~~U.S. CONCRETE, INC.~~

INDEX



				Page No.
Part I – Financial Information
Item 1.			Financial Statements (Unaudited)
			Condensed Consolidated Balance Sheets	31
			Condensed Consolidated Statements of Operations	42
			~~Condensed Consolidated Statements of Changes in Equity~~	5
	Condensed Consolidated Statements of Cash Flows	63
			Condensed Consolidated Statements of Total Equity	5
			Notes to Condensed Consolidated Financial Statements	86
			~~Cautionary Statement Concerning Forward-Looking Statements~~1. Basis of Presentation	406
			2. Acquisitions and Business Combinations	6
			3. Allowance for Doubtful Accounts and Customer Disputes	8
			4. Inventories	9
			5. Debt	9
			6. Stock-based Compensation	11
			7. Income Taxes	12
			8. Earnings (Loss) Per Share	12
			9. Commitments and Contingencies	12
			10. Segment Information	15

Item 2.			Management’s Discussion and Analysis of Financial Condition and Results of Operations	4118
Item 3.			Quantitative and Qualitative Disclosures About Market Risk	5429
Item 4.			Controls and Procedures	5429

Part II – Other Information
Item 1.			Legal Proceedings	5630
Item 1A.			Risk Factors	5630
Item 2.			Unregistered Sales of Equity Securities and Use of Proceeds	5632
Item 4.			Mine Safety Disclosures	5632
Item 6.			Exhibits	5733

~~SIGNATURE~~Signature				5834

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

U.S. CONCRETE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in ~~thousands)~~millions)

September 30, 2017
December 31, 2016

(Unaudited)

ASSETS

Current assets:

Cash and cash equivalents $ 248,263

$ 75,774
Trade accounts receivable, net of allowances of $6,284 and $5,960 as of September 30, 2017, and December 31, 2016, respectively 234,976

207,292
Inventories 45,429

41,979
Other receivables 14,080

8,691
Prepaid expenses 6,328

5,534
Other current assets 1,298

2,019
Total current assets 550,374

341,289
Property, plant and equipment, net of accumulated depreciation, depletion, and amortization of $167,874 and $137,629 as of September 30, 2017, and December 31, 2016, respectively 438,789

337,412
Goodwill 147,160

133,271
Intangible assets, net 121,385

130,973
Other assets 1,993

2,457
Total assets $ 1,259,701

$ 945,402
LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Accounts payable $ 123,126

$ 110,694
Accrued liabilities 90,563

85,243
Current maturities of long-term debt 24,938

16,654
Derivative liabilities —
57,415
Total current liabilities 238,627

270,006
Long-term debt, net of current maturities 663,480

432,644
Other long-term obligations and deferred credits 60,833

46,267
Deferred income taxes 14,970

7,656
Total liabilities 977,910

756,573
Commitments and contingencies (Note 14)

Stockholders' equity:

Preferred stock —

—
Common stock 18

17
Additional paid-in capital 317,254

249,832
Accumulated deficit (10,711 )
(39,296 )
Treasury stock, at cost (24,770 )
(21,724 )
Total stockholders' equity 281,791

188,829
Total liabilities and stockholders' equity $ 1,259,701

$ 945,402

~~The accompanying notes are an integral part of these condensed consolidated financial statements.~~

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS~~

~~(Unaudited)~~

~~(in thousands, except per share amounts)~~

Three Months Ended
September 30,
Nine Months Ended
September 30,
2017
2016
2017
2016
Revenue $ 354,628

$ 328,588

$ 994,687

$ 849,383
Cost of goods sold before depreciation, depletion and amortization 278,995

253,477

778,328

674,451
Selling, general and administrative expenses 30,056

25,104

86,073

71,447
Depreciation, depletion and amortization 16,593

14,139

48,802

38,795
Change in value of contingent consideration 719
714
2,047
2,325
Impairment of assets 648
—
648
—
Loss (gain) on disposal of assets, net (106 )
(1,003 )
(496 )
(1,016 )
Operating income 27,723

36,157
79,285
63,381
Interest expense, net 10,552

7,635

31,062

19,933
Derivative loss (income) (13,119 ) (21,772 )
791

(6,430 )
Loss on extinguishment of debt 60

—

60

12,003
Other income, net (1,287 )
(405 )
(2,591 )
(1,412 )
Income from continuing operations before income taxes 31,517

50,699
49,963
39,287
Income tax expense 7,241

12,577

20,854

14,317
Income from continuing operations 24,276

38,122
29,109
24,970
Loss from discontinued operations, net of taxes (222 )
(166 )
(524 )
(518 )
Net income $ 24,054

$ 37,956
$ 28,585
$ 24,452

Basic income (loss) per share:

Income from continuing operations $ 1.51

$ 2.50

$ 1.85

$ 1.67
Loss from discontinued operations, net of taxes (0.01 )
(0.01 )
(0.03 )
(0.04 )
Net income per share – basic $ 1.50

$ 2.49
$ 1.82
$ 1.63

Diluted income (loss) per share:

Income from continuing operations $ 1.46
$ 2.35
$ 1.75
$ 1.54
Loss from discontinued operations, net of taxes (0.01 ) (0.01 ) (0.03 ) (0.03 )
Net income per share – diluted $ 1.45

$ 2.34
$ 1.72
$ 1.51

Weighted average shares outstanding:

Basic 16,028

15,222

15,745

14,978
Diluted 16,651
16,240
16,633
16,186


	June 30, 2021		December 31, 2020
ASSETS	(Unaudited)
Current assets:
Cash and cash equivalents	$	20.9	$	11.1
Trade accounts receivable, net	193.5		212.5
Inventories	76.5		70.3
Other receivables, net	25.8		13.2
Prepaid expenses and other	9.1		11.1
Total current assets	325.8		318.2
Property, plant and equipment, net of accumulated depreciation, depletion and amortization of $395.3 as of June 30, 2021 and $360.2 as of December 31, 2020	806.8		788.2
Operating lease assets	73.2		76.1
Goodwill	238.0		238.2
Intangible assets, net of accumulated amortization of $102.1 as of June 30, 2021 and $97.5 as of December 31, 2020	60.0		70.9
Other assets	19.8		14.7
Total assets	$	1,523.6	$	1,506.3
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	94.3	$	127.8
Accrued liabilities	75.6		86.1
Current maturities of long-term debt	40.8		33.7
Current operating lease liabilities	14.7		14.3
Total current liabilities	225.4		261.9
Long-term debt, net of current maturities	748.3		668.7
Long-term operating lease liabilities	62.5		65.5
Other long-term obligations and deferred credits	46.4		51.9
Deferred income taxes	61.3		56.6
Total liabilities	1,143.9		1,104.6
Commitments and contingencies (Note 9)	0		0
Equity:


Additional paid-in capital	381.4		363.8
Retained earnings	28.2		53.3
Treasury stock, at cost	(52.2)		(37.9)
Total shareholders' equity	357.4		379.2
Non-controlling interest	22.3		22.5
Total equity	379.7		401.7
Total liabilities and equity	$	1,523.6	$	1,506.3

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

U.S. CONCRETE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATEDSTATEMENTS OF ~~CHANGES IN EQUITY~~OPERATIONS

(in millions except per share amounts)

(Unaudited)

~~(in thousands)~~


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Revenue	$	327.4	$	322.7	$	613.1	$	657.1
Cost of goods sold excluding depreciation, depletion and amortization	259.4		250.1		492.5		524.0
Selling, general and administrative expenses	48.3		31.7		77.6		65.4
Depreciation, depletion and amortization	25.7		25.2		50.1		48.6
Change in value of contingent consideration	0		(5.8)		(0.1)		(5.5)

Gain on sale/disposal of assets and business, net	(0.1)		(0.1)		(1.6)		(0.1)
Operating income (loss)	(5.9)		21.6		(5.4)		24.7
Interest expense, net	10.3		11.4		20.7		22.8
Loss on extinguishment of debt	5.5		0		5.5		0
Other income, net	(0.5)		(0.6)		(0.9)		(1.2)
Income (loss) before income taxes	(21.2)		10.8		(30.7)		3.1
Income tax expense (benefit)	(0.7)		4.3		(5.4)		(0.6)
Net income (loss)	(20.5)		6.5		(25.3)		3.7
Amounts attributable to non-controlling interest	(0.2)		(0.1)		(0.2)		0.2
Net income (loss) attributable to U.S. Concrete	$	(20.3)	$	6.6	$	(25.1)	$	3.5

Earnings (loss) per share attributable to U.S. Concrete:
Basic and diluted	$	(1.19)	$	0.39	$	(1.49)	$	0.21

Weighted average shares outstanding:
Basic and diluted	17.0		16.6		16.9		16.6

Common Stock
# of Shares Par Value
Additional
Paid-In
Capital

Accumulated
Deficit

Treasury
Stock

Total
Equity
BALANCE, December 31, 2016 15,696
$ 17
$ 249,832
$ (39,296 ) $ (21,724 ) $ 188,829
Stock-based compensation expense —
—
6,523
—
—
6,523
Restricted stock vesting 13
—
—
—
—
—
Restricted stock grants, net of cancellations 139
—
—
—
—
—
Stock options exercised 6
—
132
—
—
132
Warrants exercised 834
1
60,767
—
—
60,768
Other treasury share purchases (44 ) —
—
—
(3,046 ) (3,046 )
Net income —
—
—
28,585
—
28,585
BALANCE, September 30, 2017 16,644
$ 18
$ 317,254
$ (10,711 ) $ (24,770 ) $ 281,791

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

U.S. CONCRETE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

(Unaudited)

