sorbent materials. Consumer products, consisting primarily
of cat litter, are sold through the grocery products industry, mass
merchandisers, warehouse clubs, and pet specialty retail outlets. Fluids
purification products, consisting primarily of bleaching, filtration and
clarification clays, are sold to processors and refiners of edible and
petroleum-based oils. Agricultural products, which include carriers for crop
protection chemicals and fertilizers, drying agents, soil conditioners, sports
field products, pellet binders for animal feeds and flowability aids, are sold
to manufacturers of agricultural chemicals and distributors of other
agricultural and sports turf products. Industrial and automotive products,
consisting primarily of oil, grease and water sorbents (both clay and non-
clay), are sold to distributors of industrial cleanup and automotive products,
environmental service companies and retail outlets.

     The Registrant's sorbent technologies include absorbent and adsorbent
products. Absorbents, like sponges, draw liquids up into their many pores.
Examples of the Registrant's absorbent products are CAT'S PRIDE(R) Premium cat
litter and other cat litters, OIL-DRI ALL PURPOSE(R) clay floor absorbent and
AGSORB(R) granular agricultural chemical carriers.

     Adsorbent products attract liquids, impurities, metals and surfactants to
themselves and form low level chemical bonds. The Registrant's adsorbents are
used for cleanup and filtration mediums. The Registrant's adsorbent products
include OIL-DRI LITE(R) sorbents for industrial cleanup, PURE-FLO(R),
PURE-FLO(R) Supreme, PERFORM(TM) and SELECT(TM) bleaching clays for edible oils,
fats and tallows, and ULTRA-CLEAR(R) clarification aids for petroleum-based oils
and by-products.

     The Registrant has pursued a strategy of developing products for consumer,
fluids purification, agricultural and industrial and automotive uses, where the
Registrant's marketing, manufacturing and research and development capabilities
can play important roles. The Registrant's products are sold through its
specialized divisional sales staffs supported by technical service
representatives and through a network of industrial distributors and food
brokers. The Registrant maintains its own research and development facility and
staff.

     Certain financial information on segments is contained in Note 4 of the
"Notes to Consolidated Financial Statements," incorporated herein by reference.
Information concerning total revenue of classes of similar products accounting
for more than 10% of consolidated revenues in any of the last three fiscal years
is not separately provided because it is the same as the information on net
sales of segments furnished in Note 4 of the "Notes to Consolidated Financial
Statements."

     Certain financial information about the Registrant's foreign and domestic
operations is contained in Note 4 of the "Notes to Consolidated Financial
Statements," incorporated herein by reference.

Consumer Products

     The Registrant's cat litter products, in both coarse granular and fine
granular clumping (scoopable) forms, are sold under the Registrant's CAT'S
PRIDE(R) and LASTING PRIDE(R) brand names, FRESH STEP(R) brand manufactured for
The Clorox Company, Arm & Hammer(R) SUPER STOP(TM) brand manufactured for Church
& Dwight Co., Inc., and private label cat litters manufactured for mass
merchandisers, wholesale clubs, drug chains, pet superstores and retail grocery
stores. Alternative litters, made from recycled paper, are sold under the DUST
STOPPER(R) (coarse) and SCOOP 'N FLUSH(R) (scoopable) brand cat litter and are
marketed through similar channels. The Registrant also packages and markets
CAT'S

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PRIDE(R) KAT KIT cat litter in a disposable tray. These products are sold
through independent food brokers and the Registrant's representatives to major
grocery outlets such as Publix, Kroger, Stop and Shop and others. LASTING
PRIDE(R) cat litter is principally sold to mass merchandisers such as Wal-Mart
and
K-Mart.

     The Registrant and The Clorox Company have long-term arrangements, expiring
in January 2005, under which they developed FRESH STEP(R) premium-priced cat
litter products and under which the Registrant has a long-term exclusive right
to supply The Clorox Company's requirements for FRESH STEP(R) coarse cat litter
up to certain levels. The Registrant and The Clorox Company are discussing
possible extension of this agreement. FRESH STEP(R) brand, which is owned,
trademarked and marketed by The Clorox Company, utilizes the Registrant's
special low density, highly absorbent clay mineral. FRESH STEP(R) cat litter
contains microencapsulated odor controllers which are activated by the cat.
According to independently published supermarket industry reports, FRESH STEP(R)
coarse cat litter was the largest dollar grossing branded cat litter sold
through grocery chains in the United States in the 52-week period ended August
6, 2000.

     In the first quarter of fiscal year 2000, the Registrant and Church &
Dwight Co., Inc. entered into a long-term supply agreement whereby the
Registrant is the exclusive manufacturer for a new cat litter, Arm and Hammer(R)
SUPER STOP(TM). This traditional or non-clumping cat litter utilizes an odor
control formula developed by Church & Dwight. Church & Dwight will control all
aspects of sales and marketing of this brand.

     Traditional coarse granular clay litters once represented approximately 98%
of the market. Beginning in 1990, the cat litter market changed and traditional
coarse litters are now complemented by new, fine granule clumping (scoopable)
products. These clumping products have the characteristic of binding together
and expanding when moisture is introduced. The Registrant's clumping cat litter
is based on naturally occurring organic ingredients which are biodegradable. On
an industry-wide basis, clumping cat litters have assumed market shares in
excess of approximately 53% of retail dollar sales volume in the grocery
industry and 65% of retail dollar sales volume in the mass merchandiser industry
in the 52-week period ended August 6, 2000, compared with 52% and 63%,
respectively, in a similar period last year.

     In fiscal 1998, the Registrant purchased Salubrius, Inc., a manufacturer of
dog biscuits. Subsequently renamed Phoebe Products Company, it has conducted
test market studies on its SMART SNACKS(TM) line of dog biscuits, jerky treats
and rawhides. While market test results appear satisfactory, the Registrant
cannot assure additional distribution of this product line extension due to the
high costs associated with new product launches and the highly competitive
nature of this market segment.

Fluids Purification Products Group

     Fluids purification products include PURE-FLO(R) and PURE-FLO(R) Supreme
bleaching clays and ULTRA-CLEAR(R) clarification aids. These products are
supported by a team of technical sales and support representatives employed by
the Company and the services of the Registrant's research and development group.
The products are marketed in the United States and international markets.

     PURE-FLO(R) bleaching clays, used in the bleaching of edible oils, remove
impurities and color bodies from these oils. The primary customers for these
products are refiners of food oils. ULTRA-CLEAR(R) clarification aids are used
as filtration and purification mediums for jet fuel and other petroleum-based
oils. These products adsorb unwanted moisture and other impurities, and are
primarily sold to oil refiners.

     The Registrant also produces PERFORM(TM) and SELECT(TM) bleaching clays,
which offer performance advances to refiners. The PERFORM(TM) products are the
next generation of bleaching clays, providing increased activity for
hard-to-bleach oils. The SELECT(TM) line of products is used earlier in the
process stream to remove a variety of impurities from edible oils. SELECT(TM)
bleaching clays can also be used to replace the water wash step in the caustic
refining of edible oils.

Agricultural Products Group

     The Registrant produces and markets a wide range of granular and powdered
mineral absorbent products that are used with crop protection chemicals, animal
feed, fertilizers, other horticultural applications and
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sports field and turf management. Products include AGSORB(R) agricultural
chemical carriers and drying agents; FLO-FRE(R), a highly absorbent microgranule
flowability aid; PEL-UNITE(R) and CONDITIONADE(R) pelleting aids used in the
manufacture of animal feeds, TERRA GREEN(R) and SOILMASTER(R) soil conditioners
and POULTRY GUARD(TM) litter amendments used in controlling ammonia levels in
commercial poultry houses.

     The AGSORB(R) carriers are used as mediums of distribution for crop
protection chemicals, including herbicides, fungicides, insecticides, and
fertilizers. AGSORB(R) customized carriers are designed to reduce dust and to
increase accuracy of application. The Registrant's AGSORB(R) drying agent is
used to prevent clogging in specialized farm machinery and enables farmers to
evenly apply granular fertilizers and liquid pesticides to their fields in one
application. The Registrant has also developed the AGSORB(R) product as a
blending agent for fertilizers and chemicals used in the lawn and garden market.
SOILMASTER(R) products include ball field maintenance and turf conditioner
products.

     Agricultural products are marketed in the United States by technical
salesmen employed by the Company who sell to crop protection chemical
manufacturers, feed producers and agricultural product distributors. The
Registrant's principal customers for these products include the agricultural
groups of Monsanto, DowElanco and Zeneca.

     In October 1999 the Registrant acquired Pro's Choice, Inc., a marketer and
distributor of sports field products. Previously, the Registrant had supplied
Pro's Choice with specialty clay products for use in these markets. Products
include SOILMASTER(R) Infield Conditioner, which improves drainage and prevents
compaction on baseball infields and other surfaces, and SOILMASTER(R) Green Soil
Conditioner, which improves oxygen, water and nutrient flow to the root zone of
turf surfaces. The Registrant's principal customers for these products include
professional baseball teams, colleges, municipalities and park districts.

Industrial and Automotive Products

     Products for industrial applications include the Registrant's oil, grease
and water sorbents, which are cost effective floor maintenance products that
provide a nonslip and nonflammable surface for workers. These products are sold
through a wide range of distribution channels and have achieved a high level of
brand name recognition. The Registrant distributes clay-based sorbents sold in
granular form and in other configurations such as pillows and socks. The
Registrant also distributes non-clay sorbents including its OIL-DRI Industrial
Pad and OIL-DRI Industrial Rug, which are made of needle-punched polypropylene.

     The Registrant sells its industrial products through a distributor network
that includes industrial, auto parts, safety, sanitary supply, chemical and
paper distributors and environmental service companies. The Registrant supports
the efforts of the industrial distributors with specialized divisional sales
personnel.

     The Registrant also produces for the consumer market OIL-DRI Automotive, a
floor absorbent for home and garage use. This product is sold through automobile
parts distributors and mass merchandisers.

Transportation Services

     In the second quarter of fiscal 1998, the Registrant exited the
transportation business and formed a strategic alliance with CRST International,
Inc., which since that time has serviced the majority of the Registrant's
over-the-road shipping requirements.

Patents

     The Registrant has obtained or applied for patents for certain of its
processes and products. These patents expire at various times, beginning in
1999. Patented processes and products are not material to the Registrant's
overall business.

Foreign

     SAULAR(R) cat litter manufactured and marketed by Favorite Products
Company, Ltd. (d.b.a. Oil-Dri Canada), the Registrant's wholly owned Canadian
subsidiary, is a leading cat litter brand sold in Canada.

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Favorite Products Company, Ltd. also packages and markets the SAULAR(R)
KAT-KIT(TM)disposable cat litter tray and litter. Certain of the products sold
in Canada are blends of clay and synthetic sorbent materials.

     The Registrant's wholly owned subsidiary in England, Oil-Dri, U.K., Ltd.,
packages clay granules produced by the Registrant's domestic manufacturing
facilities and, for certain applications, blends a synthetic sorbent material
which it manufactures locally. Oil-Dri, U.K., Ltd. markets these products,
primarily in the United Kingdom, as an oil and grease absorbent and as a cat
litter.

     The Registrant's wholly owned subsidiary in Switzerland, Oil-Dri S.A.,
performs various management, sales and administrative functions for the
Registrant and its foreign subsidiaries.

     The Company's foreign operations are subject to the normal risks of doing
business overseas, such as currency devaluations and fluctuations, restrictions
on the transfer of funds and import/export duties. The Registrant's foreign
subsidiaries to date have not been materially affected by these risks.

Backlog; Seasonality

     At July 31, 2000 and 1999, the Registrant's backlog of orders was
approximately $2,913,000 and $2,534,000, respectively. The Registrant does not
consider its clay sorbent business, taken as a whole, to be seasonal to any
material extent. However, certain business activities of certain customers of
the Registrant (such as agricultural) are subject to such factors as crop
acreage planted and product formulation cycles.

Customers

     Sales to Wal-Mart Stores, Inc. accounted for approximately 20% of the
Registrant's net sales for the fiscal year ended July 31, 2000. Sales to The
Clorox Company accounted for approximately 9% of the Registrant's net sales for
the fiscal year ended July 31, 2000. The Clorox Company and the Registrant are
parties to a long-term supply contract. The loss of any other of the
Registrant's customers would not have a materially adverse effect on the
Registrant.

Competition

     The Registrant has approximately six principal competitors in the United
States, some of which have substantially greater financial resources than the
Company, which compete with the Registrant in certain markets and with respect
to certain products. Price, service and technical support, product quality and
delivery are the principal methods of competition in the Registrant's markets
and competition has historically been very vigorous. The Registrant believes
that it can compete favorably in all of its present markets.

Reserves

     The Registrant mines sorbent materials, consisting of either
montmorillonite, attapulgite or diatomaceous earth on leased or owned land near
its manufacturing facilities in Mississippi, Georgia, Illinois and Oregon, and
on leased and owned land in Florida (see "Item 2--Properties" below). The
Registrant estimates that its proven recoverable reserves of these sorbent
materials aggregate approximately 489,118,000 tons. Based on its rate of
consumption during the 2000 fiscal year, the Registrant considers its proven
recoverable reserves adequate to supply the Registrant's needs for over 45
years. It is the Registrant's policy to attempt to add to reserves in most
years, but not necessarily in every year, an amount at least equal to the amount
of reserves consumed in that year. The Registrant has a program of exploration
for additional reserves and, although reserves have been acquired, the
Registrant cannot assure that such additional reserves will continue to become
available. The Registrant's use of these reserves will be subject to compliance
with existing and future federal and state statutes and regulations regarding
mining and environmental compliance. Also, requirements for environmental
compliance may restrict exploration or use of lands that might otherwise be
utilized as a source of reserves. During the fiscal year ended July 31, 2000,
the Registrant utilized these reserves to produce substantially all of the
sorbent minerals that it sold.

     In 1997, the Registrant acquired rights to mineral reserves on
approximately 5,907 acres in Nevada. This acreage is in addition to
approximately 415 acres acquired in 1991 in Washoe County, Nevada. The
Registrant estimates that there are over 300,000,000 tons of proven reserves of
sorbent materials on the combined
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acreage. Mining and processing these reserves requires the approval of federal,
state and local agencies. The Registrant has received federal approval to mine
these properties and is in the process of obtaining all other necessary state
and local approvals. In the future, the Registrant hopes to develop facilities
so as to use these reserves as a source of supply for its West Coast customers.
However, there can be no assurance that this will be accomplished.

     In 1998, mineral reserves on approximately 778 acres in Tennessee and 755
acres in Illinois were acquired in conjunction with the purchase of Oil-Dri,
Mounds Production Company.

Mining Operations

     The Registrant has conducted mining operations in Ripley, Mississippi since
1963; in Ochlocknee, Georgia since 1971; in Christmas Valley, Oregon since 1979;
in Blue Mountain, Mississippi since 1989; and in Mounds, Illinois since 1998.

     The Registrant's raw materials are surface mined on a year-round basis,
generally using large earth moving scrapers and bulldozers to remove overburden,
and then loaded into dump trucks with backhoe or dragline equipment for movement
to the processing facilities. The mining and hauling of the Registrant's clay is
performed by the Registrant and by independent contractors.

     The Registrant's current operating mines range in distance from immediately
adjacent to several miles from its processing plants. Access to processing
facilities from the mining areas is generally by private road, and in some
instances public highways are utilized.

     Each of the Registrant's processing facilities maintains stockpiles of
unprocessed clay of approximately one to three weeks production requirements.

     Proven reserves are those reserves for which (a) quantity is computed from
dimensions revealed in outcrops, trenches, workings or drill holes; grade and/or
quality are computed from results of detailed sampling, and (b) the sites for
inspection, sampling and measurement are spaced so closely and the geologic
character is so well defined that size, shape, depth and mineral content of
reserves are well established. Probable reserves are computed from information
similar to that used for proven reserves, but the sites for inspection,
sampling, and measurement are farther apart or are otherwise less adequately
spaced. The degree of assurance, although lower than that for proven reserves,
is high enough to assume continuity between points of observation.

     The Registrant employs a staff of geologists and mineral specialists who
estimate and evaluate existing and potential reserves in terms of quality,
quantity and availability.

     The following schedule summarizes, for each of the Registrant's
manufacturing facilities, the net book value of land and other plant and
equipment:

                                                                          PLANT AND
                                                                 LAND     EQUIPMENT
                                                                 ----     ---------
                                                                  (IN THOUSANDS)
                                                                    
Ochlocknee, Georgia.........................................    $2,697     $15,578
Ripley, Mississippi.........................................    $1,543     $11,439
Mounds, Illinois............................................    $  325     $ 8,461
Blue Mountain, Mississippi..................................    $  952     $ 7,503
Christmas Valley, Oregon....................................    $  100     $   449

Employees

     As of July 31, 2000, the Registrant employed 713 persons, 75 of whom were
employed by the Registrant's foreign subsidiaries. The Registrant's corporate
offices, research and development center and manufacturing facilities are
adequately staffed and no material labor shortages are anticipated.
Approximately 43 of the Registrant's employees in the U.S. and approximately 19
of the Registrant's employees in Canada are represented by labor unions, which
have entered into separate collective bargaining agreements with the Company.
Employee relations are considered satisfactory.

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Environmental Compliance

     The Registrant's mining and manufacturing operations and facilities in
Georgia, Mississippi, Oregon and Illinois are required to comply with state
surface mining statutes and various federal, state and local statutes,
regulations and ordinances which govern the discharge of materials, water and
waste into the environment and restrict mining on "wetlands" or otherwise
regulate the Registrant's operations. In recent years, environmental regulation
has grown increasingly stringent, a trend which the Registrant expects will
continue. The Registrant endeavors to stay in substantial compliance with
applicable environmental controls and regulations and to work with regulators to
correct any deficiency. As a result, expenditures relating to environmental
compliance have increased over the years; however, these expenditures have not
been material. The Registrant continues, and will continue, to incur costs in
connection with reclaiming exhausted mining sites. The costs of reclamation have
not had a material effect on its mining costs. These costs are treated as part
of the Registrant's mining expense.

     In addition to the environmental requirements relating to mining and
manufacturing operations and facilities, there is increasing federal and state
legislation and regulation with respect to the labeling, use, and disposal after
use, of various of the Registrant's products. The Registrant endeavors to stay
in substantial compliance with that legislation and regulation and to assist its
customers in that compliance.

     The Registrant cannot assure that, despite its best efforts, it will always
be in compliance with environmental legislation and regulations or with
requirements regarding the labeling, use, and disposal after use, of its
products; nor can it assure that from time to time enforcement of such
requirements will not have an adverse impact on its business.

Energy

     The Registrant uses coal, natural gas and recycled fuel oil as permitted
for energy sources in the processing of its clay products. In prior years, the
Registrant has switched from natural gas to other energy sources during certain
months due to seasonal unavailability and the higher cost of natural gas
relative to other fuels.

Research and Development

     At the Registrant's research facility, the research and development staff
develops new products and applications and improves existing products. The staff
and various consultants consist of geologists, mineralogists and chemists. In
the past several years, the Registrant's research efforts have resulted in a
number of new sorbent products and processes including PURE-FLO(R) Supreme,
PURE-FLO(R) B80, B81, PERFORM(TM), SELECT(TM) and POULTRY GUARD(TM) absorbents,
and CAT'S PRIDE(R) Scoopable, LASTING PRIDE(R), DUST STOPPER(R) and SCOOP 'N
FLUSH(R) cat litters. The technical center produces prototype samples and tests
new products for customer trial and evaluation.

     The Registrant spent approximately $1,951,000, $2,110,000 and $2,376,000
during its fiscal years ended July 31, 2000, 1999 and 1998, respectively, for
research and development. None of such research and development was customer
sponsored, and all research and development costs are expensed in the year in
which incurred.

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ITEM 2. PROPERTIES

     The Registrant's properties are generally described below:

                        LAND HOLDINGS & MINERAL RESERVES

                              LAND       LAND            LAND                          PROVEN           PROBABLE
                              OWNED     LEASED     UNPATENTED CLAIMS     TOTAL        RESERVES          RESERVES
                              -----     ------     -----------------     -----        --------          --------
                             (ACRES)    (ACRES)         (ACRES)         (ACRES)    (000S OF TONS)    (000S OF TONS)
                                                                                   
Florida..................       537        446              --             983          4,512             1,092
Georgia..................     1,944      1,739              --           3,683         43,821            11,174
Illinois.................       161        598              --             759          8,334             6,000
Mississippi..............     2,384      1,331              --           3,715        121,282           111,483
Nevada...................       495         --           5,907           6,402        306,830           248,874
Oregon...................       400         --             220             620             89               311
Tennessee................       778         --              --             778          4,250             4,250
                              -----      -----           -----          ------        -------           -------
                              6,699      4,114           6,127          16,940        489,118           383,184
                              =====      =====           =====          ======        =======           =======

                               TOTAL
                               -----
                           (000S OF TONS)
                        
Florida..................       5,604
Georgia..................      54,995
Illinois.................      14,334
Mississippi..............     232,765
Nevada...................     555,704
Oregon...................         400
Tennessee................       8,500
                              -------
                              872,302
                              =======

     See "Item 1. Business--Reserves"

     There are no mortgages on the property owned by the Registrant. The
Mississippi, Georgia, Oregon, Tennessee, Nevada, Florida and Illinois properties
are primarily mineral in nature. Parcels of such land are also sites of
manufacturing facilities operated by the Registrant. The Illinois land also
includes the site of the Registrant's research and development facility. The
Registrant owns approximately one acre of land in Laval, Quebec, Canada, which
is the site of the processing and packaging facility for the Registrant's
Canadian subsidiary.

     The Registrant's mining operations are conducted on leased or owned land
and, in Oregon, unpatented mining claims. The Georgia, Illinois, Florida and
Mississippi mining leases, with expiration dates ranging from 2000 to 2053, no
one of which is material, generally require that the Registrant pay a minimum
monthly rental to continue the lease term. This rental payment is applied
against a royalty related to the number of unprocessed, or in some cases
processed, tons of mineral extracted from the leased property.

     Of the Registrant's total reserves, certain claims in Nevada and Oregon are
unpatented mining claims leased by the Registrant, on which the Registrant has
the right to conduct mining activities. The validity of title to unpatented
mining claims is dependent upon numerous factual matters. The Registrant
believes the unpatented mining claims it leases are in compliance with all
applicable federal, state and local mining laws, rules and regulations. In
fiscal 2000, the Bureau of Land Management determined that the Registrant's
claim on certain Nevada properties are locatable in nature. This ruling has the
effect of perfecting the Registrant's right to mine these claims. In the past,
members of Congress and the executive branch of the federal government have
proposed amendments to existing federal mining laws. These amendments could have
a prospective effect on mining operations on federal lands and include, among
other changes, the imposition of royalty fees on the mining of unpatented
claims, the elimination or restructuring of the patent system and an increase in
fees for the maintenance of unpatented claims. To the extent that future
proposals may result in the imposition of royalty fees on unpatented lands, the
mining of the Registrant's unpatented claims may become uneconomic. The
Registrant cannot predict the form that any such amendments might take or
whether or when such amendments might be adopted.

     The Registrant operates manufacturing facilities at Ripley, Mississippi;
Ochlocknee, Georgia; Christmas Valley, Oregon; Blue Mountain, Mississippi and
Mounds, Illinois; production and packaging plants at Laval, Quebec, Canada and
Wisbech, United Kingdom; a non-clay sorbents processing and warehousing facility
in Alpharetta, Georgia; and a dog biscuit manufacturing plant in Kiel,
Wisconsin. The Registrant's facilities at Ripley, Mississippi; Ochlocknee,
Georgia; Christmas Valley, Oregon; Mounds, Illinois; Alpharetta, Georgia; Kiel,
Wisconsin; Laval, Quebec, Canada and Wisbech, United Kingdom are wholly owned by
the Registrant and the Registrant's facility at Blue Mountain, Mississippi is
owned in part by the Registrant, with the balance leased as hereinafter
described. The Registrant is a party to leases that relate to certain plant
acquisition and expansion projects at the Registrant's facility at Blue
Mountain, Mississippi. The Blue Mountain, Mississippi

                                       10
   11

lease was entered into with the Town of Blue Mountain, Mississippi in 1988 in
connection with the issuance by the Town of $7,500,000 in aggregate principal
amount of industrial revenue bonds ($5,000,000 of which has been subsequently
retired), full payment of which is guaranteed by the Registrant. Upon expiration
of the leases in 2008, a subsidiary of the Registrant has the right to purchase
the leased property for $100 upon full payment of the bonds. The land on which
the manufacturing facility at Wisbech, United Kingdom is located is leased
pursuant to a long-term lease arrangement with the Port Authority of Wisbech
which expires in 2032. The facilities in Alpharetta, Georgia and Kiel, Wisconsin
are leased.

     All of the Registrant's domestic manufacturing facilities, whether owned or
leased, consist of related steel frame, sheet steel covered or brick buildings
of various heights, with concrete floors and storage tanks. The buildings occupy
approximately 208,000 square feet at Ripley, Mississippi; 247,000 square feet at
Ochlocknee, Georgia; 129,000 square feet at Mounds, Illinois; 18,000 square feet
at Christmas Valley, Oregon; 26,000 square feet at Alpharetta, Georgia; 16,000
square feet at Kiel, Wisconsin and 140,000 square feet at Blue Mountain,
Mississippi. The Registrant maintains railroad siding facilities near the
Ripley, Mississippi; Ochlocknee, Georgia; Blue Mountain, Mississippi; Mounds,
Illinois and Laval, Quebec, Canada manufacturing facilities. Equipment at all
facilities is in good condition, well maintained and adequate for current
processing levels.

     All of the Registrant's foreign facilities are owned and consist of related
steel frame, sheet steel covered or brick buildings of various heights, with
concrete floors and storage tanks. The buildings occupy 22,500 square feet at
Laval, Quebec, Canada and 66,850 square feet at Wisbech, United Kingdom.

     The Registrant's research and development facility is located on owned land
in Vernon Hills, Illinois and consists of brick buildings of approximately
19,100 square feet, including a pilot plant facility.

     The Registrant's principal office, consisting of approximately 20,000
square feet in Chicago, Illinois, is presently occupied under a lease expiring
on June 30, 2008.

ITEM 3. LEGAL PROCEEDINGS

     There are no material pending legal proceedings.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     Not applicable.

                                       11
   12

ITEM 401(B) OF REGULATION S-K. EXECUTIVE OFFICERS OF THE REGISTRANT

     The following table gives certain information with respect to the Executive
Officers of the Registrant.

                                                       PRINCIPAL OCCUPATION
             NAME(1)                                   FOR LAST FIVE YEARS                        AGE
             -------                                   --------------------                       ---
                                                                                            
Richard M. Jaffee.................  Chairman of the Board of the Registrant; President from       64
                                    1960 to June 1995; Chief Executive Officer from 1962 until
                                    1997.
Daniel S. Jaffee(2)...............  President and Chief Executive Officer of the Registrant;      36
                                    President and Chief Operating Officer from June 1995 until
                                    August 1997; Chief Executive Officer of Favorite Products
                                    Company, Ltd., a subsidiary of the Registrant since 1990;
                                    Chief Financial Officer of the Registrant from 1990 to
                                    1995; Group Vice-President, Consumer Products of the
                                    Registrant from 1994 to 1995.
Richard V. Hardin(3)..............  Group Vice-President, Technology, of the Registrant.          61
Eugene W. Kiesel..................  Vice-President & General Manager, Global Fluids               43
                                    Purification Group of the Registrant since October 1997;
                                    Vice-President of Radian International, LLC, a subsidiary
                                    of Dow Chemical Company from July 1996 to October 1997;
                                    General Manager of ACS, a division of Dow Chemical Company
                                    from November 1993 to July 1996.
Wade R. Bradley...................  Vice-President, Global Consumer Products of the Registrant    39
                                    since June 2000; Vice-President, Industrial & Automotive
                                    Products Group from December 1998 to June 2000; General
                                    Manager, Industrial & Automotive Products Group from June
                                    1995 to December 1998.
Thomas F. Cofsky(3)...............  Vice-President of Manufacturing and Logistics of the          39
                                    Registrant since June 1999; Vice-President of Logistics,
                                    Quality & Service from February 1996 to June 1999; General
                                    Manager, Logistics, Quality & Service from February 1995
                                    to February 1996.
Jeffrey M. Libert.................  Vice-President & Chief Financial Officer of the Registrant    33
                                    since April 2000; Vice-President of Corporate Development
                                    and Planning from June 1998 to April 2000; Manager of
                                    Production Planning from August 1995 to June 1998; Plant
                                    Controller and Operations Associate from August 1993 to
                                    August 1995.

