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                                 SCHEDULE 14A

                           SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
                              (Amendment No.  )

    Filed by the Registrant [X]

    Filed by a Party other than the Registrant [ ]

    Check the appropriate box:

    [X] Preliminary Proxy Statement

    [ ] Definitive Proxy Statement

    [ ] Definitive Additional Materials

    [ ] Soliciting Material Pursuant to Section 240.14a-11(c) or 
        Section 240.14a-12

- - -------------------------------------------------------------------------------
           (Name of Registrant as Specified in Its Charter)

- - -------------------------------------------------------------------------------
               (Name of Person(s) Filing Proxy Statement)

Payment of Filing Fee (Check the appropriate box):

    [X] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2)

    [ ] $500 per each party to the controversy pursuant to Exchange Act 
        Rule 14a-6(i)(3).

    [ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11

    (1) Title of each class of securities to which transaction applies:

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

    (2) Aggregate number of securities to which transaction applies:

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

    (3) Per unit price or other underlying value of transaction computed 
pursuant to Exchange Act Rule 0-11:1

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

    (4) Proposed maximum aggregate value of transaction:

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

1  Set forth the amount on which the filing fee is calculated and state how it
was determined.

[ ] Check box if any part of the fee is offset as provided by Exchange Act 
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was 
paid previously. Identify the previous filing by registration statement 
number, or the Form or Schedule and the date of its filing.

    (1) Amount Previously Paid:

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

    (2) Form, Schedule or Registration Statement No.:

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

    (3) Filing Party:

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

    (4) Date Filed:

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

   2

OIL-DRI CORPORATION OF AMERICA

RICHARD M. JAFFEE
PRESIDENT & CHIEF EXECUTIVE OFFICER

                                                                November 1, 1994

Dear Stockholder:

         On behalf of the Board of Directors and Management, I would like to
invite you to attend Oil-Dri's Annual Meeting of Stockholders, which will be
held at 10:30 a.m. on December 13, 1994, at the Standard Club, 320 South
Plymouth Court, Chicago, Illinois.

         In addition to the formal portion of the meeting, we will review the
results of the last year and examine future opportunities.  Our officers and
directors will be present to answer any questions you may have.

         We hope that you will be able to join us for the meeting.  However, if
you are unable to attend, or wish to vote by proxy, please make sure you
complete and return the proxy card at your earliest convenience.

Sincerely,

Richard M. Jaffee
President and Chief Executive Officer
   3
                         OIL-DRI CORPORATION OF AMERICA
                    Notice of Annual Meeting of Stockholders
                        TO BE HELD ON DECEMBER 13, 1994

To the Stockholders of
Oil-Dri Corporation of America:

         Notice is hereby given that the 1994 Annual Meeting of Stockholders of
Oil-Dri Corporation of America, a Delaware corporation (the "Company"), will be
held at The Standard Club, located at 320 Plymouth Court, Chicago, Illinois, on
December 13, 1994 at 10:30 A.M., local time, for the purpose of considering and
voting on:

         1.   The election of eleven directors;

         2.   A proposal to amend the Company's Certificate of Incorporation in
              order to authorize 30,000,000 shares of a new class of non-voting
              common stock to be designated as Class A Common Stock.

         3.   Such other business as may properly come before the meeting.

         The stock transfer books of the Company will remain open.  The Board
of Directors has determined that only holders of record of outstanding shares
of Common Stock and Class B Stock at the close of business on October 21, 1994,
are entitled to notice of, and to vote at, the annual meeting or any 
adjournment thereof.  All stockholders, whether or not they now expect to be
present at the meeting, are requested to date, sign and return the enclosed
proxy, which requires no postage if mailed in the United States.

         Your attention is directed to the following pages for further
information relating to the meeting.

                                        BY ORDER OF THE BOARD OF DIRECTORS

                                        RICHARD M. JAFFEE
                                        President and Chief Executive Officer

Chicago, Illinois
NOVEMBER 1, 1994
   4
                         OIL-DRI CORPORATION OF AMERICA
                           410 NORTH MICHIGAN AVENUE
                                   SUITE 400
                            CHICAGO, ILLINOIS  60611

                                PROXY STATEMENT

                                    GENERAL

         This Proxy Statement and the accompanying proxy are being mailed on or
about NOVEMBER 1, 1994 to all holders of record of outstanding shares of
Common Stock and Class B Stock at the close of business on October 21, 1994.
Proxies are being solicited on behalf of the Board of Directors for use at the
1994 Annual Meeting of Stockholders, notice of which accompanies this Proxy
Statement.  Any stockholder giving a proxy has the power to revoke it at any
time prior to the exercise thereof by executing a subsequent proxy, by
notifying the Secretary of the Company of such revocation in writing (such
notification to be directed to him at the Company's offices at 410 North
Michigan Avenue, Suite 400, Chicago, Illinois 60611), or by attending the annual
meeting and voting in person.  EACH PROXY WILL BE VOTED FOR THE ELECTION OF THE
ELEVEN NOMINEES NAMED BELOW TO THE BOARD OF DIRECTORS AND FOR THE PROPOSED
AMENDMENT TO THE COMPANY'S CERTIFICATE OF INCORPORATION IF NO CONTRARY
INSTRUCTION IS INDICATED IN THE PROXY.

         The Company will pay the costs of this solicitation of proxies for the
annual meeting.  In addition to using the mails, officers and certain other
regular employees of the Company may solicit proxies in person and by telephone
and facsimile.  The Company may reimburse brokers and others who are record
holders of Common Stock and Class B Stock for their reasonable expenses
incurred in obtaining voting instructions from the beneficial owners of such
stock.  In addition, the Company has retained Kissel-Blake Inc., to assist in
solicitation at a base fee of $13,000 plus $4.25 for each stockholder
contacted, and out of pocket costs. 

         The record date for the determination of stockholders entitled to vote
at the meeting is October 21, 1994, at the close of business.  Holders as of
the record date of outstanding shares of Common Stock and Class B Stock are
entitled to vote at the meeting. Holders of Common Stock are entitled to one
vote per share and holders of Class B Stock to ten votes per share (on a
non-cumulative basis for each director to be elected when voting for the
election of directors) and vote together without regard to class (except that
any amendment to the Company's Certificate of Incorporation changing the number
of authorized shares or adversely affecting the rights of either class requires
the separate approval of the class so affected as well as the approval of both
classes voting together).  Holders of Class B Stock are entitled to convert any
and all of such stock into Common Stock on a share-for-share basis at any time
and are subject to mandatory conversion under certain circumstances.  As of the
record date, [4,816,927] shares of Common Stock and [2,132,895] shares of Class
B Stock were outstanding.

         The election of directors requires a plurality of votes cast.
Accordingly, only proxies and ballots marked "FOR all nominees listed"
(including executed proxies not marked with respect to election of directors,
which will be voted for all nominees), or voting for some, but not all
nominees, by specifying that votes be withheld for one or more designated
nominees, are counted to determine the total number of votes cast for the
various nominees, with the eleven nominees receiving the largest numbers of
votes being elected.  Abstentions and broker non-votes have no effect on the
outcome of the election of directors.

         The proposed amendment to the Company's Certificate Of Incorporation
("Amendment"), in order to be adopted, must receive the affirmative vote of (i)
the holders of a majority of the votes of the outstanding shares of Common
Stock (one vote per share) and Class B Stock (10 votes per share), voting as a
single class, (ii) the holders of a majority of the outstanding shares of Class
B Stock, voting as a class, and (iii) the holders of a majority of the
outstanding shares of Common Stock, voting as a class.  Abstentions and broker
non-votes will have the effect of votes against the Amendment.  Given the Class
B Stock holdings of the Jaffee Family (see "Principal Stockholders"), who have
indicated that they will vote their shares for the Amendment, the approvals
specified in clauses (i) and (ii) are assured.

                                      -3-
   5
PRINCIPAL STOCKHOLDERS

         The following table sets forth information, as of September 30, 1994,
regarding beneficial ownership of the Company's Common Stock and Class B Stock
by each person or group known to the Company to hold more than five percent of
either class and by all executive officers and directors of the Company, as a
group:

                                                                      AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP (1)
                                                          --------------------------------------------------------------------------
                                                          NUMBER OF SHARES OF                                 PERCENTAGE OF
                                                            COMMON STOCK AND                                 AGGREGATE VOTING
                                                          CLASS B STOCK OWNED        PERCENTAGE OF          POWER OF COMMON STOCK
                                                          WITH SOLE INVESTMENT        OUTSTANDING            AND CLASS B STOCK
NAME AND ADDRESS OF BENEFICIAL OWNER                        AND VOTING POWER        STOCK OF CLASS       REPRESENTED BY SHARES OWNED
                                                          --------------------      -----------------    ---------------------------
                                                                                                        
Richard M. Jaffee (2)           Common Stock:                   2,392(3)                  .05%                    .01%
410 N. Michigan Ave.            Class B Stock:              1,163,256(4)(9)              54.54%                  44.35%
Chicago, Illinois  60611

Robert D. Jaffee (2)            Common Stock:                   1,138(5)                  .02%                     0%
901 N. Kilpatrick Ave.          Class B Stock:               693,393(6)(9)               32.51%                  26.44%
Chicago, Illinois  60651

All Executive Officers
and Directors as a              Common Stock:                220,156(8)(10)               4.49%                   .84%
group                           Class B Stock:               1,956,371(11)               91.72%                  74.59%
(13 in group)(7)

- - ----------------              
         (1)  Beneficial ownership is defined in applicable Securities and
              Exchange Commission rules as sole or shared power to vote or to
              direct the disposition of a security.  All beneficial ownership
              is with sole voting power and sole investment power except as
              described in the Notes below.

         (2)  Richard M. Jaffee and Robert D. Jaffee are brothers.

         (3)  Includes 2,292 shares held in a revocable trust of which Richard
              M. Jaffee is the grantor and, during his lifetime, the trustee
              and sole beneficiary.

         (4)  These 1,163,256 shares are held in a revocable trust of which
              Richard M. Jaffee is the grantor and, during his lifetime, the
              trustee and sole beneficiary; does not include 80,000 shares held
              in a revocable trust of which Richard M. Jaffee's wife is the
              grantor and, during her lifetime, the trustee and sole 
              beneficiary.

         (5)  Consists of 338 shares held in a revocable trust of which Robert
              D. Jaffee is the grantor and, during his lifetime, the trustee
              and sole beneficiary; and 800 shares owned by Robert D. Jaffee's
              wife.

         (6)  Consists of 685,090 shares held in a revocable trust of which
              Robert D. Jaffee is the grantor and, during his lifetime, the
              trustee and sole beneficiary; 7,971 shares owned by Robert D.
              Jaffee's wife; and 332 shares owned by Robert D. Jaffee as
              guardian.

         (7)  See table under the heading "Election of Directors" and Notes
              thereto regarding security ownership of individual directors and
              nominees for director.

         (8)  Does not include shares as to which executive officers and
              directors disclaim beneficial ownership.  Includes 23,772 shares
              of Common Stock which constitute all such shares that the
              executive officers and directors of the Company have the right to
              acquire within 60 days of September 30, 1994 (including the
              shares of Common Stock which may be acquired as described in
              Notes above and in the Notes under the heading "Election of
              Directors").

                                              (footnotes continued on next page)

                                      -4-
   6
 (footnotes continued from previous page)

     (9)      Robert D. Jaffee has pledged to Richard M. Jaffee, as trustee,
              119,166 shares of Class B Stock ("the shares") to secure
              performance by Amco Corporation of a Stock Purchase Agreement
              dated July 28, 1992, between Amco Corporation and Richard M.
              Jaffee, as trustee, relating to the sale to Amco Corporation of
              certain shares of Common Stock of Amco Corporation that were
              owned by Richard M. Jaffee, as trustee.  Robert D. Jaffee's
              pledge of the shares also secures Amco's performance of a related
              Consulting and Non-Competition Agreement with Richard M. Jaffee.
              (Robert D. Jaffee and Richard M. Jaffee are brothers and Robert
              D. Jaffee is Chairman of the Board of Amco Corporation). Robert
              D. Jaffee has the sole right to vote the shares until the
              occurrence of an event of default, after which Richard M. Jaffee
              has the sole right to vote the shares.  If there were to be a
              foreclosure on, and sale of, the shares, control of the Company
              would be unchanged.

     (10)     Includes 4,701 shares owned by Mr. Richard V. Hardin's spouse, and
              1,570 shares of Common Stock which Mr. Hardin has the right to
              acquire within 60 days of September 30, 1994; Mr. Hardin is the
              Company's Group Vice President, Technology, and Richard M. 
              Jaffee's son-in-law.

     (11)     Includes 31,111 shares of Class B Stock owned by Richard V.
              Hardin's spouse; but does not include 1,500 shares of Class B 
              Stock owned by his spouse as trustee for their child.

         By virtue of their direct and indirect ownership of shares of the
Company's stock,  Richard M. Jaffee and Robert D. Jaffee may be deemed to be
control persons of the Company under the federal securities laws.

INDEPENDENT PUBLIC ACCOUNTANTS

         The Company has selected Blackman Kallick Bartelstein as its
independent public accountants for the current fiscal year.  Blackman Kallick
Bartelstein served in such capacity for the fiscal year ended July 31, 1994.
Representatives of Blackman Kallick Bartelstein will be present at the Annual
Meeting with an opportunity to make a statement if they so desire and to answer
questions that any stockholder may have.

                                      -5-
   7
INFORMATION CONCERNING THE BOARD OF DIRECTORS

         During the fiscal year ended July 31, 1994, four meetings of the Board
of Directors were held.  Each director attended at least 75% of the meetings of
the Board and of any Board Committee on which he sits, with the exception of
Norman B. Gershon who is based in Switzerland, sits on no committees, and who
attended 50% of the Board meetings.

         The Company has an Audit Committee composed of three persons who are
outside directors -- Messrs. J. Steven Cole, Edgar D. Jannotta and Allan H.
Selig.  The Audit Committee makes recommendations to the Board of Directors
regarding the engagement of independent public accountants, reviews the scope
of the audit and other services rendered by independent public accountants and
the fees and other arrangements regarding the services of independent public
accountants, and reviews audit results with the independent public accountants
and receives reports on the Company's accounting systems and internal
accounting controls.  In addition, the Audit Committee reviews related
transactions and potential conflicts of interest with regard to such
transactions.  The Audit Committee held one meeting during the fiscal year
ended July 31, 1994, at which all members were present.

         The Company has a Compensation Committee composed of three persons who
are outside directors -- Messrs. J. Steven Cole, Paul J. Miller and Allan H.
Selig.  The Compensation Committee is responsible for reviewing the
compensation, including benefits, of the Chief Executive Officer and other
executive officers of the Company.  The Compensation Committee met on September
22, 1993 and September 23, 1994, at which meetings all members were present.