~~(in thousands)~~


	Six Months Ended June 30,
	2021		2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	(25.3)	$	3.7
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion and amortization	50.1		48.6
Loss on extinguishment of debt	5.5		0
Amortization of debt issuance costs	1.0		1.0
Change in value of contingent consideration	(0.1)		(5.5)
Gain on sale/disposal of assets and business, net	(1.6)		(0.1)
Deferred income taxes	5.8		2.6
Provision for doubtful accounts and customer disputes	1.0		1.0
Stock-based compensation	17.6		6.2
Other, net	1.0		(0.8)
Changes in assets and liabilities, excluding effects of acquisitions:
Accounts receivable	18.0		24.9
Inventories	(13.1)		1.7
Prepaid expenses and other current assets	(10.7)		(3.0)
Other assets and liabilities	(4.4)		2.7
Accounts payable and accrued liabilities	(40.4)		1.1
Net cash provided by operating activities	4.4		84.1
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment	(46.0)		(14.2)
Proceeds from sale of business and property, plant and equipment	3.0		0.3
Payments for acquisition of businesses	(0.2)		(140.2)
Net cash used in investing activities	(43.2)		(154.1)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from revolver borrowings	274.4		260.8
Repayments of revolver borrowings	(277.4)		(204.3)
Proceeds from issuance of term loans	296.2		0
Repayment of senior unsecured notes	(200.0)		0
Premium paid on early retirement of debt	(3.2)		0
Payments for acquisition-related liabilities	(8.2)		(9.9)
Payments for finance leases, promissory notes and other	(17.6)		(10.8)
Shares redeemed for employee income tax obligations	(14.3)		(1.2)
Proceeds from finance leases and other	0		14.5
Debt issuance costs	(1.2)		(2.2)
Net cash provided by financing activities	48.7		46.9
EFFECT OF EXCHANGE RATES ON CASH AND CASH EQUIVALENTS	(0.1)		0
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	9.8		(23.1)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	11.1		40.6
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	20.9	$	17.5

Nine Months Ended
September 30,
2017
2016
CASH FLOWS FROM OPERATING ACTIVITIES:

Net income $ 28,585

$ 24,452
Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation, depletion and amortization 48,802

38,795
Amortization of debt issuance costs 1,515

1,431
Amortization of discount on long-term incentive plan and other accrued interest 530

445
Amortization of premium on long-term debt (1,163 ) —
Derivative loss (income) 791

(6,430 )
Change in value of contingent consideration 2,047

2,325
Net loss (gain) on disposal of assets (496 )
(1,016 )
Loss on extinguishment of debt 60
12,003
Asset impairments 648
—
Deferred income taxes 6,863

9,772
Provision for doubtful accounts and customer disputes 3,518

1,421
Stock-based compensation 6,523

5,678
Changes in assets and liabilities, excluding effects of acquisitions:

Accounts receivable (30,076 )
(24,969 )
Inventories (2,946 )
(4,376 )
Prepaid expenses and other current assets 1,565

(1,906 )
Other assets and liabilities 201

2,168
Accounts payable and accrued liabilities 17,279

32,497
Net cash provided by operating activities 84,246

92,290
CASH FLOWS FROM INVESTING ACTIVITIES:

Purchases of property, plant and equipment (33,984 )
(31,041 )
Payments for acquisitions, net of cash acquired (56,796 )
(124,481 )
Advance for note receivable (8,063 ) —
Proceeds from disposals of property, plant and equipment 1,003

1,920
Proceeds from disposal of businesses 1,305

375
Net cash used in investing activities (96,535 )
(153,227 )
CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from revolver borrowings —

128,904
Repayments of revolver borrowings —

(173,904 )
Proceeds from issuance of debt 211,500
400,000
Repayments of debt —

(200,000 )
Premium paid on early retirement of debt —
(8,500 )
Proceeds from exercise of warrants and stock options 2,695

166
Payments of other long-term obligations (7,722 )
(4,143 )
Payments for other financing (14,317 )
(8,880 )
Debt issuance costs (4,332 )
(7,786 )
Other treasury share purchases (3,046 )
(2,825 )
Net cash provided by financing activities 184,778

123,032
NET INCREASE IN CASH AND CASH EQUIVALENTS 172,489

62,095
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 75,774

3,925
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 248,263

$ 66,020

U.S. CONCRETE, INC. AND ~~SUBSIDARIES~~SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)

(in millions)

(Unaudited)

(


	Six Months Ended June 30,
	2021		2020
Supplemental Disclosure of Cash Flow Information:
Net cash paid for interest	$	18.2	$	22.6
Net cash paid for (refund from) income taxes	$	1.8	$	(0.1)

Supplemental Disclosure of Non-cash Investing and Financing Activities:
Capital expenditures funded by finance leases and promissory notes	$	11.6	$	13.7
Net right-of-use assets obtained in exchange for operating lease liabilities	$	4.5	$	7.4
Acquisitions funded by deferred consideration	$	0	$	1.7
Transfer of non-controlling interest	$	0	$	3.3

Approximately $0.6 million of accounts payable owed by the Company was effectively settled as part of the Coram Acquisition, as defined in ~~thousands)~~Note 2 to these condensed consolidated financial statements.

Nine Months Ended
September 30,
2017 2016
Supplemental Disclosure of Cash Flow Information:

Cash paid for interest $ 20,870
$ 11,389
Cash paid for income taxes $ 17,377
$ 2,892

Supplemental Disclosure of Non-cash Investing and Financing Activities:
Capital expenditures funded by capital leases and promissory notes $ 45,517
$ 29,171
Settlement of accounts receivable for acquisition of a business $ —
$ 1,000

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

U.S. CONCRETE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATEDSTATEMENTS OF TOTAL EQUITY

(in millions)

(Unaudited)


	# of Common Shares	Additional Paid-In Capital		Retained Earnings		Treasury Stock		Total Shareholders' Equity		Non-controlling Interest		Total Equity
December 31, 2019	16.7	$	348.9	$	31.1	$	(36.6)	$	343.4	$	26.2	$	369.6
Cumulative-effect adjustment upon adoption of ASC 326, net of taxes	—	—		(3.3)		—		(3.3)		—		(3.3)
Transfer of non-controlling interest	—	3.3		—		—		3.3		(3.3)		—
Stock-based compensation	—	3.7		—		(1.1)		2.6		—		2.6
Net income (loss)	—	—		(3.1)		—		(3.1)		0.3		(2.8)
March 31, 2020	16.7	355.9		24.7		(37.7)		342.9		23.2		366.1
Stock-based compensation	—	2.5		—		(0.2)		2.3		—		2.3
Net income	—	—		6.6		—		6.6		(0.1)		6.5
June 30, 2020	16.7	$	358.4	$	31.3	$	(37.9)	$	351.8	$	23.1	$	374.9

December 31, 2020	16.7	$	363.8	$	53.3	$	(37.9)	$	379.2	$	22.5	$	401.7
Stock-based compensation	0.3	2.9		—		(9.7)		(6.8)		—		(6.8)

Net income (loss)	—	—		(4.8)		—		(4.8)		—		(4.8)
March 31, 2021	17.0	366.7		48.5		(47.6)		367.6		22.5		390.1
Stock-based compensation	0.1	14.7		—		(4.6)		10.1		—		10.1
Net income (loss)	—	—		(20.3)		—		(20.3)		(0.2)		(20.5)
June 30, 2021	17.1	$	381.4	$	28.2	$	(52.2)	$	357.4	$	22.3	$	379.7

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

U.S. CONCRETE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


1.	~~BASIS OF PRESENTATION~~

~~The accompanying~~

1.BASIS OF PRESENTATION AND ACCOUNTING POLICIES

These unaudited condensed consolidated financial statements include the accounts of U.S. Concrete, Inc. and its subsidiaries (collectively, ~~"we," "us," "our," "U.S. Concrete,"~~“we,” “us,” “our,” the “Company,” or ~~the "Company"~~“U.S. Concrete”) and ~~have been~~were prepared ~~pursuant to~~in accordance with the rules and regulations of the Securities and Exchange Commission (the ~~"SEC"~~“SEC”) ~~for reporting~~applicable to interim financial ~~information. Some~~statements. While these unaudited condensed consolidated financial statements reflect all normal recurring adjustments that are, in the opinion of management, necessary for fair presentation of the results of the interim period, they do not include all of the information and ~~footnote disclosures normally included in financial statements prepared in accordance with~~footnotes required by generally accepted accounting principles in the United States ("(“U.S. ~~GAAP"~~GAAP”) ~~have been~~for complete financial statements. Our unaudited condensed ~~or omitted pursuant to~~consolidated financial statements reflect estimates and assumptions made by management that affect the ~~SEC’s rules~~reported amounts of assets, liabilities, revenues and ~~regulations.~~expenses. Such estimates and assumptions affect, among other things, our goodwill and long-lived asset valuations; inventory valuation; assessment of the effective tax rate; valuation of deferred income taxes; valuation of liabilities for workers' compensation, automobile, and general liability; allowance for doubtful accounts; and measurement of cash bonus plans. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes in our Annual Report on Form 10-K for the year ended December 31, ~~2016~~2020 (the ~~"2016 Form 10-K"~~“2020 10-K”). In

We use the ~~opinion of our management, all adjustments necessary to state fairly the information~~same accounting policies in ~~our unaudited condensed consolidated~~preparing quarterly and annual financial ~~statements and to make such financial statements not misleading~~statements. Certain reclassifications have been ~~included. All adjustments~~made to prior year amounts to conform with the current year presentation. Unless otherwise noted, all amounts are presented in U.S. dollars. Certain computations may be impacted by the effect of ~~a normal or recurring nature.~~rounding in this report. Operating results for interim periods are not necessarily indicative of the results that may be expected for the full ~~year.~~

~~The preparation of financial statements and accompanying notes in conformity with U.S. GAAP requires management~~year primarily due to ~~make estimates and assumptions in determining~~ the ~~reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as~~impact of the ~~date of~~coronavirus (“COVID-19”) pandemic, weather patterns and general economic conditions in our markets.