     The term of each executive officer expires at the 2000 Annual Meeting of
the Stockholders and when his successor is elected and qualified.
- -------------------------
(1) Of the persons in this table, only Richard M. Jaffee and Daniel S. Jaffee
    are directors.
(2) Daniel S. Jaffee is Richard M. Jaffee's son.
(3) Richard V. Hardin and Thomas F. Cofsky are Richard M. Jaffee's sons-in-law.

                                       12
   13

                                    PART II

ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED SECURITY HOLDER
MATTERS

     Information concerning stock prices and dividends with regard to the Common
Stock of the Registrant, which is traded on the New York Stock Exchange, and
information concerning dividends with regard to the Class B Stock of the
Registrant, for which there is no established public trading market, is
contained in Note 14 of the "Notes to Consolidated Financial Statements,"
incorporated herein by reference. No shares of Class A common stock are
outstanding. The Registrant's ability to pay dividends is limited by the
Registrant's Credit Agreement with Harris Trust and Savings Bank dated January
29, 1999. See Note 5 of "Notes to Consolidated Financial Statements,"
incorporated herein by reference. Information concerning a private placement of
$25,000,000 in principal amount of notes in April 1998 is incorporated herein by
reference to Note 5 of the "Notes to the Consolidated Financial Statements." The
notes were sold in reliance on the exemption from registration under the
Securities Act of 1933 contained in Section 4(2) thereof, based on the fact that
they were privately sold in their entirety to two financial institutions.
Information with respect to holders of Common Stock and Class B Stock is
contained in Note 7 of the "Notes to Consolidated Financial Statements"
incorporated herein by reference.

                                       13
   14

ITEM 6. SELECTED FINANCIAL DATA

                       TEN YEAR SUMMARY OF FINANCIAL DATA

                                                    --------------------------------------------------
                                                      2000          1999          1998          1997
                                                      ----          ----          ----          ----
                                                       (IN THOUSANDS EXCEPT FOR PER SHARE AMOUNTS)
                                                                                  
SUMMARY OF OPERATIONS
Net Sales.......................................    $175,119      $173,985      $160,252      $156,616
Cost of Sales...................................     125,184       119,126       110,096       108,687
                                                    --------      --------      --------      --------
Gross Profit....................................      49,935        54,859        50,156        47,929
Selling, General and Administrative Expenses....      42,942        43,108        38,598        37,260
Restructuring and Special Charges...............       1,239            --         3,129            --
                                                    --------      --------      --------      --------
Income from Operations..........................       5,754        11,751         8,429        10,669
                                                    --------      --------      --------      --------
Other Income (Expense)
  Interest Income...............................         206           480           491           637
  Interest Expense..............................      (3,185)       (3,185)       (2,049)       (1,775)
  Foreign Exchange (Losses) Gains...............        (173)         (124)         (146)           --
  Other, Net....................................         446         1,114          (119)          (17)
                                                    --------      --------      --------      --------
     Total Other Expense, Net...................      (2,706)       (1,715)       (1,823)       (1,155)
                                                    --------      --------      --------      --------
Income before Income Taxes......................       3,048        10,036         6,606         9,514
Income Taxes....................................         821         2,860         1,883         2,721
                                                    --------      --------      --------      --------
Net Income......................................    $  2,227      $  7,176      $  4,723      $  6,793
                                                    ========      ========      ========      ========
AVERAGE SHARES OUTSTANDING
  Basic.........................................       5,647         5,827         6,125         6,596
  Dilutive......................................       5,677         5,996         6,165         6,599
NET INCOME PER SHARE
  Basic.........................................    $   0.39      $   1.23      $   0.77      $   1.03
  Dilutive......................................    $   0.39      $   1.20      $   0.77      $   1.03
IMPORTANT HIGHLIGHTS
  Total Assets..................................    $132,844      $133,750      $134,215      $114,558
  Long-Term Debt................................    $ 39,434      $ 38,150      $ 39,976      $ 17,052
  Working Capital...............................    $ 38,875      $ 37,141      $ 36,283      $ 31,165
  Working Capital Ratio.........................         3.6           3.3           3.1           3.0
  Book Value per Share..........................    $  13.01      $  13.00      $  12.15      $  12.03
  Dividends Declared............................    $  1,900      $  1,904      $  1,808      $  1,936
  Capital Expenditures..........................    $  6,001      $  8,495      $  6,496      $  5,395
  Depreciation and Amortization.................    $  9,099      $  8,497      $  7,832      $  7,587
  Operating Cash Flows, less Capital
     Expenditures...............................    $    (33)     $  1,165      $  2,330      $  8,349
  Long-Term Debt to Total Capital...............        35.1%         33.9%         35.8%         18.1%
  Net Income as a Percent of Net Sales..........         1.3%          4.1%          3.0%          4.3%
  Return on Average Stockholder's Equity........         3.0%          9.8%          6.3%          8.8%
  Gross Profit as a Percent of Net Sales........        28.5%         31.5%         31.3%         30.6%
  Operating Expenses as a Percent of Net
     Sales......................................        25.2%         24.8%         26.0%         23.8%

                                       14
   15

                           YEAR ENDED JULY 31
     ---------------------------------------------------------------
       1996       1995       1994       1993       1992       1991
       ----       ----       ----       ----       ----       ----

     $153,787   $152,899   $147,147   $140,866   $124,585   $106,054
      107,730    108,268    102,457     97,396     85,116     74,370
     --------   --------   --------   --------   --------   --------
       46,057     44,631     44,690     43,470     39,469     31,684
       39,153     31,921     30,394     29,553     28,967     21,778
          921         --         --         --         --         --
     --------   --------   --------   --------   --------   --------
        5,983     12,710     14,296     13,917     10,502      9,906
     --------   --------   --------   --------   --------   --------
          587        448        441        452        515        602
       (1,917)    (1,921)    (1,752)    (1,729)    (1,884)    (1,363)
           (7)        (5)         3        (88)        63        (23)
          137        (84)       171       (298)        15         50
     --------   --------   --------   --------   --------   --------
       (1,200)    (1,562)    (1,137)    (1,663)    (1,291)      (734)
     --------   --------   --------   --------   --------   --------
        4,783     11,148     13,159     12,254      9,211      9,172
        1,409      3,145      3,307      2,834      2,110      2,092
     --------   --------   --------   --------   --------   --------
     $  3,374   $  8,003   $  9,852   $  9,420   $  7,101   $  7,080
     ========   ========   ========   ========   ========   ========
        6,806      6,932      6,990      6,995      6,994      7,004
        6,807      6,936      7,011      7,031      7,026      7,055
     $   0.50   $   1.15   $   1.41   $   1.35   $   1.02   $   1.01
     $   0.50   $   1.15   $   1.41   $   1.34   $   1.01   $   1.00
     $117,693   $116,988   $112,267   $102,117   $ 95,018   $ 89,394
     $ 18,978   $ 20,422   $ 21,521   $ 17,766   $ 18,831   $ 20,176
     $ 30,399   $ 33,074   $ 29,337   $ 26,043   $ 24,359   $ 24,763
          2.7        3.1        3.0        2.7        2.8        3.4
     $  11.46   $  11.35   $  10.51   $   9.50   $   8.66   $   7.93
     $  2,022   $  2,047   $  1,807   $  1,679   $  1,548   $  1,422
     $  7,184   $  7,032   $ 13,559   $  9,158   $  8,040   $ 10,416
     $  7,926   $  7,808   $  6,798   $  5,835   $  5,407   $  4,831
     $  6,869   $  5,285   $ (3,734)  $  5,080   $    645   $ (1,310)
         19.7%      20.7%      22.8%      21.1%      24.0%      26.6%
          2.2%       5.2%       6.7%       6.7%       5.7%       6.7%
          4.3%      10.6%      14.1%      14.9%      12.3%      13.4%
         29.9%      29.2%      30.4%      30.9%      31.7%      29.9%
         26.1%      20.9%      20.7%      21.0%      23.3%      20.5%

                                       15
   16

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

Results of Operations
Fiscal 2000 Compared to Fiscal 1999

     Consolidated net sales for the year ended July 31, 2000, were $175,119,000,
an increase of 0.7% over net sales of $173,985,000 in fiscal 1999. This increase
was due to increased sales in the Consumer Products and Industrial and
Automotive Products segments, partially offset by decreased sales in the
Agricultural Products and Fluids Purification Products segments. Basic and
diluted net income per share was $0.39 for fiscal 2000, versus basic net income
per share of $1.23 and diluted net income per share of $1.20 in fiscal 1999.
This decrease was due to a restructuring charge recorded in the second quarter
of fiscal 2000, additional manufacturing costs associated with the start-up of
the Church & Dwight Co., Inc. supply agreement, significant increases in energy
costs used in the Company's manufacturing processes, increased costs of
packaging and distribution, unfavorable foreign exchange rate fluctuations and a
decline in demand for agricultural carriers. The restructuring charge, which
covered severance costs for certain eliminated positions ($604,000) and the
write-off of non-performing assets ($635,000). This charge reduced income before
taxes by $1,239,000, net income by $879,000 and basic and fully diluted net
income per share by $0.16 and $0.15 respectively for the year ended July 31,
2000.

     Net sales for the Consumer Products segment for fiscal 2000 were
$115,614,000, an increase of 0.8% over net sales of $114,704,000 in fiscal 1999.
Increased sales of co-packaged cat litter, primarily FRESH STEP(R) manufactured
for the Clorox Company and Arm & Hammer SUPER STOP(TM) brand manufactured for
Church & Dwight Co., Inc., offset reduced sales of branded products and the
reduced grocery distribution for paper cat litter products. Consumer Products'
operating income declined 18.0% from $17,331,000 in fiscal 1999 to $14,212,000
in fiscal 2000. This decline was due to significant increases in energy costs
used in the Company's manufacturing processes, packaging costs, distribution
costs, inefficient trade spending, start-up costs of the Church & Dwight supply
agreement and unfavorable sales mix relative to fiscal 1999.

     Net sales of the Fluids Purification Products segment for fiscal 2000 were
$22,669,000, a decrease of 1.7% from net sales of $23,071,000 in fiscal 1999.
While North American and Latin American sales of PURE FLO(R) bleaching clays and
ULTRA CLEAR(R) clarification aids increased over fiscal 1999 levels, European
sales, specifically by the Company's United Kingdom subsidiary, decreased.
Export sales were also hampered by the relative strength of the U.S. dollar
versus other currencies, particularly the Euro. Operating income for the Fluids
Purification Products segment decreased 25.4% from $5,641,000 in fiscal 1999 to
$4,209,000 in fiscal 2000. This decrease was due to higher manufacturing costs,
competitive activities leading to defensive pricing strategies and unfavorable
exchange rate fluctuations.

     Net sales of the Agricultural Products segment for fiscal 2000 were
$18,199,000, a decrease of 4.8% from net sales of $19,119,000 in fiscal 1999.
This decline is due to reduced crop protection product formulations by the
Company's agricultural chemical customers resulting from a depressed farm
economy. Agricultural Products operating income decreased 45.6% from $3,464,000
in fiscal 1999 to $1,883,000 in fiscal 2000, due to the unfavorable sales mix,
increased manufacturing costs and railcar expenses.

     Net sales of the Industrial and Automotive Products segment for fiscal year
2000 were $18,637,000, an increase of 9.0% from net sales of $17,091,000 in
fiscal 1999 due to increased sales volume of clay-based industrial and
automotive products and price increases instituted during the year. Industrial
and Automotive Products' operating income increased 28.7% from $783,000 in
fiscal 1999 to $1,008,000 in fiscal 2000 due to the increase in sales discussed
above.

     Consolidated gross profit as a percentage of net sales for fiscal 2000
decreased to 28.5% from 31.5% in fiscal 1999. This decline was due to an
unfavorable sales mix in the Consumer Products and Agricultural Products
segments, defensive pricing strategies in the overseas markets of the Fluids
Purification Products segment, reduced export profitability due to unfavorable
exchange rate fluctuation, startup costs associated with the Church & Dwight
Co., Inc. agreement as well as higher manufacturing costs in the form of
increased energy, packaging and distribution costs.

                                       16
   17

     Operating expenses as a percentage of net sales increased to 25.2% for
fiscal 2000 from 24.8% in fiscal 1999. Excluding the restructuring charge
recorded in the second quarter, operating expenses as a percentage of net sales
were 24.5%.

     Interest expense was unchanged in dollar terms from fiscal 1999 to fiscal
2000. Reductions in notes payable from scheduled debt service was offset by line
of credit draws during the year. At July 31, 2000, outstanding borrowings
against the Company's revolving credit agreements was $3,020,000.

     Interest income declined $274,000 from fiscal 1999 due to lower levels of
funds available for investment.

     The Company's effective tax rate was 26.9% of income before tax in fiscal
2000 and 28.5% in fiscal 1999. The reduction in the rate was due to current year
net operating losses carried back to prior years, resulting in income tax
refunds receivable.

     Total assets of the Company decreased $906,000 or 0.7% during the year
ended July 31, 2000. Current assets increased slightly from fiscal 1999 year end
balances primarily due to decreased cash and cash equivalents and accounts
receivable balances, offset by increases in inventories, income taxes receivable
and prepaid expenses. Property, plant and equipment, net of accumulated
depreciation, decreased $3,236,000 during the year as depreciation expense
exceeded capital expenditures.

     Total liabilities increased $637,000 or 1.1% during the year due primarily
to increased noncurrent notes payable balances, partially offset by decreased
accrued expenses and deferred compensation. Current liabilities decreased
$855,000 or 5.4% from July 31, 1999 balances, due to decreases in accrued
salary, wages and commissions and current maturities of notes payable.

Expectations

     The Company anticipates net sales for fiscal 2001 will be higher than the
net sales in fiscal 2000. Sales of branded cat box absorbents are expected to be
flat during the year consistent with projected sales in the overall category.
However, profitability of branded cat box absorbents is expected to increase
moderately due to improved spending controls. Sales of contract manufactured and
private label litters are expected to increase moderately. Within the
agricultural products segment, sales of agricultural carriers are expected to be
flat due to the slow agricultural economy. Moderate sales growth is expected
from market growth and increased market share of our poultry litter and sports
turf products. Sales of the Company's fluid purification products and industrial
and automotive products are expected to increase moderately in fiscal 2001.

Liquidity and Capital Resources

     The current ratio increased to 3.6 at July 31, 2000 from 3.3 at July 31,
1999. Working capital increased $1,734,000 during fiscal 2000 to $38,875,000.
Cash provided by operations continues to be the Company's primary source of
funds to finance ordinary investing and financing activities. During the year,
the balances of cash, cash equivalents and investment securities decreased
$2,980,000. Cash provided by operating activities of $5,956,000, cash on hand
and line of credit draws were used to fund capital expenditures ($6,001,000),
principal payments on long term debt ($2,226,000), dividend payments
($1,911,000), and purchases of the Company's common stock ($1,751,000). Total
cash and investment balances held by the Company's foreign subsidiaries at July
31, 2000 and July 31, 1999 were $2,366,000 and $2,692,000, respectively.

     The Company believes that cash on hand, cash flow from operations and
borrowing capability under its committed credit facility are adequate to fund
the Company's cash requirements for fiscal 2001. Should the Company undertake
strategic acquisitions requiring funds in excess of its internally generated
cash flow, it might be required to incur additional debt.

Results of Operations
Fiscal 1999 Compared to Fiscal 1998

     Consolidated net sales for the year ended July 31, 1999, were $173,985,000,
an increase of 8.6% over net sales of $160,252,000 in fiscal 1998. Excluding the
$2,372,000 of fiscal 1998 sales from the transportation business, which was
divested last year, sales increased 10.2% in fiscal 1999. Net income for fiscal
1999 was

                                       17
   18

$7,176,000, an increase of 51.9% from $4,723,000 earned in fiscal 1998. Basic
net income per share for fiscal 1999 was $1.23 and diluted net income per share
was $1.20, versus $0.77 per share (basic and diluted) earned in fiscal 1998. A
significant portion of the year-to-year increase in net income and net income
per share was due to a special charge recorded in the second quarter of fiscal
1998 to cover the costs of exiting the transportation business and writing off
certain non-performing assets. This charge reduced pre-tax income by $3,129,000,
net income by $2,237,000 and net income per share by $0.36 for the year ended
July 31, 1998.

     Net sales of the Consumer Products segment for fiscal 1999 were
$114,704,000, an increase of 12.7% over net sales of $101,766,000 in fiscal
1998. This growth was primarily due to incremental sales from the introduction
of SCOOP 'N FLUSH(R) and DUST STOPPER(R) paper litters and the acquisition of
Oil-Dri, Mounds Production Company, partially offset by the loss of sales to
Sam's Club, which in fiscal 1998 discontinued carrying the Company's cat litter
products. Consumer Products' operating income declined 3.9% from $18,034,000 in
fiscal 1998 to $17,331,000 in fiscal 1999. This decline was due to nonrecurring
development, marketing and slotting costs related to the launch of the paper
litters in fiscal 1999.

     Net sales of the Fluids Purification Products segment for fiscal 1999 were
$23,071,000, an increase of 8.1% over net sales of $21,337,000 in fiscal 1998.
Sales of ULTRA-CLEAR(R) clarification aids grew in fiscal 1999, and demand for
PURE-FLO(R) was particularly strong in the United Kingdom. Fluids Purification
Products' operating income increased 27.8% from $4,413,000 in fiscal 1998 to
$5,641,000 in fiscal 1999 due to productivity improvements and favorable changes
in sales mix.

     Net sales of the Agricultural Products segment for fiscal 1999 were
$19,119,000, a decrease of 1.5% from net sales of $19,403,000 in fiscal 1998.
This overall decline is due to sharply reduced demand for agricultural carriers
as a result of a depressed farm economy and the growth of biotechnology
products. Agricultural Products' operating income increased 7.4% from $3,225,000
in fiscal 1998 to $3,464,000 in fiscal 1999 due to a decrease in advertising
expenditures.

     Net sales of the Industrial and Automotive Products segment for fiscal 1999
were $17,091,000, an increase of 11.2% from net sales of $15,374,000 in fiscal
1998 due to incremental sales from last year's acquisition of Oil-Dri, Mounds
Production Company. Industrial and Automotive Products' operating income
increased 26.7% from $618,000 in fiscal 1998 to $783,000 in fiscal 1999,
primarily as a result of decreased advertising expenditures.

     Consolidated gross profit as a percentage of net sales for fiscal 1999
increased to 31.5% from 31.3% in fiscal 1998. Changes in sales mix, a
companywide effort to reduce costs and exiting the transportation business
contributed to this increase.

     Operating expenses as a percentage of net sales decreased to 24.8% for
fiscal 1999 from 26.0% in fiscal 1998. This decrease is primarily due to a
pre-tax special charge of $3,129,000 recorded in the second quarter of fiscal
1998 for the cost of exiting the transportation business and writing off certain
non-performing assets, partially offset by nonrecurring development, marketing
and slotting costs related to the launch of the paper litters in fiscal 1999.

     Interest expense increased $1,136,000 while interest income decreased
$11,000. The higher interest expense is primarily due to the fixed rate
financing secured during the third quarter of fiscal 1998 which was used to fund
the purchase of Oil-Dri, Mounds Production Company, repay draws against the
Company's line of credit and for general working capital purposes.

     The Company's effective tax rate was 28.5% of pre-tax income in fiscal 1999
and fiscal 1998.

     Total assets of the Company decreased $465,000 or 0.3% during the year
ended July 31, 1999. Current assets decreased $529,000 or 1.0% from fiscal 1998
year-end balances primarily due to decreased cash and cash equivalents,
partially offset by increases in inventory, prepaid expenses and accounts
receivable levels. Property, plant and equipment, net of accumulated
depreciation, decreased $37,000 during the year as depreciation expense
essentially offset new capital expenditures.

     Total liabilities decreased $3,164,000 or 5.1% during the year due
primarily to decreases in accrued expenses and in notes payable, partially
offset by an increase in accounts payable. Current liabilities decreased

                                       18
   19

$1,387,000 or 8.0% from July 31, 1998 balances, due to decreases in accrued
expenses, partially offset by increases in accounts payable and in the current
maturities of notes payable.

Foreign Operations

     Net sales by the Company's foreign subsidiaries during fiscal 2000 were
$13,394,000 or 7.6% of total Company sales. This represents a decrease of 7.6%
from fiscal 1999 in which foreign subsidiary sales were $14,501,000 or 8.3% of
total Company sales. This decrease is due to lower sales of fluids purification
products in the United Kingdom. Net loss of the foreign subsidiaries for fiscal
2000 was $27,000, a decrease of 104.6% from net income of $590,000 earned in
fiscal 1999. This decrease was primarily due to unfavorable changes in sales mix
and the loss of a key customer in the United Kingdom. Identifiable assets of the
Company's foreign subsidiaries as of July 31, 2000 were $10,083,000, a decrease
of $981,000 from $11,064,000 as of July 31, 1999.

     Net sales by the Company's foreign subsidiaries during fiscal 1999 were
$14,501,000 or 8.3% of total Company sales. This represents an increase of 3.7%
from fiscal 1998 in which foreign subsidiary sales were $13,987,000 or 8.7% of
total Company sales. The increase is due to higher demand for fluids
purification products in the United Kingdom. Net income of the foreign
subsidiaries for fiscal 1999 was $590,000, a decrease of 6.9% from $634,000
earned in fiscal 1998. This decrease was primarily due to unfavorable changes in
sales mix. Identifiable assets of the Company's foreign subsidiaries as of July
31, 1999 were $11,064,000, a decrease of $696,000 from $11,760,000 as of July
31, 1998. The decrease is primarily due to lower inventories and cash and cash
equivalents.

Year 2000

     The Year 2000 ("Y2K") issue was a result of computer programs using a
two-digit format, as opposed to four digits, to indicate the year. Such computer
systems would have been unable to interpret dates beyond 1999, which could have
caused a system failure or application errors, leading to disruptions in
operations.

     As of the date of this report, the Company has not experienced any material
problems related to Y2K, nor has the Company received any significant complaints
regarding Y2K issues related to its products. Also, the Company is not aware of
any significant Y2K issues affecting the Company's major customers or suppliers.

Forward-Looking Statements

     Certain statements in this report, including, but not limited to, those
under the heading "Expectations" and those statements elsewhere in this report
that use forward-looking terminology such as "expect," "would," "could,"
"should," "estimates," and "believes" are "forward-looking statements" within
the meaning of that term in the Securities Exchange Act of 1934, as amended.
Actual results may differ materially from those reflected in these
forward-looking statements, due primarily to continued vigorous competition in
the grocery, mass merchandiser and club markets, the level of success of new
products, and the cost of product introductions and promotions in the consumer
market. These forward-looking statements also involve the risk of changes in
market conditions in the overall economy and, for the fluids purification and
agricultural markets, in planting activity, crop quality, and overall
agricultural demand, including export demand and foreign exchange rate
fluctuations. Other factors affecting these forward-looking statements may be
detailed from time to time in reports filed with the Securities and Exchange
Commission.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     The Company did not have any derivative financial instruments as of July
31, 2000. However, the Company is exposed to interest rate risk. The Company
employs policies and procedures to manage its exposure to changes in the market
risk of its cash equivalents and short-term investments. The Company believes
that the market risk arising from holdings of its financial instruments is not
material.

                                       19
   20

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

                          CONSOLIDATED BALANCE SHEETS

                                                                        JULY 31,
                                                                -------------------------
                                                                  2000             1999
                                                                  ----             ----
                                                                (IN THOUSANDS OF DOLLARS)
                                                                           
ASSETS
CURRENT ASSETS
  Cash and cash equivalents.................................    $  1,388         $  4,362
  Investment securities.....................................       1,219            1,225
  Accounts receivable, less allowance of $836 in 2000 and
     $358 in 1999...........................................      24,438           25,365
  Inventories...............................................      16,928           15,165
  Income taxes receivable...................................       2,267               --
  Prepaid expenses..........................................       7,719            6,963
                                                                --------         --------
       Total Current Assets.................................      53,959           53,080
                                                                --------         --------

PROPERTY, PLANT AND EQUIPMENT, AT COST
  Buildings and leasehold improvements......................      20,769           20,391
  Machinery and equipment...................................      88,737           87,536
  Office furniture and equipment............................       9,532            8,658
  Vehicles..................................................       5,166            5,118
                                                                --------         --------
                                                                 124,204          121,703
  Less accumulated depreciation and amortization............     (76,033)         (69,631)
                                                                --------         --------
                                                                  48,171           52,072
  Construction in progress..................................       3,722            3,199
  Land......................................................       7,719            7,577
                                                                --------         --------
       Total Property, Plant and Equipment, Net.............      59,612           62,848
                                                                --------         --------

OTHER ASSETS
  Goodwill and intangibles (Net of accumulated amortization
     of $2,664 in 2000 and $2,128 in 1999)..................      10,324            9,780
  Deferred income taxes.....................................       2,606            3,045
  Other.....................................................       6,343            4,997
                                                                --------         --------
       Total Other Assets...................................      19,273           17,822
                                                                --------         --------
  Total Assets..............................................    $132,844         $133,750
                                                                ========         ========

                                       20
   21

                                                                        JULY 31,
                                                                -------------------------
                                                                  2000             1999
                                                                  ----             ----
                                                                (IN THOUSANDS OF DOLLARS)
                                                                           
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
  Current maturities of notes payable.......................    $  1,750         $  2,226
  Accounts payable..........................................       4,804            4,842
  Dividends payable.........................................         473              484
  Accrued expenses
     Salaries, wages and commissions........................       2,111            3,016
     Trade promotions and advertising.......................       1,159            1,166
     Freight................................................       1,385            1,119
     Other..................................................       3,402            3,086
                                                                --------         --------
          Total Current Liabilities.........................      15,084           15,939
                                                                --------         --------
NONCURRENT LIABILITIES
  Notes payable.............................................      39,434           38,150
  Deferred compensation.....................................       3,112            3,206
  Other.....................................................       2,250            1,948
                                                                --------         --------
          Total Noncurrent Liabilities......................      44,796           43,304
                                                                --------         --------
          Total Liabilities.................................      59,880           59,243
                                                                --------         --------
STOCKHOLDERS' EQUITY
  Common Stock, par value $.10 per share, issued 5,470,435
     shares in 2000 and 5,470,252 shares in 1999............         547              547
  Class B Stock, par value $.10 per share, issued 1,765,083
     shares in 2000 and 1,765,266 shares in 1999............         177              177
  Additional paid-in capital................................       7,698            7,702
  Retained earnings.........................................      90,757           90,430
  Restricted unearned stock compensation....................         (10)              (9)
  Cumulative translation adjustments........................      (1,310)          (1,159)
                                                                --------         --------
                                                                  97,859           97,688
  Less treasury stock, at cost (1,283,769 Common shares and
     342,241 Class B shares in 2000 and 1,163,764 Common
     shares and 342,241 Class B shares in 1999).............     (24,895)         (23,181)
                                                                --------         --------
          Total Stockholders' Equity........................      72,964           74,507
                                                                --------         --------
  Total Liabilities and Stockholders' Equity................    $132,844         $133,750
                                                                ========         ========

   The accompanying notes are an integral part of the consolidated financial
                                  statements.

                                       21
   22

                       CONSOLIDATED STATEMENTS OF INCOME

                                                                      YEAR ENDED JULY 31,
                                                                --------------------------------
                                                                  2000        1999        1998
                                                                  ----        ----        ----
                                                                         (IN THOUSANDS
                                                                   EXCEPT FOR PER SHARE DATA)
                                                                               
NET SALES...................................................    $175,119    $173,985    $160,252
COST OF SALES...............................................     125,184     119,126     110,096
                                                                --------    --------    --------
GROSS PROFIT................................................      49,935      54,859      50,156
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES................      42,942      43,108      38,598
RESTRUCTURING AND SPECIAL CHARGES...........................       1,239          --       3,129
                                                                --------    --------    --------
INCOME FROM OPERATIONS......................................       5,754      11,751       8,429
                                                                --------    --------    --------
OTHER INCOME (EXPENSE)
  Interest income...........................................         206         480         491
  Interest expense..........................................      (3,185)     (3,185)     (2,049)
  Foreign exchange losses...................................        (173)       (124)       (146)
  Other investment income...................................         254         939          --
  Other, net................................................         192         175        (119)
                                                                --------    --------    --------
       Total Other Expense, Net.............................      (2,706)     (1,715)     (1,823)
                                                                --------    --------    --------
INCOME BEFORE INCOME TAXES..................................       3,048      10,036       6,606
INCOME TAXES................................................         821       2,860       1,883
                                                                --------    --------    --------
NET INCOME..................................................    $  2,227    $  7,176    $  4,723
                                                                ========    ========    ========
NET INCOME PER SHARE
  Basic.....................................................    $   0.39    $   1.23    $   0.77
                                                                ========    ========    ========
  Dilutive..................................................    $   0.39    $   1.20    $   0.77
                                                                ========    ========    ========
AVERAGE SHARES OUTSTANDING
  Basic.....................................................       5,647       5,827       6,125
                                                                ========    ========    ========
  Dilutive..................................................       5,677       5,996       6,165
                                                                ========    ========    ========

   The accompanying notes are an integral part of the consolidated financial
                                  statements.