         The Company has a Stock Option Committee composed of three persons who
are outside directors -- Messrs. J. Steven Cole, Paul J. Miller, and Allan H.
Selig.  The Stock Option Committee is responsible for reviewing the Company's
stock option plans and granting stock options to employees, including grants to
the executive officers of the Company. The Stock Option Committee met August
16, 1994 and August 29, 1994, at which meetings all members were present.

         The Company does not have a nominating committee.

ANNUAL REPORT ON FORM 10-K

         This Proxy Statement does not include information regarding executive
officers called for by Item 401(b) of Regulation S-K because such information
was furnished in the Company's Annual Report on Form 10-K for the fiscal year
ended July 31, 1994, and such information is incorporated herein by reference
thereto.  The Company's Annual Report was filed with the Securities and
Exchange Commission on October __, 1994.  EACH STOCKHOLDER MAY OBTAIN A COPY OF
THE COMPANY'S 1994 ANNUAL REPORT TO THE SECURITIES AND EXCHANGE COMMISSION ON
FORM 10-K FROM THE COMPANY AT NO CHARGE BY WRITTEN REQUEST TO THE OFFICE OF
STOCKHOLDER RELATIONS, OIL-DRI CORPORATION OF AMERICA, 410 NORTH MICHIGAN
AVENUE, SUITE 400, CHICAGO, ILLINOIS  60611.

STOCKHOLDER PROPOSALS

         Stockholder proposals for inclusion in proxy material for the 1995
Annual Meeting of Stockholders should be addressed to the Office of Stockholder
Relations, Oil-Dri Corporation of America, 410 North Michigan Avenue, Suite
400, Chicago, Illinois  60611, and must be received before July 7, 1995.

                                      -6-
   8
[6~                              1.  ELECTION OF DIRECTORS

         The shares represented by each proxy will be voted to elect as
directors the eleven nominees named in the following table to hold office until
the next Annual Meeting of Stockholders and until their successors have been
elected and qualify if no contrary instruction is indicated in the proxy.  Each
nominee is currently a director of the Company.  If any nominee should be
unable or unwilling to serve, which is not now contemplated, the proxy holders
may, but will not be bound to, vote for a substitute nominee.

                                                                                                                      SHARES OF
                                                                                                                     COMMON STOCK
                                                                                                                     AND CLASS B
                                                                                                                     STOCK OWNED
                                                                                                                     BENEFICIALLY
                                                                                                     YEAR FIRST          AS OF
                                     PRINCIPAL OCCUPATION                                             ELECTED          SEPTEMBER 
NAME OF NOMINEE                      FOR LAST FIVE YEARS                                  AGE         DIRECTOR       30,1994 (1)(2)
- - ---------------                      -------------------                                  ---         --------      ---------------
                                                                                                            
Richard M. Jaffee (13)               President and Chief Executive Officer of the          58           1958                  (3)
                                        Company.

Robert D. Jaffee (13)                Chairman of the Board of Amco Corporation, a          61           1956                  (3)
                                        manufacturer of proprietary food service
                                        equipment and supplies for both
                                        institutional and consumer markets;
                                        Executive Vice President of the Company from
                                        1957 through 1991.

Norman B. Gershon                    Vice President, International Operations of the       58           1975            22,286(4)
                                        Company; Managing Director of Oil-Dri, S.A.,                                          -0-
                                        a subsidiary of the Company; Vice President,
                                        European Operations of the Company from 1973
                                        to 1991.

Bruce H. Sone                        Vice President, Consumer Products Mass                54           1979            46,077(5)
                                        Merchandising Division of the Company; Vice                                           -0-
                                        President and General Manager of Consumer
                                        Products Division of the Company from 1985
                                        until 1992.

J. Steven Cole                       President, Cole and Associates, an                    60           1981                9,550
                                        international consulting firm; President,                                              -0-
                                        SAV-A-LIFE Systems, Inc., which sells
                                        specialty products to the dental and medical
                                        professions; Senior Vice President,
                                        International Division of A.H. Robins Co.,
                                        manufacturer of ethical pharmaceuticals and
                                        consumer products from 1986 to 1990.

                                      -7-
   9

                                                                                                                      SHARES OF
                                                                                                                     COMMON STOCK
                                                                                                                     AND CLASS B
                                                                                                                     STOCK OWNED
                                                                                                                     BENEFICIALLY
                                                                                                     YEAR FIRST          AS OF
                                     PRINCIPAL OCCUPATION                                             ELECTED          SEPTEMBER 
NAME OF NOMINEE                      FOR LAST FIVE YEARS                                  AGE         DIRECTOR       30,1994 (1)(2)
- - ---------------                      -------------------                                  ---         --------      ---------------
                                                                                                           
Edgar D. Jannotta                    Managing Partner, William Blair & Company,            63           1969            60,000(6)
                                        investment bankers.                                                                   -0-

Paul J. Miller                       Partner, Sonnenschein Nath & Rosenthal,               65           1975             6,104(7)
                                        attorneys, general counsel to the Company.                                            -0-

Haydn H. Murray                      Professor Emeritus of Geology, Indiana                70           1984             2,316(8)
                                        University.  Professor of Geology, Indiana                                            -0-
                                        University until 1994.

Allan H. Selig                       President, Selig Executive Leasing, automobile        60           1969             4,000(9)
                                        leasing; President, Milwaukee Brewers                                                 -0-
                                        Baseball Club Inc.; Chairman of the
                                        Executive Council of Major League Baseball;
                                        President, Selig Chevrolet, Inc. from 1984
                                        until 1990.

Joseph C. Miller                     Senior Vice President of the Company for              52           1989           19,500(10)
                                        Consumer, Industrial & Environmental and                                              -0-
                                        Transportation; Group Vice President of the
                                        Company for Sales & Marketing and
                                        Distribution, from 1990 to 1993; Vice
                                        President of Corporate Planning and
                                        Marketing for the Company from 1989 to 1990;
                                        President of Whiteford Systems, a
                                        transportation service company, from 1989 to
                                        1990.

Daniel S. Jaffee                     Group Vice President, Consumer Products of the        30           1992            4,669(11)
                                        Company; Chief Financial Officer of the                                        68,611(12)
                                        Company; Chief Executive Officer of Favorite
                                        Products Company, Ltd., a subsidiary of the
                                        Company; Group Vice President, Canadian
                                        Operations and Consumer Products-Grocery
                                        Division of the Company from 1992 until
                                        1994; Group Vice President, Domestic and
                                        Canadian Operations of the Company from 1990
                                        until 1992; Group Vice President of Canadian
                                        Operations, Management Information Systems
                                        and Finance of the Company in 1990; Product
                                        Manager in the Industrial and Agricultural
                                        Divisions of the Company from 1987 to 1989.

                                      -8-
   10
- - ------------------                    
         (1)  Beneficial ownership is defined in applicable Securities and
              Exchange Commission rules as sole or shared power to vote or to
              direct the disposition of a security.  All beneficial ownership
              is with sole voting power and sole investment power except as
              described in the Notes below.

         (2)  None of the nominees for election to the Board of Directors,
              other than Richard M. Jaffee, Robert D. Jaffee and Daniel S.
              Jaffee own any shares of the Class B stock.  The number of shares
              of Common Stock owned beneficially by each of the other nominees
              for election to the Board of Directors other than Edgar D.
              Jannotta, constitute less than 1% of the number of outstanding
              shares of Common Stock and represent shares having less than 1%
              of the aggregate voting power of the Common Stock and Class B
              Stock.

         (3)  For information regarding the shares owned by each of Richard M.
              Jaffee and Robert D. Jaffee, who are brothers, see the table
              under the heading "Principal Stockholders" and the Notes thereto.

         (4)  Includes 1,570 shares of Common Stock which Mr. Gershon has the
              right to acquire within 60 days of September 30, 1994, pursuant
              to stock options.

         (5)  Does not include 25 shares owned by Bruce H. Sone as Custodian
              under the Uniform Gifts to Minors Act for his child.  Mr. Sone
              disclaims beneficial ownership of such shares.  Includes 1,570
              shares of Common Stock which Mr. Sone has the right to acquire
              within 60 days of September 30, 1994, pursuant to stock options.

         (6)  William Blair & Company has served as the Company's investment
              banking advisor for a number of years.  The shares of Common
              Stock shown above as owned by Mr. Jannotta represent 1.22% of the
              outstanding shares of Common Stock, but represent less than 1.0%
              of the aggregate voting power of the Common Stock and Class B
              Stock. These shares do not include shares held by William Blair &
              Company in its proprietary or managed accounts.

         (7)  Includes 2,088 shares owned by Mr. Paul Miller's wife.  Does not
              include 1,774 shares held by children of Mr.  Miller;  Mr. Miller
              disclaims beneficial ownership of his children's shares.

         (8)  Includes 300 shares of Common Stock owned by Mr. Murray s spouse.

         (9)  Does not include 887 shares owned by Mr. Selig's mother.  Mr.
              Selig disclaims beneficial ownership of those shares.

         (10) Includes 17,500 shares of Common Stock which Mr. Joseph Miller
              has the right to acquire within 60 days of September 30, 1994,
              pursuant to stock options.

         (11) Includes 2 shares of Common Stock owned by Daniel S. Jaffee's
              spouse and 1,562 shares of Common Stock which Daniel S. Jaffee
              has the right to acquire within 60 days of September 30, 1994,
              pursuant to stock options.

         (12) Includes 18,000 shares of Class B Stock held by Daniel S. Jaffee
              as trustee of the Richard M. Jaffee 1993 Annuity Trust and 18,000
              shares of Class B Stock held by Daniel S. Jaffee as trustee of
              the Shirley Jaffee 1993 Annuity Trust.  Daniel S. Jaffee has
              beneficial ownership of 3.22% of Class B Shares which represents
              2.62% of the aggregate voting power of Common Stock and Class B
              Stock.  Daniel S. Jaffee is Richard M. Jaffee's son.

                                              (footnotes continued on next page)

                                      -9-
   11
(footnotes continued from previous page)

     (13)     Pursuant to the Stock Purchase Agreement described in Note (9)
              under "Principal Stockholders", Richard M. Jaffee agreed to use
              his best efforts to cause the Company's Board of Directors to
              nominate Robert D. Jaffee to serve as a director of the Company
              unless Richard M. Jaffee concludes in good faith that such
              nomination would not be consistent with his fiduciary duties to
              the Company and its shareholders, or would be contrary to any
              provision of law.  Richard M. Jaffee also agreed to vote all his
              shares of the Company's stock in any election of the Company's
              directors to elect Robert D. Jaffee to the Board of Directors.
              Mr.  Richard M. Jaffee and Mr. Robert D. Jaffee are brothers.

OTHER DIRECTORSHIPS

         Mr. Jannotta is also a director of Bandag, Inc., Safety-Kleen Corp.,
AAR Corp., Sloan Valve Company, Molex Incorporated and the New York Stock
Exchange, Inc.  No other nominee for the Board of Directors of the Company is a
director of any other corporation with a class  of securities registered
pursuant to Section 12 of the Securities Exchange Act of 1934 or subject to the
requirements of Section 15(d) of that Act or of any corporation registered as
an investment company under the Investment Company Act of 1940.

                                      -10-
   12
       2.  A PROPOSAL TO AMEND THE COMPANY S CERTIFICATE OF INCORPORATION

         Since 1985, the Company's Certificate of Incorporation ("Charter") has
provided for two classes of stock, Common Stock, with one vote per share, and
Class B Stock with 10 votes per share; each share of Common Stock is entitled
to receive cash dividends equal to 133-1/3% of the cash dividends on a share of
Class B Stock.  The Charter also provides that if at any time the Class B Stock
owned (in the manner described below) by Richard M. and Robert D. Jaffee and
their Permitted Transferees (as defined below) ceases to account for at least
20% of the total outstanding shares of Class B Stock and Common Stock (the
"Sunset Trigger"), each share of Class B Stock will automatically convert into
a share of Common Stock.  Class B Stock is converted automatically into Common
Stock on a share for share basis if, at any time, it is transferred to a person
who is not a Permitted Transferee.

         On October 19, 1993, the Board of Directors of the Company adopted the
Amendment to the Charter attached hereto as Schedule A (the "Amendment"), and
directed its submission to a vote of the stockholders.  The Board adopted a
resolution declaring the Amendment advisable and in the best interests of the
Company and its stockholders.  The Amendment would amend the Charter to:

         (a)     authorize 30,000,000 shares of a new class of common stock,
                 par value $.10 per share, to be designated as "Class A Common
                 Stock" (the "Class A Common Stock") that would generally have
                 no voting rights; and

         (b)     fix and establish the relative rights, powers and limitations
                 of the Company's Common Stock, par value $.10 per share, Class
                 B Stock, par value $.10 per share, and Class A Common Stock.

         The Board of Directors recommends that all stockholders vote FOR the
Amendment.  The Board urges stockholders to carefully read the description of
the Amendment and its related effects, which are set forth in this proxy
statement.  The summary of the Amendment contained herein should be read in
conjunction with, and is qualified in its entirety by reference to, the
complete text of the Amendment, which is attached hereto as Schedule A.

        Under the Amendment, 30,000,000 shares of a new class of common stock,
par value $.10 per share, would be created.  The new class of common stock
would be designated "Class A Common Stock."  The currently outstanding shares
of common stock would continue to be designated "Common Stock" and "Class B
Stock," as the case may be, and such classes would continue with their present
powers and rights.  The Common Stock and the 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,
if the Amendment is approved, will be equal in all respects on a per share
basis to the Common Stock, except as to voting 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 would have no voting rights on any matters submitted to a vote of
stockholders (except as otherwise required by Delaware law).  (See "Description
of Common Stock, Class B Stock and Class A Common Stock - Voting Rights".)  The
Class A Common Stock, like the Common Stock, would have no conversion rights;
the Class B Stock is convertible, on a share for share basis, into Common
Stock, and is automatically so converted under certain circumstances.  (See
"Description of Common Stock, Class B Stock and Non-Voting Stock -
Convertibility, Restrictions on Transfer and Sunset Provisions").  The
Amendment would preserve the current premium of the Common Stock over the Class
B Stock with respect to cash dividends and would afford the same premium to the
Class A Common Stock.  In the case of stock splits or common stock dividends,
holders of Common Stock and Class B Stock, as at present, will receive Common
Stock, and Class B Stock respectively, while holders of Class A Common Stock
would receive Class A Common Stock, in each case in the same ratio, except that
the Board of Directors would be authorized to declare and pay a special
dividend (the "Special Stock Dividend").  The Special Stock Dividend, which can
be issued only once, will be either (i) a dividend of one share of Class A
Common Stock for each share of Common Stock and Class B Stock outstanding or
(ii) in the form of a recapitalization, in which half of each outstanding share
of Common Stock and half of each outstanding share of Class B Stock would be
each automatically converted into half a share of Class A Common Stock. 
Neither type of Special Stock Dividend would affect the relative voting
percentages and equity ownership of stockholders of the Company, including
members of the Jaffee Family.