2. ACQUISITIONS AND BUSINESS COMBINATIONS

Rail Terminal and Bulk Storage Facility

On April 20, 2021, we purchased a rail terminal and bulk storage facility for cementitious materials in Stockton, California for $8.2 million that is currently leased to and operated by a third party. We made this investment to increase the ~~financial statements~~control and stability over our raw material supply chain to support our West Region's ready-mixed concrete business. We accounted for this purchase as an asset acquisition and recorded the assets in property, plant and equipment on our condensed consolidated balance sheets.

Property Royalty Agreement

On March 12, 2021, we acquired property and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Estimates and assumptions that we consider critical and that involve complex judgments in the preparation of our financial statements include those related to our business combinations, goodwill and goodwill impairment, impairment of long-lived assets, accruals for self-insurance programs, income taxes, derivative instruments, and contingent consideration.

~~Certain reclassifications have been made to prior year balances to conform~~underlying royalty agreement associated with the ~~current year presentation.~~


2.	~~RECENT ACCOUNTING PRONOUNCEMENTS AND SIGNIFICANT ACCOUNTING POLICIES~~

~~Standards/Updates Adopted This Year~~

~~In March 2016,~~Orca Quarry on Vancouver Island, British Columbia, Canada for $28.7 million (the “Orca Acquisition”). The Orca Acquisition had the ~~Financial Accounting Standards Board ("FASB") issued an amendment related to share-based~~effect of eliminating future royalty payments, ~~to employees,~~ which ~~simplifies several aspects~~had previously been recognized in cost of goods sold excluding depreciation, depletion and amortization in our condensed consolidated statements of operations. We accounted for the accounting for employee share-based payment transactions for public entities. In the first quarter of 2017, we adopted all applicable aspects of this standard on a prospective basis with the exception of the presentation of excess tax benefits on the statement of cash flows, which we adopted on a retrospective basis, and the election to account for forfeitures as they occur, which we adopted on a modified-retrospective basis. The new standard requires companies to recognize all excess tax benefits and tax deficiencies in the income statement when the awards vest or are settled, rather than recognized as additional paid-in capital in the equity section of the balance sheet. Upon adoption, we recognized $0.2 million in discrete tax benefits related to share-based payment accounting, resulting in a lower effective tax rate. This standard also affects the average shares outstanding used in the diluted earnings per share calculation, as we no longer increase or decrease the assumed proceeds from an employee vesting in, or exercising, a share-based payment award by the amount of excess tax benefits or deficiencies taken to additional paid-in capital.

~~The guidance also requires excess tax benefits to be classified~~Orca Acquisition as an ~~operating activity~~asset acquisition and recorded the assets in the statement of cash flows rather than a financing activity. Retrospective application of the cash flow presentation requirement resulted in an increase to net cash provided by operating activities of $3.8 millionproperty, plant and a decrease to net cash provided by financing activities of $3.8 million for the nine months ended September 30, 2016. Further, this guidance permits an entity to make an accounting policy election to either estimate forfeitures on stock compensation awards, as previously required, or to recognize forfeitures as they occur. We elected to change our accounting policy from estimating forfeitures expected to occur to recognizing forfeitures as they occur. This change in policy did not have a material impactequipment on our ~~financial condition, results of operations, or cash flows.~~

In July 2015, the FASB issued guidance requiring inventory to be measured at the lower of cost or net realizable value, which is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. This guidance is effective prospectively for annual reporting periods beginning after December 15, 2016, and interim reporting periods within those annual reporting periods. We adopted this guidance as of January 1, 2017, when it became effective for us. There was no impact on our consolidated financial statements or results of operations as a result of adopting this standard.

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~Standards/Updates Not Yet Adopted~~

In January 2017, the FASB issued new guidance to simplify the accounting for goodwill impairment. The guidance removes the second step of the goodwill impairment test, which requires a hypothetical purchase price allocation. Upon adoption, a goodwill impairment will be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. All other goodwill impairment guidance will remain largely unchanged. Entities will continue to have the option to perform a qualitative assessment to determine if a quantitative impairment test is necessary. The same one-step impairment test will be applied to goodwill at all reporting units, even those with zero or negative carrying amounts. Entities will be required to disclose the amount of goodwill at reporting units with zero or negative carrying amounts. This guidance is effective in 2020, but early adoption is permitted for any impairment tests performed after January 1, 2017. We are currently evaluating the impact that this guidance will have on our financial condition and results of operations.

In January 2017, the FASB issued an update under business combinations in an effort to clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or as business combinations. The amendments in this update provide a screen to determine when a set of assets is not of a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. This screen reduces the number of transactions that need to be further evaluated. This guidance is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early application is permitted for transactions for which the acquisition (or disposal) date occurs before the effective date of the amendments, if the transaction has not been reported in financial statements that have been issued or made available for issuance. We do not expect the adoption of this standard to have a material impact on our financial condition and results of operations.

In August 2016, the FASB issued guidance to reduce diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The new amendment is effective for financial statements issued for fiscal years beginning after December 15, 2017, and interim periods within those periods. Adoption of this standard will not result in any material changes to our statements of cash flows.

In February 2016, the FASB issued an amendment related to leases. The new guidance requires the recognition of lease assets and lease liabilities for all of our leases greater than one year in duration that are currently classified as operating leases. The adoption of this amendment will result in a significant increase to the Company'scondensed consolidated balance ~~sheets for lease liabilities and right-of-use~~sheets.

Sugar City Building Materials Co.

On November 7, 2020, we acquired certain assets ~~and we are still evaluating the other effects the adoption on our financial condition and results~~ of operations. The evaluation process will include reviewing all forms of leases, performing a completeness assessment over the lease population, analyzing the practical expedients, and assessing the need to make any changes to our lease accounting technology system in order to determine the best implementation strategy. The standard will be adopted when it becomes effective for us in the first quarter of 2019 using a modified retrospective transition beginning with the earliest comparative period presented.

~~In May 2014, the FASB issued guidance that outlines a single comprehensive model for accounting for revenue arising from contracts with customers,~~Sugar City Building Materials Co. (the “Sugar City Acquisition”), which supersedes most of the existing revenue recognition guidance. This guidance requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services and also requires certain additional disclosures. The guidance is effective for interim and annual reporting periods that begin after December 15, 2017. The guidance permits two methods of adoption: retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (modified retrospective method). We primarily earn our revenue by producing and delivering ready-mixed concrete, aggregates, and related building materials, as requested by our customers primarily through purchase orders. We generally do not have significant customer contracts and do not provide post-delivery services, such as paving or finishing. As such, adoption of the new guidance should not result in significant changes in the amount of revenue recognized or the timing of when such revenue is recognized. We will adopt the new guidance in the first quarter of 2018, when it becomes effective for us, using the modified retrospective transition method.

~~For a description of our significant accounting policies, see Note 1 of the consolidated financial statements in our 2016 Form 10-K.~~

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~


3.	~~ACQUISITIONS~~

~~2017 Acquisitions~~

~~We completed four acquisitions that~~ expanded our ready-mixed concrete ~~and aggregate products~~ operations ~~during the first nine months~~in our West Region, for total cash consideration of ~~2017. The total consideration was $53.7 million, along with contingent consideration~~$7.8 million. We accounted for the ~~Corbett acquisition,~~Sugar City Acquisition as ~~defined below,~~a business combination. The assets acquired primarily included inventory and property, plant and equipment. The Sugar City Acquisition resulted in $2.1 million of ~~$23.0 million,~~goodwill, which is ~~based~~amortizable for tax purposes and has been allocated to our ready-mixed concrete segment because we expect to receive synergies in that segment. No pro forma information has been disclosed in these financial statements, as the operations of Sugar City Building Materials Co. for the period were not material to our revenue, net income or earnings per share.

Coram Materials Corp.

On February 24, 2020, we acquired the equity of Coram Materials Corp. and certain of its affiliates (collectively, “Coram Materials”). Coram Materials is a sand and gravel products provider located on Long Island in New York. This acquisition increased the ~~amount~~vertical integration of ~~reserves permitted and is not payable before~~our New York City operations.

The acquisition of the equity of Coram Materials (the “Coram Acquisition”) was accounted for as a ~~minimum two-year period following the acquisition date. The aggregate purchase price was comprised of $53.5 million in cash and the assumption of a $0.2 million working capital payable.~~business combination. We funded the initial cash ~~portion of the acquisitions from~~purchase consideration with cash ~~on hand.~~

~~The acquisitions included the assets of the following:~~

~~Corbett Aggregate Companies, LLC. ("Corbett") located~~and borrowings under our Revolving Facility (as defined in ~~Quinton, New Jersey on April 7, 2017;~~

~~Harbor Ready-Mix ("Harbor"~~Note 5) ~~located in Redwood City, California on September 29, 2017;~~

~~A-1 Materials, Inc. ("A-1”) and L.C. Frey Company, Inc. ("Frey") (collectively “A-1/Frey”) located in San Carlos, California on September 29, 2017; and~~

~~Action Supply Co., Inc. ("Action Supply") located in Philadelphia, Pennsylvania on September 29, 2017.~~

. The combined assets acquired through ~~these 2017 acquisitions~~the Coram Acquisition included ~~401~~an aggregates facility with 330 acres of land, ~~with 35~~including 180 mining acres containing approximately 41.9 million tons of in-place, proven and permitted aggregate reserves ~~45 mixer trucks, 4 ready-mix concrete plants, a long-term lease with~~and approximately 7.5 million tons of in-place, proven, but unpermitted aggregate reserves. To effect this transaction, we incurred $0.6 million of transaction costs, which were included in selling and general administrative expenses in our condensed consolidated statements of operations for the South Jersey Port Corporation for an export dock as well as a licensing agreement with the exclusive right to move coarse and fine aggregates through the North Shore Terminal located on Staten Island, New York. See Note 11 for additional information related to contingent consideration obligations.six months ended June 30, 2020.