                                       22
   23

                CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

                                                                           RESTRICTED
                                       COMMON &   ADDITIONAL                UNEARNED                    OTHER           TOTAL
                                       CLASS B     PAID-IN     RETAINED      STOCK       TREASURY   COMPREHENSIVE   STOCKHOLDERS'
                                        STOCK      CAPITAL     EARNINGS   COMPENSATION    STOCK        INCOME          EQUITY
                                       --------   ----------   --------   ------------   --------   -------------   -------------
                                                                             (IN THOUSANDS)
                                                                                               
BALANCE, JULY 31, 1997...............    $724       $7,686     $82,243        $(18)      $(12,398)     $  (907)        $77,330
                                                                                                                       -------
Net Income...........................      --           --       4,723          --             --           --           4,723
  Cumulative Translation
    Adjustments......................      --           --          --          --             --         (244)           (244)
                                                                                                                       -------
         Total Comprehensive
           Income....................                                                                                    4,479
                                                                                                                       -------
Dividends Declared...................      --           --      (1,808)         --             --           --          (1,808)
Purchases of Treasury Stock..........      --           --          --          --         (8,237)          --          (8,237)
Issuance of stock under 1995
  Long-Term Incentive Plan...........      --           16          --         (77)            61           --              --
Amortization of Restricted Common
  Stock Compensation.................      --           --          --          44             --           --              44
                                         ----       ------     -------        ----       --------      -------         -------
BALANCE, JULY 31, 1998...............     724        7,702      85,158         (51)       (20,574)      (1,151)         71,808
Net Income...........................      --           --       7,176          --             --           --           7,176
  Cumulative Translation
    Adjustments......................      --           --          --          --             --           (8)             (8)
                                                                                                                       -------
         Total Comprehensive
           Income....................                                                                                    7,168
                                                                                                                       -------
Dividends Declared...................      --           --      (1,904)         --             --           --          (1,904)
Purchases of Treasury Stock..........      --           --          --          --         (2,607)          --          (2,607)
Amortization of Restricted Common
  Stock Compensation.................      --           --          --          42             --           --              42
                                         ----       ------     -------        ----       --------      -------         -------
BALANCE, JULY 31, 1999...............     724        7,702      90,430          (9)       (23,181)      (1,159)         74,507
Net Income...........................      --           --       2,227          --             --           --           2,227
  Cumulative Translation
    Adjustments......................      --           --          --          --             --         (151)           (151)
                                                                                                                       -------
         Total Comprehensive
           Income....................                                                                                    2,076
                                                                                                                       -------
Dividends Declared...................      --           --      (1,900)         --             --           --          (1,900)
Purchases of Treasury Stock..........      --           --          --          --         (1,751)          --          (1,751)
Issuance of Stock Under 1995
  Long-Term Incentive Plan...........      --           (4)         --         (33)            37           --              --
Amortization of Restricted Common
  Stock Compensation.................      --           --          --          32             --           --              32
                                         ----       ------     -------        ----       --------      -------         -------
BALANCE, JULY 31, 2000...............    $724       $7,698     $90,757        $(10)      $(24,895)     $(1,310)        $72,964
                                         ====       ======     =======        ====       ========      =======         =======

   The accompanying notes are an integral part of the consolidated financial
                                  statements.

                                       23
   24

                     CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                                     YEAR ENDED JULY 31,
                                                                ------------------------------
                                                                 2000       1999        1998
                                                                 ----       ----        ----
                                                                        (IN THOUSANDS)
                                                                             
CASH FLOWS FROM OPERATING ACTIVITIES
Net income..................................................    $2,227..   $ 7,176    $  4,723
                                                                -------    -------    --------
Adjustments to reconcile net income to net cash provided by
  operating activities:
  Depreciation and amortization.............................    9,099..      8,497       7,832
  Non-cash restructuring and special charges................    716....         --       1,689
  Deferred income taxes.....................................    439....        652      (1,251)
  Provision for bad debts...................................    523....          8           2
  (Increase) decrease in
     Accounts receivable....................................    404....     (1,163)     (4,282)
     Income taxes receivable................................     (2,267)        --          --
     Inventories............................................     (1,763)    (1,906)     (2,381)
     Prepaid expenses and taxes.............................       (756)    (1,405)       (873)
     Other assets...........................................     (2,426)      (788)       (637)
  Increase (decrease) in
     Accounts payable.......................................        (38)       426         366
     Accrued expenses.......................................       (410)    (1,637)        649
     Deferred compensation..................................        (94)        32         424
     Other..................................................        302       (341)        250
                                                                -------    -------    --------
       Total Adjustments....................................      3,729      2,375       1,788
                                                                -------    -------    --------
       Net Cash Provided by Operating Activities............      5,956      9,551       6,511
                                                                -------    -------    --------
CASH FLOWS FROM INVESTING ACTIVITIES
  Capital expenditures......................................     (6,001)    (8,495)     (6,496)
  Proceeds from sale of property, plant and equipment.......         12        109          78
  Purchases of investment securities........................     (1,219)    (1,225)     (1,173)
  Dispositions of investment securities.....................      1,225      1,173       1,544
  Proceeds from sale of investments.........................         --         --         709
  Purchase of Oil-Dri, Mounds Production Company assets.....         --         --     (14,657)
  Other.....................................................         (9)         5          32
                                                                -------    -------    --------
       Net Cash Used in Investing Activities................     (5,992)    (8,433)    (19,963)
                                                                -------    -------    --------
CASH FLOWS FROM FINANCING ACTIVITIES
  Principal payments on long-term debt......................     (2,226)    (2,084)     (1,937)
  Proceeds from issuance of long-term debt..................      3,033        400      25,000
  Dividends paid............................................     (1,911)    (1,865)     (1,839)
  Purchase of treasury stock................................     (1,751)    (2,607)     (8,237)
  Other.....................................................        (83)       (10)       (122)
                                                                -------    -------    --------
       Net Cash (Used in) Provided by Financing
          Activities........................................     (2,938)    (6,166)     12,865
                                                                -------    -------    --------
NET DECREASE IN CASH AND CASH EQUIVALENTS...................     (2,974)    (5,048)       (587)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR................      4,362      9,410       9,997
                                                                -------    -------    --------
CASH AND CASH EQUIVALENTS, END OF YEAR......................    $ 1,388    $ 4,362    $  9,410
                                                                =======    =======    ========

   The accompanying notes are an integral part of the consolidated financial
                                  statements.

                                       24
   25

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

     The consolidated financial statements include the accounts of Oil-Dri
Corporation of America and its subsidiaries, all of which are wholly owned. All
significant intercompany balances and transactions have been eliminated from the
consolidated financial statements.

Management Use of Estimates

     The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities as of the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

Revenue Recognition

     Revenues from sales of products are recognized upon shipment.

Income Taxes

     Deferred income taxes reflect the impact of temporary differences between
the assets and liabilities recognized for financial reporting purposes and
amounts recognized for tax purposes.

     No provision has been made for possible income taxes which may be paid on
the distribution of approximately $16,953,000 and $20,391,000 as of July 31,
2000 and 1999, respectively, of retained earnings of foreign subsidiaries, as
substantially all such amounts are intended to be indefinitely invested in these
subsidiaries or no additional income taxes would be incurred when such earnings
are distributed. It is not practicable to determine the amount of income taxes
or withholding taxes that would be payable upon the remittance of assets that
represent those earnings.

Interest Rate Derivative Instruments

     An interest rate swap agreement which expired on August 1, 1998 was
utilized in the management of interest rate exposure. Interest differentials on
the swap contract (Note 5) are recorded as interest expense in the contract
period incurred. The Company recognized additional interest expense of $15,100
and $57,000 in fiscal years 1999 and 1998, respectively, as a result of this
contract.

Reclassification

     Certain items in prior year financial statements have been reclassified to
conform to the presentation used in fiscal 2000.

Translation of Foreign Currencies

     Assets and liabilities of foreign subsidiaries, where the local currency is
the functional currency, are translated at the exchange rates in effect at
period end. Income statement items are translated at the average exchange rate
on a monthly basis. Resulting translation adjustments are recorded as a separate
component of stockholders' equity.

Cash Equivalents

     Cash equivalents are highly liquid investments with maturities of three
months or less when purchased.

                                       25
   26

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Inventories

     Inventories are valued at the lower of cost (first-in, first-out) or
market. The composition of inventories as of July 31 is as follows:

                                                                2000       1999
                                                                ----       ----
                                                                 (IN THOUSANDS)
                                                                    
Finished goods.............................................    $10,251    $ 9,593
Packaging..................................................      5,273      4,267
Other......................................................      1,404      1,305
                                                               -------    -------
                                                               $16,928    $15,165
                                                               =======    =======

Concentration of Credit Risk

     Financial instruments which potentially subject the Company to
concentrations of credit risk consist principally of cash investments and
accounts receivable. The Company places its cash investments in government
backed instruments, both foreign and domestic, and with other quality
institutions. Concentrations of credit risk with respect to accounts receivable
are subject to the financial condition of certain major customers, principally
the customer referred to in Note 4. The Company generally does not require
collateral to secure customer receivables.

Property, Plant and Equipment

     Property, plant and equipment expenditures are generally depreciated using
the straight-line method over their estimated useful lives as follows:

                                                                YEARS
                                                                -----
                                                             
Buildings and leasehold improvements........................    5-30
Machinery and equipment.....................................    2-20
Office furniture and equipment..............................    2-10
Vehicles....................................................     2-8

Research and Development

     Research and development costs of $1,951,000, $2,110,000 and $2,376,000
were charged to expense as incurred for the years ended July 31, 2000, 1999 and
1998, respectively.

Intangibles and Goodwill

     Intangibles and goodwill are amortized on a straight-line basis over
periods ranging from 15 to 40 years. The Company periodically reviews goodwill
and other intangibles to assess recoverability from projected undiscounted cash
flows of the related operating entities.

Advertising Costs

     The Company defers recognition of advertising production costs until the
first time the advertising takes place; other advertising costs are expensed as
incurred. Advertising expenses were $4,095,000, $4,577,000 and $4,352,000 for
the years ended July 31, 2000, 1999 and 1998, respectively.

Fair Value of Financial Instruments

     Non-derivative financial instruments included in the consolidated balance
sheets are cash and cash equivalents, investment securities and notes payable.
These instruments, except for notes payable, were carried at amounts
approximating fair value as of July 31, 2000 and 1999. The fair value of notes
payable was estimated based on future cash flows discounted at current interest
rates available to the Company for debt

                                       26
   27

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
with similar maturities and characteristics. The fair value of notes payable as
of July 31, 2000 was less than its carrying value by approximately $2,880,000
and was greater than its carrying value by approximately $261,000 as of July 31,
1999.

New Accounting Standards

     In July 1997, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 130, "Reporting
Comprehensive Income." This statement established standards for reporting
comprehensive income in the financial statements. The Company adopted this
standard in July 1999 and has elected to disclose comprehensive income, which
for the Company includes net income and foreign currency translation
adjustments, in the consolidated statements of stockholders' equity.

     In June 1997, the FASB issued SFAS No. 131, "Disclosures About Segments of
an Enterprise and Related Information." This statement established new standards
for the way companies report information about operating segments and requires
that those enterprises report selected information about operating segments in
the financial reports issued to shareholders. The Company adopted this standard
in July 1999 (see Note 4).

     In February 1998, the FASB issued SFAS No. 132, "Employers' Disclosure
about Pension and Other Postretirement Benefits." This statement revises
employers' disclosures about pensions and other postretirement benefit plans. It
does not change the measurement or recognition of those plans in the financial
statements. The Company's adoption of this new standard in July 1999 did not
result in material changes to the previously reported amounts. See Note 9 for
further discussion.

     In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities" which requires companies to recognize all
derivatives as assets or liabilities measured at their fair value. The
accounting for changes in the fair value of a derivative depends on the intended
use of the derivative and whether it qualifies for hedge accounting. Although
the impact of this statement has not been fully assessed, the Company believes
adoption of this statement as amended by SFAS No. 137, which will occur by July
2001, will not have a material financial statement impact.

NOTE 2 -- RESTRUCTURING AND SPECIAL CHARGES

     In the second quarter of fiscal 2000, the Company recorded a pre-tax
restructuring charge of $1,239,000 against income from operations, as follows
(in thousands):

                                                             
Severance costs.............................................    $  604
Non-performing asset........................................       635
                                                                ------
Restructuring charge........................................    $1,239
                                                                ======

     The severance costs are related to a realignment of the Company's personnel
costs to bring them more in line with current levels of sales and profitability.
The severance accrual represents 13 employees that were terminated during fiscal
2000. The majority of the positions terminated are at the selling, general and
administrative level.

     The net book value of the non-performing asset consisted of specific
production equipment that has been scrapped. The equipment had been used
primarily in the Agricultural Products segment. The net book value of this asset
was approximately 1% of the net book value of all fixed assets outstanding as of
January 31, 2000.

     The Company recorded a pre-tax special charge of $3,129,000 in the second
quarter of fiscal 1998 to cover the cost of exiting the transportation business
($1,508,000), to write off certain other non-performing assets ($932,000), and
to cover other exit costs ($689,000). The transportation business exit costs
consisted primarily of trailer rehabilitation, employee severance, and
professional fees. None of these items was individually significant.

                                       27
   28

NOTE 2 -- RESTRUCTURING AND SPECIAL CHARGES (CONTINUED)
     At July 31, 2000, $81,000 of the restructuring charges remained in current
liabilities. A summary of the balance sheet activity for the years ended July 31
is presented below:

                                                          2000     1999      1998
                                                          ----     ----      ----
                                                               (IN THOUSANDS)
                                                                   
Beginning balance....................................    $    0    $ 358    $     0
Restructuring and special charges....................     1,239       --      3,129
Utilization of special charges:
  Transportation business exit costs.................        --      (68)    (1,440)
  Write-off of non-performing assets.................        --     (124)      (808)
  Other exit costs...................................        --     (166)      (523)
Utilization of restructuring charge:
  Severance costs....................................      (523)      --         --
  Write-off of non-performing assets.................      (635)      --         --
                                                         ------    -----    -------
Balance at end of year...............................    $   81    $   0    $   358
                                                         ======    =====    =======

NOTE 3 -- ACQUISITION

     On April 20, 1998, the Company completed the purchase of the Fuller's Earth
absorbent business of American Colloid Co., a wholly owned subsidiary of Amcol
International, for approximately $14,657,000 including transaction expenses. The
purchase includes a production plant and mineral reserves in Mounds, Illinois
("Oil-Dri, Mounds Production Company"), and mineral reserves located in Paris,
Tennessee. At the time of acquisition, the business had annual sales
approximating $15,000,000. The Company financed the acquisition through a fixed
rate private debt placement. The acquisition was accounted for as a purchase,
with the excess purchase price over fair market value of the underlying assets
allocated to intangibles, including supply contracts and non-compete covenants.
These intangibles are being amortized over periods from 15 to 40 years.

NOTE 4 -- OPERATING SEGMENTS

     SFAS No. 131, "Disclosures about Segments of an Enterprise and Related
Information" establishes standards for reporting information about operating
segments. Under this standard, the Company has four reportable operating
segments: Consumer Products, Fluids Purification Products, Agricultural
Products, and Industrial and Automotive Products. These segments are managed
separately because each business has different economic characteristics. A
complete description of each segment can be found in Item 1 of this report.

     The accounting policies of the segments are the same as those described in
the summary of significant accounting policies.

                                       28
   29

NOTE 4 -- OPERATING SEGMENTS (CONTINUED)
     Because management does not rely on segment asset allocation, information
regarding segment assets is not meaningful and therefore is not reported.

                                                              YEAR ENDED JULY 31
                                       -----------------------------------------------------------------
                                                  NET SALES                      OPERATING INCOME
                                       --------------------------------    -----------------------------
                                         2000        1999        1998       2000       1999       1998
                                         ----        ----        ----       ----       ----       ----
                                                                (IN THOUSANDS)
                                                                               
Consumer Products..................    $115,614    $114,704    $101,766    $14,212    $17,331    $18,034
Fluids Purification Products.......      22,669      23,071      21,337      4,209      5,641      4,413
Agricultural Products..............      18,199      19,119      19,403      1,883      3,464      3,225
Industrial and Automotive
  Products.........................      18,637      17,091      15,374      1,008        783        618
                                       --------    --------    --------    -------    -------    -------
Total Ongoing Businesses...........     175,119     173,985     157,880     21,312     27,219     26,290
Total Exited Businesses(1).........           0           0       2,372          0          0         35
                                       --------    --------    --------    -------    -------    -------
TOTAL SALES/OPERATING INCOME.......    $175,119    $173,985    $160,252    $21,312    $27,219    $26,325
                                       --------    --------    --------    -------    -------    -------
Less: Restructuring and Special
        Charges(2).................                                          1,239         --      3,129
      Corporate Expenses...........                                         14,046     14,478     15,032
      Interest Expense, net of
       interest
        income.....................                                          2,979      2,705      1,558
                                                                           -------    -------    -------
INCOME BEFORE INCOME TAXES.........                                          3,048     10,036      6,606
                                                                           -------    -------    -------
INCOME TAXES.......................                                            821      2,860      1,883
                                                                           -------    -------    -------
NET INCOME.........................                                        $ 2,227    $ 7,176    $ 4,723
                                                                           =======    =======    =======

- -------------------------
(1) The Company exited the transportation business during the second quarter of
fiscal 1998.

(2) See Note 2 for a discussion of the restructuring and special charges
    recorded in fiscal 2000 and 1998, respectively.

     The following is a summary of financial information by geographic region
for the years ended July 31:

                                                      2000        1999        1998
                                                      ----        ----        ----
                                                             (IN THOUSANDS)
                                                                   
Sales to unaffiliated customers:
  Domestic......................................    $161,725    $159,484    $146,265
  Foreign subsidiaries..........................    $ 13,394    $ 14,501    $ 13,987
Sales or transfers between geographic areas:
  Domestic......................................    $  6,708    $  7,332    $  9,200
Income before income taxes:
  Domestic......................................    $  3,064    $  9,263    $  5,750
  Foreign subsidiaries..........................    $    (16)   $    773    $    856
Net Income:
  Domestic......................................    $  2,254    $  6,586    $  4,089
  Foreign subsidiaries..........................    $    (27)   $    590    $    634
Identifiable assets:
  Domestic......................................    $122,761    $122,686    $122,455
  Foreign subsidiaries..........................    $ 10,083    $ 11,064    $ 11,760

     The Company's largest customer accounted for the following percentage of
consolidated net sales and net accounts receivable under the Consumer Products
segment:

                                                                2000    1999    1998
                                                                ----    ----    ----
                                                                       
Sales for the years ended July 31...........................    20%     20%     23%
Accounts receivable as of July 31...........................    26%     24%     26%

                                       29
   30

NOTE 5 -- NOTES PAYABLE

     The composition of notes payable at July 31 is as follows:

                                                                 2000       1999
                                                                 ----       ----
                                                                  (IN THOUSANDS)
                                                                     
Town of Blue Mountain, Mississippi
  Principal payable on October 6, 2008. Interest payable
  monthly at a variable interest rate set weekly based on
  market conditions for similar instruments. The average
  rate was 4.12% and 3.50% in fiscal 2000 and 1999
  respectively. Payment of these bonds by the Company is
  guaranteed by a letter of credit issued by Harris Trust
  and Savings Bank..........................................    $ 2,500    $ 2,500
Teachers Insurance and Annuity Association of America
  Payable in annual principal installments on November 15;
  $1,100,000 in fiscal 2001; and $1,000,000 in fiscal 2002.
  Interest is payable semiannually at an annual rate of
  9.38%.....................................................      2,100      3,300
Teachers Insurance and Annuity Association of America
  Payable in annual principal installments on August 15;
  $500,000 in fiscal 2002; $1,000,000 in fiscal 2003; and
  $2,500,000 in fiscal 2004 and 2005. Interest is payable
  semiannually at an annual rate of 7.17%...................      6,500      6,500
Harris Trust and Savings Bank
  Payable in annual principal installments on June 20;
  $650,000 in fiscal 2001 and 2002; and $350,000 in fiscal
  2003. Interest is payable quarterly at an annual rate of
  7.78%.....................................................      1,650      2,550
Teachers Insurance and Annuity Association of America and
Connecticut General Life Insurance Company
  Payable in annual principal installments on April 15;
  $1,500,000 in fiscal 2003, 2004 and 2005; $3,000,000 in
  fiscal 2006; $4,000,000 in fiscal 2007 and 2008;
  $1,500,000 in fiscal 2009; $3,000,000 in fiscal 2010;
  $2,000,000 in fiscal 2011; and $1,500,000 in fiscal 2012
  and 2013. Interest is payable semiannually at an annual
  rate of 6.55%.............................................     25,000     25,000
Harris Trust and Savings Bank Credit Agreement..............      3,020         --
Other.......................................................        414        526
                                                                -------    -------
                                                                 41,184     40,376
  Less current maturities of notes payable..................     (1,750)    (2,226)
                                                                -------    -------
                                                                $39,434    $38,150
                                                                =======    =======

     On January 29, 1999, the Company entered into a Credit Agreement with
Harris Trust and Savings Bank which provides for up to $15,000,000 in committed
unsecured revolving credit loans and/or letters of credit (not to exceed
$5,000,000). This agreement terminates on January 29, 2004, or such earlier date
as provided for in the agreement. Additionally, the Company decreased its
uncommitted line of credit agreement, which is renewable on an annual basis,
with Harris Trust and Savings Bank to $15,000,000 in fiscal 1999. Outstanding
borrowings against this or prior lines were $3,020,000 and $0 at July 31, 2000
and 1999, respectively.

     In April 1998, the Company completed a private debt placement of
$25,000,000 at 6.55% with Teachers Insurance and Annuity Association of America
($14,000,000) and Connecticut General Life Insurance Company ($11,000,000). The
proceeds of this fixed rate note were used to fund the purchase of the Company's
production facility in Mounds, Illinois, repay draws against the Company's line
of credit and for general working capital purposes.

     The agreements with the Town of Blue Mountain, Mississippi, Teachers
Insurance and Annuity Association of America, Harris Trust and Savings Bank and
Connecticut General Life Insurance Company impose working capital requirements,
dividend and financing limitations, minimum tangible net worth

                                       30
   31

NOTE 5 -- NOTES PAYABLE (CONTINUED)
requirements and other restrictions. The Company's new Credit Agreement with
Harris Trust and Savings Bank indirectly restricts dividends by requiring the
Company to maintain tangible net worth, as defined, in the amount of $50,000,000
plus 40% of cumulative annual earnings from July 31, 1998.

     In prior years, the Town of Blue Mountain, Mississippi issued long-term
bonds to finance the purchase of substantially all of the assets of certain
plant expansion projects, and leased the projects to the Company and various of
its subsidiaries (with the Company and various of its wholly owned subsidiaries
as guarantors) at rentals sufficient to pay the debt service on the bonds.

     The following is a schedule by year of future maturities of notes payable
as of July 31, 2000:

                                                              (IN THOUSANDS)
                                                           
2002........................................................     $ 2,164
2003........................................................       2,850
2004........................................................       7,020
2005........................................................       4,080
Later years.................................................      23,320
                                                                 -------
                                                                 $39,434
                                                                 =======

NOTE 6 -- INCOME TAXES

     The provision for income tax expense consists of the following:

                                                         2000       1999      1998
                                                         ----       ----      ----
                                                               (IN THOUSANDS)
                                                                    
Current
  Federal...........................................    $(1,450)   $1,324    $ 2,159
  Foreign...........................................         11       182        194
  State.............................................       (409)      702        781
                                                        -------    ------    -------
                                                         (1,848)    2,208      3,134
                                                        -------    ------    -------
Deferred
  Federal...........................................      1,046       649       (436)
  Operating loss carryforward.......................      1,371        91       (611)
  Foreign...........................................         --         1         25
  State.............................................        252       (89)      (229)
                                                        -------    ------    -------
                                                          2,669       652     (1,251)
                                                        -------    ------    -------
Total Income Tax Provision..........................    $   821    $2,860    $ 1,883
                                                        =======    ======    =======

     Principal reasons for variations between the statutory federal rate and the
effective rates for the years ended July 31 were as follows:

                                                              2000    1999     1998
                                                              ----    ----     ----
                                                                      
U.S. federal statutory income tax rate....................    34.0%    34.0%    34.0%
Depletion deductions allowed for mining...................    (5.0)   (12.0)   (15.1)
State income tax (benefit)/expense, net of federal tax
  (benefit)/expense.......................................    (3.4)     4.0      2.2
Valuation allowance without income tax benefit............    (3.3)     4.6     10.4
Difference in effective tax rate of foreign
  subsidiaries............................................    (0.1)    (1.0)    (1.1)
Alternative minimum and foreign tax credits...............     3.8      1.9     (0.2)
Other.....................................................     0.9     (3.0)    (1.7)
                                                              ----    -----    -----
                                                              26.9%    28.5%    28.5%
                                                              ====    =====    =====

                                       31
   32

NOTE 6 -- INCOME TAXES (CONTINUED)
     The consolidated balance sheets as of July 31 included the following tax
effects of cumulative temporary differences:

                                                      2000                      1999
                                              ---------------------    ----------------------
                                              ASSETS    LIABILITIES    ASSETS     LIABILITIES
                                              ------    -----------    ------     -----------
                                                              (IN THOUSANDS)
                                                                      
Depreciation..............................    $   --      $1,000       $    --      $1,608
Deferred compensation.....................     1,207          --         1,244          --
Postretirement benefits...................       548          --           474          --
Other assets..............................       617          --           633          --
Accrued expenses..........................       255          --           486          --
Tax credits...............................       635          --           750          --
Operating loss carryforward...............     1,125          --         2,768          --
Other.....................................        --         259            40          --
                                              ------      ------       -------      ------
                                               4,387       1,259         6,395       1,608
Valuation allowance.......................      (522)         --        (1,742)         --
                                              ------      ------       -------      ------
Total deferred taxes......................    $3,865      $1,259       $ 4,653      $1,608
                                              ======      ======       =======      ======

     As of July 31, 2000, for federal income tax purposes there were regular tax
operating loss carryforwards of approximately $2,899,000, which begin to expire
in the year 2013. Tax credits of approximately $635,000, primarily consisting of
foreign tax credits expiring in 2001 and later years, are also being carried
forward. A valuation allowance has been established for $522,000 of the deferred
tax benefit related to those tax credits for which it is more likely than not
that the benefit will not be realized. The net decrease in the valuation
allowance of $1,220,000 is the result of an addition to the allowance of
$522,000 for foreign tax credits, as previously described, and the reduction in
the reverse of $1,742,000, relating to net operating loss carryforwards. Due to
higher levels of taxable income at the parent company level in the current year,
the Company was able to utilize approximately $4,574,000 of net operating loss
carryforwards. It is anticipated that the remaining net operating loss
carryforwards will be utilized in future years.

NOTE 7 -- STOCKHOLDERS' EQUITY

     The authorized capital stock of the Company at July 31, 2000 and 1999
consisted of 15,000,000 shares of Common Stock, 7,000,000 shares of Class B
Stock and 30,000,000 shares of Class A Common Stock, each with a par value of
$.10 per share. There are no Class A shares currently outstanding.

     The Common Stock and Class B Stock are equal, on a per share basis, in all
respects except as to voting rights, conversion rights, cash dividends and stock
splits or stock dividends. The Class A Common Stock is equal, on a per share
basis, in all respects, to the Common Stock except as to voting rights and stock
splits or stock dividends. In the case of voting rights, Common Stock is
entitled to one vote per share and Class B Stock is entitled to ten votes per
share, while Class A Common Stock generally has no voting rights. Common Stock
and Class A Common Stock have no conversion rights. Class B Stock is convertible
on a share-for-share basis into Common Stock at any time and is subject to
mandatory conversion under certain circumstances.