                                      -11-
   13
         The Company's ability to effect the Special Stock Dividend in the form
of a recapitalization is subject to the New York Stock Exchange continued
listing requirement that a listed company have a listed class of stock with at
least 1,200 beneficial owners of at least 100 shares of that class.

         The Amendment also provides, while shares of Common Stock, Class A
Common Stock and Class B Stock are outstanding, an additional protective
provision for holders of Common Stock and Class A Common Stock with respect to
cash dividends:  the aggregate cash dividend on one share of Common Stock and
one share of Class A Common Stock must equal at least 133-1/3% of the aggregate
cash dividend on one share of Class B Stock and one share of Class A Common
Stock.  This preserves, for a holder of Common Stock who retains the Class A
Common Stock issued to him in the Special Stock Dividend, the cash dividend
premium to which he is currently entitled.

         The Company presently intends, in the event of stockholder approval of
the Amendment, to apply for listing of the Class A Common Stock on the New York
Stock Exchange and, upon approval of such listing, to declare and distribute
the Special Stock Dividend.

         Although issuance of Class A Common Stock cannot result in automatic
conversion of Class B Stock into Common Stock pursuant to the Sunset Trigger,
the Amendment adds to the present Sunset Trigger, which it preserves, a new
provision ("New Sunset Trigger"), under which each share of the Class B Stock
will automatically convert into a share of Common Stock if, during any
continuous period of one year, the total number of shares of Class B Stock,
Common Stock and Non-Voting Stock owned by the Jaffee Family (as defined below)
do not account for at least 10% of the total outstanding shares of Class B
Stock, Common Stock and Non-Voting Stock.

         1.      REASONS FOR AUTHORIZATION OF THE CLASS A COMMON STOCK

         Approval of the Amendment would permit the Company to do each of the
following without diluting the relative voting interests of existing
stockholders, including the Jaffee Family: (i) raise equity capital; (ii) make
acquisitions for stock; and (iii) contribute to existing and future employee
benefit and incentive plans, including stock option plans, in each case
utilizing the Class A Common Stock.  The Company's distribution of the Special
Stock Dividend would also provide the Company and its stockholders with the
following benefits: (i) a public market for the Class A Common Stock, which
would be available to persons who may acquire such stock in any future
acquisition transaction by the Company; and (ii) an ability of existing
stockholders, including the Jaffee Family, to liquidate a portion of their
equity interests without a concurrent reduction of relative voting interests.

         There are, as of September 30, 1994, 4,816,927 shares of Common Stock
and 2,132,895 shares of Class B Stock issued and outstanding, an aggregate of
6,949,822 shares of capital stock.  The shares of Class B Stock outstanding at
that date constitute 30.7% of the aggregate of outstanding shares of Common and
Class B Stock.  Of the 2,132,895 shares of Class B Stock outstanding, 1,410,030
(20.3% of the aggregate outstanding shares of Common and Class B Stock) are
beneficially owned directly or indirectly, by Richard M. Jaffee, President and
a director of the Company, and his wife and children and children's spouses
(collectively, "Richard Jaffee Family"), and 722,865 (10.4% of the aggregate
outstanding Common and Class B Stock) are beneficially owned directly and
indirectly by Richard M. Jaffee's brother, Robert D. Jaffee, a director of the
Company, and his wife and children and children's spouses (collectively,
"Robert Jaffee Family").

         The Amendment and the Special Stock Dividend would permit the Jaffee
Family to sell shares of Class A Common Stock, disposing of part of their
investment in the Company, without diluting their voting interest in the
Company.  In addition, to the extent that the Richard Jaffee Family desired to
buy Class B Stock after distribution of the Special Stock Dividend and the
Robert Jaffee Family desired to sell Class B Stock, the Special Stock Dividend
(and, if it is effected as a dividend rather than as a recapitalization, any
resulting reduction in market price) could reduce the cost to the Richard
Jaffee Family of buying such stock, thereby retaining its voting power for the
Jaffee Family, and could facilitate financing of such purchases of Class B
Stock through sales of Class A Common Stock.  The Amendment would thus
facilitate the Jaffee Family's and, in particular, the Richard Jaffee Family's,
continued ownership of a substantial portion of the Company's voting
securities.  This continued ownership is consistent with the goal of enabling
the

                                      -12-
   14
Company to continue to be managed based on long-term objectives, which the
Company's Board of Directors considers to be a benefit to the Company and its
stockholders.  However, there could be potential disadvantages to Stockholders.
(See "Description of Common Stock, Class B Stock and Class A Common Stock -
Convertibility, Restrictions on Transfer and Sunset Provisions"; "Certain Other
Considerations - Anti-takeover Effects of the Amendment"; and "Board
Recommendation").

         The Class A Common Stock could be used in connection with stock
dividends, acquisitions, convertible debt, public and private offerings,
employee benefit and incentive programs and such other uses as are permissible
under the Charter, the Company's By-laws and governing law.  Although the Board
of Directors intends, in the event of approval of the Amendment, to use the
Class A Common Stock for some or all of such purposes, there are presently no
specific plans, arrangements or understandings for the issuance of the Class A
Common Stock other than to issue the Special Stock Dividend.  However, there
can be no assurance, in the event the Amendment is approved by Stockholders, as
to whether or when the Special Stock Dividend would be declared and paid.

         The Board of Directors would have the authority under the Amendment to
issue shares of Class A Common Stock in such amounts, to such persons or
entities, upon such terms and conditions and for such consideration as the
Board may determine (regardless of the comparative values of the Class A Common
Stock and the Common Stock) and without any vote or other action by the
stockholders, although applicable law and regulations require stockholder
approval (but not approval by the Class A Common Stock) of certain mergers and
acquisitions.  The Board of Directors would also have the authority, upon
approval of the Amendment and after issuance of Class A Common Stock, to
repurchase shares of such stock (or, as at present, shares of Common Stock)
upon such terms and conditions and for such consideration as the Board may
determine (regardless of the comparative values of the classes) and without any
stockholder action.

         Under the Amendment, 52,000,000 shares of the Company's common stock
would be authorized.  Of this amount, 6,949,822 shares are or would be
represented by shares of Common Stock and Class B Stock outstanding as of
September 30, 1994, 283,696 by shares of Common Stock held in the treasury, and
2,405,824 by shares of Common Stock reserved for employee stock option plans
and for conversion of shares of Class B Stock.  The remaining authorized shares
of Common Stock and Class A Common Stock would be available for issuance by the
Board of Directors to raise equity capital, to make acquisitions for stock, in
connection with employee benefit and incentive plans, including stock option
plans, to distribute to stockholders in the form of stock dividends or stock
split-ups (Common Stock and, except for the Special Stock Dividend, Class A
Common Stock, being issuable in connection with a stock dividend or stock
split-up only to holders of Common Stock and Class A Common Stock,
respectively), and for other corporate purposes.  The Board of Directors has
indicated that if the Amendment is approved, and except pursuant to stock
dividends or stock split-ups, it does not presently intend (but retains the
authority and option) to issue additional shares of Common Stock.  Remaining
authorized Class B Stock can be issued only pursuant to stock dividends or
stock split-ups, pro rata to all classes, in which Class B Stock is paid only
to holders of Class B Stock.  (See "Description of Common Stock, Class B Stock
and Class A Common Stock - Dividends and Other Distributions.")

         2.  CERTAIN REGULATORY MATTERS

         The Common Stock is traded on the New York Stock Exchange ("NYSE").
The Class B Stock is not publicly traded.  A NYSE policy (the "Policy")
prohibits, among other things, any corporate action or issuance that
disparately reduces or restricts the voting rights of existing shareholders of
publicly traded Common Stock, such as the Common Stock.  The Policy contains a
non-exclusive list of types of transactions prohibited thereunder, which does
not include transactions such as the Special Stock Dividend.  The Policy
specifically permits the listing of non-voting stock of a company that also has
listed voting stock.

         The NYSE has advised the Company that (i) it does not generally view
the terms of the Class A Common Stock or the Special Stock Dividend as having
the effect of disparately reducing or restricting the per share voting rights
of the Common Stock; and (ii) accordingly, it does not view the authorization
or any issuance of the Class A Common Stock, including the Special Stock
Dividend, as violating the Policy.  The Company expects that, in the event of
the approval of the Amendment, it will file an application to list the Class A
Common Stock on the New York Stock Exchange.

                                      -13-
   15
        It is possible that future legislation or regulatory developments could
make the Company's Common Stock or Class A Common Stock ineligible for trading
on national securities exchanges or inclusion in securities quotation systems,
because of the lack of voting power of the Class A Common Stock.  The Amendment
provides that if, as a result of the lack of voting power of the Class A Common
Stock, either the Common Stock or Class A Common Stock will be delisted from
the New York Stock Exchange (or such other exchange as is then the principal
market for such stock), the Board of Directors, if it determines that there is
no appropriate alternative, may specify and provide voting rights for the
Class A Common Stock (but not more than one vote per share).

         No subsequent stockholder approval is required (and it is not
anticipated that stockholder approval would be sought) to issue up to the
authorized number of shares of Common Stock, Class A Common Stock or Class B
Stock; additional shares of Class B Stock can be issued only as a stock
dividend with respect to outstanding Class B Stock.

     3.      DESCRIPTION OF COMMON STOCK, CLASS B STOCK AND CLASS A COMMON STOCK

         The rights, powers and limitations of the Class A Common Stock, as
well as of the Common Stock and Class B Stock, are set forth in full in the
Amendment attached hereto as Schedule A, and incorporated herein by reference.
The following summary should be read in conjunction with, and is qualified in
its entirety by reference to, Schedule A.

        A.      VOTING RIGHTS.  Each share of Class B Stock entitles the holder
thereof to ten votes upon each matter upon which stockholders are entitled to
vote or to which stockholders are entitled to give consent, while each share of
Common Stock has one vote in such matters submitted to a vote of the
stockholders. Such matters include election of directors, mergers, asset sales,
dissolution and amendments to by-laws or the Charter. The shares of the Class A
Common Stock generally will have no voting rights (unless provided by the Board
of Directors in response to delisting of the Company's stock),  except as
otherwise required by Delaware law.

         Under Delaware General Corporation Law, any amendments to the Charter
altering or changing the powers, preferences, or special rights of the shares
of any class so as to adversely affect them, including the Class A Common
Stock, would require the separate approval of the class so affected, as well as
the approval of all classes entitled to vote thereon, voting together.  These
voting rights are specifically included in the Amendment. The Amendment also
provides, however, that the number of authorized shares of Class A Common Stock
may be increased or decreased (but not below the number of outstanding shares
of Class A Common Stock then outstanding) by the affirmative vote of the
holders of a majority of the votes entitled to be cast by the holders of the
Common Stock and Class B Stock, without a vote by any holders of Class A Common
Stock.

         B.  CONVERTIBILITY, RESTRICTIONS ON TRANSFER AND SUNSET PROVISIONS.
Each share of Class B Stock is convertible on a share for share basis into
shares of Common Stock.  The Common Stock is not convertible, nor, under the
terms of the Amendment, is the Class A Common Stock.

         Shares of Class B Stock are not transferable except to any one or more
of the following ("Permitted Transferees"):  (i) any beneficial owner thereof;
(ii) any beneficial owner's spouse; (iii) any parent or any lineal descendent
(including any adopted child) of any parent of any beneficial owner or any
beneficial owner's spouse; (iv) any trustee, guardian or custodian for or any
executor, administrator or other legal representative of the estate of any of
the foregoing; and (v) any general or limited partnership each of the partners
of which is any of the persons described in clauses (i) through (iv) and which
prohibits transfer of all or any part of any interest in the partnership except
to the partnership or to any of such persons.  (This last category of Permitted
Transferees, a general or limited partnership meeting the specified
requirements, was added by amendment to the Certificate of Incorporation, with
approval of the Company's stockholders, including approval of the holders of
Common Stock voting as a class, effective on December 17, 1990.)

         If a holder of shares of Class B Stock transfers such shares to anyone
other than a Permitted Transferee, that transfer constitutes an election to
convert the transferred shares into shares of Common Stock on a share-for-share
basis, and a transfer of those shares of Common Stock.  Thus, for example, open
market sales of Class B Stock result in its conversion into Common Stock.

         The Charter provides ("Sunset Trigger"), and would continue to provide
upon approval of the Amendment, that if shares of Class B Stock owned directly
or beneficially by the Jaffee Family (i.e., Richard M. Jaffee, Robert D. Jaffee
and their Permitted Transferees)

                                      -14-
   16
(excluding any shares owned beneficially where beneficial ownership results
solely from possession of the power to vote or direct disposition of such
shares and where there is no economic interest, including a contingent or
future interest in such shares) cease to account for at least twenty percent
(20%) of the aggregate of outstanding shares of Common Stock and Class B Stock,
shares of Class B Stock automatically convert into and become for all purposes,
including voting and dividends, shares of Common Stock.  The Amendment adds to
this provision the New Sunset Trigger, under which each share of Class B Stock
will automatically convert into a share of Common Stock if, during any
continuous period of one year, the Class B Stock, Common Stock and Non-Voting
Stock owned by the Jaffee Family does not account for at least 10% of the total
outstanding shares of Common Stock, Class A Common Stock and Class B Stock.
(See "Certain other Considerations -- Anti-Takeover Effects of the Amendment.")

         C.  DIVIDENDS AND OTHER DISTRIBUTIONS.  Common Stock is entitled to
cash dividends, as and when declared by the Board of Directors, equal to at
least 133-1/3% on a per share basis of the cash dividends payable on the Class B
Stock.  Class A Common Stock would be entitled to cash dividends on a per share
basis equal to the cash dividends on Common Stock, and thus the Class A Common
Stock would be entitled to the same cash dividend premium over the Class B
Stock as that of the Common Stock.  In addition, the Amendment provides that,
while shares of Common Stock, Class A Common Stock and Class B Stock are
outstanding, the sum of the cash dividend payable on shares of Common Stock and
the cash dividend payable on shares of Class A Common Stock, each on a per
share basis, shall in all cases be equal to at least 133-1/3% of the sum of the
cash dividend payable on shares of Class B Stock and the cash dividend payable
on shares of Class A Common Stock, each on a per share basis.  Thus, for
example, if a cash dividend of $.04 were paid on the Class B Stock, the Common
Stock and the Class A Common Stock would each be entitled to a cash dividend of
$.08 per share so that the sum of the per share dividends on the Common Stock
and the Class A Common Stock ($.16) would be equal to at least 133-1/3% of the
sum of the per share dividends on the Class B Stock and the Class A Common
Stock ($.12).  Accordingly, if the Special Stock Dividend is paid, holders of
Common Stock who retain a share of Class A Common Stock received in the Special
Stock Dividend and the share of Common Stock with respect to which it was
received will maintain the same 133-1/3% cash dividend preference (over Class B
Stock and Class A Common Stock received thereon in the Special Stock Dividend)
that the Common Stock currently has over the Class B Stock.  If a cash dividend
is paid that meets the foregoing ratio requirements, the Amendment provides
that the aggregate amount paid to each stockholder will be rounded up to the
nearest cent without regard to such requirements.  Of course, the Amendment,
like the current provision of the Company's Certificate of Incorporation,
assures the relationship of cash dividends among the classes; there can be no
assurance of any particular level of cash dividends, or, indeed, of payment of
any cash dividends.