The recording of the Corbett, Harbor, A-1/Frey, and Action Supply business combinations is preliminary, and we expect to record adjustments as we accumulate information needed to estimate the fair value of assets acquired and liabilities assumed, including working capital balances, estimated fair value of identifiable intangible assets, property, plant, and equipment, and goodwill.

~~The following table presents the~~ total consideration for the ~~2017 acquisitions~~Coram Acquisition and the ~~preliminary~~ amounts related to the assets acquired and liabilities assumed based on the estimated fair values as of the ~~respective~~ acquisition ~~dates (in thousands):~~date were as follows:

2017 Acquisitions
Accounts receivable ⁽¹⁾
$ 1,126
Inventory 504
Other current assets 40
Property, plant and equipment 55,315
Definite-lived intangible assets 5,884
Total assets acquired 62,869
Current liabilities 674
Total liabilities assumed 674
Goodwill 12,164
Total consideration (fair value) ⁽²⁾
$ 74,359


~~(1)~~($ in millions)			~~The aggregate fair value of the acquired accounts~~Coram Materials
Accounts receivable ~~approximates the aggregate gross contractual amount as of the respective acquisition dates.~~(1)

~~(2) Contingent consideration payments included at fair value as of the respective acquisition dates.~~

The accounting for business combinations requires the significant use of estimates and is based on information that was available to management at the time these condensed consolidated financial statements were prepared. We utilized recognized valuation techniques, including the income approach, sales approach, and cost approach to value the net assets acquired. Any changes to the provisional business combination accounting will be made as soon as practical, but no later than one year from the respective acquisition dates.

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~2016 Acquisitions~~

During 2016, we completed four acquisitions that expanded our ready-mixed concrete operations in the New York Metropolitan market for total consideration of $142.8 million. The acquisitions included the assets of the following ready-mixed concrete plants in New York:

•~~Greco Brothers Concrete of L.I., Inc. ("Greco"), located in Brooklyn on February 26, 2016;~~

•~~Nycon Supply Corp. ("Nycon"), located in Queens on June 24, 2016;~~

•~~Jenna Concrete Corp. ("Jenna"), located in Bronx on August 10, 2016; and~~

•~~Kings Ready Mix Inc. ("Kings"), located in Brooklyn on August 22, 2016.~~

The combined assets acquired through the New York acquisitions included land, 10 ready-mixed concrete plants, and a fleet of 189 mixer trucks. In addition, on March 31, 2016, and September 13, 2016, we acquired two individually immaterial ready-mixed concrete operations in our West Texas market for total consideration of $3.5 million.

The aggregate consideration for these six acquisitions included $131.7 million in cash, $6.1 million in payments deferred over a three-year period, the issuance of $1.0 million of credits applied against existing trade accounts receivable, plus 136,215 shares of our common stock, calculated in accordance with the terms of the purchase agreement, and valued at approximately $7.5 million on the date of issuance. We funded the cash portion of these acquisitions through a combination of cash on hand and borrowings under our asset-based revolving credit facility (the "Revolving Facility").

The following table presents the total consideration for the 2016 acquisitions and the final amounts related to the assets acquired and liabilities assumed based on the fair values as of the respective acquisition dates (in thousands):

2016 Acquisitions
Cash $ 9
Accounts receivable ⁽¹⁾
12,314
Inventory 1,249
Other current assets 68
Property, plant and equipment 34,918
Definite-lived intangible assets 47,144
Total assets acquired 95,702
Current liabilities 7,055
Other long-term liabilities 3,713
Total liabilities assumed 10,768
Goodwill 60,583
Total consideration (fair value) ⁽²⁾
$ 145,517

$	2.0
~~(1)~~Inventory			~~The aggregate fair value of the acquired accounts receivable approximates the aggregate gross contractual amount as of the respective acquisition dates.~~

10.0
~~(2)~~Other current assets	~~Deferred payments included at fair value as of the respective acquisition dates.~~0.3
Property, plant and equipment	130.9
Total assets acquired	143.2
Current liabilities	0.1
Other long-term liabilities	0.2
Total liabilities assumed	0.3
Total consideration (fair value)(2)	$	142.9

(1) The aggregate fair value of the acquired accounts receivable approximated the aggregate gross contractual amount.

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~Acquired Intangibles~~

(2) Consisted of a $140.2 million initial cash payment, a $1.7 million initial present value of deferred consideration, and a $1.6 million working capital adjustment paid in August 2020, less a $0.6 million settlement of accounts payable owed by the Company to Coram Materials at the acquisition date. The ~~major classes~~total amount of ~~intangible assets acquired in 2016 and 2017 were as follows (in thousands~~deferred consideration was $2.0 million, of ~~dollars):~~

Weighted Average Amortization Period (In Years) Fair Value At Acquisition Date
Customer relationships 6.00 $ 37,764
Non-compete agreements 5.00 5,807
Leasehold interests 5.00 4,955
Trade names 4.95 4,118
Favorable Contract 3.67 384
Total $ 53,028

The amortization periods of these intangible assets range from seven months to ten years. As of September 30, 2017, the estimated future aggregate amortization expense of definite-lived intangible assets from the acquisitionswhich $1.0 million was ~~as follows (in thousands):~~

Year Ending December 31,
2017 (remainder of the year) $ 2,350
2018 9,398
2019 9,133
2020 8,604
2021 7,679
Thereafter 5,427
Total $ 42,591

~~Also included in other non-current liabilities~~paid in the accompanying condensed consolidated balance sheets is an unfavorable lease intangible with a gross carrying amount of $0.4 million and a net carrying amount of $0.3 million as of September 30, 2017. This unfavorable lease intangible will be amortized over its remaining lease term.

~~During the three and nine~~six months ended ~~September~~June 30, ~~2017, we recorded $2.1 million~~2021 and ~~$6.5 million of net amortization expense and during both~~ the ~~three and nine months ended September 30, 2016, we recorded $1.0 million of net amortization expense related to these intangible assets and unfavorable lease intangibles.~~remainder is due in February 2022.

The goodwill ascribed to each of the 2016 and 2017 acquisitions is related to the synergies we expect to achieve with expansion in the markets in which we already operate as well as entry into new metropolitan areas of our existing geographic markets. The goodwill for the 2016 and 2017 acquisitions relates primarily to our ready-mixed concrete reportable segment. See Note 6 for the allocation of goodwill to our segments. We expect the goodwill to generally be deductible for tax purposes. See Note 12 for additional information regarding income taxes.

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~Actual and Pro Forma~~ Impact of ~~Acquisitions~~Coram Acquisition

During the three months ended ~~September~~June 30, ~~2017, we recorded approximately $39.9~~2020, the Coram Materials business generated revenue of $7.0 million, including intersegment sales of ~~revenue~~$2.7 million, and ~~$4.8 million of~~generated operating income of $1.3 million. During the period from the acquisition date to June 30, 2020, the Coram Materials business generated revenue of $9.6 million, including intersegment sales of $3.7 million, and generated operating income of $1.1 million. The results of this acquired business are included in our condensed consolidated statements of operations related to the 2016 and 2017 acquisitions. During the three months ended September 30, 2016, we recorded approximately $31.8 million of revenue and $6.2 million of operating income in our condensed consolidated statements of operations related to the 2016 acquisitions.aggregate products segment.

During the nine months ended September 30, 2017, we recorded approximately $122.0 million of revenue and $17.4 million of operating income in our condensed consolidated statements of operations related to the 2016 and 2017 acquisitions. During the nine months ended September 30, 2016, we recorded approximately $34.9 million of revenue and $6.2 million of operating income in our condensed consolidated statements of operations related to the 2016 acquisitions.

The ~~unaudited~~ pro forma ~~information presented below reflects the combined~~consolidated financial results for the 2016 and 2017 acquisitions, excluding the two 2016 individually immaterial acquisitions in West Texas described above, because historical financial results for these operations were not material and were impractical to obtain from the former owners. All other 2016 and 2017 acquisitions have been included andshown below represent our estimate of the Company's results of operations ~~for the three and nine months ended September 30, 2017 and 2016,~~ as if the ~~2017 acquisitions~~Coram Acquisition had been completed on January 1, ~~2016, and the 2016 acquisitions had been completed on January 1, 2015 (in thousands, except per share information):~~2020.