     Common Stock is entitled to cash dividends, as and when declared or paid,
equal to 133 1/3% on a per share basis of the cash dividend paid on Class B
Stock. Class A Common Stock is entitled to cash dividends on a per share basis
equal to the cash dividend on Common Stock. Additionally, while shares of Common
Stock, Class A Common Stock and Class B Stock are outstanding, the sum of the
per share cash dividend paid on shares of Common Stock and Class A Common Stock,
must be equal to at least 133 1/3% of the sum of the per share cash dividend
paid on Class B Stock and Class A Common Stock. See Note 5 regarding dividend
restrictions.

     Shares of Common Stock, Class A Common Stock and Class B Stock are equal in
respect of all rights to dividends (other than cash) and distributions in the
form of stock or other property (including stock dividends

                                       32
   33

NOTE 7 -- STOCKHOLDERS' EQUITY (CONTINUED)
and split-ups) in each case in the same ratio except in the case of a Special
Stock Dividend. The Special Stock Dividend, which can be issued only once, is
either a dividend of one share of Class A Common Stock for each share of Common
Stock and Class B Stock outstanding or a recapitalization, in which half of each
outstanding share of Common Stock and Class B Stock would be converted into a
half share of Class A Common Stock.

     In December 1999, the Board of Directors of the Company authorized the
repurchase, from time to time, of up to 350,000 additional shares of the
Company's stock. This authorization, in addition to previous authorizations,
totals 1,916,771 shares. As of July 31, 2000, 1,127,330 shares of Common Stock
and 342,241 shares of Class B Stock have been repurchased under these
authorizations.

     The number of holders of record of Common Stock and Class B stock on July
31, 2000 was 1,117 and 32, respectively, as reported by the Company's transfer
agent. The Company's Common Stock is traded on the New York Stock Exchange.
There is no established trading market for the Class B Stock.

NOTE 8 -- STOCK OPTION PLANS

     The Company instituted the Oil-Dri Corporation of America 1995 Long Term
Incentive Plan during the fiscal year ended July 31, 1996. On December 9, 1997,
the stockholders voted to increase the number of shares available for grant
under the 1995 Plan from 500,000 to 1,000,000 and further authorized the grant
of Class B Shares under the Plan to certain members of the Richard M. Jaffee
family. Generally, other than grants to Richard M. Jaffee family members, shares
of stock awarded under the 1995 Plan will be Class A Common Stock, except that,
if there is no Class A Common Stock issued and publicly traded on a securities
exchange when such awards are exercised, the shares awarded would be Common
Stock. On December 7, 1999, the stockholders voted to increase the number of
shares available for grant under the 1995 Plan from 1,000,000 to 1,500,000. On
June 9, 2000 the 1995 Plan was amended to provide 100% vesting and a three year
exercise period upon the death or disability of a grantee or upon a grantee's
retirement with age plus years of service equal to at least 80. The Plan
provides for various other types of awards. Awards of restricted stock in the
amount of 2,500 and 4,500 shares were made during the fiscal years ended July
31, 2000, and 1998 respectively. On September 18, 1998, 840,125 shares which had
been issued in prior fiscal years under the 1995 Plan at an average price of
$14.83 were reissued at an exercise price of $11.25. The reissued options
awarded to members of the Richard M. Jaffee family covered Class B shares. A new
vesting period applied to all the reissued options.

     The Oil-Dri Corporation of America 1988 Stock Option Plan terminated on
December 12, 1995, for purposes of future grants. The outstanding options under
this plan will remain outstanding and exercisable in accordance with their
respective terms.

     The Company instituted the Oil-Dri Corporation of America Outside
Director's Stock Plan on June 9, 1998. All shares of stock issued under this
plan will be shares of Common Stock issued from Treasury Stock. The Plan
provides for stock option grants and various other types of awards.

                                       33
   34

NOTE 8 -- STOCK OPTION PLANS (CONTINUED)
     A summary of option transactions under the plans follows:

                                   1988 OPTION PLAN                    1995 OPTION PLAN
                           ---------------------------------   ---------------------------------
                                   NUMBER OF SHARES                    NUMBER OF SHARES
                            (WEIGHTED AVERAGE OPTION PRICE)     (WEIGHTED AVERAGE OPTION PRICE)
                           ---------------------------------   ---------------------------------
                             2000        1999        1998        2000        1999        1998
                             ----        ----        ----        ----        ----        ----
                                        (IN THOUSANDS EXCEPT FOR PER SHARE AMOUNTS)
                                                                     
Outstanding, Beginning of
  Year...................       144         186         199         884         881         324
                    Per
  Share                     $(19.27)    $(18.49)    $(18.49)    $(11.37)    $(14.84)    $(14.88)
Granted..................        --          --          --         167         882       1,036
                    Per
  Share                          --          --          --     $(12.37)    $(11.29)    $(15.33)
Exercised................        --          --          --          --          --          --
                    Per
  Share                          --          --          --          --          --          --
Canceled/Terminated......        35          42          13         245          39          37
                    Per
  Share                     $(19.25)    $(15.85)    $(18.59)    $(11.43)    $(13.51)    $(15.62)
Canceled/Reissued........        --          --          --          --         840         442
                    Per
  Share                          --          --          --          --     $(14.83)    $(15.94)
Outstanding, End of
  Year...................       109         144         186         806         884         881
                    Per
  Share                     $(19.27)    $(19.27)    $(18.49)    $(11.56)    $(11.37)    $(14.84)

                                OUTSIDE DIRECTOR'S PLAN                 COMBINED PLANS
                           ---------------------------------   ---------------------------------
                                   NUMBER OF SHARES                    NUMBER OF SHARES
                            (WEIGHTED AVERAGE OPTION PRICE)     (WEIGHTED AVERAGE OPTION PRICE)
                           ---------------------------------   ---------------------------------
                             2000        1999        1998        2000        1999        1998
                             ----        ----        ----        ----        ----        ----
                                        (IN THOUSANDS EXCEPT FOR PER SHARE AMOUNTS)
                                                                     
Outstanding, Beginning of
  Year...................        70          70          --       1,098       1,137         523
                    Per
  Share                     $(14.63)    $(14.63)         --     $(12.61)    $(15.42)    $(16.25)
Granted..................        10          --          70         177         882       1,106
                    Per
  Share                     $(14.75)         --     $(14.63)    $(12.50)    $(11.29)    $(15.28)
Exercised................        --          --          --          --          --          --
                    Per
  Share                          --          --          --          --          --          --
Canceled/Terminated......        --          --          --         280          81          50
                    Per
  Share                          --          --          --     $(12.40)    $(14.73)    $(16.36)
Canceled/Reissued........        --          --          --          --         840         442
                    Per
  Share                          --          --          --          --     $(14.83)    $(15.94)
Outstanding, End of
  Year...................        80          70          70         995       1,098       1,137
                    Per
            Share           $(14.64)    $(14.63)    $(14.63)    $(12.65)    $(12.61)    $(15.42)

     As of July 31, 2000, the Company has reserved 684,750 and 120,000 shares of
Common Stock for future grants and issuances under the Oil-Dri Corporation of
America 1995 Long Term Incentive Plan and the Oil-Dri Corporation of America
Outside Director's Stock Plan, respectively.

     Exercise prices of the options outstanding under the 1988 Option Plan range
between $17.75 and $19.38 per share with a weighted average price of $19.27 per
share and a weighted remaining average contractual life at July 31, 2000 of 3.8
years. As of July 31, 2000 all of the 109,250 options outstanding were
exercisable.

     The weighted average exercise price of options outstanding under the
Outside Director's Stock Plan is $14.64 with a weighted average contractual life
of 8.0 years. As of July 31, 2000, 70,000 of these options were exercisable.

                                       34
   35

NOTE 8 -- STOCK OPTION PLANS (CONTINUED)
     Exercise prices of the options outstanding under the 1995 Long Term
Incentive Plan range between $8.19 and $15.13 per share with a weighted average
exercise price of $11.56 per share and a weighted remaining average contractual
life of 8.3 years at July 31, 2000. As of July 31, 2000, 10,250 of these options
were exercisable.

     The Company has elected to continue to account for stock-based compensation
using the intrinsic value method under APB Opinion No. 25. Consequently, no
compensation expense has been recognized for stock options. If compensation
expense for the Company's stock options issued in the fiscal years ended July
31, 2000, 1999 and 1998 had been determined based on the fair value method of
accounting, as defined in SFAS No. 123, the Company's net income and net income
per share would have been reduced to the pro forma amounts indicated below:

                                                           2000       1999       1998
                                                           ----       ----       ----
                                                                  (IN THOUSANDS
                                                          EXCEPT FOR PER SHARE AMOUNTS)
                                                                       
Net income as reported................................    $2,227     $7,176     $4,723
Pro forma.............................................    $1,651     $6,515     $4,430
Net income per share as reported
  Basic...............................................    $ 0.39     $ 1.23     $ 0.77
  Dilutive............................................    $ 0.39     $ 1.20     $ 0.77
Pro forma
  Basic...............................................    $ 0.29     $ 1.12     $ 0.72
  Dilutive............................................    $ 0.29     $ 1.09     $ 0.72

     The fair value of issued stock options is estimated on the grant date using
the Black-Scholes Option Pricing Method with the following assumptions:

                                                           2000     1999     1998
                                                           ----     ----     ----
                                                                    
Dividend Yields........................................     3.1%     2.8%     2.1%
Volatility.............................................    30.9%    25.8%    25.6%
Risk-free Interest Rate................................     6.1%     5.9%     5.7%
Expected Life (Years)..................................      5.4      5.4      5.4

     The weighted average fair value of the options granted, including the
effect of repricing in fiscal year 1999, was $3.66, $1.42 and $4.55 for the
fiscal years ended July 31, 2000, 1999 and 1998, respectively.

NOTE 9 -- EMPLOYEE BENEFIT PLANS

     The Company and its subsidiaries have defined benefit pension plans for
eligible salaried and hourly employees. Benefits are based on a formula of years
of credited service and levels of compensation or stated amounts for each year
of credited service. The assets of these plans are invested in various high
quality marketable securities.

     The net periodic pension cost for the years ended July 31 consists of the
following:

                                                          2000     1999      1998
                                                          ----     ----      ----
                                                               (IN THOUSANDS)
                                                                   
Service cost..........................................    $ 499    $ 539    $   438
Interest cost on projected benefit obligations........      642      591        538
Earnings on plan assets...............................     (904)    (686)    (1,060)
Net amortization and deferral.........................     (105)     (33)       422
                                                          -----    -----    -------
Net pension cost......................................    $ 132    $ 411    $   338
                                                          =====    =====    =======

                                       35
   36

NOTE 9 -- EMPLOYEE BENEFIT PLANS (CONTINUED)
     The funded status of the plans at July 31 is as follows:

                                                               2000         1999
                                                               ----         ----
                                                                 (IN THOUSANDS)
                                                                     
Actuarial Present Value of Benefit Obligations
  Accumulated Benefit Obligations
  Vested..................................................    $ 6,600      $ 6,194
  Nonvested...............................................        400          337
                                                              -------      -------
       Total Accumulated Benefit Obligations..............    $ 7,000      $ 6,531
                                                              =======      =======
  Projected Benefit Obligations...........................    $ 8,700      $ 8,370
Plan Assets at Fair value.................................     11,040       10,059
                                                              -------      -------
Excess of Plan Assets Over Projected Benefit
  Obligations.............................................      2,340        1,689
Unrecognized Net Gain.....................................     (3,679)      (3,303)
Unrecognized Prior Service Cost...........................        534          581
Unrecognized Net Excess Plan Assets as of August 1, 1987,
  Being Recognized Principally Over 21 Years..............       (211)        (238)
                                                              -------      -------
Accrued Pension Included in Noncurrent
  Liabilities--Other......................................    $(1,016)     $(1,271)
                                                              =======      =======

     Reconciliation of the assets and liabilities of the plans at July 31 is as
follows:

                                                               2000         1999
                                                               ----         ----
                                                                 (IN THOUSANDS)
                                                                     
Change in Plan Assets
Plan assets at fair value, beginning of year..............    $10,059      $ 8,524
Actual return on plan assets..............................        852        1,322
Contributions.............................................        387          464
Benefits paid.............................................       (258)        (251)
                                                              -------      -------
Plan assets at fair value, end of year....................    $11,040      $10,059
                                                              =======      =======
Change in Projected Benefit Obligation
Projected benefit obligation, beginning of year...........    $ 8,370      $ 8,943
Service cost..............................................        499          539
Interest cost.............................................        642          592
Change in discount rate...................................       (368)      (1,131)
Other assumption changes..................................       (259)          --
Plan amendments...........................................         --            3
Actuarial loss (gain).....................................         74         (325)
Benefits paid.............................................       (258)        (251)
                                                              -------      -------
Projected benefit obligation, end of year.................    $ 8,700      $ 8,370
                                                              =======      =======

     Assumptions used in the previous calculations are as follows:

                                                               2000         1999
                                                               ----         ----
                                                                     
Discount rate.............................................       8.0%        7.75%
Rate of increase in compensation levels for net pension
  costs...................................................       5.0%         5.0%
Rate of increase in compensation levels for projected
  benefit obligations.....................................       4.5%         5.0%
Long-term expected rate of return on assets...............       9.0%         8.0%

     The Company has funded the plans based upon actuarially determined
contributions that take into account the amount deductible for income tax
purposes and the minimum contribution required under the Employee Retirement
Income Security Act of 1974 (ERISA), as amended.

                                       36
   37

NOTE 9 -- EMPLOYEE BENEFIT PLANS (CONTINUED)
     For the years ended July 31, 2000, 1999 and 1998, the Company maintained a
401(k) savings plan under which the Company matches a portion of employee
contributions. The plan is available to essentially all domestic employees at
the beginning of the month following thirty or sixty days of employment. During
the period May 1, 1998 through July 31, 1999, domestic employees were eligible
to participate at the beginning of the fiscal quarter following thirty or sixty
days of employment. Prior to May 1, 1998, domestic employees were eligible to
participate after one year of service and the attainment of age 21. The
Company's contributions to this plan, and to similar plans maintained by the
Company's foreign subsidiaries, were $489,000, $449,000 and $226,000 for fiscal
years 2000, 1999 and 1998, respectively.

NOTE 10 -- DEFERRED COMPENSATION

     In December 1995, the Company adopted the Oil-Dri Corporation of America
Deferred Compensation Plan. This plan has permitted Directors and certain
management employees to defer portions of their compensation and earn interest
on the deferred amounts. During the period January 1, 1999 through September 30,
2000, participants' returns were tied to the performance of various investment
elections. The compensation, which has been deferred since the inception of the
original plan, has been accrued as well as earnings thereon. The Company has
purchased life insurance contracts on some participants to partially fund both
the original plan and the new plan.

NOTE 11 -- COMMITMENTS AND CONTINGENCIES

     The Company became a guarantor of certain leases for transportation
equipment reassigned to CRST International, Inc. (CRST) during fiscal 1998, when
exiting the transportation business. Remaining payments due under these lease
agreements by CRST are $299,000, $156,000 and $65,000 for fiscal years 2001,
2002 and 2003, respectively.

     The Company is involved in various litigation of a nature that is normal to
its business. While it is impossible at this time to determine with certainty
the ultimate outcome of these or other lawsuits, each lawsuit is either covered
by insurance or adequate provisions have been made for probable losses with
respect thereto as can best be determined at this time. Management therefore
believes that none of the pending litigation will have a material adverse effect
on the financial condition of the Company or on results of operations.

NOTE 12 -- LEASES

     The Company's mining operations are conducted on leased or owned property.
These leases generally provide the Company with the right to mine as long as the
Company continues to pay a minimum monthly rental, which is applied against the
per ton royalty when the property is mined.

     The Company leases its corporate offices in Chicago, Illinois (20,000
square feet), office, production and warehouse space in Alpharetta, Georgia
(26,000 square feet), office and production facilities in Kiel, Wisconsin
(16,000 square feet) and office facilities in Europe. The office space in
Chicago is subject to a lease expiring in fiscal 2008. The Alpharetta, Georgia
and Kiel, Wisconsin leases expire in fiscal 2003. The facilities in Europe are
leased on a year-to-year basis.

     In addition, the Company leases railcars, mining equipment, warehouse
space, data processing equipment, and office equipment. In most cases, the
Company expects that, in the normal course of business, leases will be renewed
or replaced by other leases. Prior to exiting the transportation business, the
Company leased tractors and trailers.

                                       37
   38

NOTE 12 -- LEASES (CONTINUED)
     The following is a schedule by year of future minimum rental requirements
under operating leases that have initial or remaining noncancelable lease terms
in excess of one year as of July 31, 2000:

                                                                (IN THOUSANDS)
                                                             
2001........................................................       $ 2,658
2002........................................................         1,543
2003........................................................         1,287
2004........................................................         1,244
2005........................................................           988
Later years.................................................         3,626
                                                                   -------
                                                                   $11,346
                                                                   =======

     The following schedule shows the composition of total rental expense for
all operating leases, including those with terms of one month or less which were
not renewed as of the years ended July 31:

                                                           2000      1999      1998
                                                           ----      ----      ----
                                                                (IN THOUSANDS)
                                                                     
Transportation equipment..............................    $1,099    $  898    $1,237
Office facilities.....................................       480       475       441
Warehouse facilities..................................       452       216       190
Mining properties
  Minimum.............................................       191       186       202
  Contingent..........................................       295       410       403
Other.................................................       594       630       298
                                                          ------    ------    ------
                                                          $3,111    $2,815    $2,771
                                                          ======    ======    ======

NOTE 13 -- OTHER CASH FLOW INFORMATION

     Cash payments for interest and income taxes were as follows:

                                                           2000      1999      1998
                                                           ----      ----      ----
                                                                (IN THOUSANDS)
                                                                     
Interest..............................................    $2,836    $2,879    $1,398
                                                          ======    ======    ======
Income Taxes..........................................    $2,051    $3,152    $2,619
                                                          ======    ======    ======

                                       38
   39

NOTE 14 -- SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)

     A summary of selected information for 2000 and 1999 is as follows:

                                                   FISCAL 2000 QUARTER ENDED
                                  -----------------------------------------------------------
                                  OCTOBER 31    JANUARY 31    APRIL 30    JULY 31     TOTAL
                                  ----------    ----------    --------    -------     -----
                                            (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
                                                                      
Net Sales.....................     $44,549       $45,880      $42,604     $42,086    $175,119
Gross Profit..................     $13,580       $12,084      $12,061     $12,210    $ 49,935
Net Income....................     $ 1,479       $  (599)     $   560     $   787    $  2,227
Net Income Per Share
  Basic.......................     $  0.26       $ (0.11)     $  0.10     $  0.14    $   0.39
  Dilutive....................     $  0.25       $ (0.10)     $  0.10     $  0.14    $   0.39
Dividends Per Share
  Common......................     $  0.09       $  0.09      $  0.09     $  0.09    $   0.36
  Class B.....................     $  0.07       $  0.07      $  0.07     $  0.07    $   0.27
Company Common Stock Price
  Range:
  High........................     $ 16.13       $ 15.63      $ 12.81     $ 10.25
  Low.........................     $  9.75       $ 11.75      $  6.88     $  7.75

                                                   FISCAL 1999 QUARTER ENDED
                                  -----------------------------------------------------------
                                  OCTOBER 31    JANUARY 31    APRIL 30    JULY 31     TOTAL
                                  ----------    ----------    --------    -------     -----
                                            (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
                                                                      
Net Sales.....................     $43,670       $47,435      $42,405     $40,475    $173,985
Gross Profit..................     $14,085       $15,208      $13,015     $12,551    $ 54,859
Net Income....................     $ 2,028       $ 2,276      $ 1,195     $ 1,677    $  7,176
Net Income Per Share
  Basic.......................     $  0.34       $  0.39      $  0.21     $  0.29    $   1.23
  Dilutive....................     $  0.34       $  0.38      $  0.20     $  0.28    $   1.20
Dividends Per Share
  Common......................     $  0.08       $  0.09      $  0.09     $  0.09    $   0.35
  Class B.....................     $  0.06       $0.0675      $0.0675     $0.0675    $ 0.2625
Company Common Stock Price
  Range:
  High........................     $ 14.13       $ 15.50      $ 15.94     $ 16.38
  Low.........................     $ 10.81       $ 13.44      $ 14.25     $ 13.63

                                       39
   40

                          INDEPENDENT AUDITOR'S REPORT

STOCKHOLDERS AND BOARD OF DIRECTORS
Oil-Dri Corporation of America

     We have audited the consolidated balance sheets of OIL-DRI CORPORATION OF
AMERICA AND SUBSIDIARIES as of July 31, 2000 and 1999, and the related
consolidated statements of income, stockholders' equity and cash flows for each
of the three years in the period ended July 31, 2000. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.

     We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

     In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of OIL-DRI
CORPORATION OF AMERICA AND SUBSIDIARIES as of July 31, 2000 and 1999, and the
results of their operations and their cash flows for each of the three years in
the period ended July 31, 2000 in conformity with generally accepted accounting
principles.

BLACKMAN KALLICK BARTELSTEIN, LLP

Chicago, Illinois

September 15, 2000

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

     None.

                                       40
   41

                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     The information required by this Item is (except for information set forth
below concerning the Board of Directors and information in Part I, hereof,
concerning executive officers) contained in the Registrant's Proxy Statement for
its 2000 Annual Meeting of stockholders ("Proxy Statement") under the caption
"1. Election of Directors" and is incorporated herein by this reference.

                               BOARD OF DIRECTORS

Richard M. Jaffee
  Chairman

Daniel S. Jaffee
  President and Chief Executive Officer

J. Steven Cole(1)
  President, Cole & Associates,
  Chairman, Sav-A-Life Systems, Inc.

Arnold W. Donald
  Senior Vice-President, Monsanto Life Sciences Co.

Ronald B. Gordon
  Chief Executive Officer, Beiersdorf North America

Thomas D. Kuczmarski
  Senior Partner and President, Kuczmarski
  & Associates, Inc.
Joseph C. Miller
  Vice-Chairman

Paul J. Miller
  Partner, Sonnenschein Nath & Rosenthal

Haydn H. Murray
  Professor Emeritus of Geology, Indiana University,
  President, H.H. Murray & Associates

Allan H. Selig(2)
  President and Chairman, Selig Lease Company,
  Commissioner of Major League Baseball

  (1)Audit Committee Chair
  (2)Compensation Committee Chair

ITEM 11. EXECUTIVE COMPENSATION

     The information required by this Item is contained in the Registrant's
Proxy Statement under the captions "Executive Compensation," "Report of the
Compensation and the Stock Option Committees of Oil-Dri Corporation of America
on Executive Compensation," "Compensation Committee Interlocks and Insider
Participation" and "Performance Graph" and is incorporated herein by this
reference.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The information required by this Item is contained in the Registrant's
Proxy Statement under the captions "General -- Principal Stockholders" and
"Security Ownership of Management" and is incorporated herein by this reference.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The information required by this Item is contained in the Registrant's
Proxy Statement under the caption "Compensation Committee Interlocks and Insider
Participation" and is incorporated herein by this reference.

                                       41
   42

                                    PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

     (a)(1) The following financial statements are contained herein.

        Consolidated Balance Sheets as of July 31, 2000 (audited) and July 31,
        1999 (audited).

        Consolidated Statements of Income for the fiscal years ended July 31,
        2000 (audited), July 31, 1999 (audited) and July 31, 1998 (audited).

        Consolidated Statements of Stockholders' Equity for the fiscal years
        ended July 31, 2000 (audited), July 31, 1999 (audited) and July 31, 1998
        (audited).

        Consolidated Statements of Cash Flows for the fiscal years ended July
        31, 2000 (audited), July 31, 1999 (audited) and July 31, 1998 (audited).

        Notes to Consolidated Financial Statements.

        Independent Auditor's Report.

     (a)(2) The following financial statement schedules are contained herein:

        Independent Auditor's Report on Schedules.

        Schedules to Financial Statements, as follows:

               Schedule II -- Valuation and Qualifying Accounts, years ended
     July 31, 2000, 1999 and 1998.

     (a)(3) The following documents are exhibits to this Report:

           
(3)(a)(1)     Articles of Incorporation of the Registrant, as amended.
(3)(b)(2)     Bylaws of the Registrant, as amended June 16, 1995.
(10)(c)(1)(3) Agreement ("Clorox Agreement") dated January 12, 1981
              between The Clorox Company and the Registrant, as amended.
              (Confidential treatment of certain portions of this Exhibit
              has been granted.)
(10)(c)(2)(4) Amendment to Clorox Agreement dated March 3, 1989, as
              accepted by the Registrant on March 20, 1989, between The
              Clorox Company and the Registrant. (Confidential treatment
              of certain portions of this Exhibit has been granted.)
(10)(c)(3)(5) Amendment to Clorox Agreement dated February 14, 1991,
              between The Clorox Company and the Registrant. (Confidential
              treatment of certain portions of this Exhibit has been
              granted.)
(10)(d)(6)    Description of 1987 Executive Deferred Compensation
              Program.*
(10)(e)(1)(7) Salary Continuation Agreement dated August 1, 1989 between
              Richard M. Jaffee and the Registrant ("1989 Agreement").*
(10)(e)(2)(8) Extension and Amendment, dated October 9, 1998, to the 1989
              Agreement.*
(10)(f)(9)    1988 Stock Option Plan.*
(10)(g)(10)   Note Agreement, dated April 5, 1991, between the Registrant
              and Teacher's Insurance and Annuity Association of America
              regarding $8,000,000 9.38% Senior Notes due November 15,
              2001.
(10)(h)(11)   Note Agreement, dated as of April 15, 1993, between the
              Registrant and Teacher's Insurance and Annuity Association
              of America regarding $6,500,000 7.17% Senior Notes due
              August 15, 2004.

                                       42
   43

             
(10)(i)(12)     Credit Agreement, dated as of September 21, 1994, between the Registrant and Harris Trust and
                Savings Bank regarding $5,000,000 7.78% Term Loan Note and $5,000,000 Revolving Credit Note.
(10)(j)         The Oil-Dri Corporation of America Deferred Compensation Plan adopted November 15, 1995, as
                amended and restated effective October 1, 2000.*
(10)(k)         The Oil-Dri Corporation of America 1995 Long Term Incentive Plan as amended and restated effective
                June 9, 2000.*
(10)(l)(13)     $10,000,000 unsecured line of credit agreement dated as of July 25, 1996 between the Registrant
                and Harris Trust and Savings Bank.
(10)(m)(14)     $25,000,000 Note Purchase Agreement dated as of April 15, 1998 between the Registrant and Teachers
                Insurance and Annuity Association of America and Cigna Investments, Inc.
(10)(n)         The Oil-Dri Corporation of America Outside Director Stock Plan as amended and restated effective
                October 16, 1999.*
(10)(o)(15)     $15,000,000 unsecured line of credit agreement dated January 29, 1999 between the Company and
                Harris Trust and Savings Bank.
(10)(p)(16)     $15,000,000 unsecured, uncommitted line of credit agreement dated January 29, 1999 between the
                Company and Harris Trust and Savings Bank.
(10)(q)(17)     Split Dollar Life Insurance Agreements dated February 26, 1999.*
(10)(r)(18)     Agreement ("Church & Dwight Agreement") dated May 19, 1999 between Church & Dwight Co., Inc. and
                the Registrant. (Confidential treatment of certain portions of this Exhibit has been granted.)

     (b) Reports on Form 8-K.

        Report on Form 8-K was filed by the Registrant on July 24, 2000,
        Reporting on Item 5., Other events.

           
(11)          Statement re: Computation of Income per Share
(21)          Subsidiaries of the Registrant.
(23)          Consent of Blackman Kallick Bartelstein, LLP.
(27)          Financial Data Schedule.

- -------------------------

* Management contract or compensatory plan or arrangement.

 (1) Incorporated by reference to Exhibit (4.1) to the Registrant's Registration
     Statement on Form S-8 (Registration No. 333-57625), made effective on June
     24, 1998.

 (2) Incorporated by reference to Exhibit (3)(b) to the Registrant's Annual
     Report on Form 10-K for the fiscal year ended July 31, 1995.

 (3) Incorporated by reference to Exhibit (10)(f) to the Registrant's
     Registration Statement on Form S-2 (Registration No. 2-97248) made
     effective on May 29, 1985.

 (4) Incorporated by reference to Exhibit (10)(e)(2) to the Registrant's Annual
     Report on Form 10-K for the fiscal year ended July 31, 1989.

 (5) Incorporated by reference to Exhibit (10)(e)(3) to the Registrant's Annual
     Report on Form 10-K for the fiscal year ended July 31, 1991.