         Shares of Common Stock, Class A Common Stock, and of Class B Stock are
equal in respect of all rights to dividends (other than cash) and
distributions, when and as declared, in the form of stock or other property of
the Company, except that, in the case of dividends or other distributions
payable in stock of the Company (including stock split-ups, divisions, or
combinations, but excluding the Special Stock Dividend), shares of Common
Stock, Class A Common Stock, and Class B Stock may be distributed,
respectively, only with respect to shares of the same class and as part of a
distribution that is pro-rata to the Company's stockholders and in the same
ratio for each class.

         D.  PREEMPTIVE RIGHTS.   There are no preemptive rights to subscribe
to new shares, either currently or in the event of approval of the Amendment.

         E.  REGISTRATION AND TRANSFERABILITY.  The Company will deliver to the
holders of Common Stock, Class B Stock and Class A Common Stock, in the event
of approval of the Amendment, the same information and reports as it currently
delivers to holders of Common Stock and Class B Stock.  The Company would apply
to register the Class A Common Stock pursuant to the Securities Exchange Act of
1934, as amended.  Class A Common Stock would be freely transferable; provided,
however, that certain stockholders (generally, affiliates of the Company) may
be required to comply with Rule 144 (promulgated by the SEC under the
Securities Act of 1933, as amended) with respect to transfers of Class A Common
Stock.

         F.  EXISTING STOCK OPTIONS.  In the event of payment of the Special
Stock Dividend, an appropriate adjustment will be made to options outstanding
under the Company's equity based employee benefit plans, with the result that
upon the exercise of a currently

                                      -15-
   17
outstanding option on one share of Common Stock, and payment of the current
option exercise price, the holder thereof would receive one share of Common
Stock and one share of Class A Common Stock (or, if the Special Stock Dividend
is effected in the form of a recapitalization, one half share each of Common
Stock and Class A Common Stock.)

         G.  OTHER RIGHTS.  Except as set forth above, each share of the Common
Stock, Class B Stock and the Class A Common Stock would have identical powers,
dividends, preferences and rights, including the right to share equally on a
per share basis in the net proceeds of a liquidation.

         4.  CERTAIN OTHER CONSIDERATIONS

         A.  ANTI-TAKEOVER EFFECTS OF THE AMENDMENT

         The Amendment is not being recommended in response to any specific
effort to accumulate material amounts of the Company's stock or to obtain
control of the Company by means of a merger, tender offer, proxy solicitation
in opposition to the Board of Directors or otherwise, or to change the
Company's Management. The Company is not aware of any existing or planned
effort on the part of any party to accumulate material amounts of the Company's
stock or to acquire control of the Company by any means or to change the
Company's Management.  In addition, there have been no offers to acquire all or
substantially all of the Common Stock, Class B Stock or assets of the Company.
The Amendment is not a part of a plan by the Company's Management to adopt a
series of amendments to the Charter which would have anti-takeover effects, and
Management does not presently intend to propose other anti-takeover measures in
future proxy solicitations.  However, the Amendment could have the effect of
preventing the Sunset Trigger from being reached, therefore continuing the
special voting rights of the Class B Stock and continuing a capital stock
structure that operates as an anti-takeover measure for longer than would be
the case under the present Charter.  (The Amendment does provide for the New
Sunset Trigger, but that is a substantially less stringent restriction on the
continuance of the special voting rights of the Class B Stock.)  The Company's
Charter and Bylaws do not contain any other anti-takeover measure.

         Under the Sunset Provision, if the Class B Stock ownership by the
Jaffee Family declines past the Sunset Trigger, the Class B Stock would
automatically convert into Common Stock and the Jaffee Family, including
present Management, would lose voting control of the Company, moving from the
right to cast over 70%* of the stockholder votes when the present Sunset
Trigger is reached to the right to cast under 20% of such votes.  Based on the
Company's closing price of $19.75 at September 30, 1994, the market value of
the minimum Class B Stock ownership required at that date to avoid the Sunset
Trigger ("Minimum Class B Ownership") and maintain voting control of the
Company was $27,451,797 -- the value at that date of 20% of the total number of
outstanding shares of Common Stock and Class B Stock.  The Minimum Class B
Ownership would increase if additional Common Stock were issued, to raise
equity capital or to fund acquisitions or employee benefit and incentive plans,
and could eventually cause the Sunset Trigger to be crossed, resulting in
automatic conversion of the Class B Stock and the loss of the Jaffee Family's
control of the Company, even if the Jaffee Family had sold little or none of
the Class B Stock.  The Amendment would facilitate maintenance of the Minimum
Class B Ownership at its present level (except for fluctuations resulting from
variations in stock prices) by using Class A Common Stock for equity capital,
acquisitions and employee benefit and incentive plans and avoiding further
issuance of Common Stock.  Although the market value of the minimum Company
stock ownership required to avoid the New Sunset Trigger at September 30, 1994
is only $13,725,898, that minimum level of ownership (at the same stock price
level) will, of course, increase as Class A Common Stock is issued by the
Company.  The Company has from time to time repurchased Common Stock in the
market and otherwise.  To the extent it does so, the Minimum Class B Ownership
(at any particular stock price level) would be reduced.

         Although the effect of the Amendment and the Special Stock Dividend on
market prices of the Common Stock and the Class A Common Stock cannot be
predicted (See "Certain Other Considerations -- Other Effects of the
Amendment"), it is likely that upon declaration and payment of the Special
Stock Dividend, the market value of the Minimum Class B Ownership

                                  
- - ----------------
*    As of September 30, 1994, the Jaffee Family had the right to cast over
     81.5% of the stockholder votes.

                                      -16-
   18
will decline significantly (by approximately the amount of the market value of
the Class A Common Stock received by holders of Class B Stock as part of the
Special Stock Dividend). This would permit the Jaffee Family to sell a
substantial portion (possibly as much as 50%) of their current equity in the
Company (i.e., the Class A Common Stock received by the Jaffee Family pursuant
to the Special Stock Dividend if it is declared and paid) without at all
diluting their current voting control. The Richard Jaffee Family has
indicated it has no intention under present circumstances to sell any of its
present equity position in the Company.

         Accordingly, the Amendment has the effect of deferring the termination
of the special voting rights of the Class B Stock, and therefore continuing
control of the Company in the Jaffee Family and present Management.  That
control includes power to elect or remove without cause all of the members of
the Board of Directors and to cast a majority of the votes on all other matters
(excepting only those also requiring approval by a majority of the votes
entitled to be cast by holders of Common Stock, or holders of Class A Common
Stock, in each case voting as a class).   Consequently, while that control is
continued, no individual, corporation or group desiring to acquire or take
control of the Company, or to obtain approval of the Company's stockholders for
any proposed merger, consolidation, sale of assets or other form of
acquisition, could do so without the approval of the Jaffee Family.  This could
discourage attempts to acquire the Company and could deprive holders of Common
Stock of an opportunity to sell their shares in such an acquisition at a
premium over the then market price.  It also deprives holders of Common Stock
of the ability to remove Management if they believe that Management has not
been effective.

         Regardless of whether the Amendment is adopted, the Jaffee Family is
presently in a position to maintain the voting control of the Company they
currently have, with the power to elect or remove without cause the members of
the Board of Directors and to cast 81.5% of the votes on other matters.
Consequently, it is presently impossible for any individual, corporation or
group desiring to acquire or take control of the Company, or to obtain approval
of the Company's stockholders for any proposed merger, consolidation, sale of
assets or other form of acquisition, to do so without the approval of the
Jaffee Family.

         Tender offers or other non-open market acquisitions of stock are
usually made at prices above the prevailing market price of a company's stock.
In addition, acquisitions of stock by persons attempting to acquire control
through market purchases may cause the market price of the stock to reach
levels which are higher than would otherwise prevail.  The Amendment may
discourage any or all of such acquisitions, particularly those of less than all
of the Company's stock, and may thereby deprive holders of the Company's stock
of an opportunity to sell their stock at a temporarily higher market price or
otherwise participate in a tender offer at a premium price.

         B.  DILUTIVE EFFECT.  As noted above, one purpose of creating the
Class A Common Stock is to provide the Company with an alternative equity
financing vehicle which does not dilute the voting rights of the existing
stockholders.  As with any issuance of equity, however, an issuance of Class A
Common Stock may cause dilution of the economic interest that each outstanding
share represents.  In this case, an issuance of the Class A Common Stock cannot
dilute voting rights.  Because the Class A Common Stock shares the preference
of the Common Stock over the Class B Stock with respect to cash dividends, and
otherwise shares equally with the Common Stock with respect to all economic
benefits (except dividends paid in stock), issuances of the Class A Common
Stock will have a dilutive effect on the economic interest of each outstanding
share of Common Stock, Class B Stock and Class A Common Stock similar to the
dilutive effect of subsequent issuances of the existing Common Stock on
currently outstanding Common Stock and Class B Common Stock. It is possible,
however, that issuance of Class A Common Stock in connection with an
acquisition or other transaction could have a greater dilutive effect on
stockholders than issuance of Common Stock.  This is because the Class A Common
Stock, as a result of its lack of voting power, may trade at prices lower than
Common Stock notwithstanding the cash dividend preference of the Class A Common
Stock.  If it does, more shares of Class A Common Stock would have to be
delivered than Common Stock in order to deliver the same economic value in a
transaction.

         Although the interests of each stockholder in the total equity of the
Company would remain substantially unchanged, issuance of the Class A Common
Stock pursuant to the Special Stock Dividend, if it were paid in the form of a
dividend and not a

                                      -17-
   19
recapitalization, would cause the Company's book value and earnings per share
of common stock outstanding to decline by 50% because of the increased number
of shares outstanding. In this regard, the Special Stock Dividend (in the form
of a dividend) would have an effect similar to a two-for-one stock split.

         C.  STATE STATUTES.  Some state securities statutes contain provisions
that, if the Class A Common Stock is issued, may restrict an offering of equity
securities by the Company or the secondary trading of its equity securities in
such states.  However, due to exemptions or for other reasons, the Company does
not believe that such provisions would have a material adverse effect on the
amount of equity securities which the Company would be able to offer, or on the
price obtainable for such equity securities in such an offering, or on the
secondary trading market for the Company's equity securities if the Company
were to issue shares of Class A Common Stock.

         D.  ACQUISITION ACCOUNTING.  Regardless of whether the Amendment is
approved, the Company will not be able to issue stock to effect a business
combination to be accounted for using the "pooling of interests" method unless
and until the Sunset Trigger or the New Sunset Trigger is reached, resulting in
conversion of the Class B Stock into Common Stock. Approval of the Amendment
will have the effect of delaying such conversion.

         E.  OTHER EFFECTS OF THE AMENDMENT.  Holding non-voting common stock
may be against the investment policies of certain stockholders, which may cause
such stockholders to sell their Class A Common Stock or potential stockholders
not to purchase Class A Common Stock in the event of distribution of the
Dividend.  It is expected that, in the event of issuance of the Class A Common
Stock, both the Common Stock and the Class A Common Stock will be publicly
traded and that they will trade at different market prices, which may lead to
investor confusion.  The fact that the Class A Common Stock is non-voting stock
might have an adverse effect on the market price of the Class A Common Stock.
(See "Dilutive Effect," above.)  It is possible that if the Special Stock
Dividend were paid, certain institutions that would otherwise hold the
Company's stock would choose not to do so because their investment would
represent a significantly greater percentage of the class of the stock held.
If the Amendment is adopted and the Class A Common Stock is issued, the market
price of shares of Common Stock and shares of Class A Common Stock will depend
on many factors, including, among others, the future performance of the
Company, the future dividend policy of the Company and market conditions
generally.  Accordingly, the Company cannot predict the price at which the
Common Stock or Class A Common Stock will eventually trade in the event of
adoption of the Amendment and issuance of shares of Class A Common Stock,
although it is anticipated that in the event of payment of the Special Stock
Dividend in the form of a dividend, shares of Class A Common Stock and Common
Stock will each trade at approximately one half of the price at which the
Common Stock traded immediately before such payment.  If the Special Stock
Dividend were effected in the form of a recapitalization, it is expected that
the Class A Common Stock and the Common Stock would each trade at approximately
the price at which the Common Stock traded immediately before the Special Stock
Dividend.  On September 30, 1994, the closing sales price of the Common Stock
as reported on the New York Stock Exchange was $19.75 per share. The Company
does not expect that the adoption of the Amendment or issuance of the Special
Stock Dividend would affect the ability of the Company's common stock to be
used as security for the extension of credit by securities brokers or dealers.

                                      -18-
   20
         5.  FEDERAL INCOME TAX CONSEQUENCES

         Sonnenschein Nath & Rosenthal, counsel to the Company, has advised the
Company that, in general, for federal income tax purposes (i) the distribution
of the Special Stock Dividend, if effected, will not be taxable to a
stockholder, (ii) the cost or other basis of the shares of Common Stock or
Class B Common Stock held by a stockholder on the Special Stock Dividend record
date will be apportioned between the shares of Common Stock or Class B Stock
and the shares of Class A Common Stock received in the Special Stock Dividend
in proportion to the fair market value of the shares of each class of stock on
the date that the Special Stock Dividend is distributed, and (iii) a
stockholder's holding period for the shares of Class A Common Stock received
with respect to the Special Stock Dividend will be the same as such
stockholder's holding period for the shares of Common Stock or Class B Stock
with respect to which the shares of Class A Common Stock were received.  The
preceding sentence constitutes the opinion of Sonnenschein Nath & Rosenthal,
counsel to the Company, regarding the material tax consequences of the
Proposal.  Mr. Paul J. Miller, a director of the Company, is a partner of
Sonnenschein Nath & Rosenthal.   Stockholders are urged to consult their tax
advisors with specific reference to their own tax situation.