($ in millions except per share)	Three Months Ended June 30, 2020		Six Months Ended June 30, 2020
Revenue	$	322.7	$	659.2
Net income attributable to U.S. Concrete	$	9.3	$	7.7

Earnings per share attributable to U.S. Concrete - basic	$	0.56	$	0.46
Earnings per share attributable to U.S. Concrete - diluted	$	0.56	$	0.46

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
Revenue $ 361,262
$ 349,431
$ 1,026,865
$ 972,564
Net income (loss) $ 24,813
$ 40,128
$ 31,869
$ 31,397

Net income per share, basic $ 1.55
$ 2.64
$ 2.02
$ 2.10
Net income per share, diluted $ 1.49
$ 2.47
$ 1.92
$ 1.94

The above pro forma results ~~are unaudited and~~ were prepared based on the historical U.S. GAAP results of the Company and the historical results of ~~the acquired companies for which financial information was available,~~Coram Materials, based on data provided by the former owners. These results are not necessarily indicative of what the Company's actual results would have been had the ~~2017 acquisitions~~Coram Acquisition occurred on January 1, ~~2016,~~2020 and ~~the 2016 acquisitions occurred on January 1, 2015.~~

~~The unaudited pro forma net income (loss) and net income (loss) per share amounts above reflect the following adjustments (in thousands):~~

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
Decrease (increase) in intangible amortization expense $ (203 ) $ (1,655 ) $ (538 ) $ (6,254 )
Exclusion of buyer transaction costs $ 334
$ 584
$ 867
$ 1,395
Decrease (increase) in interest expense $ 54
$ (9 ) $ 224
$ (193 )
Decrease (increase) in income tax expense $ 279
$ 969
$ (607 ) $ (4,725 )

~~The unaudited pro forma results~~ do not reflect any operational efficiencies or potential cost savings that may occur as a result of the consolidation of ~~the~~these operations.

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~


4.	~~DISCONTINUED OPERATIONS~~

~~Discontinued operations primarily relate to real estate leases and subleases of our former precast concrete operations disposed of in prior years. The lease obligations will expire by June 30, 2018.~~

The ~~results~~pro forma amounts above reflect the following adjustments:


($ in millions)	Three Months Ended June 30, 2020		Six Months Ended June 30, 2020
Decrease in cost of goods sold related to fair value increase in inventory	$	2.6	$	4.2
Increase in depreciation, depletion and amortization expense	0		(0.9)
Exclusion of buyer transaction costs	0.1		0.6
Exclusion of seller transaction costs	0		0.3
Increase in interest expense	0		(0.8)
Increase in income tax expense	0		(1.1)

Acquisition by Vulcan Materials Company

On June 6, 2021, we entered into an Agreement and Plan of ~~these discontinued operations were as follows (in thousands):~~Merger (the “Merger Agreement”) with Vulcan Materials Company, a New Jersey corporation (“Vulcan”), and Grizzly Merger Sub I, Inc., a Delaware corporation and a wholly owned subsidiary of Vulcan (“Grizzly”). The Merger Agreement provides that, subject to its terms and conditions, Grizzly will merge with and into U.S. Concrete (the “Merger”), with U.S. Concrete surviving the Merger and becoming a wholly owned subsidiary of Vulcan.

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
Revenue $ —
$ 48
$ —
$ 48
Operating expenses 363
316
858
887
Loss from discontinued operations, before income taxes (363 ) (268 ) (858 ) (839 )
Income tax benefit (141 ) (102 ) (334 ) (321 )
Loss from discontinued operations, net of taxes $ (222 ) $ (166 ) $ (524 ) $ (518 )

~~Cash flows from operating activities included operating cash flows used~~Subject to the terms and conditions set forth in ~~discontinued operations of $0.6 million and $0.4 million during~~ the ~~nine months ended September 30, 2017 and 2016, respectively. Cash flows from investing activities included investing cash flows provided by discontinued operations of $0.6 million and $0.4 million for~~Merger Agreement, at the ~~nine months ended September 30, 2017 and 2016, respectively.~~


5.	~~INVENTORIES~~

~~Inventories as of September 30, 2017, and December 31, 2016, consisted~~time of the ~~following (in thousands):~~Merger (the “Effective Time”), each issued and outstanding share of common stock, par value $0.001 per share, of U.S. Concrete (“USCR Stock”) (other than such shares (i) owned by U.S. Concrete or any of its subsidiaries, Vulcan or Grizzly or any other wholly owned subsidiary of Vulcan or (ii) exercising dissenters rights in accordance with Section 262 of the General Corporation Law of the State of Delaware) will be converted into the right to receive $74.00 in cash, without interest. In addition, each restricted stock unit that is solely subject to time-based vesting requirements granted under the Company's Long Term Incentive Plan that is outstanding immediately prior to the Effective Time will fully vest and be converted into the right to receive $74.00 in cash (without interest and subject to applicable tax withholding). The Merger Agreement provides each of the Company and Vulcan with certain termination rights and, under certain circumstances, may require the Company or Vulcan to pay a $50.0 million termination fee.

September 30, 2017 December 31, 2016
Raw materials $ 41,486
$ 38,752
Building materials for resale 2,263
1,923
Other 1,680
1,304
Total inventories $ 45,429
$ 41,979

6.~~GOODWILL ANDOTHER INTANGIBLES~~

~~Goodwill~~

~~The changes in goodwill by reportable segment from December 31, 2016, to September 30, 2017,~~To effect this transaction, we incurred $6.3 million of transaction costs, which were ~~as follows (in thousands):~~

Ready-Mixed Concrete Segment Aggregate Products Segment Other Non-Reportable Segments Total
Balance at December 31, 2016 $ 127,515
$ 2,494
$ 3,262
$ 133,271
2017 acquisitions ⁽¹⁾
12,164
—
—
12,164
Adjustment for prior period business combination⁽²⁾
549
1,176
—
1,725
Balance at September 30, 2017 $ 140,228
$ 3,670
$ 3,262
$ 147,160


~~(1)~~	The measurement period adjustments for the 2017 acquisitions recorded during the nine months ended September 30, 2017, primarily included the impact of recording a $0.9 million definite-lived intangible asset. (See Note 3)

~~(2)~~

Reflects a $1.2 million correction to the change in the acquisition accounting for a 2015 acquisition and a $0.5 million adjustment related to determination of the conclusion of tax attributes as of the acquisition date for a 2016 acquisition. The correction to the 2015 acquisition accounting was recorded in the current period as it was not material to the prior periods and had no impact on the Condensed Consolidated Statements of Operations of any period.

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~Other Intangibles~~

~~Our purchased intangible assets were as follows (in thousands):~~

As of September 30, 2017
Gross Accumulated Amortization Net Weighted Average Remaining Life (In Years)
Definite-lived intangible assets
Customer relationships $ 85,993
$ (25,041 ) $ 60,952
5.30
Trade names 45,756
(7,353 ) 38,403
19.62
Non-competes 17,375
(7,673 ) 9,702
3.24
Leasehold interests 12,480
(2,956 ) 9,524
6.85
Favorable contracts 4,034
(2,708 ) 1,326
1.54
Total definite-lived intangible assets 165,638
(45,731 ) 119,907
9.79
Indefinite-lived intangible assets
Land rights⁽¹⁾
1,478
—
1,478

Total purchased intangible assets $ 167,116
$ (45,731 ) $ 121,385


~~(1)~~	Land rights acquired in a prior year acquisition will be reclassified to property, plant, and equipment upon the division of certain shared properties and settlement of the associated deferred payment.

As of December 31, 2016
Gross Accumulated Amortization Net Weighted Average Remaining Life (In Years)
Definite-lived intangible assets
Customer relationships $ 82,174
$ (16,414 ) $ 65,760
5.97
Trade names 44,456
(4,948 ) 39,508
20.20
Non-competes 16,862
(5,160 ) 11,702
3.81
Leasehold interests 12,480
(1,693 ) 10,787
7.46
Favorable contract 3,650
(1,912 ) 1,738
1.67
Total definite-lived intangible assets 159,622
(30,127 ) 129,495
10.19
Indefinite-lived intangible assets
Land rights⁽¹⁾
1,478
—
1,478

Total purchased intangible assets $ 161,100
$ (30,127 ) $ 130,973


~~(1)~~	Land rights acquired in a prior year acquisition will be reclassified to property, plant, and equipment upon the division of certain shared properties and settlement of the associated deferred payment.

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~As of September 30, 2017, the estimated remaining amortization of our definite-lived intangible assets was as follows (in thousands):~~

Year Ending December 31,
2017 (remainder of the year) $ 5,362
2018 21,018
2019 19,176
2020 16,985
2021 15,561
Thereafter 41,805
Total $ 119,907

~~Also~~ included in ~~other non-current liabilities~~selling, general and administrative expenses in the accompanying condensed consolidated balance sheets are unfavorable lease intangibles with a gross carrying amount of $1.5 million and a net carrying amount of $1.1 million as of September 30, 2017, which have a weighted average remaining life of 5.14 years.

~~We recorded $5.1 million and $4.2 million of amortization expense on~~ our definite-lived intangible assets and unfavorable lease intangibles for the three months ended September 30, 2017 and 2016, respectively. We recorded $15.4 million and $11.1 million of amortization expense on our definite-lived intangible assets and unfavorable lease liabilities for the nine months ended September 30, 2017 and 2016, respectively. This amortization expense is included in the accompanying condensed consolidated statements of ~~operations.~~operations for the three and six months ended June 30, 2021.