 (6) Incorporated by reference to Exhibit (10)(f) to the Registrant's Annual
     Report on Form 10-K for the fiscal year ended July 31, 1988.

 (7) Incorporated by reference to Exhibit (10)(g) to the Registrant's Annual
     Report on Form 10-K for the fiscal year ended July 31, 1989.

 (8) Incorporated by reference to Exhibit (10)(n) to the Registrant's Annual
     Report on Form 10-K for the fiscal year ended July 31, 1998.

                                       43
   44

 (9) Incorporated by reference to Exhibit (4)(a) to the Registrant's
     Registration Statement on Form S-8 (Registration No. 33-29650), made
     effective on June 30, 1989.

(10) Incorporated by reference to Exhibit (10)(h) to the Registrant's Annual
     Report on Form 10-K for the fiscal year ended July 31, 1991.

(11) Incorporated by reference to Exhibit (10)(i) to the Registrant's Annual
     Report on Form 10-K for the fiscal year ended July 31, 1993.

(12) Incorporated by reference to Exhibit (10)(i) to the Registrant's Annual
     Report on Form 10-K for the fiscal year ended July 31, 1994.

(13) Incorporated by reference to Exhibit (10)(l) to the Registrant's Annual
     Report on Form 10-K for the fiscal year ended July 31, 1996.

(14) Incorporated by reference to Exhibit (10)(m) to the Registrant's Quarterly
     Report on Form 10-Q for the quarter ended April 30, 1998.

(15) Incorporated by reference to Exhibit (10)(o) to the Registrant's Quarterly
     Report on Form 10-Q for the quarter ended January 31, 1999.

(16) Incorporated by reference to Exhibit (10)(p) to the Registrant's Quarterly
     Report on Form 10-Q for the quarter ended January 31, 1999.

(17) Incorporated by reference to Exhibit (10)(q) to the Registrant's Quarterly
     Report on Form 10-Q for the quarter ended January 31, 1999.

(18) Incorporated by reference to Exhibit (10)(r) to the Registrant's Annual
     Report on Form 10-K for the fiscal year ended July 31, 1999.

     The Registrant agrees to furnish the following agreements upon the request
of the Commission:

             
Exhibit         Letter of Credit Agreement, dated as of October 1, 1988
  (4)(b)        between Harris Trust and Savings Bank and Blue Mountain
                Production Company in the amount of $2,634,590 in connection
                with the issuance by Town of Blue Mountain, Mississippi of
                Variable/Fixed Rate Industrial Development Revenue Bonds,
                Series 1988 B (Blue Mountain Production Company Project) in
                the aggregate principal amount of $2,500,000 and related
                Indenture of Trust, Lease Agreement, Remarketing Agreement
                and Guaranties.

                                       44
   45

                                   SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) 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.

                                          OIL-DRI CORPORATION OF AMERICA
                                          (Registrant)
                                          By      /s/ DANIEL S. JAFFEE
                                            ------------------------------------
                                            Daniel S. Jaffee,
                                            President and Chief Executive
                                             Officer, Director

Dated: October 13, 2000

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated:

                                                         

                /s/ RICHARD M. JAFFEE                       October 13, 2000
- -----------------------------------------------------
                  Richard M. Jaffee
         Chairman of the Board of Directors

                /s/ JEFFREY M. LIBERT                       October 13, 2000
- -----------------------------------------------------
                  Jeffrey M. Libert
                   Vice President
               Chief Financial Officer
             Principal Financial Officer
            Principal Accounting Officer

                 /s/ J. STEVEN COLE                         October 13, 2000
- -----------------------------------------------------
                   J. Steven Cole
                      Director

                /s/ ARNOLD W. DONALD                        October 13, 2000
- -----------------------------------------------------
                  Arnold W. Donald
                      Director

                /s/ RONALD B. GORDON                        October 13, 2000
- -----------------------------------------------------
                  Ronald B. Gordon
                      Director

              /s/ THOMAS D. KUZCMARSKI                      October 13, 2000
- -----------------------------------------------------
                Thomas D. Kuzcmarski
                      Director

                /s/ JOSEPH C. MILLER                        October 13, 2000
- -----------------------------------------------------
                  Joseph C. Miller
                      Director

                 /s/ PAUL J. MILLER                         October 13, 2000
- -----------------------------------------------------
                   Paul J. Miller
                      Director

                                       45
   46

                 /s/ HAYDN H. MURRAY                        October 13, 2000
- -----------------------------------------------------
                   Haydn H. Murray
                      Director

                 /s/ ALLAN H. SELIG                         October 13, 2000
- -----------------------------------------------------
                   Allan H. Selig
                      Director

                                       46
   47

                   INDEPENDENT AUDITOR'S REPORT ON SCHEDULES

Board of Directors
Oil-Dri Corporation of America
Chicago, Illinois

     In connection with our audit of the consolidated financial statements of
OIL-DRI CORPORATION OF AMERICA AND SUBSIDIARIES as of July 31, 2000 and 1999 and
for each of the three years in the period ended July 31, 2000, which report
thereon dated September 15, 2000, is incorporated by reference in this Annual
Report on Form 10-K, we also examined the financial statement schedules listed
in the accompanying index at Item 14(A)(2). In our opinion, these financial
statement schedules present fairly, when read in conjunction with the related
consolidated financial statements, the financial data required to be set forth
therein.

Blackman Kallick Bartelstein, LLP

September 15, 2000

                                       47
   48

                OIL-DRI CORPORATION OF AMERICA AND SUBSIDIARIES

                       VALUATION AND QUALIFYING ACCOUNTS

                                                                 YEAR ENDED JULY 31
                                                                --------------------
                                                                2000    1999    1998
                                                                ----    ----    ----
                                                                   (IN THOUSANDS)
                                                                       
Allowance for doubtful accounts:
  Beginning balance.........................................    $358    $351    $261
  Additions charged to expense*.............................     523       8     201
  Deductions**..............................................      45       1     111
                                                                ----    ----    ----
  Balance at end of year....................................    $836    $358    $351
                                                                ====    ====    ====

 * Includes transfers from Special Charge Reserve in fiscal 1998.

** Net of recoveries.

                                                                           
Inventory obsolescence reserve:
  Beginning balance.........................................    $  358    $  540    $365
  Additions charged to expense..............................        --       300     300
  Deductions................................................       102       482     125
                                                                ------    ------    ----
  Balance at end of year....................................    $  256    $  358    $540
                                                                ======    ======    ====
Valuation reserve for income taxes:
  Beginning balance.........................................    $1,742    $  648    $730
  Additions charged to expense..............................       522     1,094      --
  Deductions................................................     1,742        --      82
                                                                ------    ------    ----
  Balance at end of year....................................    $  522    $1,742    $648
                                                                ======    ======    ====

                                       48
   49

                                 EXHIBIT INDEX

EXHIBIT
NUMBER
- -------
       
          The Oil-Dri Corporation of America Deferred Compensation
          Plan as amended and restated effective October 1, 2000.
(10)(j)
          The Oil-Dri Corporation of America 1995 Long Term Incentive
          Plan as amended and restated effective June 9, 2000.
(10)(k)
          The Oil-Dri Corporation of America Outside Director Stock
          Plan as amended and restated effective October 16, 1999.
(10)(n)
          Computation of Net Income per share
(11)
          Subsidiaries of the Registrant
(21)
          Consent of Blackman Kallick Bartelstein, LLP
(23)
          Financial Data Schedule
(27)

Note: Shareholders may receive copies of the above listed exhibits, without fee,
      by written request to Investor Relations, Oil-Dri Corporation of America,
      410 North Michigan Avenue, Suite 400, Chicago, Illinois 60611-4213

                                       49
   1

                                                                 Exhibit (10)(j)

          THE OIL-DRI CORPORATION OF AMERICA DEFERRED COMPENSATION PLAN
                As Amended and Restated Effective October 1, 2000

ARTICLE 1 - INTRODUCTION

1.1  PURPOSE OF PLAN

Oil-Dri Corporation of America, a Delaware Corporation has adopted the Plan set
forth herein to provide a means by which certain employees and non-employee
directors may elect to defer receipt of designated percentages or amounts of
their Compensation and bonuses.

1.2  STATUS OF PLAN

The Plan is intended to be "a plan which is unfunded and is maintained by an
employer primarily for the purpose of providing deferred compensation for a
select group of management or highly compensated employees" within the meaning
of Sections 201(2), 301(a)(3) and 401(a)(1) of the Employee Retirement Income
Security Act of 1974 ("ERISA"), and shall be interpreted and administered to the
extent possible in a manner consistent with that intent.

ARTICLE 2 - DEFINITIONS

Wherever used herein, the following terms have the meanings set forth below,
unless a different meaning is clearly required by the context:

2.1  ACCOUNT means for each Participant, the bookkeeping account established for
his or her benefit under Section 5.1.

2.2  CHANGE OF CONTROL has the meaning set forth in the Oil-Dri Corporation of
America 1995 Long-Term Incentive Plan.

2.3  CODE means the Internal Revenue Code of 1986, as amended from time to time.
Reference to any section or subsection of the Code includes reference to any
comparable or succeeding provisions of any legislation which amends, supplements
or replaces such section or subsection.

2.4  COMPANY means Oil-Dri Corporation of America, any successor to all or a
major portion of the Company's assets or business which assumes the obligations
of the Company, and each other entity that is affiliated with the Company which
adopts the Plan with the consent of Oil-Dri Corporation of America.

2.5  COMPENSATION means base salary, retainer or meeting fees payable to a
Participant by the Company or an affiliate. Base salary is determined before
giving effect to Elective Deferrals and other salary reduction amounts which are
not included in the Participant's gross income under Code sections 125, 401(k),
402(h) or 403(b).

   2

2.6  EARNINGS means the Company's long-term borrowing cost in effect during the
quarter for which Earnings are being credited plus one percent. Prior to October
1, 2000 Earnings means the reported composite rate of return experienced by the
investment portfolio(s) chosen by a Plan Participant as crediting indices and
for the portfolio referred to as the Oil-Dri Declared Rate Fund, Earnings means
the Company's long-term borrowing cost ("Interest") in effect during the quarter
for which Earnings are being credited. Prior to January 1, 1999, Earnings means
Interest as defined +in this paragraph 2.6. For Participants who retired prior
to January 1, 1999, Earnings will continue to mean Interest as defined in this
paragraph 2.6.

2.7  EFFECTIVE DATE means the date as of which the Plan first becomes effective,
December 15, 1995.

2.8  ELECTION FORM means the participation election form as approved and
prescribed by the Plan Administrator.

2.9  ELECTIVE DEFERRAL means the portion of Compensation which is deferred by a
Participant under Section 4.1.

2.10 ELIGIBLE EMPLOYEE OR DIRECTOR generally means each employee of the Company
who is at a salary grade of Grade 10 or higher at the time he or she elects to
make Elective Deferrals or a non-employee who is a member of the Company's Board
of Directors. The Company reserves the right to from time to time extend
eligibility to participate in the Plan to a management employee of the Company
who is at a salary grade less than Grade 10.

2.11 ERISA means the Employee Retirement Income Security Act of 1974, as amended
from time to time. Reference to any section or subsection of ERISA includes
reference to any comparable or succeeding provisions of any legislation which
amends, supplements or replaces such section or subsection.

2.12 INSOLVENT means either (i) the Company is unable to pay its debts as they
become due, or (ii) the Company is subject to a pending proceeding as a debtor
under the United States Bankruptcy Code.

2.13 PARTICIPANT means any individual who participates in the Plan in accordance
with Article 3.

2.14 PLAN means the Oil-Dri Corporation of America Deferred Compensation Plan
and all amendments thereto.

2.15 PLAN ADMINISTRATOR means the person, persons or entity designated by the
Company from time to time to administer the Plan. If no such person or entity is
so serving at any time, Oil-Dri Corporation of America shall be the Plan
Administrator.

2.16 PLAN YEAR means the 12-month period beginning January 1 and ending December
31.

2.17 TOTAL AND PERMANENT DISABILITY means the inability of a Participant to
engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death or which has lasted or can be expected to last for a continuous period of
not less than 12 months, and the permanence and degree of which shall be
supported by medical evidence satisfactory to the Plan Administrator.

                                       2
   3

ARTICLE 3 - PARTICIPATION

3.1  COMMENCEMENT OF PARTICIPATION

Any individual who elects to defer part of his or her Compensation in accordance
with Section 4.1 shall become a Participant in the Plan as of the date such
deferrals commence in accordance with Section 4.1.

3.2  CONTINUED PARTICIPATION

A Participant in the Plan shall continue to be a Participant so long as any
amount remains credited to his or her Account.

                                       3
   4

ARTICLE 4 - ELECTIVE DEFERRALS

4.1  ELECTIVE DEFERRALS

An individual who is an Eligible Employee or Director on the Effective Date may,
by completing an Election Form and filing it with the Plan Administrator on or
before the Effective Date, elect to defer a percentage or dollar amount of one
or more payments of Compensation, on such terms as the Plan Administrator may
permit, which are for services to be performed by the Participant in the Plan
Year immediately following the Effective Date. A Participant may, by completing
an Election Form and filing it with the Plan Administrator on or before March 15
of any Plan Year, elect to defer a percentage of any bonuses payable under the
Oil-Dri Corporation of America Annual Incentive Plan in such Plan Year. A
Participant other than a non-employee director may elect to defer only up to 50%
of base salary, provided that such deferral shall equal a minimum of $5,000 and
up to 100% of any bonuses earned under the Oil-Dri Corporation of America Annual
Incentive Plan for any Plan Year. A Participant who is a non-employee director
may elect to defer all or any part of such Participant's Compensation. Any
individual who becomes an Eligible Employee or Director after the Effective Date
may, by completing an Election Form and filing it with the Plan Administrator
within 30 days after becoming an Eligible Employee or Director, elect to defer a
percentage or dollar amount of one or more payments of Compensation, on such
terms as the Plan Administrator may permit, which are for services to be
performed by the Participant after the date on which the individual files the
Election Form. Any Eligible Employee or Director who has not otherwise initially
elected to defer Compensation in accordance with this paragraph 4.1 may elect to
defer a percentage or dollar amount of one or more payments of Compensation, on
such terms as the Plan Administrator may permit, commencing with Compensation
paid in the next succeeding Plan Year, by completing an Election Form and filing
it with the Plan Administrator on or before November 15 of the year preceding
such Plan Year. A Participant's Compensation shall be reduced in accordance with
the Participant's election hereunder and amounts deferred hereunder shall be
credited to the Participant's Account as of the date the amounts would have been
paid to the Participant absent the deferral election. Elective Deferrals shall
not be in effect for any Participant during any period in which such Participant
is eligible to receive benefits under the Company's Long Term Disability policy.

An election to defer a percentage or dollar amount of Compensation for any Plan
Year or any bonus payable under the Oil-Dri Corporation of America Annual
Incentive Plan in such plan year, shall apply for only such Plan Year. For each
succeeding Plan Year an Eligible Employee or Director must make a new deferral
election by completing and filing with the Plan Administrator an Election Form
on or before the 15th of November preceding that Plan Year with respect to
Compensation (except that elections for the Plan Year 1996 may be made up to and
including the effective date of December 15, 1995) and before the 15th of March
with respect to any bonus payable under the Oil-Dri Corporation of America
Annual Incentive Plan in such Plan Year.

                                       4
   5

ARTICLE 5 - ACCOUNTS

5.1  ACCOUNTS

The Plan Administrator shall establish a bookkeeping Account for each
Participant reflecting Elective Deferrals made for the Participant's benefit and
any distributions to the Participant, together with any adjustments for
Earnings. The Plan Administrator shall provide the Participant as soon as
practicable after the end of the Plan Year with a statement of his or her
Account as of the last business day of the Plan Year, reflecting the amounts of
deferrals, earnings, and distributions of such Account since the prior
statement. Prior to October 1, 2000 and subsequent to January 1, 1999 the Plan
Administrator shall provide each Participant with a statement showing the status
of his or her account as of the end of the calendar quarter.

5.2  EARNINGS CREDITED

Each Participant's Account shall be adjusted for Earnings. Effective October 1,
2000 Earnings adjustments shall be calculated at a rate equal to the Company's
long-term borrowing cost in effect during the quarter for which the
Participant's Account is being adjusted plus one percent.

Prior to October 1, 2000, Earnings adjustments shall be calculated at a rate
computed as if the Participant's Account had been invested in whole and
fractional shares of the investment portfolio(s) selected by the Participant as
crediting indices. For purposes of computing these Earnings adjustments,
Elective Deferrals shall be assumed to have been invested in shares of the
crediting indices on each date a transaction is credited to or debited from the
Participant's account, at the trading price of the crediting indices on such
date or the first business day thereafter. Earnings adjustments shall be
computed as if all dividends paid on the crediting indices were reinvested in
whole or fractional shares on the date paid.

Prior to January 1, 1999 the rate for calculation of Earnings shall be the
Company's long-term borrowing cost ("Interest") in effect during the quarter for
which the Participant's Account is being adjusted. For Participants who retired
prior to January 1, 1999, the rate for calculation of Earnings will continue to
be the Interest rate as defined in paragraph 2.6.

5.3  CREDITING INDICES

Effective October 1, 2000 no crediting indicies shall be offered under the Plan.

Prior to October 1 and subsequent to January 1, 1999 the Company shall select
investment portfolios to serve as crediting indices. Each Participant may
designate any combination (in increments of not less than 5%) of these
portfolios to be used as the crediting indices for his or her account.
Participants do not have an ownership interest in the investment portfolio(s)
chosen by them as crediting indices. Each Participant may change his or her
designated portfolio(s) to be effective the first day of any quarter by
submitting the appropriate form to the Plan Administrator at least ten days
prior to the first day of such quarter. Any designation of new crediting indices
will result in an Earnings adjustment equivalent to a sale of shares in the
current crediting indices and a purchase of shares in the new crediting indices
on the first day of the quarter or the first business day thereafter. The
Company may from time to time change the selection of investment portfolios
offered to Participants as crediting indices. The Plan Administrator shall
notify each Participant of any such change in investment portfolios.

                                       5
   6

ARTICLE 6 - VESTING

6.1  GENERAL

A Participant shall be immediately vested in, i.e., shall have a nonforfeitable
right to, all Elective Deferrals, and all Earnings attributable thereto,
credited to his or her Account.

ARTICLE 7 - PAYMENTS

7.1  ELECTION AS TO TIME AND FORM OF PAYMENT

A Participant shall elect on the Election Form the date at which the Elective
Deferrals (including any Earnings attributable thereto) will commence to be paid
to the Participant. Such date must be at least five years following the date at
which such Elective Deferrals commence or the date of retirement, whichever
occurs first. The Participant shall also elect thereon for payments to be paid
in either:

a.   a single lump sum; or

b.   annual installments over a period elected by the Participant up to 15
     years, the amount of each installment to equal the balance of his or her
     Account immediately prior to the installment divided by the number of
     installments remaining to be paid ("Annual Installments").

Each such election will be effective only for deferrals (including any Earnings
attributable thereto) for the Plan Year for which it is made. Except as provided
in Sections 7.2, 7.3, 7.4, 7.5 or 7.6, payment of a Participant's Account shall
be made in accordance with the Participant's elections under this Section 7.1
Such elections will be irrevocable except that a Participant who has elected to
receive payments only upon retirement, may change the method of payment by
completing a new Election Form more than one year in advance of retirement.

7.2  CHANGE OF CONTROL

The Plan will terminate upon a Change of Control. Immediately prior to the
consummation of a transaction resulting in a Change of Control or, if not
possible, as soon as possible following a Change of Control, each Participant
shall be paid his or her entire Account balance in a single lump sum.

7.3. TERMINATION OF EMPLOYMENT PRIOR TO RETIREMENT AGE

Upon termination of a Participant's employment for any reason other than death
prior to the attainment of the Retirement Age, which is age 55, the
Participant's entire Account shall be paid to the Participant in a single lump
sum as soon as practicable following the end of the quarter in which such
termination occurs.

                                       6
   7

7.4  DISABILITY

If a Participant suffers a Total and Permanent Disability prior to the complete
distribution of his or her Account balance, the following provisions shall
apply:

a.   If the Participant is receiving disability benefits under the Company's
     short-term or long-term disability plan, the Participant will be treated as
     actively employed and payment from the Participant's account shall not be
     made. The Participant may, at his or her election, apply for payment
     because of Unforeseen Emergency under Section 7.6.

b.   If disability benefits under the Company's disability plans cease due to
     recovery from the Total and Permanent Disability, and the Participant does
     not return to employment with the Company, the Participant's Account shall
     be paid to the Participant as provided in Section 7.3.

7.5  DEATH

If a Participant dies prior to the complete distribution of his or her Account,
the balance of the Account shall be paid, according to the Participant's
irrevocable election on the Election Form, to the Participant's designated
beneficiary or beneficiaries. Payment in a single lump sum shall be made as soon
as practicable following the end of the quarter in which death occurs. Payment
in annual installments shall commence the year immediately following the year in
which death occurs.

Any designation of beneficiary and form of payment to such beneficiary shall be
made by the Participant on a designation/change of beneficiary form filed with
the Plan Administrator and may be changed by the Participant at any time by
filing another designation/change of beneficiary form containing the revised
instructions. If no beneficiary is designated or no designated beneficiary
survives the Participant, payment shall be made to the Participant's surviving
spouse, or, if none, to his or her issue per stirpes, in a single payment. If no
spouse or issue survives the Participant payment shall be made in a single lump
sum to the Participant's estate.

7.6  UNFORESEEN EMERGENCY

If a Participant suffers an unforeseen emergency, as defined herein, the Plan
Administrator, in its sole discretion, may pay to the Participant only that
portion, if any, of his or her Account which the Plan Administrator determines
is necessary to satisfy the emergency need, including at the discretion of the
Plan Administrator any amounts necessary to pay any federal, state and local
income taxes reasonably anticipated to result from the distribution.

A Participant requesting emergency payment shall apply for the payment in
writing in a form approved by the Plan Administrator and shall provide such
additional information as the Plan Administrator may require. For purposes of
this paragraph, "unforeseen emergency" means an immediate and heavy financial
need resulting from any of the following:

a.   expenses which are not covered by insurance and which the Participant or
     his or her spouse or dependent has incurred as a result of sudden and
     unexpected illness or accident; or

b.   expenses which are not covered by insurance and which the Participant or
     his or her spouse or dependent has incurred or must incur as a result of a
     casualty loss.

                                       7
   8

7.7  TAXES

All federal, state and local taxes that the Plan Administrator determines are
required to be withheld from any payments made pursuant to this Article 7 shall
be withheld.

7.8  CLAIMS PROCEDURE

A Participant or beneficiary (a "Claimant") entitled to benefits may file a
claim for such benefits with the Plan Administrator, in such form as permitted
by the Plan Administrator. The claim will be evaluated and a decision rendered
within ninety (90) days, unless special circumstances require an additional
ninety (90) day extension of time.

A Claimant shall be given written notice of whether the claim is granted or
denied, in whole or in part, including (1) specific reasons for the denial, (2)
references to pertinent Plan provisions on which the denial is based, (3) a
description of any additional material or information necessary to perfect the
claim and explanation as to why necessary, and (4) the Claimant's right to seek
review of the denial.

If denied, in whole or in part, the Claimant may make a written request for
review of such denial to the Plan Administrator within 60 days after receipt of
the denial, and may include pertinent documents, issues and comments to aid the
Plan Administrator. The request will be evaluated and a decision rendered within
sixty (60) days, unless special circumstances require an additional sixty (60)
day extension of time. The written decision will specify reasons for the
decision and references to Plan provisions upon which the decision is based.

A Claimant who fails to file a claim, or submit a request for review of an
initial claim shall have no right to review and shall have no right to bring
action in any court. The denial of the claim shall be final and binding on all
persons for all purposes.

7.9  SECTION 162(m) LIMITATIONS

In the event that any amount to be paid pursuant to Section 7.1, 7.3, 7.4, 7.5
or 7.6 would, in the Company's judgment, result in the non-deductibility, under
Section 162(m) of the code, of any portion of such Participant's income payable
by or attributable to the Company for the year in which such amount is to be
paid, such amount shall not be paid in such year. Such nondeductible amount
shall be payable in the following calendar year, as an addition to the annual
installment scheduled to be paid in such following calendar year, if applicable,
subject to the provisions of this Section 7.9.

                                       8
   9

ARTICLE 8 - PLAN ADMINISTRATOR

8.1  PLAN ADMINISTRATION AND INTERPRETATION

The Plan Administrator shall oversee the administration of the Plan. The Plan
Administrator shall have complete control and authority to determine the rights
and benefits and all claims, demands and actions arising out of the provisions
of the Plan of any Participant, beneficiary, deceased Participant, or other
person having or claiming to have any interest under the Plan. The Plan
Administrator shall have complete discretion to interpret the Plan and to decide
all matters under the Plan. Such interpretation and decision shall be final,
conclusive and binding on all Participants and any person claiming under or
through any Participant, in the absence of clear and convincing evidence that
the Plan Administrator acted arbitrarily and capriciously. Any individual(s)
serving as Plan Administrator who is a Participant will not vote or act on any
matter relating solely to himself or herself. In such case, the Oil-Dri
Corporation of America will appoint an individual to act as Plan Administrator
to take such actions. When making a determination or calculation, the Plan
Administrator shall be entitled to rely on information furnished by a
Participant, a beneficiary or the Company. The Plan Administrator shall have the
responsibility for complying with any reporting and disclosure requirements of
ERISA.

8.2. POWERS, DUTIES, PROCEDURES, ETC.

The Plan Administrator shall have such powers and duties, may adopt such rules
and tables, may act in accordance with such procedures, may appoint such
officers or agents, may delegate such powers and duties, may receive such
reimbursements, and shall follow such claims and appeal procedures with respect
to the Plan as it may establish.

8.3  INFORMATION

To enable the Plan Administrator to perform its functions, the Company shall
supply full and timely information to the Plan Administrator on all matters
relating to the compensation of Participants, their employment, retirement,
death, termination of employment, and such other pertinent facts as the Plan
Administrator may require.

8.4  INDEMNIFICATION OF PLAN ADMINISTRATOR

The Company agrees to indemnify and to defend to the fullest extent permitted by
law any officer(s) or employee(s) who serve as Plan Administrator (including any
such individual, whether a present or former employee, who formerly served as
Plan Administrator) against all liabilities, damages, costs and expenses
(including attorneys' fees and amounts paid in settlement of any claims approved
by Oil-Dri Corporation of America) occasioned by any act or omission to act in
connection with the Plan, if such act or omission is in good faith.

                                       9
   10

ARTICLE 9 - AMENDMENT AND TERMINATION

9.1  AMENDMENTS

Oil-Dri Corporation of America shall have the right to amend the Plan from time
to time, subject to Section 9.3, by an instrument in writing which has been
executed on Oil-Dri Corporation of America's behalf by its Chief Executive
Officer or his delegate designated in writing, with the specific approval of the
board of directors.

9.2  TERMINATION OF PLAN

This Plan is strictly a voluntary undertaking on the part of the Company and
shall not be deemed to constitute a contract between the Company and any
Eligible Employee or Director (or any other employee) or a consideration for, or
an inducement or condition of employment for the performance of the services by
an Eligible Employee or Director (or other employee). Oil-Dri Corporation of
America reserves the right to terminate the Plan at any time, subject to Section
9.3, by an instrument in writing which has been executed on Oil-Dri Corporation
of America's behalf by its Chief Executive Officer or his delegate designated in
writing, with the specific approval of the board of directors. In addition, the
Plan shall terminate upon a Change of Control in accordance with Section 7.2.

9.3  EXISTING RIGHTS

No amendment or termination of the Plan shall adversely affect the rights of any
Participant with respect to amounts that have been credited to his or her
Account prior to the date of such amendment or termination.

ARTICLE 10 - MISCELLANEOUS

10.1 NO FUNDING

The Plan constitutes a mere promise by the Company to make payments in
accordance with the terms of the Plan and Participants and beneficiaries shall
have the status of general unsecured creditors of the Company. Nothing in the
Plan will be construed to give any employee or any other person rights to any
specific assets of the Company or of any other person. In all events, it is the
intent of the Company that the Plan be treated as unfunded for tax purposes and
for purposes of Title I of ERISA.

10.2 NON-ASSIGNABILITY

None of the benefits, payments, proceeds or claims of any participant or
beneficiary shall be subject to any claim of any creditor of any Participant or
beneficiary, nor shall any Participant or beneficiary have any right to
alienate, anticipate, commute, pledge, encumber or assign any of the benefits or
payments or proceeds which he or she may expect to receive, contingently or
otherwise, under the Plan.