         6.      BOARD RECOMMENDATION

         At its meeting on September 26, 1994, Mr. Richard M. Jaffee advised
the Board that, in light of the Company's substantial growth, he was
recommending adoption of the Amendment as a means of permitting the Company to
raise equity capital and fund acquisitions and employee benefit and incentive
plans without diluting the voting strength of existing stockholders, including,
in particular, the voting control of the Company by the Richard Jaffee Family.
He also noted that the Amendment would permit payment of the Special Stock
Dividend, which would in turn permit stockholders at the time of the Special
Stock Dividend, including the Richard Jaffee Family, to dispose of substantial
portions (possibly up to 50%) of their equity in the Company without affecting
their voting position.  Mr. Paul J. Miller, a director of the Company and
partner of Sonnenschein Nath & Rosenthal, counsel to the Company, discussed
with the other members of the Board the provisions of the Amendment, draft
copies of which had been provided to the Board, together with draft copies of
the portion of the Company's proxy material relating to the Amendment.  Mr.
Jannotta, a director of the Company and managing partner of William Blair &
Company, investment banking advisor to the Company, discussed with the Board
the anticipated liquidity and other market effects of the Special Stock
Dividend.  The Board discussed the Amendment, the substantial contributions to
the Company of Richard M. Jaffee and other members of the Richard Jaffee
Family, the benefits of Jaffee Family control for Company stability, the
effects of the Amendment in prolonging such control, the cash dividend rights
of the Class A Common Stock, and the terms of a New Sunset Trigger.  The Board
determined to appoint Messrs. Cole, Murray and Selig as members of a Special
Committee ("Special Committee"), advised by William Blair & Company and
Sonnenschein Nath & Rosenthal (collectively, its "Advisers"), to consider the
Amendment and to furnish the Board with its recommendations.  Immediately
following the conclusion of the Board meeting, the Special Committee, with its
Advisers, met separately to begin its consideration of the Amendment.

At a meeting on October 3, 1994, the Special Committee, with its Advisers,
further discussed the Amendment.  In the Special Committee's view, Richard M.
Jaffee has played a key role in the growth of the Company since it became a
public company, and even before, including, in particular, the period since
1985.  The Special Committee also noted that Daniel S. Jaffee has recently made
substantial contributions to the Company's progress, and that other members of
the Richard Jaffee Family working for the Company have also contributed to its
growth.  The Special Committee took into account the stability which the
Company's stock structure has achieved since 1985, avoiding any diversion of
management time and Company resources to address possible hostile takeovers. 
The Special Committee recognized that this stability, achieved through
continued voting control, was also an important ingredient in the continuing
commitment of the Jaffee Family (and, in particular, the Richard Jaffee Family)
to the Company.  It recognized the fact that following adoption of the dual
class structure in 1985, the percentage of shares of Class B Stock in relation
to aggregate shares of Class B and Common Stock had declined, due to an
increase in the number of shares of Common Stock and to conversion and sales of
shares of Class B Stock by the Robert Jaffee Family and by other members of the
Jaffee Family.  Since 1985, in such manner, after giving effect to the
Company's repurchase of 209,572 shares of Common Stock, 2,747,158 shares of
Class B Stock have been converted and sold (or converted and held) and an
aggregate of 774,831 additional shares of Common Stock have

                                      -19-
   21
been issued.  However,  the Special Committee noted that during that entire
time, Richard M. Jaffee and other members of the Richard Jaffee Family had not
sold any Class B Shares.

         The Special Committee continues to believe, as did the Board in 1985,
that the Company will require additional resources to achieve its long term
growth objectives, remain competitive, and maintain the strength of its
business for all stockholders; that debt financing should be used
conservatively; that internally generated funds would not be sufficient to
finance future growth; that an important component of the needed additional
resources should be common equity; that the continued success of the Company
depends significantly on the devotion and effort of Richard M. Jaffee and
members of his family; and that the ability to offer common equity in the
Company through plans designed to retain and hire well qualified employees is
also important to the Company's continuing success.  The Special Committee
believes that the loss of the special voting rights of the Class B Stock would
not be in the best interests of the Company or its stockholders because the
special voting rights are an important deterrent to a hostile takeover of the
Company and allow the Company to be managed on the basis of long term
objectives without undue emphasis on short term results.  The availability of
the Class A Common Stock would permit the Company to use equity financing to
support and expand its business operations without making it vulnerable to a
hostile takeover.  Mr. Jannotta advised the Special Committee concerning the
effects of the Class A Common Stock on market and liquidation values.  (See
description of opinion of William Blair & Company below.)

         The Special Committee also discussed the fact that although the
Amendment would permit the Jaffee Family to dispose of substantial amounts of
its equity in the Company while retaining voting control, such dispositions
will have to take into consideration the New Sunset Trigger and future issuance
of Class A Common Stock.  The Special Committee discussed and agreed on the
percentage level for the New Sunset Trigger and the number of shares of Class A
Common Stock to be authorized.  (See "Reasons for Authorization of the Class A
Common Stock" and "Certain Other Considerations-Anti-Takeover Effects of the
Amendments.")  

        The Special Committee also noted that the Board of Directors had also
considered, at its June 18, 1993 meeting and additional meetings in the fall of
1993, the possibility of a charter amendment to lower the Sunset Trigger in
order to enhance the Company's access to equity financing without jeopardizing
the Jaffee Family control; however, lowering of the Sunset Trigger was not
proposed because the National Association of Securities Dealers (the Common
Stock was then included in the NASDAQ National Market System) concluded that it
would be inconsistent with NASDAQ policy.  

        The Special Committee noted that the Board of Directors had discussed
the possible authorization of a class of non-voting common stock as early as
its meeting on June 18, 1993.  The Special Committee also noted that the
Company was advised by the New York Stock Exchange in October, 1993, in advance
of the listing of the Common Stock with the Exchange, that, subject to the
Exchange's normal review process, including review of the relevant documents, a
charter amendment and stock dividend substantially similar to the Amendment and
the Special Stock Dividend (paid as a dividend) would not appear to present a
problem with respect to listing of the Common Stock or the Class A Common
Stock.

         The Special Committee also reviewed the matters discussed under the
heading "Certain Other Considerations", above, and recognized, as should the
Common Stockholders, that in some respects the Amendment might be
disadvantageous to Common Stockholders.

         The Special Committee determined, at its October 3, 1994, meeting, to
recommend approval of the Amendment, subject to receipt of (i) advice from the
New York Stock Exchange (on which the Company's Common Stock is now listed)
that the Amendment is consistent with continued listing of the Common Stock and
that the Class A Common Stock will also be eligible for such listing, and (ii)
the opinion of William Blair & Company, in final form with respect to liquidity
and market value after the Special Stock Dividend.

        At its meeting on October 14, 1994, the Board received the report and
recommendation of the Special Committee, and considered further and discussed
with counsel and William Blair & Company the factors discussed at the Board's
September 26, 1994, meeting and at the Special Committee's October 3, 1994
meeting.  The Board also reviewed the form of opinion of William Blair &
Company, to the effect that (a) the Special Stock Dividend would not have a
material adverse effect (i) upon the market liquidity for the Class A Common
Stock or Common Stock, (ii) upon the ability of investors to buy and sell Class
A Common Stock or Common Stock, and (iii) upon the Company's ability to raise
capital through an offering or offerings of shares of Class A

                                      -20-
   22
Common Stock; and (b) from a financial point of view and under current market
conditions, immediately after the announcement and implementation of the
Special Stock Dividend, the total market value of the Company's Class A Common
Stock and Class B Stock and Common Stock will not be materially different than
the total market value of the Company's existing Common Stock and Class B Stock
immediately prior to the announcement and implementation of the Special Stock
Dividend.  A copy of the opinion is attached hereto as Schedule B.

         At the October 14 meeting, the Board also reviewed with Management
revised drafts of the Amendment and the preliminary proxy materials proposed to
be filed with the Securities and Exchange Commission, copies of which had
previously been furnished to the Board.  The Board was advised by counsel that
the Amendment and the Special Stock Dividend were designed to comply with
present New York Stock Exchange policies, but that the Exchange's advice, after
its review of the Amendment, had not yet been received.  The Board informally
expressed its general approval of the Amendment, but indicated a desire to give
further consideration to the terms of the New Sunset Trigger and to have the
benefit of the Exchange's conclusions.

        On October 19, the Special Committee further discussed the terms of the
New Sunset Trigger, and determined to recommend two modifications of its
proposed terms: a "grace period," so that the conversion thereunder occurs only
after the specified Jaffee Family ownership level of 10% is not met
continuously for one year; and a provision giving the Board discretionary power
to provide voting rights to the Class A Common Stock should the Board determine
that future regulatory changes do not permit continued listing of the Class A
Common Stock or the Common Stock on an exchange absent such provision of voting
rights.  In addition, the Special Committee was advised that although no
assurance could be given as to any future changes in New York Stock Exchange
listing policies, the Company had been advised by the New York Stock Exchange
that (i) the Amendment would not affect the inclusion of the Company's Common
Stock on the New York Stock Exchange, and (ii) that if the Special Stock
Dividend were declared and paid, such inclusion or listing, as the case may be,
would be unaffected and the Class A Common Stock would be eligible for listing
if it met certain standards, as the Company believes it would.*

        The Special Committee, following its meeting, met with the full Board
of Directors, and recommended adoption of the Amendment in its final form,
reflecting the Special Committee recommendations noted above.  The Board
discussed the Special Committee's recommendation, including the provisions of
the Amendment noted above, and then unanimously (Messrs. Richard M., Robert D.
and Daniel S. Jaffee abstaining) concluded that the Amendment would be in the
best interests of the Company and its stockholders, including holders of its
Common Stock, and is fair to all of the stockholders, and directed that the
Amendment be submitted to a vote of the stockholders. The Board of Directors
therefore unanimously (Messrs. Richard M., Robert D. and Daniel S. Jaffee
abstaining, but indicating their support for the Amendment) recommended that
the holders of the Company's Common Stock vote for the adoption of the
Amendment.

         If the Amendment is adopted, the Board of Directors intends to cause
the Amendment to be filed with the Secretary of State of Delaware and the 
Amendment will be effective upon such filing.  The Board would then be free to
issue Class A Common Stock without any further action on the part of
stockholders.  Although the Board of Directors presently intends to file the
Amendment if it is approved by the stockholders, the resolution of the
stockholders will reserve the right of the Board of Directors to abandon the
Amendment and to not file it even if it is approved by the stockholders.
Although the Board of Directors does not currently anticipate exercising its
right to abandon the Amendment nor does it contemplate any specific events
which would trigger the abandonment of the

                                  
- - ----------------
*        The Board of Directors will not pay the Special Stock Dividend in the
         form of a recapitalization if this  would result in applicable New
         York Stock Exchange standards not being met.

                                      -21-
   23
Amendment, the Board will defer or abandon the Amendment, if, in its business
judgment, adverse market conditions or general economic conditions affecting
the Company are such as to make the Amendment no longer in the best interests
to the Company or its stockholders.  The Board may also postpone filing the
Amendment until such time as it deems appropriate in connection with issuance
of the Special Stock Dividend.

         THE BOARD OF DIRECTORS recommends approval of the Amendment.

                                      -22-
   24
                             EXECUTIVE COMPENSATION

The following table shows, for the fiscal years ended July 31, 1994, 1993 and
1992, the compensation of the chief executive officer and the four other most
highly compensated executive officers of the Company.

                           SUMMARY COMPENSATION TABLE

                                                                                               LONG TERM 
                                                                       ANNUAL                COMPENSATION(9)
                                                                   COMPENSATION (1)(2)       ---------------
                                                     FISCAL        -------------------   OPTION           ALL OTHER      
                NAME AND PRINCIPAL POSITION           YEAR        SALARY       BONUS     AWARDS       COMPENSATION(11)
                --------------------------            ----        ------       -----     ------       ----------------
                                                                                       
         Richard Jaffee                                94        $300,000      $91,660         0          $49,463(3)(4)(5)(6)
            President, Chief                           93         256,804      160,584         0          $49,107
            Executive Officer                          92         253,608       39,677         0              ---

         Norman B. Gershon (7)                         94         212,800       10,000         0            6,898(7)
            Vice President,                            93         212,800       10,000         0            7,004
            International                              92         207,729          ---         0              ---

         Joseph C. Miller                              94         167,500       49,755         0              ---
            Senior V.P., Consumer,                     93         160,000       76,134         0              ---
            Industrial & Environmental                 92         160,000       26,452         0              ---
            and Distribution

         Herbert V. Pomerantz                          94         136,000       38,090         0              125(8)
            Senior V.P., Agricultural &                93          66,000       29,436     5,000              ---
            Specialty Products and                     92             ---          ---         0              ---
            Research & Development

         Bruce H. Sone                                 94         121,500       30,935         0            1,653(4)(10)
            Vice President, Consumer                   93         114,500       56,390         0            1,656
              Products                                 92         112,205       25,059         0              ---
            Mass Merchandising Division

- - -----------------            
         (1)  Amounts shown include cash compensation earned during the year
              covered, whether received or deferred at the election of the
              officer, including amounts earned but deferred at the election of
              those officers pursuant to the Company's Key Employee and Director
              Deferred Compensation Program.  In fiscal year ended July 31,
              1994, $50,000 of compensation was deferred by Richard M. Jaffee.

         (2)  None of the named executive officers received perquisites or
              other personal benefits in excess of the lesser of $50,000 or 10%
              of his total salary and bonus for the fiscal years ended July 31,
              1994 and 1993.

         (3)  For the fiscal year ended July 31, 1994, includes $3,587 of
              interest accrued on income deferred by Richard M. Jaffee under
              the Company's Key Employee and Director Deferred Compensation
              Program in excess of 120% above the applicable Federal rate under
              Internal Revenue Code Section 1274(d).

         (4)  Certain officers, including executive officers Richard M. Jaffee
              and Bruce H. Sone, are provided split dollar life insurance. The
              premiums paid by the Company on each of the split dollar
              policies, net of dividends, are charged to open accounts
              established by the Company. No interest accrues on the balance of
              the open accounts.  On the death of the employee, the estate of
              the deceased is obligated to pay the balance of the deceased's
              open account in full.  In fiscal years ended July 31, 1994 and
              1993, the Company paid no premiums on these policies; the
              premiums were paid by earnings on the policies.

         (5)  The Company also provides split dollar joint survivorship life
              insurance policies in the aggregate amount of $10,000,000 on the
              lives of Richard M. Jaffee and his wife, with payment to be made
              on the death of the last to survive, on terms similar to those
              described in Note (4) above relating to payment of premiums,
              payment of interest on account balances and the obligation to pay
              open account balances upon death.

                                      -23-
   25
(footnotes continued from previous page)

         (6)  $14,057 represents payments on behalf of Mr. Jaffee by the
              Company and Oil-Dri, S.A., a Company subsidiary, to defined
              contribution plans. $4,236 constitutes the economic benefit to
              Mr. Jaffee associated with his interest in the cash surrender
              value of the policies described in Note (4).  $14,923 constitutes
              the economic benefit to Mr. Jaffee of the term life component of
              the split dollar policies described in Note (5); Mr. Jaffee pays
              this amount directly to the insurance company as premium and is
              reimbursed by the Company.  $12,660 constitutes the estimated
              economic benefit for fiscal year 1994 of an agreement between the
              Company and Mr. Jaffee to pay Mr. Jaffee $300,000 upon his
              retirement.  On death or total disability of Mr. Jaffee, the
              Company has agreed to pay his widow or the Richard M. Jaffee
              Revocable Trust an amount equal to two fiscal years' compensation
              based upon the highest amount per fiscal year paid him during the
              period beginning August 1, 1988.