The transaction is expected to close in the second half of 2021 subject to the receipt of approvals by the Company's shareholders, regulatory approval and other customary closing conditions. If the Merger is consummated, USCR Stock will be delisted from Nasdaq and deregistered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

3. ALLOWANCE FOR DOUBTFUL ACCOUNTS AND CUSTOMER DISPUTES


7.($ in millions)			~~ACCRUED LIABILITIES~~

~~Our accrued liabilities were as follows (in thousands):~~

September 30, 2017 December 31, 2016
Accrued materials $ 17,827
$ 20,349
Accrued compensation and benefits 16,724
16,553
Accrued insurance reserves 16,409
15,206
Accrued interest 12,871
2,217
Accrued property, sales and other taxes 8,811
11,829
Deferred consideration 6,448
9,227
Contingent consideration, current portion 2,322
2,418
Deferred rent 2,270
2,232
Other 6,881
5,212
Total accrued liabilities $ 90,563
$ 85,243

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~


8.Balance, December 31, 2020			~~DEBT~~

~~Our debt and capital leases were as follows (in thousands):~~

September 30, 2017 December 31, 2016
Senior unsecured notes due 2024 and unamortized premium⁽¹⁾
$ 610,337
$ 400,000
Senior secured credit facility —
—
Capital leases 62,490
37,860
Other financing 26,817
20,248
Debt issuance costs (11,226 ) (8,810 )
Total debt 688,418
449,298
Less: current maturities (24,938 ) (16,654 )
Long-term debt, net of current maturities $ 663,480
$ 432,644

$	7.2
~~(1)~~Provision for doubtful accounts and customer disputes		~~The effective interest rates for these notes as~~	1.0
Uncollectible receivables written off, net of ~~September~~recoveries			(0.8)
Balance, June 30, ~~2017, and December 31, 2016, were 6.56% and 6.62%, respectively.~~2021(1)			$	7.4

~~Senior Unsecured Notes due 2024~~

~~In 2016, we issued $400.0~~(1) Excludes $1.3 million ~~aggregate principal amount~~ of 6.375% senior unsecured notes due 2024 (the "2024 Notes"). On January 9, 2017, we completed an offering of $200.0 million aggregate principal amount of additional 2024 Notes (the "Additional Notes," and together with the 2024 Notes, the "Senior Unsecured Notes") at an issue price of 105.75%. The terms of the Additional Notes are identical to the terms of the 2024 Notes,allowances for other than the issue date, the issue price, the first interest payment date, and the provisions relating to transfer restrictions and registration rights. We used the net proceeds from the offering of the Additional Notes,receivables, which were ~~approximately $208.4~~included in other receivables, net, on our condensed consolidated balance sheets.

4. INVENTORIES


($ in millions)	June 30, 2021		December 31, 2020
Raw materials(1)	$	67.6	$	64.4
Building materials for resale	6.4		4.1
Other	2.5		1.8
Total	$	76.5	$	70.3

(1) Additional inventory totaling $9.4 million ~~to increase our liquidity.~~

~~The Senior Unsecured Notes are governed by an indenture (the “Indenture”) dated~~ as of June ~~7, 2016, by~~30, 2021 and ~~among U.S. Concrete, Inc.,~~$2.5 million as ~~issuer,~~of December 31, 2020 was classified as other assets, since we did not expect to sell it within one year following the ~~subsidiary guarantors party thereto,~~respective balance sheet dates.

5. DEBT


($ in millions)	June 30, 2021		December 31, 2020
5.125% senior unsecured notes due 2029(1)	$	400.0	$	400.0
6.375% senior unsecured notes due 2024 and unamortized premium(2)	0		201.8
Term loans(3)	300.0		0
Asset based revolving credit facility(4)	3.5		6.5
Delayed draw term loan facility(5)	0		0
Finance leases	85.4		87.9
Promissory notes	10.4		13.8
Debt issuance costs	(10.2)		(7.6)
Total debt	789.1		702.4
Less: current maturities	(40.8)		(33.7)
Long-term debt, net of current maturities	$	748.3	$	668.7

(1) The effective interest rate for these notes was 5.25% as of both June 30, 2021 and ~~U.S. Bank National Association,~~December 31, 2020.

(2) The effective interest rate for these notes was 6.56% as ~~trustee.~~of December 31, 2020.

(3) The ~~Senior Unsecured Notes accrue~~effective interest ~~at a~~ rate for these loans was 3.25% as of ~~6.375% per annum. We pay~~June 30, 2021.

(4) The interest onrate for the ~~Senior Unsecured Notes~~revolving facility was 3.50% as of both June 30, 2021 and December 31, 2020.

(5) Terminated on June 125, 2021.

Asset Based Revolving Credit Facility

On June 25, 2021, we and ~~December 1~~certain of each year. The Senior Unsecured Notes mature on June 1, 2024, and are redeemable at our option prior to maturity at prices specified in the Indenture. The Indenture contains negative covenants that restrict our ability and our restricted subsidiaries' ability to engage in certain transactions, as described below, and also contains customary events of default.

~~The Indenture contains covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to:~~

~~incur additional debt or issue disqualified stock or preferred stock;~~

~~pay dividends or make other distributions, repurchase or redeem our stock or subordinated indebtedness or make certain investments;~~

~~sell assets and issue capital stock of our restricted subsidiaries;~~

~~incur liens;~~

~~allow to exist certain restrictions on the ability of our restricted subsidiaries to pay dividends or make other payments to us;~~

~~enter into certain transactions with affiliates;~~

~~consolidate, merge or sell all or substantially all of our assets; and~~

~~designate~~ our subsidiaries, as ~~unrestricted subsidiaries.~~

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~The Senior Unsecured Notes are issued by U.S. Concrete, Inc. (the "Parent"). Our obligations under the Senior Unsecured Notes are jointly~~co-borrowers and severally and fully and unconditionally guaranteed on a senior unsecured basis by each of our restricted subsidiaries that guarantees any obligations under the Revolving Facility or that guarantees certain of our other indebtedness or certain indebtedness of our restricted subsidiaries (other than foreign restricted subsidiaries that guarantee only indebtedness incurred by another foreign subsidiary).

U.S. Concrete, Inc. does not have any independent assets or operations, and none of its foreign subsidiaries guarantee the Senior Unsecured Notes. There are no significant restrictions on the ability of the Company or any guarantor to obtain funds from its subsidiaries by dividend or loan. For additional information regarding our guarantor and non-guarantor subsidiaries, see the information set forth in Note 16.

The Senior Unsecured Notes and the guarantees thereof are effectively subordinated to all of our and our guarantors' existing and future secured obligations, including obligations under the Revolving Facility, to the extent of the value of the collateral securing such obligations; senior in right of payment to any of our and our guarantors' future subordinated indebtedness; pari passu in right of payment with any of our and our guarantors' existing and future senior indebtedness, including our and our guarantors' obligations under the Revolving Facility; and structurally subordinated to all existing and future indebtedness and other liabilities, including preferred stock, of any non-guarantor subsidiaries.

~~Senior Secured Credit Facility~~

~~On August 31, 2017, we~~as guarantors, entered into the ~~Third~~Fourth Amended and Restated Loan ~~and~~ Security Agreement (the ~~“Third~~“Fourth Loan Agreement”) with certain financial institutions named therein as lenders ~~(the “Lenders”)~~ and Bank of America, N.A., as agent for the ~~Lenders,~~lenders, which amended and restated the ~~Second~~Third Amended and Restated Loan and Security Agreement, dated as of ~~November 18, 2015~~August 31, 2017 (the ~~“Second~~“Third Loan Agreement”). Among other things, the ~~Third~~Fourth Loan Agreement ~~increased the~~provides for revolving commitments ~~from $250.0~~of $300.0 million ~~to $350.0 million~~ (the “Revolving Facility”)and extended the maturity date to ~~August 31, 2022.~~June 25, 2026. The ~~Third~~Fourth Loan Agreement also amended certain terms of the ~~Second~~Third Loan Agreement, including, without limitation, ~~a provision to permit~~permitting the incurrence of the loans under the Term Loan Agreement (as defined below). In connection with entering into the Fourth Loan Agreement, we incurred $1.5 million of debt issuance costs.

The obligations under the Fourth Loan Agreement are secured by first priority security interests in accounts receivable, inventory and certain other ~~secured indebtedness up to amounts specified~~personal property of the Company and its subsidiaries (the “ABL Collateral”) and second priority liens on and security interests in certain real property of the ~~Third~~Company's subsidiaries and certain personal property of the Company and its subsidiary guarantors that is not ABL Collateral (the “Term Loan ~~Agreement.~~ Collateral”).

As of ~~September~~June 30, ~~2017,~~2021, we had ~~no outstanding borrowings on the Third Loan Agreement, and we had $14.3~~$1.1 million of undrawn standby letters of credit under our Revolving Facility. Loans under the Revolving ~~Facility.~~Facility are in the form of either base rate loans or London Interbank Offered Rate (“LIBOR”) loans denominated in U.S. dollars.

Our actual maximum credit availability under the Revolving Facility varies from time to time and is determined by calculating the value of our eligible accounts receivable, inventory, mixer trucks and machinery, minus reserves imposed by the ~~Lenders~~lenders and certain other ~~adjustments, all as specified in the Third Loan Agreement.~~adjustments. Our ~~maximum~~ availability under the Revolving Facility at ~~September~~June 30, ~~2017,~~2021 was $245.8 million as compared to $221.3 million at December 31, 2016. The Third Loan Agreement also contains a provision for over-advances and protective advances by Lenders, in each case, of up to $25.0 million in excess of borrowing base levels and provides for swingline loans, up to a $15.0 million sublimit.

Up to $50.0 million of the Revolving Facility is available for the issuance of letters of credit, and any such issuance of letters of credit will reduce the amount available for loans under the Revolving Facility. Loans under the Revolving Facility may not exceed a borrowing base as defined in the Third Loan Agreement.

~~The Third Loan Agreement also requires that we,~~$214.7 million. We are required, upon the occurrence of certain events, to maintain a fixed charge coverage ratio of at least 1.0 to 1.0 for each period of 12 calendar ~~months, as determined in accordance with the Third~~months. The Fourth Loan ~~Agreement.~~Agreement contains customary representations, warranties, covenants and events of default. As of ~~September~~June 30, ~~2017,~~2021, we were in compliance with all covenants under the ~~Third~~Fourth Loan Agreement.