                                       10
   11

10.3 LIMITATION OF PARTICIPANT'S RIGHTS

Nothing contained in the Plan shall confer upon any person a right to be
employed or to continue in the employ of the Company, or interfere in any way
with the right of the Company to terminate the employment of a Participant in
the Plan at any time, with or without cause.

10.4 PARTICIPANTS BOUND

Any action with respect to the Plan taken by Oil-Dri Corporation of America, the
Plan Administrator or the Company or any action authorized by or taken at the
direction of the Plan Administrator or the Company shall be conclusive upon all
Participants and beneficiaries entitled to benefits under the Plan.

10.5 RECEIPT AND RELEASE

Any payment to any Participant or beneficiary in accordance with the provisions
of the Plan shall, to the extent thereof, be in satisfaction of claims against
the Company and/or, the Plan Administrator under the Plan, and the Plan
Administrator may require such Participant or beneficiary, as a condition
precedent to such payment, to execute a receipt and release to such effect. If
any Participant or beneficiary is determined by the Plan Administrator to be
incompetent by reason of physical or mental disability, including minority, to
give a valid receipt and release, the Plan Administrator may cause payment or
payments becoming due to such person to be made to another person for his or her
benefit without responsibility on the part of the Plan Administrator or the
Company to follow the application of such funds.

10.6 GOVERNING LAW

The Plan shall be construed, administered, and governed in all respects under
and by the laws of the state of Illinois. If any provision shall be held by a
court of competent jurisdiction to be invalid or unenforceable, the remaining
provisions hereof shall continue to be fully effective.

10.7 HEADINGS AND SUBHEADINGS

Headings and subheadings in this Plan are inserted for convenience only and are
not to be considered in the construction of the provisions thereof.

                                       11
   1

                                                                 Exhibit (10)(k)

                         OIL-DRI CORPORATION OF AMERICA

                          1995 LONG TERM INCENTIVE PLAN

                             AS AMENDED AND RESTATED
                                  JUNE 9, 2000

   2

                               TABLE OF CONTENTS

                                                                                                                   Page
                                                                                                                   ----
                                                                                                                
 1.  Establishment, Purpose and Effective Date and Termination of the Oil-Dri Corporation of America ...............1
     1988 Stock Option Plan
     (a) Establishment..............................................................................................1
     (b) Purpose....................................................................................................1
     (c) Effective Date.............................................................................................1
     (d) Termination of Oil-Dri Corporation of America 1988 Stock Option Plan.......................................1

 2.  Definitions....................................................................................................1

 3.  Scope of Plan..................................................................................................4
     (a) Number of Shares Available Under the Plan..................................................................4
     (b) Reduction in the Available Shares in Connection with Award Grants..........................................5
     (c) Effect of the Expiration or Termination of Awards..........................................................5
     (d) Maximum Number of Options and Stock Appreciation Rights to any Individual Grantee..........................5

 4.  Administration.................................................................................................5
     (a) Committee Administration...................................................................................5
     (b) Board Reservation and Delegation...........................................................................5
     (c) Committee Authority........................................................................................6
     (d) Committee Determinations Final.............................................................................6

 5.  Eligibility....................................................................................................6

 6.  Conditions to Grants...........................................................................................6
     (a) General Conditions.........................................................................................6
     (b) Grant of Options and Option Price..........................................................................7
     (c) Grant of Incentive Stock Options...........................................................................7
     (d) Grant of Shares of Restricted Stock........................................................................8
     (e) Grant of Stock Appreciation Rights.........................................................................9
     (f) Grant of Performance Units and Performance Shares..........................................................9
     (g) Grant of Phantom Stock.....................................................................................10
     (h) Grant of Stock Bonuses.....................................................................................10
     (i) Tandem Awards..............................................................................................10
     (j) Performance Goals..........................................................................................10

 7.  Non-transferability............................................................................................10

 8.  Exercise.......................................................................................................10
     (a) Exercise of Options........................................................................................10
     (b) Exercise of Stock Appreciation Rights......................................................................11
     (c) Exercise of Performance Units..............................................................................12
     (d) Payment of Performance Shares..............................................................................12
     (e) Payment of Phantom Stock Awards............................................................................13
     (f) Full Vesting Upon Change of Control........................................................................13
     (g) Pooling of Interest........................................................................................13
     (h) Exercise, Cancellation, Expiration or Forfeiture of Tandem Awards..........................................13
     (i) Vesting and Exercise Period upon Disability, Death or Retirement...........................................13

 9.  Effect of Certain Transactions.................................................................................14

10.  Mandatory Withholding Taxes....................................................................................14

11.  Termination of Employment......................................................................................14

12.  Securities Law Matters.........................................................................................14

13.  No Funding Required............................................................................................15

                                       ii

   3

                           TABLE OF CONTENTS (CONT'D)

                                                                                                                   Page
                                                                                                                   ----
                                                                                                                
14.  No Employment Rights...........................................................................................15

15.  Rights as a Stockholder........................................................................................15

16.  Nature of Payments.............................................................................................15

17.  Non-Uniform Determinations.....................................................................................15

18.  Adjustments....................................................................................................15

19.  Amendment of the Plan..........................................................................................16

20.  Termination of the Plan........................................................................................16

21.  No Illegal Transactions........................................................................................16

22.  Governing Law..................................................................................................16

23.  Severability...................................................................................................16

                                      iii

   4

                         OIL DRI CORPORATION OF AMERICA
                          1995 LONG-TERM INCENTIVE PLAN
                                  (AS AMENDED)

1.   Establishment, Purpose and Effective Date and Termination of the Oil-Dri
Corporation of America 1988 Stock Option Plan.

     (a) Establishment. The Company hereby establishes the Oil-Dri Corporation
of America 1995 Long-Term Incentive Plan ("Plan").

     (b) Purpose. The primary purpose of the Plan is to provide a means by which
key employees of the Company and its Subsidiaries can acquire and maintain stock
ownership, thereby strengthening their commitment to the success of the Company
and its Subsidiaries and their desire to remain employed by the Company and its
Subsidiaries, focusing their attention on managing the Company as an equity
owner, and aligning their interests with those of the Company's stockholders.
The Plan also is intended to attract and retain key employees and to provide
such employees with additional incentive and reward opportunities designed to
encourage them to enhance the profitable growth of the Company and its
Subsidiaries.

     (c) Effective Date. The Plan shall become effective upon its adoption by
the Board, subject to the approval of the votes of a majority of the shares of
Common Stock and Class B Stock of the Company voting together present or
represented by proxy at the 1995 annual meeting of stockholders. Until such
approval shall have been obtained, no Option, stock appreciation right, or
performance unit shall be exercised, no stock bonus shall be granted, no
performance share shall be paid, and no shares of restricted stock shall become
nonforfeitable. If such shareholder approval is not obtained at the 1995 annual
meeting of shareholders, all Awards shall automatically become null and void and
no further Awards shall be granted.

     (d) Termination of the Oil-Dri Corporation of America 1988 Stock Option
Plan. Effective upon stockholder approval of this Plan, the Oil-Dri Corporation
of America 1988 Stock Option Plan shall terminate and the shares of Stock
allotted for stock option grants under that plan, which are not the subject of
outstanding options granted under that plan, shall not be available for the
granting of any further options or other awards under that plan or any other
employee or director plan or arrangement of the Company. The options outstanding
under the Oil-Dri Corporation of America 1988 Stock Option Plan shall remain
outstanding and exercisable in accordance with their respective terms.

2.   Definitions. As used in the Plan, terms defined parenthetically immediately
after their use shall have the respective meanings provided by such definitions
and the terms set forth below shall have the following meanings (such meanings
to be equally applicable to both the singular and plural forms of the terms
defined):

          (a) "Award" means Options, shares of restricted Stock, stock
     appreciation rights, performance units, or performance shares stock bonuses
     or shares of phantom stock granted under the Plan.

          (b) "Award Agreement" means the written agreement by which an Award is
     evidenced.

          (c) "Beneficial Owner", "Beneficially Owned", "Beneficially Owning",
     and "Beneficial Ownership" shall have the meanings applicable under Rule
     13d-3 promulgated under the 1934 Act.

          (d) "Board" means the board of directors of the Company.

          (e) "Change in Capitalization" means any increase or reduction in the
     number of shares of Stock, or any change in the shares of Stock or exchange
     of shares of Stock for a different number or kind of shares or other
     securities by reason of a stock dividend (either as a dividend of the same
     class of Stock or as a dividend of a different class of Stock), stock
     split, reverse stock split, share combination, reclassification,
     recapitalization, merger, consolidation, spin-off, split-up,
     reorganization, issuance of warrants or rights, liquidation, exchange of
     shares, repurchase of shares, change in corporate structure, or similar
     event, of or by the Company.

                                       1
   5

          (f) "Change of Control" means any of the following

              (i)   Class B Stock, together with the Common Stock held by the
                    Beneficial Owner of the Class B Stock, has less than 50% of
                    the Voting Power of the Company, and

                    (A)  the acquisition by any person or group of Beneficial
                         Ownership of stock possessing more than 20% of the
                         Voting Power of the Company, except that (i) no such
                         person or group shall be deemed to own beneficially (a)
                         any securities acquired directly from the Company
                         pursuant to a written agreement with the Company, or
                         (b) any securities held by the Company or a Subsidiary
                         or any employee benefit plan (or any related trust) of
                         the Company or a Subsidiary, and (ii) no Change of
                         Control shall be deemed to have occurred solely by
                         reason of any such acquisition by a corporation with
                         respect to which, after such acquisition, more than 60%
                         of both the then-outstanding common shares of such
                         corporation and the Voting Power of such corporation
                         are then Beneficially Owned, directly or indirectly, by
                         the persons who were the Beneficial Owners of the Stock
                         and voting securities of the Company immediately before
                         such acquisition in substantially the same proportions
                         as their ownership, immediately before such
                         acquisition, of the then outstanding Stock or the
                         Voting Power of the Company, as the case may be; or

                    (B)  individuals who, as of the Effective Date, constitute
                         the Board (the "Incumbent Board") cease for any reason
                         to constitute at least a majority of the Board;
                         provided that any individual who becomes a director
                         after the Effective Date whose election or nomination
                         for election by the Company's stockholders was approved
                         by a vote of at least two-thirds of the directors then
                         comprising the Incumbent Board shall be considered as
                         though such individual were a member of the Incumbent
                         Board, but excluding, for this purpose, any such
                         individual whose initial assumption of office is in
                         connection with an actual or threatened election
                         contest relating to the election of the directors of
                         the Company (as such terms are used in Rule 14a-11
                         under the 1934 Act); or

              (ii)  approval by the stockholders of the Company of (A) a merger,
                    reorganization or consolidation with respect to which the
                    individuals and entities who were the respective Beneficial
                    Owners of the Stock and Voting Power of the Company
                    immediately before such merger, reorganization or
                    consolidation do not, immediately after such merger,
                    reorganization or consolidation, beneficially own, directly
                    or indirectly, more than 60% of, respectively, the then
                    outstanding common shares and the Voting Power of the
                    corporation resulting from such merger, reorganization or
                    consolidation, (B) a liquidation or dissolution of the
                    Company or (C) the sale or other disposition of all or
                    substantially all of the assets of the Company.

              For purposes of this definition, "person" means such terms as
          used in SEC Rule 13d-5(b) under the 1934 Act, and "group" means two or
          more persons acting together in such a way to be deemed a person for
          purposes of Section 13(d) of the 1934 Act.

              Notwithstanding the foregoing, a Change of Control shall be
          deemed not to have occurred with respect to any Grantee or Transferee
          with respect to an Award initially issued to such Grantee if such
          Grantee is, by written agreement, a participant on such Grantee's own
          behalf in a transaction in which the persons (or their affiliates)
          with whom such Grantee has the written agreement cause the Change of
          Control to occur and, pursuant to the written agreement, the Grantee
          has or is to acquire an equity interest in the resulting entity.

          (g) "Committee" means the committee of the Board appointed pursuant to
     Article 4.

          (h) "Company" means Oil-Dri Corporation of America, a Delaware
     corporation.

          (i) "Disability" means for purposes of the exercise of an incentive
     stock option, a disability within the meaning of Section 22(e)(3) of the
     Code, and for all other purposes, a mental or physical condition which, in
     the opinion of the Committee, renders a Grantee unable or incompetent to
     carry out the job responsibilities which such Grantee held or the duties to
     which such Grantee was assigned at the time the disability was incurred,
     and which is expected to be permanent or for an indefinite duration.

                                       2
   6

          (j) "Effective Date" means the date that the Plan is adopted by the
     Board.

          (k) "Fair Market Value" of any security of the Company or any other
     issuer means, as of any applicable date:

                    (i) if the security is listed for trading on the New York
              Stock Exchange, the closing price, regular way, of the security as
              reported on the New York Stock Exchange Composite Tape, or if no
              such reported sale of the security shall have occurred on such
              date, on the next preceding date on which there was such a
              reported sale, or

                   (ii) if the security is not so listed, but is listed on
              another national securities exchange or authorized for quotation
              on the National Association of Securities Dealers Inc.'s NASDAQ
              National Market Systems ("NASDAQ/NMS"), the closing price, regular
              way, of the security on such exchange or NASDAQ/NMS, as the case
              may be, or if no such reported sale of the security shall have
              occurred on such date, on the next preceding date on which there
              was such a reported sale, or

                  (iii) if the security is not listed for trading on a
              national securities exchange or authorized for quotation on
              NASDAQ/NMS, the average of the closing bid and asked prices as
              reported by the National Association of Securities Dealers
              Automated Quotation System ("NASDAQ") or, if no such prices shall
              have been so reported for such date, on the next preceding date
              for which such prices were so reported, or

                   (iv) if the security is not listed for trading on a national
              securities exchange or is not authorized for quotation on
              NASDAQ/NMS or NASDAQ, the fair market value of the security as
              determined in good faith by the Committee.

                    (v) in the case of Stock which is being acquired through
              exercise of an Option and payment of the Option Price is being
              made through simultaneous sale through a broker of shares of
              unrestricted Stock acquired on exercise, as permitted under
              Regulation T of the Federal Reserve Board, the selling price of
              the Stock sold in such simultaneous sale.

          (l) "Grant Date" means the date of grant of an Award determined in
     accordance with Article 6.

          (m) "Grantee" means an individual who has been granted an Award.

          (n) "Holder" means a person who holds an Award, either as a Grantee or
     a Transferee.

          (o) "Incentive Stock Option" means an Option satisfying the
     requirements of Section 422 of the Internal Revenue Code and designated by
     the Committee as an Incentive Stock Option.

          (p) "Internal Revenue Code" means the Internal Revenue Code of 1986,
     as amended, and regulations and rulings thereunder. References to a
     particular Section of the Internal Revenue Code shall include references to
     successor provisions.

          (q) "Jaffee Family" means Richard M. Jaffee, Robert D. Jaffee and any
     other person who is a beneficial owner of Class B Stock, a beneficial
     owner's spouse, or a parent or lineal descendent (including any adopted
     child) of any parent of any beneficial owner or of any beneficial owner's
     spouse.

          (r) "Measuring Period" has the meaning specified in Article
     6(f)(ii)(B).

          (s) "Minimum Consideration" means the $.10 par value per share of
     Stock or such larger amount determined pursuant to resolution of the Board
     to be capital within the meaning of Section 154 of the Delaware General
     Corporation Law.

          (t) "1934 Act" means the Securities Exchange Act of 1934, as amended.

                                       3
   7

          (u) "Nonqualified Stock Option" means an Option which is not an
     Incentive Stock Option or other type of statutory stock option under the
     Internal Revenue Code.

          (v) "Option" means an option to purchase Stock granted under the Plan.

          (w) "Option Price" means the per share purchase price of (i) Stock
     subject to an Option or (ii) restricted Stock subject to an Option.

          (x) "Performance Goals" has the meaning set forth in Article 6(j).

          (y) "Performance Percentage" has the meaning specified in Article
     6(f)(ii)(C).

          (z) "Person" means a person within the meaning of Sections 13(d) or
     14(d) of the 1934 Act.

         (aa) "Plan" has the meaning set forth in Article 1(a).

         (bb) "SEC" means the Securities and Exchange Commission.

         (cc) "Section 16 Grantee" means a person subject to potential
     liability with respect to equity securities of the Company under Section
     16(b) of the 1934 Act.

         (dd) "Stock" means Class A Common Stock or if no Class A Common Stock
     is issued and publicly traded on any securities market described in Article
     2(k) above, then Common Stock par value $.10 per share, of the Company and,
     with respect to any Award made in shares of Class B Stock to a member of
     the Jaffee Family who is an employee of the Company or one of its
     Subsidiaries that is more than 50% owned by the Company, Class B Stock.
     Class A Common Stock, Class B Stock and Common Stock shall have the meaning
     as provided in the Company's Certificate of Incorporation.

         (ee) "Subsidiary" means for purposes of grants of incentive stock
     options, a corporation as defined in Section 424(f) of the Internal Revenue
     Code, with the Company being treated as the employer corporation for
     purposes of this definition and, for all other purposes, a corporation with
     respect to which the Company owns, directly or indirectly, 25% of the
     then-outstanding common shares.

         (ff) "10% Owner" means a person who owns stock (including stock
     treated as owned under Section 424(d) of the Internal Revenue Code)
     possessing more than 10% of the Voting Power of the Company.

         (gg) "Transferee" means a person who is the Holder of an Award as the
     result of a transfer of the Award in accordance with the terms of the Award
     and the Plan.

         (hh) "Termination of Employment" occurs the first day on which an
     individual is for any reason no longer employed by the Company or any of
     its Subsidiaries, or with respect to an individual who is an employee of a
     Subsidiary, the first day on which the Company no longer owns Voting
     Securities possessing at least 25% of the Voting Power of such Subsidiary.

         (ii) "Voting Power" means the combined voting power of the then
     outstanding Voting Securities.

         (jj) "Voting Securities" means, with respect to the Company or any
     Subsidiary, any securities issued by the Company or such Subsidiary,
     respectively, which generally entitle the holder thereof to vote for the
     election of directors of the Company.

     3.   Scope of the Plan.

          (a) Number of Shares Available Under the Plan. The maximum number of
     shares of Stock that may be made the subject of Awards granted under the
     Plan is 1,500,000 (or the number and kind of shares of Stock or other
     securities to which such shares of Stock are adjusted upon a Change in
     Capitalization pursuant to Article 18). The Company shall

                                       4
   8

     reserve for the purpose of the Plan, out of its authorized but unissued
     shares of Stock or out of shares held in the Company's treasury, or partly
     out of each, such number of shares as shall be determined by the Board. The
     Board shall have the authority to cause the company to purchase from time
     to time shares of Stock to be held as treasury shares and used for or in
     connection with Awards.

          (b) Reduction in the Available Shares in Connection with Awards
     Grants. Upon the grant of an Award, the number of shares of Stock available
     under Article 3(a) for the granting of further Awards shall be reduced as
     follows:

              (i) Performance Units Denominated in Dollars. In connection with
          the granting of each performance unit denominated in dollars, the
          number of shares of Stock available under Article 3(a) for the
          granting of further Awards shall be reduced by the quotient of (x) the
          dollar amount represented by the performance unit divided by (y) the
          Fair Market Value of a share of Stock on the date immediately
          preceding the Grant Date of the performance unit.

             (ii) Other Awards. In connection with the granting of each Award,
          other than a performance unit denominated in dollars, the number of
          shares of Stock available under Article 3(a) for the granting of
          further Awards shall be reduced by a number of shares equal to the
          number of shares of Stock in respect of which the Award is granted or
          denominated.

          Notwithstanding the foregoing, where two or more Awards are granted
     with respect to the same shares of Stock, such shares shall be taken into
     account only once for purposes of this Article 3(b).

          (c) Effect of the Expiration or Termination of Awards. If and to the
     extent an Award expires, terminates or is canceled or forfeited for any
     reason without having been exercised in full (including, without
     limitation, a cancellation of an Option pursuant to Article 4(c)(vi)), the
     shares of Stock associated with the expired, terminated, canceled or
     forfeited portion of the Award (to the extent the number of shares
     available for the granting of Awards was reduced pursuant to Article 3(b))
     shall again become available for Awards under the Plan.

          In addition, during the period that any Awards remain outstanding
     under the Plan the Committee may make good faith adjustments with respect
     to the number of shares of Stock attributable to such Awards for purposes
     of calculating the maximum number of shares available for the granting of
     future Awards under the Plan.

          (d) Maximum Number of Options and Stock Appreciation Rights to any
     Individual Grantee. No individual Grantee may be granted Options and stock
     appreciation rights to purchase more than one-fourth of the maximum number
     of shares of Stock that may be made subject of Awards under the Plan as set
     forth in Article 3(a).

4.   Administration.

     (a) Committee Administration. Subject to Article 4(b), the Plan shall be
administered by the Committee, which shall consist of not less than three
"disinterested persons" within the meaning of Rule 16b-3 under the 1934 Act;
provided, however, that the membership of the Committee shall be subject to such
changes (including, if appropriate, a change in the minimum number of members of
the Committee) as the Board deems appropriate and permissible to permit
transactions pursuant to the Plan to be exempt from potential liability under
Section 16(b) of the 1934 Act.

     (b) Board Reservation and Delegation. The Board may, in its discretion,
reserve to itself or delegate to another committee of the Board any or all of
the authority and responsibility of the Committee with respect to Awards to
Grantees who are not Section 16 Grantees at the time any such delegated
authority or responsibility is exercised. Such other committee may consist of
one or more directors who may, but need not be, officers or employees of the
Company or of any of its Subsidiaries. To the extent that the Board has reserved
to itself or delegated the authority and responsibility of the Committee to such
other committee, all references to the Committee in the Plan shall be to the
Board or to such other committee.

                                       5

   9

     (c) Committee Authority. The Committee shall have full and final authority,
in its discretion, but subject to the express provisions of the Plan, as
follows:

               (i) to grant Awards,

              (ii) to determine (A) when Awards may be granted and (B) whether
         or not specific Awards shall be identified with other specific Awards,
         and if so, whether they shall be exercisable cumulatively with, or
         alternatively to, such other specific Awards,

             (iii) to interpret the Plan and to make all determinations
         necessary or advisable for the administration of the Plan,

              (iv) to prescribe, amend, and rescind rules and regulations
         relating to the Plan, including without limitation, rules with respect
         to the exercisability and non-forfeitability of Awards upon the
         Termination of Employment of a Grantee regardless of whether the Award
         is held by such Grantee or a Transferee of an Award initially issued to
         such Grantee,

               (v) to determine the terms and provisions of the Award
         Agreements, including Performance Goals, if any, which need not be
         identical and, with the consent of the Holder, to modify any such Award
         Agreement at anytime, provided that the consent of the Holder shall not
         be required for any amendment which (A) does not adversely affect the
         rights of the Holder, or (B) is necessary or advisable (as determined
         by the Committee) to carry out the purpose of the Award as a result of
         any new or change in existing applicable law, regulation, ruling or
         judicial decision; provided that any such change shall be applicable
         only to Awards which have not been exercised;

              (vi) to cancel, with consent of the Holder, outstanding Awards,

             (vii) to accelerate or extend (subject to Article 6(a)(ii)) the
         time during which any Award or Grant of Award may be exercised and to
         accelerate or waive any or all of the restrictions and conditions
         applicable to, any Award,

            (viii) to make such adjustment or modifications to Awards to
         Grantees working outside the United States as are necessary and
         advisable to fulfill the purposes of the Plan,

              (ix) to authorize any action of or make any determination by the
         Company as the Committee shall deem necessary or advisable for carrying
         out the purposes of the Plan, and

               (x) to impose such additional conditions, restrictions, and
         limitations upon the grant, exercise or retention of Awards as the
         Committee may, before or concurrently with the grant thereof deem
         appropriate, including, without limitation, requiring simultaneous
         exercise of related identified Awards, and limiting the percentage of
         Awards which may from time to time be exercised by a Holder.

     (d) Committee Determinations Final. The determination of the Committee on
all matters relating to the Plan or any Award Agreement shall be conclusive and
final. No member of the Committee shall be liable for any action or
determination made in good faith with respect to the Plan or any Award.

5.   Eligibility. Awards may be granted to any employee of the Company or any of
its Subsidiaries. In selecting the individuals to whom Awards may be granted, as
well as in determining the number of shares of Stock subject to, and the other
terms and conditions applicable to, each Award, the Committee shall take into
consideration such factors as it deems relevant in promoting the purposes of the
Plan.

6.   Conditions to Grants.

     (a) General Conditions.

         (i) The Grant Date of an Award shall be the date on which the Committee
     grants the Award or such later date as specified in advance by the
     Committee.

                                       6
   10

        (ii) The term of each Award (subject to Article 6(c) with respect to
     Incentive Stock Options) shall be a period of not more than ten years from
     the Grant Date, and shall be subject to earlier termination as provided
     herein or in the applicable Award Agreement.

       (iii) The Committee may grant Awards with terms and conditions which
     differ among the Grantees thereof. To the extent not set forth in the Plan,
     the terms and conditions of each Award shall be set forth in an Award
     Agreement.

     (b) Grant of Options and Option Price. The Committee may, in its
     discretion, grant Options to acquire unrestricted Stock or restricted Stock
     to any employee eligible under Article 5 to receive Awards. No later than
     the Grant Date of any Option, the Committee shall determine the Option
     Price which shall not be less than 100% of the Fair Market Value of the
     Stock on the Grant Date.

     (c) Grant of Incentive Stock Options. At the time of the grant of any
     Option, the Committee may designate that such Option shall be an Incentive
     Stock Option. Any Option designated as an Incentive Stock Option:

         (i) shall have an Option Price of (A) not less than 100% of the Fair
     Market Value of the Stock on the Grant Date or (B) in the case of a 10%
     Owner, not less than 110% of the Fair Market Value of the Stock on the
     Grant Date;

        (ii) shall have a term of not more than ten years (five years, in the
     case of 10% Owner) from the Grant Date, and shall be subject to earlier
     termination as provided herein or in the applicable Award Agreement;

       (iii) shall not have an aggregate Fair Market Value (determined for each
     Incentive Stock Option at its Grant Date) of Stock with respect to which
     Incentive Stock Options are exercisable for the first time by such Grantee
     during any calendar year (under the Plan and any other employee stock
     option plan of the Grantee's employer or any parent or subsidiary thereof
     ("Other Plans")), determined in accordance with the provisions of Section
     422 of the Internal Revenue Code, which exceeds $100,000 (the "$100,000
     Limit");

        (iv) shall, if, with respect to any grant, the aggregate Fair Market
     Value of Stock (determined on the Grant Date) of all Incentive Stock
     Options previously granted under the Plan and any Other Plans ("Prior
     Grants") and any Incentive Stock Options under such grant (the "Current
     Grant") which are exercisable for the first time during any calendar year
     would exceed the $100,000 Limit, be exercisable as follows:

             (A) the portion of the Current Grant exercisable for the first time
       by the Grantee during any calendar year which would be, when added to any
       portions of any Prior Grants exercisable for the first time by the
       Grantee during such calendar year with respect to Stock which would have
       an aggregate Fair Market Value (determined as of the respective Grant
       Date for such Options) in excess of the $100,000 Limit shall,
       notwithstanding the terms of the Current Grant, be exercisable for the
       first time by the Grantee in the first subsequent calendar year or years
       in which it could be exercisable for the first time by the Grantee when
       added to all Prior Grants without exceeding the $100,000 Limit; and

             (B) if, viewed as of the date of the Current Grant, any portion of
       a Current Grant could not be exercised under the provisions of Article
       6(c)(iv)(A) during any calendar year commencing with the calendar year in
       which it is first exercisable through and including the last calendar
       year in which it may by its terms be exercised, such portion of the
       Current Grant shall not be an Incentive Stock Option, but shall be
       exercisable as a separate Nonqualified Stock Option at such date or dates
       as are provided in the Current Grant;

         (v) shall be granted within ten years from the earlier of the date of
     the Plan is adopted by the Board or the date the Plan is approved by the
     stockholders of the Company; and

        (vi) shall require the Grantee to notify the Committee of any
     disposition of any Stock issue pursuant to the exercise of the Incentive
     Stock Option under the circumstances described in Section 421(b) of the
     Internal Revenue Code (relating to certain disqualifying dispositions)
     within ten days of such disposition.

                                       7
   11

     (d) Grant of Shares of Restricted Stock.

          (i) The Committee may, in its discretion, grant shares of restricted
     Stock to any employee eligible under Article 5 to receive Awards.