         (7)  For the fiscal years ended July 31, 1994 and July 31, 1993, Mr.
              Gershon's compensation was paid in dollars.  During the fiscal
              year ended July 31, 1992, Mr. Gershon's compensation was computed
              and paid in Swiss francs.  The figures given for the year ended
              July 31, 1992 are based on the average exchange rate for the
              fiscal year computed on the basis of the average of exchange
              rates for each month.  Mr. Gershon's compensation includes a
              cost-of-living factor reflecting the fact that Mr. Gershon is
              based in Switzerland.  $6,898 represents payments on behalf of
              Mr. Gershon by Oil-Dri, S.A., a subsidiary, to a defined
              contribution plan.

         (8)  $125 represents payments on behalf of Mr. Pomerantz by the
              Company to a defined contribution plan.

         (9)  No stock appreciation rights (SARs), restricted stock awards or
              long-term incentive plan payouts were granted or earned in any
              fiscal year covered by this table.

        (10)  $250 represents payments on behalf of Mr. Sone by the Company to
              a defined contribution plan.  $1,403 constitutes the economic
              benefit to Mr. Sone associated with his interest in the cash
              surrender value of the policies described in Note (4).

        (11)  Information for the fiscal year ended July 31, 1992 is not
              required.

                                      -24-
   26
STOCK OPTIONS

Shown below is information with respect to unexercised stock options to 
purchase the Company's Common Stock which were held by the executive officers
named in the Summary Compensation table as of July 31, 1994.  No options were
granted to any of the executive officers listed below during the 1994 fiscal
year.  No options were exercised by any of the executive officers listed below
during the 1994 fiscal year.

                       OPTION FISCAL YEAR END VALUE TABLE

                               
                                                                                                  VALUE OF UNEXERCISED IN-THE-MONEY
                                                 NUMBER OF UNEXERCISED OPTIONS AT FY-END                 OPTIONS AT FY-END
         NAME (1)                                     EXERCISABLE/UNEXERCISABLE                     EXERCISABLE/UNEXERCISABLE (2)
         --------                                     -------------------------                     -----------------------------
                                                                                                  
         Richard M. Jaffee                                         -0-/-0-                              $   -0-N/A
         Norman B. Gershon                                       1,570/-0-                                3,768/N/A
         Joseph C. Miller                                       17,500/-0-                                  -0-/N/A(3)
         Herbert V. Pomerantz                                    5,000/-0-                                  -0-/N/A(3)
         Bruce H. Sone                                           1,570/-0-                                3,768/N/A

         (1)  No stock appreciation rights (SARs) were granted in the fiscal
              year covered by this table.

         (2)  The closing price of the Company's Common Stock on the last
              trading day of fiscal 1994 ($18.00 per share),  minus the
              applicable exercise prices, multiplied by the number of option
              shares held.

         (3)  The exercise price of the options was greater than the market
              price of Common Stock on July 31, 1994.

         On August 29, 1994, subsequent to the end of the last fiscal year,
options on 22,500 shares, with a term of ten years, were issued to Richard M.
Jaffee, at an exercise price of $19.375.  On the same date options on 2,500
shares and 1,250 shares, with a term of ten years, were issued to Herbert V.
Pomerantz and Joseph C. Miller, respectively, at an exercise price of $19.375. 
The closing market price on August 29, 1994 was $19.375.

         On August 16, 1994, also subsequent to the end of the last fiscal
year, options on 5,000 shares, held by Herbert V. Pomerantz, with an exercise
price of $22.375 and a remaining term of approximately 8.5 years, were canceled
and replaced by options on  the same number of shares at an exercise price of
$19.000, and with a term of ten years.  On the same date, options on 15,000
shares, held by Daniel S. Jaffee, with an exercise price of $22.750 and a
remaining term of approximately 6.5 years, were replaced by options on the same
number of shares at an exercise price of $19.000 and with a term of ten
years.  The market price at the date of the cancellation and replacement was
$19.000. In the last ten years, no other options held by executive officers of
the Company have been repriced except to reflect the effect of stock dividends.

                                      -25-
   27
PENSION PLANS

         The Company's pension plan covering salaried employees is a
non-contributory, qualified, defined benefit plan.  The plan provides for
pensions based on credited years of service and cash compensation (excluding
compensation paid under the Company's Incentive Bonus Plan) during the highest
paid consecutive five years during the last ten years of employment.  The
following table presents estimated annual retirement benefits payable upon
normal retirement at age 65 and is computed on the basis of a 5-year certain
and life annuity.  The benefits listed are not subject to a deduction for
social security or other offset amounts.

                                                             ESTIMATED ANNUAL BENEFITS AT YEARS OF SERVICE INDICATED
HIGHEST CONSECUTIVE 5-YEAR                                   -------------------------------------------------------
AVERAGE COMPENSATION                               15 YRS            20 YRS           25 YRS            30 YRS           35 YRS
- - --------------------                               ------            ------           ------            ------           ------
                                                                                                         
$125,000                                          $18,600           $24,800          $31,000           $37,300          $40,100
 150,000                                           22,800            30,300           37,900            45,500           49,900
 175,000                                           26,900            35,800           44,800            53,800           59,600
 200,000                                           31,000            41,300           51,700            62,000           69,400
 225,000                                           35,100            46,800           58,500            70,300           79,100
 250,000                                           39,300            52,300           65,400            78,500           88,900
 300,000                                           47,500            63,300           79,200            95,000          108,400

         The individuals named in the Summary Compensation Table are
participants in the Company's pension plan and had compensation as defined in
the pension plan for the fiscal year ended July 31, 1994 and number of years of
service as of August 1, 1994 under the pension plan as follows:  Richard M.
Jaffee, $235,850 (because of applicable Internal Revenue Code limitations), 36
years; Norman B. Gershon, $212,800,  23 years; Joseph C. Miller, $167,500, 4
years; Bruce H. Sone, $121,500, 32 years; and Herbert V. Pomerantz, $136,000, 1
year.

                                      -26-
   28
REMUNERATION OF DIRECTORS

         Each director of the Company who is not also an officer of the Company
receives an annual retainer of $6,000 and also receives a fee of $1,500 for
each meeting attended.

         In addition, during the fiscal year ended July 31, 1994, Mr. Robert D.
Jaffee and Mr. Haydn H. Murray were paid $30,000 and $4,200 respectively for
consulting services.

            COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION

COMPENSATION POLICY

         Oil-Dri's compensation policy, approved by its Compensation Committee,
is to provide its executive officers and other salaried employees with
compensation opportunities competitive with comparable sized companies,
reflecting annual incentive opportunities commensurate with Company performance
and level of responsibility, while allowing for recognition of individual
performance.  Further aligning compensation with overall Company performance,
Oil-Dri makes periodic awards of stock options to key management officers and
employees.  This policy, the components of compensation which implement it, and
its administration, continue essentially unchanged from those reported in
fiscal 1993.

         At present compensation levels, and given the performance-based nature
of the Company's Stock Option Plan, limitations on federal income tax
deductibility of the top officer's compensation in excess of $1,000,000 have no
impact.  In general, the Company favors the preservation of tax deductibility,
but reserves the right to reconsider this position.

                                      -27-
   29
COMPENSATION COMPONENTS

         Cash compensation has two components, base salary and annual incentive
bonus.  The Company has a number of salary grades reflecting differing levels
of responsibility.  For each salary grade, a minimum and maximum salary range
is established based on a survey of comparable-sized companies.  The incentive
compensation is a target bonus equal to a percentage of the individual's annual
base salary.  For the target to be achieved, the Company must meet the
projected annual earnings ("Plan") which are reviewed by the Compensation
Committee; minimum and maximum payouts are then set based on the achievement of
certain financial thresholds related to the Plan.  In addition, the Plan
permits discretionary adjustments up or down within a range, based on
evaluation of a particular individual's contribution.

         The annual incentive plan is designed to require communication to
employees of expectations for Company performance and for potential individual
rewards.  It establishes a threshold for required Company performance before
any bonus is earned and provides for a significant addition if projected
earnings expectations are exceeded.  Thus, it directly links Company
performance and total annual pay.  It provides for broad based participation,
so that each employee recognizes that he or she can contribute to the Company's
success.

ADMINISTRATION OF THE COMPENSATION PROGRAM

         During the year there is a review of employee performance and
progress.  At least once a year employee performance is documented and plans
for employee development are discussed.  At that time the employee's salary is
reviewed and, based on the position of the salary within the salary range and
the performance of the individual, a base salary change may, but will not
necessarily, be recommended.  On the basis of that review, any adjustment to
reflect the employee's performance in incentive bonus is also determined.

         The Compensation Committee reviews, and generally oversees the
Company's compensation program.  The Company reviews with the Compensation
Committee the prior year's salary results for the various base salary ranges
and incentive bonus targets, and reviews the base salary ranges and the target
bonus percentages for the coming year.  In reviewing target bonus percentages
for the coming fiscal year, the Company presents its earnings expectations for
that year.

                                      -28-
   30
         Company recommendations for stock option grants to be made from time
to time are reviewed with, and approved by, the Company's Stock Option
Committee, whose members are the same as those of the Compensation Committee.

         The Committee determined the compensation of Mr. Richard M. Jaffee,
President and Chief Executive Officer, for the fiscal year ended July 31, 1994,
had been established and administered in a manner consistent with that
described above.  In doing so, it reviewed the Company's strategic and
financial goals, Mr. Jaffee's personal performance as President and Chief
Executive Officer, the Company's performance, and considered its prior review
of the compensation of chief executive officers at corporations of similar size
and type of business, as well as the strong correlation that exists between the
Company's performance and Mr. Jaffee's efforts. It noted in particular that Mr.
Jaffee's bonus, like that of other plan participants, had been reduced to
reflect the fact that the Company had achieved only 85% of its incentive bonus
target and that Mr. Jaffee had then voluntarily further reduced his bonus.
This had resulted in a 1994 bonus for Mr. Jaffee of $91,660, contrasted with
his 1993 bonus of $160,584.

         The Committee determined that Mr. Jaffee's base salary for fiscal 1995
should remain at $300,000.

                                        COMPENSATION COMMITTEE
                                        (AND STOCK OPTION COMMITTEE)

                                        Allan H. Selig, Chairman
                                        J. Stephen Cole
                                        Paul J. Miller

          COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

         Mr. Selig, a director of the Company and a member of both the
Compensation Committee and the Stock Option Committee, is President of Selig
Executive Leasing Company.  During the fiscal year ended July 31, 1994, the
Company paid a subsidiary of Selig Executive Leasing Co., an aggregate of
$163,797 in connection with the leasing by the Company of automobiles from such
subsidiary.  The Company is obligated under the leases to make payments
aggregating $124,224 and $59,969 in fiscal years 1995 and 1996, respectively.
The Company believes that the leases are on terms no less favorable than would
be available from a disinterested third party.

                                      -29-
   31

                               PERFORMANCE GRAPH

        Set forth below is a line graph comparing the yearly cumulative total
shareholders' return on the Company's Common Stock against the yearly cumulative
total return of the Russell 2000 and the Russell 2000 Materials and Processing
Economic Sector Index (Peer Group).  The graph assumes that the value of the
investment in the Company's Common Stock, the Russell 2000 Index and the Russell
2000 Materials and Processing Economic Sector Index was $100 on July 31, 1989,
and that all dividends were reinvested.

                       FIVE YEAR CUMULATIVE TOTAL RETURNS
                         OIL-DRI CORPORATION OF AMERICA

                  1989        1990         1991        1992        1993         1994
                  ----        ----         ----        ----        ----         ----
                                                            
 ODC             $100.00     $128.04      $93.29       $87.16     $127.33      $98.35
 RUSSELL 2000    $100.00      $94.84     $103.93      $119.01     $146.86     $153.73
 PEER GROUP      $100.00      $89.00      $92.44       $99.57     $118.77     $128.06

                                      -30-
   32
                               3.  OTHER MATTERS

         At this time, the Board of Directors is not aware of any matters not
referred to herein which might be presented for action at the meeting.
However, if any other business should come before the meeting, votes may be
cast in respect to such matters in accordance with the best judgment of the
person or persons acting under the proxies.

                                        BY ORDER OF THE BOARD OF DIRECTORS

                                        RICHARD M. JAFFEE
                                        President and Chief Executive Officer

CHICAGO, ILLINOIS
NOVEMBER ___, 1994

                                      -31-
   33
                                   SCHEDULE A
         DELETE ARTICLE FOURTH OF THE CERTIFICATE OF INCORPORATION  AND
INSERT, IN LIEU THEREOF, A NEW ARTICLE FOURTH(1) OF THE  CERTIFICATE OF
INCORPORATION WHICH PROVIDES:

                                 ARTICLE FOURTH

A.       AUTHORIZED CAPITAL STOCK

        The total number of shares of all classes of capital stock which the
Corporation shall have authority to issue is [twenty] FIFTY-two million
[(22,000,000)] (52,000,000) shares, consisting of fifteen million (15,000,000)
shares of Common Stock, par value $.10 per share (the "Common Stock"), THIRTY
MILLION (30,000,000) SHARES OF CLASS A COMMON STOCK, PAR VALUE $.10 PER SHARE
(THE "CLASS A COMMON  STOCK") and seven million (7,000,000) shares of Class B
Stock, par value $.10 per share (the "Class B Stock").

B.       POWERS AND RIGHTS OF THE COMMON STOCK AND THE CLASS B STOCK

1.       Voting Rights and Powers.

         With respect to all matters upon which stockholders are entitled to
vote or to which stockholders are entitled to give consent (including election
of directors, mergers, asset sales, dissolution, and certificate and by-law
amendments), the holders of the outstanding shares of the Common Stock and the
holders of any outstanding shares of the Class B Stock shall vote together
without regard to class, and every holder of the outstanding shares of the
Common Stock shall be entitled to cast thereon one (1) vote in person or by
proxy for each share of the Common Stock standing in his name, and every holder
of any outstanding shares of the Class B Stock shall be entitled to cast
thereon ten (10) votes in person or by proxy for each share of Class B Common
Stock standing in his name.  [With respect to any proposed amendment to this
Certificate of Incorporation which would increase or decrease]  EXCEPT AS
INDICATED IN THIS PARAGRAPH, OR AS OTHERWISE REQUIRED BY LAW, HOLDERS  OF
CLASS A COMMON STOCK SHALL HAVE NO RIGHT TO VOTE.  WITHOUT LIMITING THE
GENERALITY OF THE  FOREGOING, the number of authorized shares of [either the
Common Stock or] CLASS A COMMON STOCK MAY BE INCREASED OR DECREASED (BUT NOT
BELOW THE NUMBER OF SHARES THEREOF THEN OUTSTANDING), BY THE AFFIRMATIVE
VOTE OF THE HOLDERS OF A MAJORITY OF THE VOTES ENTITLED TO BE CAST BY THE
HOLDERS OF THE COMMON STOCK AND the Class B Stock, WITHOUT A VOTE OF THE
HOLDERS OF ANY SHARES OF THE NON-VOTING STOCK.  WITH RESPECT TO ANY PROPOSED
AMENDMENT TO THIS CERTIFICATE OF INCORPORATION WHICH WOULD INCREASE OR
DECREASE THE NUMBER OF AUTHORIZED SHARES OF THE COMMON STOCK OR THE CLASS B
STOCK (BUT NOT THE NON-VOTING  STOCK), increase or decrease the par value of
the shares of the COMMON STOCK, THE CLASS A Common Stock or the Class B
Stock, or alter or change the powers, preferences, relative voting power or
special rights of the shares of the Common Stock , THE CLASS A COMMON STOCK
or the Class B Stock so as to affect them adversely, the approval of a majority
of the votes entitled to be cast by the holders of the class affected by the
proposed amendment, voting separately as a class, shall be obtained in addition
to the approval of a majority of the votes entitled to be cast by the holders
of the Common Stock and the Class B Stock voting together without regard to
class as hereinbefore provided.