Term Loans

On June 25, 2021, we entered into a secured term loan agreement (the “Term Loan Agreement”) with certain subsidiaries, as guarantors, JPMorgan Chase Bank, N.A., as administrative agent and collateral agent, and the lenders and other parties named therein. The Term Loan Agreement provides for $300.0 million in aggregate principal amount of term loans (the “Term Loans”), which will mature on June 25, 2028. In connection with entering into the Term Loan Agreement, we incurred $4.6 million of debt issuance costs. Proceeds of the Term Loans will be used for general corporate purposes, including repayment of certain borrowings under the Revolving Facility and to redeem the Company's 6.375% senior unsecured notes due 2024 (the “2024 Notes”), as further discussed below.

The ~~Third Loan Agreement~~Term Loans bear interest at our option of either: (1) LIBOR (subject to a floor of 0.50%) plus a margin of 2.75% or (2) a base rate (which is equal to the greatest of the prime rate, the Federal Reserve Bank of New York effective rate plus 0.50% and LIBOR plus 1.00%, and is subject to a floor of 1.50%) plus a margin of 1.75%. Additionally, the Term Loans were issued at a price of 99.75%. The Term Loans are secured by a first priority lien on ~~substantially~~and security interest in the Term Loan Collateral and a second priority security interest in the ABL Collateral. The Term Loan Agreement contains customary representations, warranties, covenants and events of default, but does not contain any financial maintenance covenants. As of June 30, 2021, we were in compliance with all covenants under the Term Loan Agreement.

Termination of Delayed Draw Term Loan Facility

On June 25, 2021, in connection with entering into the Term Loan Agreement, the Company terminated the Credit and Guaranty Agreement, dated as of April 17, 2020, among the Company, certain subsidiaries as guarantors, Bank of America, N.A., as administrative agent and collateral agent, the lenders and other parties named therein (the “Delayed Draw Term Loan Agreement”). The Delayed Draw Term Loan Agreement provided for a $178.7 million delayed draw term loan facility and was scheduled to mature on May 1, 2025. There were no outstanding borrowings under the Delayed Draw Term Loan Agreement. The Delayed Draw Term Loan was secured by a first priority lien on and secured interest in the Term Loan Collateral. During the three months ended June 30, 2021, we wrote off $2.3 million of unamortized debt issuance costs for this facility as a loss on extinguishment of debt.

Redemption of 6.375% Senior Unsecured Notes Due 2024

On June 26, 2021, we redeemed $200.0 million of outstanding 2024 Notes, which represented all outstanding 2024 Notes, at a price of 101.594% of the ~~personal property~~principal amount thereof plus accrued, unpaid interest. During the three months ended June 30, 2021, we incurred a $3.1 million pre-tax loss on the redemption of the ~~Company~~2024 Notes, which included the redemption premium of $3.2 million and a $1.4 million write-off of unamortized debt issuance costs, net of $1.5 million of unamortized issuance premium.

Fair Value of Debt

The fair value of our 5.125% senior unsecured notes due 2029 (the “2029 Notes”), which was estimated based on broker/dealer quoted market prices, was $436.6 million as of June 30, 2021. The carrying values of the outstanding amounts under our Term Loans, Revolving Facility and our ~~guarantors,~~operating and finance lease assets and liabilities approximate fair value due to the nature of the underlying collateral associated with the debt along with floating interest rates.

6. STOCK-BASED COMPENSATION

We grant stock-based compensation awards to management, employees and non-employee directors under the U.S. Concrete, Inc. Long Term Incentive Plan (the “LTI Plan”), which was amended effective February 22, 2021 (the “Amendment”) to reserve an additional 880,000 shares of common stock for future issuance as equity-based awards to management and employees. Stock-based compensation may include stock options, stock appreciation rights, restricted stock awards, restricted stock units, cash-settled equity awards and performance awards. As of June 30, 2021, there were approximately 485,000 shares remaining for future issuance under the LTI Plan.

2021 Restricted Stock Unit Grant

On March 1, 2021, the Compensation Committee of the Board of Directors approved grants of 367,720 restricted stock units (the “2021 Grant”), conditioned upon obtaining stockholder approval of the Amendment. The Amendment was approved by the Company's stockholders at the Company's annual meeting on May 13, 2021, and the stockholder approval condition related to the 2021 Grant was satisfied. The 2021 Grant consisted of a 60% time-vested component that vests annually over a three-year period and a 40% stock performance hurdle component. The stock performance hurdle component triggers vesting upon our stock price reaching certain thresholds and may vest up to 200% of the target number of performance stock units granted.

The fair value of the 2021 Grant subject only to time-based vesting restrictions was determined based upon the $55.72 closing price of our common stock on the effective date of the grant. Based on stock performance following the contingent grant in March, the stock price thresholds for the target number of performance stock units had been met, and the fair value for that 40% portion of the 2021 Grant was also determined to be the $55.72 closing price of our common stock on the effective date of the grant, and the entire $8.1 million fair value for this portion of the target performance stock units was recognized during the three months ended June 30, 2021.

The fair value of the above-target portion of the 2021 Grant subject to ~~permitted liens and certain exceptions.~~

~~Capital Leases and Other Financing~~

~~We have~~additional market performance hurdles was determined utilizing a ~~series~~Monte Carlo financial valuation model. Compensation expense determined utilizing the Monte Carlo simulation is recognized regardless of ~~promissory notes with various lenders for~~whether the ~~purchase of mixer trucks and other machinery and equipment in~~common stock reaches the defined thresholds, provided that each grantee remains an ~~aggregate original principal amount of $44.4 million, with fixed annual interest rates ranging from 2.50% to 4.64%, payable monthly with terms ranging from one to five years.~~

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

We have leasing agreements with various other lenders for the purchase of mixer trucks and other machinery and equipment for a total original principal amount of $82.3 million, with fixed annual interest rates ranging from less than 0.01% to 5.24%, payable monthly for terms ranging from two to seven years. The lease agreements include bargain purchase optionsemployee at the end of the ~~lease terms; accordingly, these financings have been classified as capital leases.~~expected term. The ~~current~~assumptions used to value the above-target portion of ~~capital leases included in current maturities of long-term debt was $16.2 million~~the 2021 Grant were as ~~of September 30, 2017, and $9.8 million as of December 31, 2016.~~follows:

~~The weighted average interest rate of our capital leases and other financings was 3.30% as of September 30, 2017, and 3.11% as of December 31, 2016.~~


9.	~~WARRANTS~~

In 2010, we issued warrants to acquire common stock in two tranches: Class A Warrants to purchase an aggregate of approximately 1.5 million shares of common stock and Class B Warrants to purchase an aggregate of approximately 1.5 million shares of common stock (collectively, the "Warrants"). The Warrants were issued to holders of our predecessor common stock pro rata based on a holder’s stock ownership as of the issuance date and expired on August 31, 2017. The Warrants were included in derivative liabilities in the accompanying condensed consolidated balance sheet as of December 31, 2016, (see Note 10) and were recorded at their fair value (see Note 11). The Warrants were treated as potentially dilutive securities in the calculation of diluted earnings (loss) per share as shares of our common stock would have been issued if the Warrants had been exercised. A total of 112,638 Class A Warrants and 114,775 Class B Warrants expired unexercised on August 31, 2017.

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~


~~10.~~	~~DERIVATIVES~~

Prior to their expiration on August 31, 2017, we were required to account for our warrants as derivative instruments, which were not used to manage business risk and were not executed for speculative purposes.

~~The following table presents the fair value of our derivative instruments as of September 30, 2017, and December 31, 2016 (in thousands):~~

Fair Value
Derivative Instruments Not Designated As
Hedging Instruments Under ASC 815
Balance Sheet Classification September 30, 2017 December 31, 2016
Warrants Derivative liabilities $ —
$ 57,415

The following table presents the effect of derivative instruments on our condensed consolidated statements of operations for the three and nine months ended September 30, 2017 and 2016, respectively, excluding income tax effects (in thousands):

Three Months Ended
Derivative Instruments Not Designated As
Hedging Instruments Under ASC 815
Classification in Statement of Operations September 30, 2017
September 30, 2016
Warrants
Derivative loss (income) $ (13,119 ) $ (21,772 )

Nine Months Ended
Derivative Instruments Not Designated As
Hedging Instruments Under ASC 815 Classification in Statement of Operations September 30, 2017 September 30, 2016
Warrants Derivative loss (income) $ 791
$ (6,430 )

~~Warrant volume positions represent the number of shares of common stock underlying the instruments. The table below presents our volume positions as of~~ ~~September 30, 2017, and~~ ~~December 31, 2016~~ ~~(in thousands):~~



		~~Number of Shares~~Value
~~Derivative Instruments Not Designated As~~ ~~Hedging Instruments Under ASC 815~~Expected term (years)(1)		~~September 30, 2017~~	~~December 31, 2016~~0.3 - 0.4
~~Warrants~~Expected volatility		—72.9%
Risk-free interest rate		0.3%
Vesting price(1)(2)	~~1,395~~	$69.23 - $74.95
Average grant date fair value per share		$49.65 - $47.97

(1)The $69.23 stock price hurdle for the 2021 Grant was met during June 2021, the related performance stock units vested, and the related expense that would have been recognized over 0.3 years was accelerated and recognized during the three months ended June 30, 2021.

(2)The vesting price is the average of the daily volume-weighted average share price of USCR Stock over any period of 20 consecutive trading days within the three-year period beginning on the date of grant, based on hurdles established on March 1, 2021.