         (ii) Shares of restricted Stock will be Class A Common Stock or if no
     Class A Common Stock is publicly traded on any securities market described
     in Article 2(k) on the Grant Date of such shares of restricted Stock, then
     such shares of restricted Stock shall be Common Stock; shares of restricted
     Stock shall be Class B Stock if a grant of restricted stock is made in
     shares of Class B Stock to a member of the Jaffee Family who is an employee
     of the Company or one of its Subsidiaries that is more than 50% owned by
     the Company.

        (iii) Before the grant of any shares of restricted Stock, the Committee
     shall determine, in its discretion:

              (A) whether the certificates for such shares shall be delivered to
       the Grantee or held (together with a stock power executed in blank by the
       Grantee) in escrow by the Secretary of the Company until such shares
       become nonforfeitable or are forfeited,

              (B) the per share purchase price of such shares, which may be
       zero, provided, however, that

                  (1) the per share purchase price of all such shares (other
              than treasury shares) shall not be less than the Minimum
              Consideration for each such share; and

                  (2) if such shares are to be granted to a Section 16 Grantee
              and the purchase price is to be in excess of the Minimum
              Consideration, to the extent necessary so that such grant
              qualifies for the exemption provided pursuant to Rule 16b-3 under
              the 1934 Act, the per share purchase price of any such shares
              shall be at least 50% of the Fair Market Value of the Stock on the
              Grant Date;

              (C) the restrictions applicable to such grant; and

              (D) whether the payment to the Grantee of dividends, or a
       specified portion thereof, declared or paid on such shares by the Company
       shall be deferred until the lapsing of the restrictions imposed upon such
       shares shall be held by the Company for the account of the Grantee,
       whether such dividends shall be reinvested in additional shares of
       restricted Stock (to the extent shares are available under Article 3)
       subject to the same restrictions and other terms as apply to the shares
       with respect to which such dividends are issued or otherwise reinvested
       in Stock or held in escrow, whether interest will be credited to the
       account of the Grantee with respect to any dividends which are not
       reinvested in restricted or unrestricted Stock, and whether any Stock
       dividends issued with respect to the restricted Stock to be granted shall
       be treated as additional shares of restricted Stock.

         (iv) Payment of the purchase price (if greater than zero) for shares of
     restricted Stock shall be made in full by the Grantee before the delivery
     of such shares and, in any event, no later than ten days after the Grant
     Date for such shares. Such payment may be made, as determined in advance by
     either the Board or the Committee in its discretion, in any one or any
     combination of the following:

              (A) cash, or

              (B) shares of restricted or unrestricted Class A Common Stock or
       Common Stock or Class B Stock owned by the Grantee prior to such grant
       and valued at its Fair Market Value on the business day immediately
       preceding the date of payment;

       provided, however, that in the case of payments in shares of restricted
       or unrestricted Class A Common Stock or Common Stock or Class B Stock

                  (1) if the purchase price for restricted Stock ("New
              Restricted Stock") is paid with shares of restricted Class A
              Common Stock or restricted Common Stock or restricted Class B
              Stock ("Old Restricted Stock"), the restrictions applicable to the
              New Restricted Stock shall be the same as if the Grantee had paid
              for the New

                                       8
   12

              Restricted Stock in cash unless, in the judgment of the Committee,
              the Old Restricted Stock was subject to a greater risk of
              forfeiture, in which case a number of shares of New Restricted
              Stock equal to the number of shares of Old Restricted Stock
              tendered in payment for New Restricted Stock shall be subject to
              the same restrictions as the Old Restricted Stock, determined
              immediately before such payment.

          (v) Upon the date that shares of restricted Common Stock become
     non-forfeitable, the Company shall exchange such shares of Common Stock for
     an equal number of shares of Class A Common Stock if such shares of
     restricted Stock have been granted as shares of Common Stock and if such
     Class A Common Stock is issued and publicly traded on any securities market
     as described in Article 2(k).

         (vi) The Committee may, but need not, provide that all or any portion
     of a Grantee's Award of restricted Stock shall be forfeited:

              (A) except as otherwise specified in the Award Agreement, upon the
       Grantee's Termination of Employment within a specified time period after
       the Grant Date, or

              (B) if the Company or the Grantee does not achieve specified
       performance goals within a specified time period after the Grant Date and
       Before the Grantee's Termination of Employment, or

              (C) upon failure to satisfy such other restrictions as the
       Committee may specify in the Award Agreement.

        (vii) If a share of restricted Stock is forfeited, then

              (A) the Grantee shall be deemed to have resold such share of
       restricted Stock to the Company at the lesser of (1) the purchase price
       paid by the Grantee (such purchase price shall be deemed to be zero
       dollars ($0) if no purchase price was paid) or (2) the Fair Market Value
       of a share of Stock on the date of such forfeiture;

              (B) the Company shall pay to the Grantee the amount determined
       under clause (A) of this sentence, if not zero, as soon as is
       administratively practicable, but in any case within 90 days after
       forfeiture; and

              (C) such share of restricted Stock shall cease to be outstanding,
       and shall no longer confer on the Grantee thereof any rights as a
       stockholder of the Company, from and after the date of the Company's
       tender of the payment specified in clause (B) of this sentence, whether
       or not such tender is accepted by the Grantee, or the date the restricted
       Stock is forfeited if no purchase price was paid for the restricted
       Stock.

       (viii) Any share of restricted Stock shall bear an appropriate legend
     specifying that such share is non-transferable and subject to the
     restrictions set forth in the Plan. If any shares of restricted Stock
     become nonforfeitable, the Company shall cause certificates for such shares
     to be issued or reissued without such legend and delivered to the Grantee
     or, at the request of the Grantee, shall cause such shares to be credited
     to a brokerage account specified by the Grantee.

     (e) Grant of Stock Appreciation Rights. The Committee may grant stock
appreciation rights to any employee eligible under Article 5 to receive Awards.
When granted, stock appreciation rights may, but need not, be identified with
shares of Stock subject to a specific Option awarded to the Grantee (including
any Option granted on or before the Grant Date of the stock appreciation rights)
in a number equal to or different from the number of stock appreciation rights
so granted. If stock appreciation rights are identified with shares of Stock
subject to an Option then, unless otherwise provided in the applicable Award
Agreement, (i) the Grantee's associated stock appreciation rights shall
terminate upon the exercise, expiration, termination, forfeiture, or
cancellation of such Option and (ii) the stock appreciation right and such
Option can only be transferred pursuant to Article 7 to the same Transferee.

     (f) Grant of Performance Units and Performance Shares.

          (i) The Committee may, in its discretion, grant performance units or
     performance shares to any employee eligible under Article 5 to receive
     Awards.

                                       9
   13

         (ii) Before the grant of any performance unit or performance share,
     the Committee shall:

              (A) determine Performance Goals applicable to such grant,

              (B) designate a period, of not less than one year nor more than
       five years, for the measurement of the extent to which Performance Goals
       are attained (the "Measuring Period"), and

              (C) assign a "Performance Percentage" to each level of attainment
       of Performance Goals during the Measuring Period, with the percentage
       applicable to minimum attainment being zero percent (0%) and the
       percentage applicable to optimum attainment to be determined by the
       Committee from time to time.

     (g) Grant of Phantom Stock. The Committee may, in its discretion, grant
shares of phantom stock to any employee who is eligible under Article 5 to
receive Awards and is employed outside the United States. Such phantom stock
shall be subject to the terms and conditions established by the Committee and
set forth in the applicable Award Agreement.

     (h) Grant of Stock Bonuses. The Committee may grant shares of Stock as a
bonus to any individual eligible under Article 5 to receive Awards.

     (i) Tandem Awards. The Committee may grant and identify any Award with any
other Award granted under the Plan, on terms and conditions determined by the
Committee.

     (j) Performance Goals. Performance Goals shall mean the goals applicable to
an Award which shall be set forth in a written document prior to the
commencement of the Grantee's services to which the Performance Goals under the
Award relate and while the outcome is still substantially uncertain. In
establishing Performance Goals, the Committee may consider such factor or
factors relating to performance as it deems appropriate, including net income,
growth in net income, earnings per share, growth of earnings per share return on
equity, return on capital, or any other business criteria as contemplated in
Section 162(m) of the Code. The Committee, if applicable, shall certify in
writing prior to payment of compensation related to any applicable performance
unit, performance share, restricted stock or share of phantom stock that the
Performance Goals and any other material terms were satisfied. The Committee
may, at any time, modify Performance Goals as a result of changes required in
applicable laws. If a Grantee is promoted, demoted or transferred to a different
business unit of the Company during a performance period, then, to the extent
the Committee determines the Performance Goals are no longer appropriate, the
Committee may adjust, change or eliminate the Performance Goals or as it deems
appropriate in order to make them appropriate and comparable to the initial
Performance Goals.

7.   Non-transferability. Except as hereinafter provided, each Award granted
hereunder shall by its terms not be assignable or transferable, and may be
exercised, during the Grantee's lifetime, only by the Grantee. Notwithstanding
the foregoing (a) if the Award is exercisable after the Grantee's death, it may
be exercised by the Grantee's legal representative or by a beneficiary
designated in writing by the Grantee to exercise his or her Award after the
Grantee's death, and (b) the Grantee may transfer an Award held by such Grantee
(other than an Incentive Stock Option or restricted Stock) (i) for no
consideration to any of the following permissible transferees: any member of the
Grantee's Immediate Family, and any general or limited partnership each of the
partners of which are members of the Grantee's Immediate Family and which
prohibits a transfer of all or any part of any interest in the partnership
except to the partnership or to any of the foregoing; and (ii) to such other
person or entity, and on such terms and conditions, as the Committee, in its
discretion, may permit. Any Award so transferred shall be subject after transfer
to all of the terms and conditions of such Award prior to the transfer and shall
not be further transferable without the consent of the Committee. "Immediate
Family" means, with respect to a particular Grantee, that Grantee's spouse, any
parent and any lineal descendent (including any adopted child) of any parent of
that Grantee or of that Grantee's spouse, and any trustee, guardian or custodian
for any of the foregoing. Each share of restricted Stock shall be
non-transferable until such share becomes nonforfeitable.

8.   Exercise.

     (a) Exercise of Options. Subject to Article 4(c)(vii), 11 and 12 and such
terms and conditions as the Committee may impose, each Option shall be
exercisable in one or more installments commencing not earlier than the first
anniversary of the Grant Date of such Option; provided, however, that all
Options shall become fully (100%) exercisable upon the occurrence of a Change of
Control regardless of whether the acceleration of the exercisability of such
Options would cause

                                       10
   14

such Options to lose their eligibility for treatment as Incentive Stock Options.
Notwithstanding the foregoing, Options may not be exercised by a Grantee for
twelve months following a hardship distribution to the Grantee, to the extent
such exercise is prohibited under Treasury Regulation Section
1.401(k)-1(d)(2)(iv)(B)(4). Each Option shall be exercised by delivery to the
Company of written notice of intent to purchase a specific number of shares of
Stock or restricted Stock subject to the Option. Such stock will be Class A
Common Stock or if no Class A Common Stock is publicly traded on any securities
market described in Article 2(k) on the date such options are exercised, then
Common Stock and with respect to an Option held by a member of the Jaffee Family
on Class B stock, Class B Stock. The Option Price of any shares of Stock or
restricted Stock as to which an Option shall be exercised shall be paid in full
at the time of the exercise. Payment may be made, as determined in advance by
either the Board or the Committee in its discretion, in any one or any
combination of the following:

         (i)  cash,

        (ii)  shares of restricted or unrestricted Class A Common Stock or
     Common Stock or Class B Stock owned by the Holder prior to the exercise of
     the Option and valued at its Fair Market Value on the last business day
     immediately preceding the date of exercise, or

       (iii)  through simultaneous sale through a broker of shares of
     unrestricted Stock acquired on exercise, as permitted under Regulation T of
     the Federal Reserve Board. Where payment of the Option Price is made
     through simultaneous sale, the Option Price shall be paid in full
     immediately following the settlement date of such sale.

     Payment of the option price with Stock simultaneously acquired by option
exercise may be made, with the consent in advance of the Board or the Committee.

     If restricted Class A Common Stock or Common Stock or Class B Stock
("Tendered Restricted Stock") is used to pay the Option Price for Stock, then a
number of shares of Stock acquired on exercise of the Option equal to the number
of shares of Tendered Restricted Stock shall be subject to the same restrictions
as the Tendered Restricted Stock, determined as of the date of exercise of the
Option. If the Option Price for restricted Stock is paid with Tendered
Restricted Stock, and if the Committee determines that the restricted Stock
acquired on exercise of the Option shall be subject to restrictions ("Greater
Restrictions") that cause it to have a greater risk of forfeiture than the
Tendered Restricted Stock, then notwithstanding the preceding sentence, all the
restricted Stock acquired on exercise of the Option shall be subject to such
Greater Restrictions.

     Shares of unrestricted Stock acquired by a Holder on exercise of an Option
shall be delivered to the Holder or, at the request of the Holder, shall be
credited directly to a brokerage account specified by the Holder.

     (b) Exercise of Stock Appreciation Rights. Subject to Article 4(c)(vii), 11
and 12 and such terms and conditions as the Committee may impose, each stock
appreciation right shall be exercisable not earlier than the first anniversary
of the Grant Date of such stock appreciation right and, if such stock
appreciation right is identified with an Option, to the extent such Option may
be exercised unless otherwise provided by the Committee, Stock appreciation
rights shall be exercised by delivery to the Company of written notice of intent
to exercise a specific number of stock appreciation rights. Unless otherwise
provided in the applicable Award Agreement, the exercise of stock appreciation
rights which are identified with shares subject to an Option shall result in the
forfeiture of such Option to the extent of such exercise.

     The benefit for each stock appreciation right exercised shall be equal to
the excess, if any, of

          (i) the Fair Market Value of a share of Stock on the date of such
     exercise, over

         (ii) an amount equal to

              (A) in the case of a stock appreciation right identified with a
       share of Stock subject to an Option, the Option Price of such Option,
       unless the Committee in the grant of the stock appreciation right
       specified a higher amount, or

                                       11
   15

              (B) in the case of any other stock appreciation right, the Fair
       Market Value of a share of Stock on the Grant Date of such stock
       appreciation right, unless the Committee in the grant of the stock
       appreciation right specified a higher amount;

provided that the Committee, in its discretion, may provide that the benefit for
any stock appreciation right shall not exceed a maximum amount (i.e. a cap) set
by Committee, which cap may be expressed as (i) a percentage of the excess
amount described above (not to exceed 100%), (ii) a percentage of the Fair
Market Value of a share of Stock on the Grant Date of the stock appreciation
right, or (iii) a fixed dollar amount. The benefit upon the exercise of a stock
appreciation right shall be payable in cash, except that the Committee, with
respect to any particular exercise, may, in its discretion, pay benefits wholly
or partly in Stock delivered to the Holder or credited to a brokerage account
specified by the Holder.

     (c) Exercise of Performance Units.

          (i) Subject to Article 4(c)(vii), 11 and 12 and such terms and
     conditions as the Committee may impose, and unless otherwise provided in
     the applicable Award Agreement, if, with respect to any performance unit,
     the minimum Performance Goals have been achieved during the applicable
     Measuring Period, then such performance unit shall be deemed exercised on
     the date on which it first becomes exercisable.

         (ii) The benefit for each performance unit exercised shall be an
     amount equal to the product of

              (A) The Unit Value (as defined below), multiplied by

              (B) the Performance Percentage attained during the Measuring
       Period for such performance unit.

        (iii) The Unit Value shall be, as specified by the Committee,

              (A) a dollar amount,

              (B) an amount equal to the Fair Market Value of a share of Stock
       on the Grant Date,

              (C) an amount equal to the Fair Market Value of a share of Stock
       on the exercise date of the performance unit, plus, if so provided in the
       Award Agreement, an amount ("Dividend Equivalent Amount") equal to the
       Fair Market Value of the number of shares of Stock that would have been
       purchased if each dividend paid on a share of Stock on or after the Grant
       Date and on or before the exercise date were invested in shares of Stock
       at a purchase price equal to its Fair Market Value on the respective
       dividend payment date, or

              (D) an amount equal to the Fair Market Value of a share of Stock
       on the exercise date of the performance unit (plus, if so specified in
       the Award Agreement, a Dividend Equivalent Amount), reduced by the Fair
       Market Value of a share of Stock on the Grant Date of the performance
       unit.

         (iv) The benefit upon the exercise of a performance unit shall be
     payable to the Holder (or at the request of the Holder, deliver to a
     brokerage account specified by the Holder), as soon as is administratively
     practicable (but in any event within 90 days) after the later of (A) the
     date the Holder is deemed to exercise such performance unit, or (B) the
     date (or dates in the event of installment payments) as provided in the
     applicable Award Agreement. Such benefit shall be payable in cash, except
     that the Committee, with respect to any particular exercise, may, provide
     in the Award Agreement that benefits may be paid wholly or partly in Stock.
     The number of shares of Stock payable in lieu of cash shall be determined
     by valuing the Stock at its Fair Market Value on the business day next
     preceding the date such benefit is to be paid.

     (d) Payment of Performance Shares. Subject to Article 4(c)(vii), 11 and 12
and such terms and conditions as the Committee may impose, and unless otherwise
provided in the applicable Award Agreement, if the minimum Performance Goals
specified by the Committee with respect to an Award of performance shares have
been achieved during the applicable Measuring Period, then the Company shall pay
to the Holder of such Award (or, at the request of the Holder, deliver to a
brokerage account specified by the Holder) shares of Stock equal in number to
the product of the number of the performance share(s) specified in the
applicable Award Agreement multiplied by the Performance Percentage achieved

                                       12
   16

during such Measuring Period, except to the extent that the Committee in its
discretion determines that cash be paid in lieu of some or all of such shares of
Stock. The amount of cash payable in lieu of a share of Stock shall be
determined by valuing such share at its Fair Market Value on the business day
next preceding the date such cash is to be paid. Payment pursuant to this
Article 8(d) shall be made as soon as administratively practicable (but in any
event within 90 days) after the end of the applicable Measuring Period. Any
performance shares with respect to which the performance goals have not been
achieved by the end of the applicable Measuring Period shall expire.

     (e) Payment of Phantom Stock Awards. Upon the vesting of a phantom stock
Award, the Holder shall be entitled to receive a cash payment in respect of each
share of phantom stock which shall be equal to the Fair Market Value of a share
of Stock as of the date the phantom stock Award was granted, or such other date
as determined by the committee at the time the phantom stock Award was granted.
The Committee may at the time a phantom stock Award is granted, provide a
limitation on the amount payable in respect of each share of phantom stock.

     (f) Full Vesting upon Change of Control. In the event of a Change of
Control, all unvested Awards shall become immediately vested and exercisable;
provided that the benefit payable with respect to any performance unit or
performance share with respect to which the Measuring Period has not ended as of
the date of such Change of Control shall be equal to the product of the Unit
Value multiplied successively by each of the following:

         (1) a fraction, the numerator of which is the number of months
     (including as a whole month any partial month) that have elapsed since the
     beginning of such Measuring Period until the date of such Change of Control
     and the denominator of which is the number of months (including as a whole
     month any partial month) in the Measuring Period; and

         (2) a percentage equal to the greater of the target percentage, if any,
     specified in the applicable Award Agreement or the maximum percentage, if
     any, that would be earned under the terms of the applicable Award Agreement
     assuming that the rate at which the performance goals have been achieved as
     of the date of such Change of Control would continue until the end of the
     Measuring Period.

     (g) Pooling of Interests. If the Committee in its discretion determines
that the exercise of an Award would preclude the use of pooling of interests
accounting following a sale of the Company which is reasonably likely to occur
and that such preclusion of pooling would have a material adverse effect on the
sale of the Company, the Committee, in its discretion, may take such action as
it deems appropriate in order to preserve the pooling of interests accounting
including either unilaterally barring the exercise of such Award by canceling
the Award prior to the Change of Control or by causing the Company to pay the
Award rights benefit in Stock if it determines that such payment would not cause
the transaction to be ineligible for pooling.

     (h) Exercise, Cancellation, Expiration or Forfeiture of Tandem Awards. Upon
the exercise, cancellation, expiration, forfeiture or payment in respect of any
Award which is identified with any other Award (the "Tandem Award") pursuant to
Article 6(i), the Tandem Award shall automatically terminate to the extent of
the number of shares in respect of which the Award is so exercised, canceled,
expired, forfeited or paid, unless otherwise provided by the Committee at the
time of grant of the Tandem Award or thereafter.

     (i) Vesting and Exercise Period upon Disability, Death or Retirement.

         (i) Disability or Death. In the event a Grantee's employment is
         terminated as a result of the Grantee's Disability, as determined under
         a Company sponsored long-term disability plan or if the Grantee is not
         a participant in such a plan, then as determined by a review of medical
         evidence by a qualified independent review agent, or as a result the
         Grantee's death, all unvested Awards shall become immediately vested
         and exercisable; provided that the benefit payment with respect to any
         performance unit or performance share with respect to which the
         Measuring Period has not ended as of the date of such termination of
         employment, shall be computed as specified in Article 8 (f), but
         substituting the words "date of such termination of employment" for the
         words "date of such Change of Control". The Holder of such Awards, or
         in the case of a deceased Grantee who has not transferred his Awards
         pursuant to Article 7 the Grantee's legal representative or
         beneficiary, shall have three years from the date of the Grantee's
         termination of employment to exercise the Awards, provided that this
         exercise period shall not extend the term (duration) of the Award.

                                       13
   17

         (ii) Retirement. In the event a Grantee's employment is terminated as a
         result of the Grantee's retirement and (a) the Grantee is eligible for
         an immediate benefit under a Company sponsored defined benefit pension
         plan and (b) the Grantee's age plus years of service on the date of
         retirement equal at least eighty, all unvested Awards shall become
         immediately vested and exercisable; provided that the benefit payment
         with respect to any performance unit or performance share with respect
         to which the Measuring Period has not ended as of the date of such
         retirement, shall be computed as specified in Article 8 (f) above, but
         substituting the words "date of such termination of employment" for the
         words "date of such Change of Control". The Holder of such Award shall
         have three years from the date of the Grantee's termination of
         employment to exercise the Award, provided that this exercise period
         shall not extend the term (duration) of the Award.

                  In the event a Grantee's employment is terminated as a result
         of the Grantee's retirement and the Grantee's age plus years of service
         on the date of retirement are equal to less than eighty, the vesting
         and exercise of Awards shall be governed by the respective Award
         Agreements.

9.   Effect of Certain Transactions. With respect to any Award which relates to
Stock, in the event of a merger or consolidation of the Company (a
"Transaction"), the Plan and the Awards issued hereunder shall continue in
effect in accordance with their respective terms and each Holder shall be
entitled to receive in respect of each share of Stock subject to any outstanding
Awards, upon the vesting, payment or exercise of the Award (as the case may be),
the same number and kind of stock, securities, cash, property, or other
consideration that each holder of a share of Stock was entitled to receive in
the Transaction in respect of a share of Stock. With respect to any Award which
relates to stock, in the event of a liquidation or dissolution of the Company,
the Committee may take such actions as it deems appropriate.

10.  Mandatory Withholding Taxes. The Company shall have the right to deduct
from any distribution of cash to any Holder an amount equal to the federal,
state and local income taxes and other amounts as may be required by law to be
withheld (the "Withholding Taxes") with respect to any Award. If a Holder is to
experience a taxable event in connection with the receipt of shares pursuant to
an Option exercise or the vesting or payment of another type of Award (a
"Taxable Event"), the Holder shall pay the Withholding Taxes to the Company
prior to the issuance, or release from escrow, of such shares or payment of such
Award. Payment of the applicable Withholding Taxes may be made, as determined in
advance by the Board or the Committee in its discretion, in any one or any
combination of (i) cash, (ii) shares of restricted or unrestricted Class A
Common Stock or Common Stock or Class B Stock owned by the Holder prior to the
Taxable Event and valued at its Fair Market Value on the business day
immediately preceding the date of exercise, or (iii) by making a Tax Election
(as described below). For purposes of this Article 10, a Holder may make a
written election (the "Tax Election"), to have withheld a portion of the shares
then issuable to him or her having an aggregate Fair Market Value, on the date
preceding the date of such issuance, equal to the Withholding Taxes.

11.  Termination of Employment. The Award Agreement pertaining to each Award
shall set forth the terms and conditions applicable to such Award upon a
Termination of Employment of the Grantee by the Company, a Subsidiary or an
operating division or unit, as the Committee may, in its discretion, determine
at the time the Award is granted or thereafter; provided, however, that if a
Grantee's employment is terminated as a result of (i) the Grantee's conviction
of a felony which is, in the opinion of the Committee, likely to result in
injury of a material nature to the Company or a Subsidiary, or (ii) the gross
and habitual negligence by the Grantee in the performance of the Grantee's
duties to the Company or its Subsidiaries (termination for "Cause"), the
Grantee's shares of restricted stock that are forfeitable, subject to the
provisions of Article 6(d)(vii) regarding repayment of certain amounts to the
Grantee, and any unexercised option, stock appreciation right, performance unit,
performance share or share of phantom stock shall thereupon terminate. If a
Grantee has transferred an Award pursuant to Article 7, then, upon a Termination
of Employment of such Grantee, the terms and conditions applicable to such
Award, including the time of its termination, shall be the same as would have
applied to the Award if the Grantee had not transferred it.

12.  Securities Law Matters.

     (a) If the Committee deems it necessary to comply with the Securities Act
of 1933, the Committee may require a written investment intent representation by
the Holder and may require that a restrictive legend be affixed to certificates
for shares of Stock.

                                       14
   18

     (b) If, based upon the opinion of counsel for the Company, the Committee
determines that the exercise or non-forfeitability of, or delivery of benefits
pursuant to, any Award would violate any applicable provision of (i) federal or
state securities law or (ii) the listing requirements of any national securities
exchange on which are listed any of the Company's equity securities, then the
Committee may postpone any such exercise, non-forfeitability or delivery, as the
case may be, but the Company shall use its best efforts to cause such exercise,
non-forfeitability or delivery to comply with all such provisions at the
earliest practicable date.

     (c) Subject to Articles 12(a) and (b) above, no shares of Stock shall be
issued to any Holder in respect of any Award prior to the time a registration
statement under the Securities Act of 1933 is effective with respect to such
shares.

13.  No Funding Required. Benefits payable under the Plan to any person shall be
paid directly by the Company. The Company shall not be required to fund, or
otherwise segregate assets to be used for payment of, benefits under the Plan.

14.  No Employment Rights. Neither the establishment of the Plan, nor the
granting of any Award shall be construed to (a) give any Grantee the right to
remain employed by the Company or any of its Subsidiaries or to any benefits not
specifically provided by the Plan or (b) in any manner modify the right of the
Company or any of its Subsidiaries to modify, amend, or terminate any of its
employee benefit plans.

15.  Rights as a Stockholder. A Holder shall not, by reason of any Award (other
than restricted Stock), have any right as a stockholder of the Company with
respect to the shares of Stock which may be deliverable upon exercise or payment
of such Award until such shares have been delivered to him. Shares of restricted
Stock held by a Grantee or held in escrow by the Secretary of the Company shall
confer on the Grantee all rights of a stockholder of the Company, except as
otherwise provided in the Plan.

16.  Nature of Payments. Any and all grants, payments of cash, or deliveries of
shares of Stock hereunder shall constitute special incentive payments to the
Grantee and shall not be taken into account in computing the amount of salary or
compensation of the Grantee for the purpose of determining any pension,
retirement, death or other benefits under (a) any pension, retirement,
profit-sharing, bonus, life insurance or other employee benefit plan of the
Company or any of its Subsidiaries or (b) any agreement between the Company or
any Subsidiary, on the one hand, and the Grantee, on the other hand, except as
such plan or agreement shall otherwise expressly provide.

17.  Non-Uniform Determinations. Neither the Committee's nor the Board's
determinations under the Plan need be uniform and may be made by the Committee
or the Board selectively among persons who receive, or are eligible to receive,
Awards (whether or not such persons are similarly situated). Without limiting
the generality of the foregoing, the Committee shall be entitled, among other
things, to make non-uniform and selective determinations, to enter into
non-uniform and selective Award Agreements as to (a) the identity of the
Grantees, (b) the terms and provisions of Awards, and (c) the treatment of
Terminations of Employment.