- - ---------------------
(1)   Marked to reflect changes from the present Article Fourth; additions in 
      upper case; deletions in brackets.

                                      -32-
   34
2.       Dividends and Distributions.
         a.      Cash Dividends.  At any time shares of the Class B Stock are
outstanding, as and when cash dividends may be declared by the Board of
Directors,  (I) the cash dividend payable on shares of the Common Stock
AND THE CASH DIVIDEND PAYABLE ON SHARES OF THE CLASS A COMMON STOCK
shall EACH in all cases be equal  ON A PER SHARE BASIS to at least
133-1/3% on a per share basis of the cash dividend payable on shares of the
Class B Stock. [For purposes of calculating the cash dividend to be paid],
(II) THE CASH DIVIDEND PAYABLE ON SHARES OF THE CLASS A COMMON STOCK ON A
PER SHARE BASIS SHALL IN ALL CASES BE EQUAL TO THE CASH DIVIDEND PAYABLE on
shares of the Common Stock [and the Class B Stock, the amount], AND (III) IF
SHARES OF CLASS A COMMON STOCK, CLASS B STOCK AND COMMON STOCK ARE OUTSTANDING,
THE SUM of the cash dividend [declared and] payable on shares of [the Common
Stock, determined in accordance with this provision, may] COMMON STOCK AND
THE CASH DIVIDEND PAYABLE ON SHARES  OF CLASS A COMMON STOCK, EACH ON A PER
SHARE BASIS, SHALL IN ALL CASES BE EQUAL TO AT LEAST 133-1/3% OF THE SUM OF THE
CASH DIVIDEND PAYABLE ON  SHARES OF CLASS B STOCK AND THE CASH DIVIDEND
PAYABLE ON SHARES OF CLASS A COMMON STOCK, EACH ON A PER SHARE BASIS.  IF A
CASH DIVIDEND IS PAID THAT MEETS THE RATIO REQUIREMENTS SET FORTH IN THIS
SUBPARAGRAPH A, THE AGGREGATE AMOUNT PAID TO EACH STOCKHOLDER WILL be rounded
up to the [next highest half cent] NEAREST CENT WITHOUT REGARD TO SUCH
REQUIREMENTS.

         b.      Other Dividends and Distributions.  Each share of the Common
Stock, EACH SHARE OF THE CLASS A COMMON STOCK and each share of the Class B
Stock shall be equal in respect of rights to dividends (other than cash) and
distributions, when and as declared, in the form of stock or other property of
the Corporation, except that in the case of dividends or other distributions
payable in stock of the Corporation, including distributions pursuant to stock
split-ups, divisions or combinations, which occur after the date shares of the
Class B Stock are first issued by the Corporation, only shares of the Common
Stock shall be distributed with respect to the Common Stock [and], only
shares of the Class B Stock shall be distributed with respect to the Class B
Stock, AND IF SHARES OF CLASS A COMMON STOCK HAVE BEEN ISSUED, ONLY SHARES
OF  CLASS A COMMON STOCK SHALL BE DISTRIBUTED WITH RESPECT TO THE CLASS A
COMMON STOCK, ALL IN ACCORDANCE WITH PARAGRAPH 8 OF THIS SECTION B,
 PROVIDED HOWEVER, THAT A SPECIAL DIVIDEND PAYABLE IN CLASS A COMMON STOCK
("SPECIAL STOCK DIVIDEND") MAY BE DECLARED AND PAID WITH RESPECT TO  COMMON
STOCK AND CLASS B STOCK (I) ON THE BASIS OF ONE SHARE OF CLASS A COMMON STOCK
DISTRIBUTED WITH RESPECT TO EACH OUTSTANDING SHARE OF  COMMON STOCK AND
CLASS B STOCK OR (II) IN THE FORM OF A RECAPITALIZATION, IN WHICH HALF OF EACH
OUTSTANDING SHARE OF COMMON STOCK AND HALF OF  EACH OUTSTANDING SHARE OF
CLASS B STOCK WOULD EACH BE AUTOMATICALLY CONVERTED INTO ONE-HALF SHARE OF 
CLASS A COMMON STOCK.  ONLY ONE SPECIAL STOCK  DIVIDEND CAN BE DECLARED.

3.       Other Rights.

         Except as otherwise required by the Delaware General Corporation Law
or as otherwise provided in this Certificate of Incorporation, each share of
the Common Stock, EACH SHARE OF CLASS A COMMON STOCK and each share of the
Class B Stock shall have identical powers, preferences and rights, including
rights in liquidation.

                                      -33-
   35
4.       Issuance of the Class B Stock.
         a.      Initial Issuance.  On or before 5:00 p.m. Central Time ("close
of business") on May 13, 1985, or such later date and time as the Board of
Directors may, prior to May 13, 1985, determine, each outstanding share of
Common Stock shall be convertible, by the holder of record thereof on March 6,
1985, on a share-for-share basis, for shares of Class B Stock, on and subject
to the terms and conditions of this paragraph 4.  Any such conversion shall be
deemed to be effective as of the date of receipt by the Corporation or its
transfer agent of the following documents:  (i) a proper written notice of
conversion by the holder of shares of Common Stock, addressed to the principal
office of the Corporation or to the office of its transfer agent, designating
the number of shares of Common Stock to be converted into shares of Class B
Stock, and (ii) the stock certificate or certificates representing the number
of shares of Common Stock to be so converted into shares of Class B Stock, duly
endorsed for transfer or accompanied by appropriate stock powers, with
signatures guaranteed by a national banking association or a member firm of the
New York Stock Exchange.  The issuance of a certificate or certificates for
shares of the Class B Stock shall be made without charge for any stamp or other
similar tax in respect of such issuance.  However, if any such certificate or
certificates is or are to be issued in a name other than that of the holder of
the share or shares of Common Stock converted, the person or persons requesting
the issuance thereof shall pay to the transfer agent or to the Corporation the
amount of any tax which may be payable in respect to any such transfer.
Notwithstanding the foregoing, such certificate or certificates may only be
issued in the name of the holder of record on March 6, 1985 of the converted
shares of Common Stock, or his Permitted Transferee, as such term is defined in
subparagraph c of paragraph 6 of this Section B.  Subject to the foregoing, as
promptly as practicable after the surrender for conversion of a certificate or
certificates representing shares of the Common Stock and payment of any tax as
hereinbefore provided, the Corporation will deliver or cause to be delivered at
the office of the transfer agent to, or upon the written order of, the holder
of such certificate or certificates, a certificate or certificates representing
the number of shares of Class B Stock issuable upon such conversion, issued in
such name or names as such holder may direct.  Such conversion shall be deemed
to have been made immediately prior to the close of business on the date of the
surrender of the certificate or certificates representing shares of the Common
Stock (if on such date the transfer books of the Corporation shall be closed,
then immediately prior to the close of business on the first date thereafter
that said books shall be open), and all rights of such holder arising from
ownership of the shares of Common Stock shall cease at that time, and the
person or persons in whose name or names the certificate or certificates
representing shares of the Class B Stock are to be issued shall be treated for
all purposes as having become the record holder or holders of such shares of
the Class B Stock at such time and shall have and may exercise all the rights
and powers appertaining thereto.  No adjustments in respect of past cash
dividends shall be made upon the conversion of any share of the Common Stock;
provided, however, that if any shares of the Common Stock shall be converted
subsequent to the record date for the payment of a cash or stock dividend or
other distribution on shares of the Common Stock, but prior to such payment,
the registered holder of such shares of Common Stock at the close of business
on such record date shall nonetheless be entitled to receive that cash or stock
dividend or other distribution.  The Corporation shall reserve and keep
available, solely for the purpose of issue upon conversion of outstanding
shares of the Common Stock, such number of shares of the Class B Stock as may
be issuable upon the conversion of all such outstanding shares of the Common
Stock.  All shares of the Class B Stock which may be issued upon conversion of
shares of the Common Stock will, upon issuance, be fully paid and
nonassessable.

         b.      Subsequent Issuance.  After expiration of the period for
initial issuance as provided in subparagraph a of this paragraph 4, the
Corporation may only issue shares of the Class B Stock in the form of a
distribution or distributions pursuant to one or more stock dividends on or
stock split-ups of the shares of the Class B Stock, or pursuant to any other
distribution which is intended to be pro-rata to the Corporation's
stockholders, and only to the then holders of the outstanding shares of the
Class B Stock in conjunction with and in the same ratio as a stock dividend on
or a stock split-up or other distribution of the shares of the CLASS A
COMMON STOCK (IF CLASS A COMMON STOCK HAS BEEN ISSUED PRIOR TO SUCH STOCK
DIVIDEND, STOCK SPLIT OR OTHER DISTRIBUTION) AND Common Stock (any such
issuance being a "Subsequent Issuance").

5.        Conversion of Class B Stock.

                                      -34-
   36
         Each share of Class B Stock may at any time be converted at the
election of the holder thereof into one fully paid and nonassessable share of
the Common Stock.  Any holder of shares of the Class B Stock may elect to
convert any or all of such shares at one time or at various times in such
holder's discretion.  Any such conversion shall be deemed to be effective as of
the close of business on the date of receipt by the Corporation or its transfer
agent or of the following documents:  (i) a proper written notice of conversion
by the holder of shares of Class B Stock, addressed to the principal office of
the Corporation or to the office of its transfer agent, designating the number
of shares of Class B Stock to be converted into shares of Common Stock, and
(ii) the stock certificate or certificates representing the number of shares of
Class B Stock to be so converted into shares of Common Stock, duly endorsed for
transfer or accompanied by appropriate stock powers, with signatures guaranteed
by a national banking association or a member firm of the New York Stock
Exchange.  The issuance of a certificate or certificates for shares of the
Common Stock upon conversion of shares of the Class B Stock shall be made
without charge for any stamp or other similar tax in respect of such issuance.
However, if any such certificate or certificates is or are to be issued in a
name other than that of the holder of the share or shares of the Class B Stock
converted, the person or persons requesting the issuance thereof shall pay to
the transfer agent or to the Corporation the amount of any tax which may be
payable in respect of any such transfer, or shall establish to the satisfaction
of the transfer agent or of the Corporation that such tax has been paid.  As
promptly as practicable after the surrender for conversion of a certificate or
certificates representing shares of the Class B Stock and the payment of any
tax as hereinbefore provided, the Corporation will deliver or cause to be
delivered at the office of the transfer agent to, or upon the written order of,
the holder of such certificate or certificates, a certificate or certificates
representing the number of shares of the Common Stock issuable upon such
conversion, issued in such name or names as such holder may direct.  Such
conversion shall be deemed to have been made immediately prior to the close of
business on the date of the surrender of the certificate or certificates
representing shares of the Class B Stock (if on such date the transfer books of
the Corporation shall be closed, then immediately prior to the close of
business on the first date thereafter that said books shall be open), and all
rights of such holder arising from ownership of shares of the Class B Stock
shall cease at such time, and the person or persons in whose name or names the
certificate or certificates representing shares of the Common Stock are to be
issued shall be treated for all purposes as having become the record holder or
holders of such shares of the Common Stock at such time and shall have and may
exercise all the rights and powers appertaining thereto.  No adjustments in
respect of past cash dividends shall be made upon the conversion of any share
of the Class B Stock; provided, however, that if any shares of the Class B
Stock shall be converted subsequent to the record date for the payment of a
cash or stock dividend or other distribution on shares of the Class B Stock but
prior to such payment, the registered holder of such shares of Class B Stock at
the close of business on such record date shall nonetheless be entitled to
receive that cash or stock dividend or other distribution.  The Corporation
shall at all times reserve and keep available, solely for the purpose of issue
upon conversion of outstanding shares of the Class B Stock, such number of
shares of the Common Stock as may be issuable upon the conversion of all such
outstanding shares of the Class B Stock, provided the Corporation may deliver
shares of the Common Stock which have previously been converted into shares of
the Class B Stock or which are held in the treasury of the Corporation for
shares of the Class B Stock to be converted.  If any shares of the Common Stock
require registration with or approval of any governmental authority under any
federal or state law before such shares of the Common Stock may be issued upon
conversion, the Corporation will cause such shares to be duly registered or
approved, as the case may be.  The Corporation will endeavor to list shares of
the Common Stock required to be delivered upon conversion prior to such
delivery upon any national securities exchange or national market system on
which the outstanding shares of the Common Stock may be listed at the time of
such delivery.  All shares of the Common Stock which may be issued upon
conversion of shares of the Class B Stock, will, upon issuance, be fully paid
and nonassessable.

                                      -35-
   37
5A.      MODIFICATION OF CLASS A COMMON STOCK.

         IF, AS A RESULT OF THE LACK OF VOTING POWER OF THE CLASS A COMMON
STOCK, EITHER THE COMMON STOCK OR CLASS A COMMON STOCK IS TO BE, OR IS,
DELISTED FROM THE NEW YORK STOCK EXCHANGE (OR FROM SUCH OTHER NATIONAL
SECURITIES EXCHANGE OR SECURITIES QUOTATION SYSTEM AS IS THEN THE PRINCIPAL
MARKET FOR SUCH STOCK), THE BOARD OF DIRECTORS, IF IT DETERMINES THAT THERE IS
NO APPROPRIATE ALTERNATIVE, MAY PROVIDE SUCH VOTING RIGHTS FOR THE CLASS A
COMMON STOCK (BUT IN NO EVENT MORE THAN ONE VOTE PER SHARE) AS IT MAY SPECIFY
BY RESOLUTION.