18.  Adjustments. In the event of Change in Capitalization, the Committee shall,
in its sole discretion, make equitable adjustment of

          (a) the aggregate number and class of shares of Stock or other stock
     or securities available under Article 3,

          (b) the number and class of shares of Stock or other stock or
     securities covered by an Award,

          (c) the Option Price applicable to outstanding Options,

          (d) the terms of performance unit and performance share grants, and

          (e) the Fair Market Value of Stock to be used to determine the amount
     of the benefit payable upon exercise of stock appreciation rights,
     performance units, performance shares or phantom stock.

                                       15
   19

19.  Amendment of the Plan. The Board may from time to time in its discretion
amend or modify the Plan without the approval of the stockholders of the
Company, except as such stockholder approval may be required (a) to retain
Incentive Stock Option treatment under Section 422 of the Internal Revenue Code
or (b) under the listing requirements of any securities exchange on which any of
the Company's equity securities are listed.

20.  Termination of the Plan. The Plan shall terminate on the tenth (10th)
anniversary of the Effective Date or at such earlier time as the Board may
determine. Any termination, shall not affect any Award then outstanding under
the Plan.

21.  No Illegal Transactions. The Plan and all Awards granted pursuant to it are
subject to all laws and regulations of any governmental authority which may be
applicable thereto; and notwithstanding any provision of the Plan or any Award,
Holders shall not be entitled to exercise Awards or receive the benefits thereof
and the Company shall not be obligated to deliver any Stock or pay any benefits
to a Holder if such exercise, delivery, receipt or payment of benefits would
constitute a violation by the Holder or the Company of any provision of any such
law or regulation.

22.  Governing Law. Except where preempted by federal law, the law of the State
of Delaware shall be controlling in all matters relating to the Plan, without
giving effect to the conflicts of law principles thereof.

23.  Severability. If all or any part of the Plan is declared by any court or
governmental authority to be unlawful or invalid, such unlawfulness or
invalidity shall not serve to invalidate any portion of the Plan not declared to
be unlawful or invalid. Any Article or part of an Article so declared to be
unlawful or invalid shall, if possible, be construed in a manner which will give
effect to the terms of such Article or part of an Article to the fullest extent
possible while remaining lawful and valid.

                                       16
   1

                                                                 Exhibit (10)(n)

                         OIL-DRI CORPORATION OF AMERICA
                           OUTSIDE DIRECTOR STOCK PLAN
                    (AMENDED AND RESTATED EFFECTIVE 10/16/99)

ARTICLE 1. ESTABLISHMENT, OBJECTIVES, AND DURATION

     1.1.   Establishment of the Plan. Oil-Dri Corporation of America, a
Delaware corporation (the "Company"), hereby establishes its Outside Director
Stock Plan (the "Plan").

     1.2.   Objectives of the Plan. The objectives of the Plan are to enhance
the ability of the Company to attract and retain the best-qualified directors,
to increase the identity of interest between directors and the Company's
shareholders, and to provide additional incentives for directors to maximize the
long-term success of the Company's business.

     1.3.   Duration of the Plan. The Plan shall become effective on June 9,
1998 (the "Effective Date") upon its adoption by the Board (which term is
hereinafter defined to include the Executive Committee of the Board). Subject to
the right of the Board to amend or terminate the Plan pursuant to Article 14,
(i) Awards may be granted from time to time on or after the Effective Date so
long as Shares reserved for delivery under Section 4.1 remain available and (ii)
Compensation earned by the Outside Directors from time to time after the
Effective Date may be deferred.

ARTICLE 2. DEFINITIONS

     For purposes of the Plan, the following capitalized terms shall have the
meanings set forth below:

     2.1.   "Account": see Section 8.1.

     2.2.   "Award" means, individually or collectively, a grant by the
Committee under this Plan of Options, Restricted Stock, Stock, or Stock Units,
whether formula-based or otherwise.

   2

     2.3.   "Annual Meeting" means an annual meeting of the shareholders of the
Company.

     2.4.   "Award Agreement" means an agreement between the Company and an
Outside Director setting forth the terms applicable to an Award. Except as
otherwise provided in the Plan, the terms of an Award Agreement need not be the
same for each Outside Director, nor for each grant, and may reflect distinctions
based on the reasons for termination of Service.

     2.5.   "Board" means the Board of Directors of the Company or the Executive
Committee of the Board of Directors of the Company.

     2.6.   "Committee" means the Compensation Committee of the Board, which
shall be comprised entirely of Outside Directors.

     2.7.   "Company": see Section 1.1.

     2.8.   "Compensation" means all retainer, meeting, committee and chair fees
payable in cash to an Outside Director for Service.

     2.9.   "Deferral Election" see Section 10.2.

     2.10.  "Director" means any member of the Board.

     2.11.  "Distribution Election" see Section 8.6.

     2.12.  "Effective Date": see Section 1.3.

     2.13.  "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

     2.14.  "Expiration Date": see Section 5.4.

     2.15.  "Fair Market Value" generally means, as of any specified date, the
closing price of the Shares on the New York Stock Exchange, or any other
national stock exchange or national market system on which the Shares are then
traded, on the specified date, or if no reported sale of Shares shall have
occurred on such date, on the next preceding date on which there was such a

                                       2
   3

reported sale. However, in an instance in which Shares are being acquired
through a cashless exercise of Options through a broker-deal as specified in
Section 5.6 (iii) of the Plan, Fair Market Value means the selling price of the
Shares in said cashless exercise.

     2.16.  "Option" means an option to purchase Shares granted under Article 5.

     2.17.  "Option Price" means the price at which a Share may be purchased
under an Option.

     2.18.  "Outside Director" means a Director who is not an employee of the
Company or a Subsidiary.

     2.19.  "Period of Restriction" means the period established by the
Committee in its discretion during which the transfer of Restricted Stock is
limited in some manner, and the Shares are subject to a substantial risk of
forfeiture, all as provided in Article 6.

     2.20.  "Restricted Stock" means an Award granted under Article 6.

     2.21.  "Rule 16b-3" means Rule 16b-3 (or a successor rule) of the
Securities and Exchange Commission under the Exchange Act, as such Rule may be
amended from time to time.

     2.22.  "Service" means an Outside Director's service on the Board or any
Board committee.

     2.23.  "Shares" means shares of Common Stock of the Company.

     2.24.  "Stock" means an Award of Shares granted under Article 7.

     2.25.  "Stock Units" means the units in which an Account is denominated. A
Stock Unit is an unsecured obligation of the Company that is intended, subject
to the terms of Article 8, to represent the economic equivalent of one Share.

                                       3
   4

     2.26.  "Subsidiary" means any corporation, partnership, joint venture,
limited liability company, or other entity in which the Company owns securities
representing a majority of the aggregate voting power.

ARTICLE 3. ADMINISTRATION

     3.1.   General. The Plan shall be administered by the Committee. Except as
may be limited by law, the articles of incorporation or bylaws of the Company,
or the Plan, the Committee shall have full power and discretion to determine the
amounts, types and terms of Awards; to determine the terms of any Award
Agreement; to construe and interpret the Plan and any Award Agreement; to
establish, amend, or waive rules for the Plan's administration; to make all
other determinations which may be necessary or advisable for the administration
of the Plan; and (subject to Section 14.3) to amend the terms of any outstanding
Award. To the extent permitted by law, the Committee shall have the authority to
delegate administrative duties to officers or Directors of the Company.

     3.2.   Decisions Binding. All determinations and decisions made by the
Committee under the Plan shall be final, conclusive and binding on all persons,
including the Company, its shareholders, Outside Directors, and their respective
estates and beneficiaries.

ARTICLE 4. SHARES SUBJECT TO THE PLAN

     4.1.   Shares Available for Grants. Subject to adjustment as provided in
Section 4.2, the number of Shares reserved for delivery under the Plan is
200,000. If any Shares subject to any Award are forfeited or such Award
otherwise terminates without the delivery of such Shares, the Shares subject to
such Award, to the extent of any such forfeiture or termination, shall again be
available for the delivery under the Plan. Shares delivered pursuant the Plan
may be treasury stock or newly-issued Shares.

                                       4
   5

     4.2.   Adjustments in Authorized Shares. In the event of any change in
corporate capitalization (such as a stock split, stock dividend, spin-off, or
other distribution of stock or property of the Company), or any merger,
consolidation, separation, reorganization (whether or not tax-free) or any
partial or complete liquidation of the Company, the Committee may make such
adjustment in the number and class of Shares which may be delivered under
Section 4.1 as it may determine in its discretion to be appropriate.

ARTICLE 5. OPTIONS

     5.1.   Award of Options. Subject to the terms of the Plan, Options may be
awarded to Outside Directors in such number, upon such terms, and at such time
or times as the Committee shall determine in its discretion.

     5.2.   Award Agreement. Each Option shall be evidenced by an Award
Agreement that shall specify the Option Price, the Expiration Date of the
Option, the number of Shares subject to the Option, and such other provisions as
the Committee may determine.

     5.3.   Option Price. The Option Price for each grant of an Option shall not
be less than 100% of the Fair Market Value of a Share on the date the Option is
granted.

     5.4.   Duration of Options. Each Option shall expire at such time as the
Committee shall determine at the time of grant (the "Expiration Date"), but in
no event after the tenth anniversary of the date of such grant.

     5.5.   Exercise of Options. Each Option shall be exercisable at such times
prior to the Expiration Date and be subject to such restrictions and conditions
as the Committee shall determine in its discretion, including without limitation
restrictions on the Shares acquired pursuant to the exercise of such Option.

     5.6.   Payment. Options shall be exercised by the delivery of a written
notice of exercise to the Company, setting forth the number of Shares with
respect to which the Option is

                                       5
   6

to be exercised. Upon the exercise of any Option, the exercise price shall be
immediately paid in full by any one or a combination of the following means:

     (i) cash or its equivalent,

     (ii) with the prior approval of the Committee, delivery of Shares already
     owned by the Outside Director and valued at the Fair Market Value thereof
     on the date of exercise,

     (iii) with the prior approval of the Committee, a cashless exercise through
     a broker-dealer approved for this purpose by the Company. Where payment of
     the Option Price is made through simultaneous sale, the Option Price shall
     be paid in full immediately following the settlement date of such sale.

     5.7.   Termination of Service. Each Award Agreement shall set forth the
extent to which the Outside Director shall have the right to exercise an Option
after termination of Service, but in no event shall any Option be exercised
after its Expiration Date.

     5.8.   Nontransferability of Options. Except as may otherwise be specified
by the Committee in its discretion, no Option may be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated, other than (i) by will, (ii)
by the laws of descent and distribution, or (iii) pursuant to a beneficiary
designation in accordance with Article 11.

ARTICLE 6. RESTRICTED STOCK

     6.1.   Award of Restricted Stock. Subject to the terms of the Plan,
Restricted Stock may be awarded to Outside Directors in such number of Shares,
upon such terms, and at such time or times as the Committee shall determine in
its discretion.

     6.2.   Restricted Stock Agreement. Each Restricted Stock Award shall be
evidenced by an Award Agreement that shall specify the Period of Restriction,
the number of Shares of Restricted Stock granted, and such other provisions as
the Committee may determine.

                                       6
   7

     6.3.   Nontransferability. Except may as otherwise be specified by the
Committee in its discretion, Restricted Stock may not be sold, transferred,
pledged, assigned, or otherwise alienated or hypothecated until after the end of
the applicable Period of Restriction. Shares of Restricted Stock shall vest and
become freely transferable after the end of the applicable Period of
Restriction.

     6.4.   Other Restrictions. The Committee may impose such other conditions
and/or restrictions on any Restricted Stock as it deems advisable, including
without limitation a stipulated purchase price for any Share of Restricted
Stock. The Company may retain possession of the certificates representing Shares
of Restricted Stock until all conditions and/or restrictions applicable to such
Shares have been satisfied.

     6.5.   Voting Rights. Shares of Restricted Stock shall have the same voting
rights as unrestricted Shares.

     6.6.   Dividends and Other Distributions. Shares of Restricted Stock shall
have the same dividend rights as unrestricted Shares; provided, however, that
(i) the Committee may in its discretion provide that dividends shall be
reinvested in additional Shares of Restricted Stock based on the Fair Market
Value of the Shares on the applicable dividend payment date and on such other
terms as may be determined by the Committee in its discretion and (ii) the
Committee may impose any restrictions it deems appropriate on dividends payable
in any form other than cash.

     6.7.   Termination of Service. The extent, if any, to which the Outside
Director shall have the right to receive unvested Shares of Restricted Stock
following termination of the Outside Director's Service shall be set forth in
each Restricted Stock Award Agreement and, subject to Section 14.3, may
subsequently be modified by the Committee in its discretion.

                                       7
   8

ARTICLE 7. STOCK

     7.1.   Award of Stock. Subject to the provisions of the Plan, Shares of
Stock may be awarded to Outside Directors in such number, upon such terms, and
at such time or times as the Committee shall determine in its discretion.

     7.2.   Award Agreement. Each Stock Award may, but need not, be evidenced by
an Award Agreement that shall specify the number of Shares to which the Award
pertains, the purchase price (if any), and such other provisions as the
Committee shall determine.

ARTICLE 8. STOCK UNITS AND ACCOUNTS

     8.1.   Accounts. One or more accounts (each, an "Account") shall be created
and maintained on the books of the Company for each Outside Director to which
shall be credited all Stock Units that may be attributed to such Outside
Director from time to time in connection with (i) Awards of Stock Units by the
Committee pursuant to Article 9, (ii) deferrals of Compensation by such Outside
Director pursuant to Article 10, or (iii) the automatic reinvestment of dividend
equivalents pursuant to Section 8.3. Accounts shall be maintained solely for
accounting purposes and shall not require a segregation of any assets of the
Company.

     8.2.   Vesting. Stock Units awarded by the Committee pursuant to Article 9
shall become vested and nonforfeitable upon such terms as the Committee may
determine. Stock Units credited to an Outside Director's Account by reason of
his or her election to defer Compensation pursuant to Article 10 shall at all
times be fully vested and nonforfeitable. Any additional Stock Units resulting
from the crediting of dividend equivalents to an Outside Director's Account or
Accounts pursuant to Section 8.3 shall be vested and nonforfeitable to the same
extent and at the same time or times as the underlying Stock Units on account of
which such dividend equivalents were credited.

     8.3.   Dividend Equivalents. Dividend equivalents shall be earned on Stock
Units and credited to an Outside Director's Account as of any date (a "Dividend
Payment Date") on which

                                       8
   9

the Company pays any dividend on the outstanding Shares (a "Dividend"). Such
dividend equivalents shall be expressed as a number of Stock Units equal to:

     (i) the number of Stock Units credited to an Outside Director's Account as
     of the record date for such Dividend multiplied by the value of the per
     Share amount of such Dividend (as determined by the Committee in the case
     of dividends paid other than in cash),

divided by:

     (ii) the Fair Market Value of a Share as of the Dividend Payment Date.

     8.4.   Amount of Payment. The amount of value payable to an Outside
Director on account of a Stock Unit as of the date of any payment determined in
accordance with Section 8.5 shall equal the Fair Market Value of a Share on such
date.

     8.5.   Timing and Method of Payment. The value of vested Stock Units shall
be paid to an Outside Director in a lump sum as soon as administratively
possible following the termination of such Outside Director's service as a
Director, except that (i) the Committee may otherwise provide in an Award
Agreement, (ii) an Outside Director may otherwise provide in Distribution
Election, or (iii) the Company may defer such payment on account of any or all
Stock Units for up to six months after the date of such termination of such
service to the extent necessary to ensure the availability of an exemption under
Rule 16b-3. All payments on account of Stock Units shall be made in cash unless
the Committee determines in its discretion to make a payment or payments in
Shares; provided that any fractional Shares shall be paid in cash based on the
Fair Market Value of a Share on the date of such payment.

     8.6.   Distribution Elections. The Committee may in its discretion permit
the Outside Director to specify in a written notice delivered to the Secretary
of the Company (a "Distribution Election") such Outside Director's election with
respect to (i) when payment to such Outside Director in respect of Stock Units
(whether resulting from an Award under Article 9 or from deferrals pursuant
Article 10) shall commence, and (ii) whether such payment shall be in a lump sum
or in such number of annual installments as the Outside Director may designate,
subject to a

                                       9
   10

maximum number of installments that the Committee shall determine from time to
time, but not in excess of ten (10). To the extent the Committee permits
Distribution Elections, an Outside Director may make or change such a
Distribution Election as to the entire balance of his or her Account at any time
or from time to time, but only by a Distribution Election filed with the Company
no later than December 31 of the year next preceding such Outside Director's
termination of service as a Director. Any Distribution Election that is not
timely made or changed shall be disregarded.

     8.7.   Nontransferability of Stock Units. Except as may otherwise be
specified by the Committee in its discretion, no Stock Unit may be transferred
in any manner other than (i) by will, (ii) by the laws of descent and
distribution, or (iii) pursuant to a beneficiary designation in accordance with
Article 11.

     8.8.   Unsecured Obligation. An Outside Director shall be a general
unsecured creditor of the Company with respect to all Stock Units credited to
his or her Account or Accounts. The Committee may, but is not required to,
establish a so-called "rabbi" trust or similar mechanism to fund the Company's
obligations under this Plan; provided, however, that any funds contained therein
shall remain subject to the claims of the Company's general creditors.

ARTICLE 9. AWARD OF STOCK UNITS BY THE COMMITTEE

     9.1.   Award of Stock Units. Subject to the terms of the Plan, Stock Units
may be awarded to Outside Directors in such number, upon such terms, and at such
time or times as the Committee shall determine in its discretion. Stock Units
may be awarded in substitution for, or replacement of, the rights or interests
(whether vested or unvested) of Outside Directors under other plans of the
Company.

     9.2.   Award Agreement. Each Stock Unit Award shall be evidenced by an
Award Agreement that shall specify the number of Stock Units to which the Award
pertains, the vesting of such Stock Units, the extent (if any) to which a
payment is to be made in respect of Stock

                                       10
   11

Units that are unvested upon the termination of an Outside Director's Service,
and such other provisions as the Committee shall determine.

ARTICLE 10. DEFERRALS BY OUTSIDE DIRECTORS

     10.1.  Deferral Election. An Outside Director may elect to defer receipt of
all or any specified portion of any Compensation payable to him or her, and to
have such amounts credited to his or her Account in accordance with Section
10.3; provided, however, that the Committee may in its discretion (i) provide
that any such election shall be subject to the prior approval of the Committee
or (ii) suspend the right of all Outside Directors to defer receipt of
Compensation to be received after the date of such suspension.

     10.2.  Timing of Deferral Election. A deferral election shall be made by
written notice (an "Deferral Election") filed with the Secretary of the Company:

     (i) on or before the Effective Date (covering Compensation to be earned
     after the Effective Date),

     (ii) no more than 30 days after a Outside Director is first elected or
     appointed to the Board (covering Compensation to be earned at any time
     after the filing of such election),

     (iii) on or before the date of any Annual Meeting (covering Compensation to
     be earned after such Annual Meeting), or

     (iv) on or before such other date or dates as may be approved in advance by
     the Committee (covering Compensation earned for such period or periods
     commencing after such other date as may be specified by the Committee).

Subject to Section 8.6, a Deferral Election may be accompanied by a Distribution
Election. Subject to Section 10.1, any Deferral Election shall continue in
effect (including with respect to the Compensation relating to subsequent
periods) unless and until revoked or modified by a new Deferral Election filed
with the Secretary of the Company. Amounts credited to an Outside

                                       11
   12

Director's Account prior to the effective date of any such revocation or
modification of a deferral election shall not be affected by such revocation or
modification. An Outside Director who has revoked a Deferral Election may file a
new Deferral Election to defer Compensation relating exclusively to services to
be rendered during the calendar year following the year in which such new
Deferral Election is filed with the Company.

     10.3.  Deferrals Credited to Account. Any Compensation deferred by an
Outside Director pursuant to this Article 10 shall be allocated to his or her
Account and deemed to be invested in a number of Stock Units equal to (i) the
amount of such Compensation divided by (ii) the Fair Market Value of a Share on
the date Compensation would otherwise have been paid.

ARTICLE 11. BENEFICIARY DESIGNATION

     Unless the Committee in its discretion determines otherwise, each Outside
Director may from time to time name any beneficiary or beneficiaries (who may be
named contingently or successively) to whom any benefit under the Plan is to be
paid in the event of such Outside Director's death before he or she receives any
or all of such benefit. Each such designation shall revoke all prior
designations by such Outside Director, shall be in a form prescribed by the
Company, and will be effective only when filed by the Outside Director in
writing with the Company during the Outside Director's lifetime. In the absence
of any such designation, benefits remaining unpaid at the Outside Director's
death shall be paid to his or her estate.

ARTICLE 12. TAX WITHHOLDING

     If any federal, state, and local tax withholding may from time to time be
required in respect of the grant, vesting or exercise of any Award or the
settlement of any Stock Unit (any such event, "Taxability Event"), the Company
shall have the authority to withhold, or require an Outside Director to remit to
the Company, an amount sufficient to satisfy such tax withholding. The Company
may defer the payment of cash or delivery of Shares in connection with a
Taxability Event until such withholding requirements have been satisfied. The
Committee may, in its

                                       12
   13

discretion, permit an Outside Director to elect, subject to such conditions as
the Committee may require, to have the Company withhold Shares otherwise
deliverable pursuant to the Plan and having a Fair Market Value sufficient to
satisfy all or part of any Outside Director's estimated total federal, state,
and local tax obligation associated with a Taxability Event.

ARTICLE 13. RIGHTS OF DIRECTORS

     Nothing in the Plan shall interfere with or limit in any way the right of
the Company's shareholders to terminate any Outside Director's Service at any
time, nor confer upon any Outside Director any right to continue in Service.

ARTICLE 14. AMENDMENT, MODIFICATIONS, AND TERMINATION

     14.1.  Amendment, Modification, and Termination. Subject to the terms of
the Plan, the Board may at any time and from time to time, alter, amend, suspend
or terminate the Plan in whole or in part without the approval of the Company's
shareholders, except that no such amendment shall increase the number of Shares
available for delivery under the Plan, change the minimum Option Price or
maximum term of an option, or change the requirements relating to the
composition of the Committee.

     14.2.  Adjustment of Awards Upon the Occurrence of Certain Unusual or
Nonrecurring Events. In connection with any unusual or nonrecurring events
(including, without limitation, the events described in Section 4.2) affecting
the Company or of changes in applicable laws, regulations, or accounting
principles, the Committee may in its discretion adjust:

     (i) the terms of Options, Restricted Stock, Stock and Stock Units
     (including without limitation in the number, class and/or price of Shares
     or Stock Units subject to, or to be distributed in connection with,
     outstanding Awards or Stock Units) and

     (ii) the criteria specified in the Award Agreements related to outstanding
     Awards,

                                       13
   14

whenever the Committee determines that such adjustments are appropriate in order
to prevent dilution or enlargement of the benefits intended to be made available
under the Plan.

     14.3.  Awards Previously Granted. Notwithstanding any other provision of
the Plan to the contrary, no termination, amendment, or modification of the Plan
shall adversely affect in any material way any previously granted Award, without
the written consent of the Outside Director holding such Award.

ARTICLE 15. NONALIENABILITY

     Except as may otherwise be specified by the Committee in its discretion, no
Award, Stock Unit, nor any right to a payment of Stock Units pursuant to Section
8.5 shall be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, attachment, or garnishment by creditors of the
Outside Director or the Outside Director's beneficiary, other than (i) by will,
(ii) by the laws of descent and distribution, or (iii) pursuant to a beneficiary
designation in accordance with Article 11.

ARTICLE 16. SUCCESSORS

     All obligations of the Company under the Plan shall be binding on any
successor to the Company, whether the existence of such successor is the result
of a direct or indirect purchase, merger, consolidation, or otherwise, of all or
substantially all of the business and/or assets of the Company. The Company and
such successor shall be jointly and severally liable for all of the Company's
obligations under the Plan.

ARTICLE 17. LEGAL CONSTRUCTION

     17.1.  Gender and Number. Except where otherwise indicated by the context,
any masculine term used herein also shall include the feminine; the plural shall
include the singular and the singular shall include the plural.

                                       14
   15

     17.2.  Articles and Sections. Except where otherwise indicated by the
context, any reference to an "Article" or "Section" shall be to an Article or
Section of this Plan.

     17.3.  Severability. If any part of the Plan is declared to be unlawful or
invalid, such unlawfulness or invalidity shall not invalidate any other part of
the Plan. Any part of the Plan so declared to be unlawful or invalid shall, if
possible, be construed in a manner which will give effect to the terms of such
part to the fullest extent possible while remaining lawful and valid.

     17.4.  Legal Compliance. If the Company determines that the exercise or
nonforfeitability of, or delivery of benefits pursuant to, any Award or Deferral
Election would violate any applicable provision of (i) federal or state
securities laws or (ii) the listing requirements of any national securities
exchange or national market system on which are then listed any of the Company's
equity securities, then the Company may postpone any such exercise,
nonforfeitability or delivery, as applicable, but the Company shall use all
reasonable efforts to cause such exercise, nonforfeitability or delivery to
comply with all such provisions at the earliest practicable date. If the Company
deems necessary to comply with any applicable securities law, the Company may
require a written investment intent representation by an Outside Director and
may require that a restrictive legend be affixed to certificates for Shares
delivered pursuant to the Plan.

     17.5.  Governing Law. The Plan and all Award Agreements shall be construed
in accordance with and governed by the laws of the State of Illinois, without
regard to the conflict of laws principles thereof.

                                       15
   1

Exhibit 11

                         OIL-DRI CORPORATION OF AMERICA
                       COMPUTATION OF NET INCOME PER SHARE
                   (IN THOUSANDS EXCEPT FOR PER SHARE AMOUNTS)

                                                            YEAR ENDED JULY 31
                                                            ------------------
                                            2000        1999       1998       1997        1996
                                            ----        ----       ----       ----        ----
                                                                          
Net income available to stockholders       $2,227      $7,176     $4,723     $6,793      $3,374
   (numerator)                             ======      ======     ======     ======      ======

Shares Calculation
   (denominator)

Average shares outstanding -
   basic                                    5,647       5,827      6,125      6,596       6,806

Effect of Dilutive Securities:

Potential Common Stock relating
   to stock options                            30         169         40          3           1
                                           ------      ------     ------     ------      ------

Average shares outstanding -
   assuming dilution                        5,677       5,996      6,165      6,599       6,807
                                           ======      ======     ======     ======      ======

Net Income Per Share:
   Basic                                   $ 0.39      $ 1.23     $ 0.77     $ 1.03      $ 0.50
                                           ======      ======     ======     ======      ======

   Dilutive                                $ 0.39      $ 1.20     $ 0.77     $ 1.03      $ 0.50
                                           ======      ======     ======     ======      ======

   1

Exhibit 21

                         SUBSIDIARIES OF THE REGISTRANT

                                                           STATE OR COUNTRY
SUBSIDIARY                                                 OF INCORPORATION
- ----------                                                 ----------------

Oil-Dri Corporation of Georgia                             Georgia
Oil-Dri Production Company                                 Mississippi
Mounds Production Company, L.L.C.                          Delaware
Oil-Dri, S.A.                                              Switzerland
Favorite Products Company, Ltd.                            Canada
Blue Mountain Production Co.                               Mississippi
Oil-Dri (U.K.) Ltd.                                        United Kingdom
Ochlocknee Holding Co., S.A.                               Spain
Ochlocknee Mining Co., S.A.                                Spain
Oil-Dri Corporation of Nevada                              Nevada
Phoebe Products Company                                    Delaware
Mounds Management, Inc.                                    Delaware
B.T. Acquisition Company                                   Illinois

   1

Exhibit 23

                    CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the use of our reports
and to all references to our Firm included in or by incorporation by reference
made a part of the Annual Report on Form 10-K of Oil-Dri Corporation of America
for the fiscal year ended July 31, 2000 and the Registration Statement on Form
S-8 relating to the 1995 Long Term Incentive Plan and the 1988 Stock Option
Plan.

Blackman Kallick Bartelstein, LLP

October 25, 2000

 5

                   12-MOS
                          JUL-31-2000
                               JUL-31-2000
                                       1,388,000
                                 1,219,000
                               25,274,000
                                   836,000
                                 16,928,000
                            53,959,000
                                     135,645,000
                              76,033,000
                             132,844,000
                       15,084,000
                                     39,434,000
                                0
                                          0
                                       724,000
                                  72,240,000
               132,844,000
                                    175,119,000
                           175,119,000
                                      125,184,000
                              125,184,000
                            43,179,000
                               523,000
                           3,185,000
                              3,048,000
                                   821,000
                          2,227,000
                                       0
                                      0
                                            0
                                 2,227,000
                                       0.39
                                     0.39