6.       Restrictions on Sale and Transfer of Class B Stock.
         a.      Shares of Class B Stock shall be registered in the name(s) of
the beneficial owner(s) thereof and not in "street" or "nominee" name;
provided, however, (i) certificates representing shares of Class B Stock issued
in conversion of the Corporation's then outstanding Common Stock will be
registered in the same name and manner as the certificates representing the
shares of Common Stock so converted into shares of Class B Stock and (ii)
certificates representing shares of Class B Stock issued pursuant to one or
more Subsequent Issuances of the Class B Stock may be registered in the same
name and manner as the certificates representing the shares of Class B Stock
with respect to which the Subsequent Issuance was made.  Certificates
representing Class B Stock shall bear a legend stating that they are subject to
the restrictions of this Article Fourth.

         b.      Shares of Class B Stock shall not be sold, assigned, given,
bequeathed, transferred, pledged or otherwise disposed of except as provided in
subparagraphs c and d of this paragraph 6.

         c.      A holder of shares of Class B Stock may sell, assign, give,
bequeath or otherwise transfer all or part of said shares to any one or more of
the following:  (i) to any beneficial owner thereof; (ii) to any beneficial
owner's spouse; (iii) to any parent or to any lineal descendant (including any
adopted child) of any parent of any beneficial owner or of any beneficial
owner's spouse; (iv) to any trustee, guardian or custodian for, or any
executor, administrator or other legal representative of the estate of, any of
the foregoing; and (v) to any general or limited partnership each of the
partners of which is any of the foregoing 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 (collectively, (i) through (v) are the "Permitted
Transferees").

         d.      Shares of Class B Common Stock may be pledged by the
beneficial owner thereof, provided such shares shall not be transferred to or
registered in the name of the pledgee and shall remain subject to the
restrictions of this paragraph 6.  In the event of foreclosure or other similar
action by the pledgee, such pledged shares of Class B Stock may, at the option
of the pledgee, be sold, transferred or otherwise disposed of on behalf of the
beneficial owner only to those persons specified in subparagraph c of this
paragraph 6, or be converted into shares of Common Stock in accordance with the
provisions of paragraph 5 of this Section B.

         e.      In the event a holder of shares of Class B Stock sells,
assigns, transfers, pledges or otherwise disposes of such shares contrary to
the provisions of this paragraph 6, then such sale, assignment, transfer,
pledge or other disposition shall be deemed (i) an election by the holder
thereof to first convert such shares of Class B Stock into shares of Common
Stock on a share-for-share basis, and (ii) a sale, assignment, transfer, pledge
or other disposition of such shares of Common Stock.  Such conversions shall be
deemed effective as of the time of such sale, assignment, transfer, pledge or
other disposition, and upon presentation to the Corporation's transfer agent of
the certificate or certificates representing such shares of Class B Stock, duly
endorsed for transfer or accompanied by appropriate stock powers, with
signatures guaranteed by a national banking association or a member firm of the
New York Stock Exchange, a certificate or certificates

                                      -36-
   38
representing an equal number of shares of Common Stock shall be issued in the
name of the transferee or pledgee.

7.       Duration of Class Rights and Powers.
        At any time when  (a) the shares of Class B Stock owned by Richard M.
and Robert D. Jaffee and their Permitted Transferees, whether owned directly or
beneficially (including the shares owned by The Northern Trust Company, as
Trustee under an Agreement between Noah Jaffee (a/k/a Nick Jaffee) and The
Northern Trust Company, as Trustee, dated April 26, 1962 and designated Trust
No. 27962, but excluding any shares  ("EXCLUDED SHARES") owned beneficially
where (i) such beneficial ownership results solely from possession of the power
to vote or direct the disposition of such shares and where (ii) there is no
economic interest, including a contingent or future interest, in such shares)
cease to account for at least twenty percent (20%) of the total of both shares
of the Common Stock and shares of the Class B Stock outstanding, TREATED AS ONE
CLASS FOR THE PURPOSE OF SUCH COMPUTATION, OR (B)  FOR A CONTINUOUS PERIOD OF
ONE YEAR, THE SHARES OF CLASS B STOCK, COMMON STOCK AND NON-VOTING STOCK OWNED
BY RICHARD M. JAFFEE AND ROBERT D. JAFFEE AND THEIR PERMITTED TRANSFEREES,
WHETHER OWNED DIRECTLY OR BENEFICIALLY, BUT EXCLUDING THE EXCLUDED SHARES, DO
NOT  ACCOUNT FOR AT LEAST TEN PERCENT (10%) OF THE TOTAL OF SHARES OF COMMON
STOCK, SHARES OF CLASS B STOCK AND SHARES OF NON-VOTING STOCK  OUTSTANDING,
treated as one class for the purpose of such computation, any shares of the
Class B Stock which are then outstanding shall, without any action by the Board
of Directors or the holder or holders thereof, automatically convert (BUT, IN
THE CASE OF CLAUSE (B) HEREOF, ONLY AT THE END OF THE CONTINUOUS PERIOD OF ONE
YEAR REFERRED TO THEREIN) into and become for all purposes shares of the Common
Stock, and the provisions of this Certificate of Incorporation which provide
for different voting or cash dividend rights for the Common Stock and the Class
B Stock shall thence forth not be of any effect.  All shares of either or both
the Common Stock or the Class B Stock which are then outstanding shall have
equal and general voting power in the election of directors and in all other
matters upon which stockholders of the Corporation are entitled to vote or give
consent, even if at such time there shall have been fixed by the Board of
Directors a record date for voting at any meeting of stockholders.  The Board
of Directors is hereby authorized to take such actions, consistent with the
Delaware General Corporation Law, as it deems appropriate or advisable with
respect to the replacement of certificates then outstanding evidencing
ownership of the Class B Stock, or otherwise, in order to carry into effect the
foregoing provisions.

8.       Issuance of the Common Stock AND CLASS A COMMON STOCK.

         The Board of Directors of the Corporation may from time to time
authorize by resolution the issuance of any or all shares of the  Common
Stock OR CLASS A COMMON STOCK herein authorized in accordance with the
terms and conditions set forth in this Certificate of Incorporation for such
purposes, in such amounts, to such persons, corporations, or entities, and for
such consideration all as the Board of Directors in its discretion may
determine and without any vote or other action by the stockholders, except as
otherwise required by law.  At any time shares of the Class B Stock OR
SHARES OF CLASS A COMMON STOCK are outstanding, the Board of Directors  (A)
may issue shares of the Common Stock OR CLASS A COMMON STOCK in the
form of a distribution or distributions pursuant to a stock dividend or
split-up of the shares of the Common Stock OR CLASS A COMMON STOCK,
RESPECTIVELY, or pursuant to any other distribution [which is intended to be
pro-rata to the Corporation's stockholders, only to the then holders of the
outstanding shares of the Common Stock and] ONLY IF SUCH STOCK DIVIDEND,
SPLIT-UP OR OTHER DISTRIBUTION IS in conjunction with and in the same ratio as
a stock dividend on or stock split-up or other distribution of the shares of
the Class B Stock , AND  INTENDED TO BE PRO-RATA TO ALL OF THE
CORPORATION'S STOCKHOLDERS, AND IS PAID AS FOLLOWS:  (I) IN COMMON STOCK TO THE
THEN HOLDERS OF THE  OUTSTANDING SHARES OF COMMON STOCK; (II) IN CLASS A
COMMON STOCK TO THE THEN HOLDERS OF THE OUTSTANDING SHARES OF CLASS A COMMON
STOCK; AND  (III) IN CLASS B STOCK TO THEN HOLDERS OF THE OUTSTANDING SHARES
OF CLASS B STOCK; OR (B) MAY ISSUE SHARES OF CLASS A COMMON STOCK PURSUANT TO
THE SPECIAL STOCK DIVIDEND, IF THE SPECIAL STOCK DIVIDEND HAS NOT
PREVIOUSLY BEEN ISSUED.

9.       Purchase of COMMON STOCK, CLASS A Common Stock or Class B  Stock
         by the Corporation.
         Subject to any applicable provision of this Article FOURTH, the
Corporation may at any time or from time to time purchase or otherwise acquire
shares of its Common Stock , CLASS A COMMON STOCK or Class B Stock in any
manner now or hereafter permitted by law, publicly or privately, or pursuant to
any agreement.

                                      -37-
   39
10.      Rights on Liquidation.
         In the event the Corporation shall be liquidated, dissolved or wound
up, whether voluntarily or involuntarily, the holders of the Class B Stock ,
CLASS A COMMON STOCK AND COMMON STOCK shall be entitled to share ratably [with
the holders of the Common Stock of the Corporation] as a single class in the
remaining net assets of the Corporation, that is, an equal amount of net assets
for each share of Common Stock , CLASS A  COMMON STOCK and Class B [Common]
Stock.  A merger or consolidation of the Corporation with or into any other
corporation or a sale or conveyance of all or any part of the assets of the
Corporation (which shall not in fact result in the liquidation of the
Corporation and the distribution of assets to stockholders) shall not be deemed
to be a voluntary or involuntary liquidation or dissolution or winding up of
the Corporation within the meaning of this paragraph 10.

                                         -38-
   40
[LETTERHEAD OF WILLIAM BLAIR AND COMPANY]

October 19, 1994

Oil-Dri Corporation
410 N. Michigan Avenue
Suite 400
Chicago, IL 60611

Dear Directors:

In connection with the Special Stock Dividend Proposal ("Special Stock
Dividend") summarized below, the Board of Directors of Oil-Dri Corporation (the
"Corporation") has requested our opinion as to certain effects of the adoption
of the Special Stock Dividend.  Specifically you have requested our opinion as
to the effects of the Special Stock Dividend, from a financial point of view
and under current market conditions, upon the market liquidity for the Class A
Common Stock or Common Stock, upon the ability of investors to buy and sell
Class A Common Stock or Common Stock and upon the Corporation's ability to raise
capital through an offering or offerings of shares of the Class A Common Stock. 
You have also asked our opinion as to the effect of the Special Stock Dividend
upon the aggregate market value of the Company's common equity.

The Special Stock Dividend provides for among other things, (i) an increase in
the number of authorized shares from 22,000,000 to 52,000,000; (ii) a dividend
of 1 share of Class A Common Stock for each share of Common Stock and Class B
Stock, or alternatively a recapitalization in which half of each outstanding
share of Common Stock and Class B Stock would be exchanged for one half share
of Class A Common Stock.  The Class A Common Stock and the Common Stock will be
substantially identical in all respects except that the Class A Common
Stock will have no voting rights except as required by law.  The Class B Stock
would continue to have 10 votes per share and the Common Stock would continue
to have 1 vote per share.  In addition, the dividend preferences will be
changed so that the cash dividends on Class A and Common Stock are equal and
the sum of cash dividends on a share of Common Stock and a share of Class A
Common Stock will be least 133 1/3% of the sum of cash dividends on 1 share of
Class B and 1 share of Class A Common Stock.

In arriving at our opinion, we have (1) reviewed drafts of the Corporation's
Proxy Statement dated November 1, 1994; (2) studied the historical financial
statements of the Corporation; (3) examined the historical market and volume
data of the Corporation and of companies with multiple classes of common stock
with different voting rights; (4) reviewed voting rights and other terms of the
classes of common stock for companies included in (3) above; (5) analyzed data
relating to the issuance of stock by companies with multiple classes of common
stock with different voting rights; and (6) completed other analyses as we have
deemed appropriate.

William Blair & Company, as part of its securities sales and trading business,
is a member of the New York and American Stock Exchanges and a major market
maker in the over-the-counter market for equity securities. William Blair &
Company has acted as financial advisor to the Corporation in connection with the
Special Stock Dividend.

   41
Based on the foregoing and other factors we deem relevant, it is our
opinion that, from a financial point of view and under current market
conditions, the adoption of the Special Stock Dividend and any subsequent
implementation would not have a material adverse effect (1) upon the market
liquidity for the Class A Common Stock or Common Stock; (2) upon the ability of
investors to buy and sell Class A Common Stock or Common Stock; and (3) upon
the Corporation's ability to raise capital through an offering or offerings of
shares of Class A Common Stock.  In addition, it is our opinion that from a
financial point of view and under current market conditions, immediately after
the announcement and implementation of the Special Stock Dividend, the total
market value of the Corporation's Class A Common Stock and Class B Stock and
Common Stock will not be materially different than the total market value of
the Corporation's existing Common Stock and Class B Stock immediately prior to
the announcement and implementation of the Special Stock Dividend. 

Sincerely yours,

WILLIAM BLAIR & COMPANY

John R. Ertelson

JRE/sm

   42
PROXY                                                                      PROXY

                        OIL-DRI CORPORATION OF AMERICA
             410 NORTH MICHIGAN AVENUE, CHICAGO, ILLINOIS  60611

         THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

        The undersigned hereby appoints Richard M. Jaffee, Robert D. Jaffee and
A. L. Swerdlik as Proxies, each with the power to appoint his substitute (the
action of one, if only one be present and acting, to be in any event
controlling),  and hereby authorizes them to represent and to vote, as
designated below, all of the shares of Common Stock and Class B Stock of
Oil-Dri Corporation of America held of record by the undersigned at the close
of business on October 21, 1994 at the annual meeting of stockholders to be
held on December 13, 1994 or any adjournment thereof.

THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED STOCKHOLDER.  EXCEPT AS OTHERWISE DIRECTED, THIS PROXY WILL
BE VOTED FOR PROPOSALS 1 AND 2.

           PLEASE MARK, SIGN, DATE AND MAIL THE PROXY CARD PROMPTLY
                         USING THE ENCLOSED ENVELOPE.

                (Continued and to be signed on reverse side.)
   43
    PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. / /
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1.  ELECTION OF DIRECTORS --                                            FOR ALL
    Nominees: J. Steven  Cole, Norman B. Gershon, Daniel S. Jaffee,    NOMINEES     WITHOLD    FOR
    Richard M. Jaffee, Robert D. Jaffee, Edgar D. Jannotta, Joseph      LISTED      FOR ALL    ALL (EXCEPT NOMINEE(S) WRITTEN BELOW)
    C. Miller, Paul J. Miller, Haydn H. Murray, Allan H. Selig,          / /        / /          / /     
    Bruce Sone.

2.  Approval of amendment to Certificate of Incorporation               FOR         AGAINST    ABSTAIN
    authorizing 30 million shares of Class A Common Stock.              / /        / /          / /     

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3.  In their discretion, the Proxies are authorized to vote
    upon such other business as may properly come before
    the meeting.

/ / Please check box if you are planning to attend the meeting.

                                        Dated:                      , 1994
                                              ----------------------
 
                              Signature(s) 
                                           ------------------------------------

                              -------------------------------------------------
                              Please sign exactly as name appears on this side
                              of the proxy.  When shares are held by joint 
                              tenants, both should sign.  When signing as 
                              attorney, administrator, trustee or guardian,
                              please give full title as such.  If a corporation,
                              please sign in full corporate name by President or
                              other authorized officer.  If a partnership,
                              please sign in partnership name by an authorized
                              person.

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