Stock-Based Compensation Cost

We ~~do not~~recognized stock-based compensation expense of $14.7 million and $17.6 million during the three and six months ended June 30, 2021, respectively, and $2.5 million and $6.2 million during the three and six months ended June 30, 2020, respectively. Stock-based compensation expense is reflected in selling, general and administrative expenses in our condensed consolidated statements of operations. Stock-based compensation expense was higher during the three and six months ended June 30, 2021 than it otherwise would have ~~any derivative instruments with credit features requiring~~been due to the ~~posting~~general increase in stock price from the date of ~~collateral~~the conditional grant through June 30, 2021, which resulted in ~~the event of a credit downgrade or similar credit event.~~

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~


~~11.~~	~~FAIR VALUE DISCLOSURES~~

~~Fair~~higher fair value ~~is defined as the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants~~per share when valued as of the ~~measurement date. Accounting guidance also establishes a hierarchy for inputs used in measuring fair value that maximizes~~stockholder approval date, as well as the ~~use~~acceleration of ~~observable inputs~~expense when certain stock price thresholds were met and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability and are developed based on market data obtained from independent sources. Unobservable inputs are inputs that reflect our assumptions about the factors market participants would use in valuing the asset or liability. The guidance establishes three levels of inputs that may be used to measure fair value:performance stock units vested.

~~Level 1—Quoted prices in active markets for identical assets or liabilities.~~

Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

~~Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.~~

Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurements. We review the fair value hierarchy classification on a quarterly basis. Changes in the observability of valuation inputs may result in a reclassification of levels for certain assets and liabilities within the fair value hierarchy.

~~The following tables present our fair value hierarchy for liabilities measured at fair value on a recurring basis as of September 30, 2017, and December 31, 2016 (in thousands):~~

September 30, 2017
Total Level 1 Level 2 Level 3
Contingent consideration, including current portion ^{(1) (2) (3) (4) (5)}
$ 52,554
$ —
$ —
$ 52,554
$ 52,554
$ —
$ —
$ 52,554

December 31, 2016
Total Level 1 Level 2 Level 3
Derivative – Warrants $ 57,415
$ —
$ 57,415
$ —
Contingent consideration, including current portion ^{(1) (2) (4) (5) (6)}
32,212
—
—
32,212
$ 89,627
$ —
$ 57,415
$ 32,212


~~(1)~~	The current portion of contingent consideration is included in accrued liabilities in our condensed consolidated balance sheets. The long-term portion of contingent consideration is included in other long-term obligations and deferred credits in our condensed consolidated balance sheets.

~~(2)~~

Includes the fair value of the contingent consideration associated with the 2015 acquisition of Ferrara Bros. Building Materials Corp. ("Ferrara Bros. Contingent Consideration"). The fair value was determined based on the expected vesting of incentive awards granted to the former owners at acquisition based on probability-weighted assumptions related to the achievement of certain annual EBITDA thresholds, using a discount rate of 8.75% as of both September 30, 2017, and December 31, 2016. The fair value of the Ferrara Bros. Contingent Consideration was $27.4 million and $26.3 million as of September 30, 2017, and December 31, 2016, respectively. The Ferrara Bros. Contingent Consideration payments were capped at $35.0 million over a four-year period beginning in 2017.

~~(3)~~

Includes the fair value of the contingent consideration associated with the 2017 acquisition of certain assets of Corbett Aggregates Company, LLC ("Corbett Contingent Consideration"). The fair value was determined based on the expected consideration that will be due to the former owner related to the achievement of obtaining permits for mining all available reserves and was based on the probability-weighted assumptions, using a discount rate of 5.0% as of September 30, 2017. The fair value of the Corbett Contingent Consideration was $20.8 million as of September 30, 2017. The Corbett Contingent Consideration payment is capped at $23.0 million and not payable before a two-year minimum period from the acquisition date.

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(4)~~

Includes the fair value of the earn-out payments associated with the 2015 acquisition of Right Away Redy Mix, Inc. (the "Right Away Earn-out"). The fair value was determined based on expected payouts that will be due to the former owners based on probability-weighted assumptions related to the achievement of annual sales volume milestones, using a discount rate of 8.25% and 8.50% as of September 30, 2017, and December 31, 2016, respectively. The fair value of the Right Away Earn-out was $3.9 million as of both September 30, 2017, and December 31, 2016. The remaining Right Away Earn-out payments were capped at $4.3 million over a four-year period and $5.0 million over a five-year period as of September 30, 2017, and December 31, 2016, respectively.

~~(5)~~

Includes the fair value of the earn-out payments associated with the 2015 acquisition of DuBrook Concrete, Inc. ("DuBrook Earn-out"). The fair value was determined based on the expected payouts that will be due to the former owners based on probability-weighted assumptions related to the achievement of sales volume milestones, using a discount rate of 15.75% as of both September 30, 2017, and December 31, 2016. The fair value of the DuBrook Earn-out was $0.5 million and $0.6 million as of September 30, 2017, and December 31, 2016, respectively. The DuBrook Earn-out paymentsare not capped; however, we do not expect total payments to be in excess of $0.5 million over a two-year period and $0.7 million over a three-year period as of September 30, 2017, and December 31, 2016, respectively.

~~(6)~~

Includes the fair value of the earn-out payments associated with the 2012 acquisition of Bode Gravel Co. and Bode Concrete LLC ("Bode Earn-out"). The fair value was determined based on expected payouts that will be due to the former owners based on the achievement of certain incremental sales volume milestones, using a contractual discount rate of 7.0%. These payments were capped at a fair value of $1.4 million as of December 31, 2016. The final Bode Earn-out payment was made in January 2017.

7. INCOME TAXES

The liability for the Warrants was valued utilizing a Black-Scholes-Merton model. Inputs into the model were based upon observable market data. The key inputs in determining our derivative liabilities include our stock price, stock price volatility, and risk free interest rates. As of December 31, 2016, observable market data existed for all of the key inputs in determining the fair value of our Warrants.

The liabilities for the Right Away Earn-out and the Ferrara Bros. Contingent Consideration were valued using Monte Carlo simulations, which incorporated probability-weighted assumptions related to the achievement of specific milestones mentioned above. The liabilities for the Corbett Contingent Consideration were valued using the income approach which incorporated probability-weighted assumptions related to the achievement of specific milestones mentioned above. The liabilities for the Bode Earn-out and the DuBrook Earn-out were valued using a discounted cash flow technique. Inputs into the models were based upon observable market data where possible. Where observable market data did not exist, we modeled inputs based upon similar observable inputs. The key inputs in determining the fair value of the contingent consideration as of September 30, 2017, and December 31, 2016, included discount rates ranging from 5.00% to 15.75% and management's estimates of future sales volumes, EBITDA and permitted reserves. Changes in these inputs will impact the valuation of our contingent consideration obligations and will result in gain or loss each quarterly period.

~~A reconciliation of the changes in Level 3 fair value measurements from December 31, 2016, to September 30, 2017, is provided below (in thousands):~~

Contingent Consideration
Balance at December 31, 2016 $ 32,212
Acquisitions ⁽¹⁾
20,621
Total losses included in earnings ⁽²⁾
2,047
Payment on contingent consideration (2,326 )
Balance at September 30, 2017 $ 52,554


~~(1)~~	~~Represents the fair value of the contingent consideration associated with the Corbett acquisition as of the acquisition date.~~


~~(2)~~	~~Represents the net loss on the change in valuation of contingent consideration, which is included in the line item of the same name in our condensed consolidated statements of operations.~~

Our other financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, and long-term debt. We consider the carrying values of cash and cash equivalents, accounts receivable, and accounts payable to be representative of their respective fair values because of their short-term maturities or expected settlement dates. The fair value of our Senior Unsecured Notes, estimated based on quoted market prices (i.e., Level 2 inputs), was $645.7 million as of September 30, 2017. The carrying value of any outstanding amounts under our Third Loan Agreement approximates fair value due to the floating interest rate. There were no such amounts outstanding as of September 30, 2017, or December 31, 2016.

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~


~~12.~~	~~INCOME TAXES~~

We recorded an income tax ~~expense allocated to continuing operations~~benefit of ~~$7.2~~$0.7 million and ~~$20.9~~$5.4 million for the three and ~~nine~~six months ended ~~September~~June 30, ~~2017, respectively. We recorded~~2021, respectively, using the discrete method. The discrete method treats the year-to-date period as if it was the annual period and determines the income tax expense ~~allocated~~or benefit on that basis. We have historically calculated the provision for income taxes during interim reporting periods by applying an estimate of the annual effective tax rate for the full year to ~~continuing operations~~“ordinary” income or loss for the reporting period. However, for the three and six-month periods ended June 30, 2021, we determined that since minor changes in estimated “ordinary” income would result in significant changes in the estimated annual effective tax rate, our historical method would not provide a reliable estimate of ~~$12.6~~income tax benefit. Our effective tax rate utilizing the discrete method differed substantially from the statutory tax rate primarily due to (1) significant Section 162(m) limitations on executive compensation and (2) our estimated interest expense limitation in accordance with the Tax Cuts and Jobs Act for which a full valuation allowance is anticipated. These differences reduced the income tax benefit recorded for the three and six months ended June 30, 2021, which was partially offset by excess tax benefits recognized for stock-based compensation.

We recorded an income tax expense of $4.3 million and ~~$14.3~~an income tax benefit of $0.6 million for the three and ~~nine~~six months ended ~~September~~June 30, ~~2016, respectively. We recorded a tax benefit of $0.1 million and $0.3 million allocated to discontinued operations for the three and nine months ended September 30, 2017 and 2016,~~2020, respectively. For the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2020, our effective tax rate differed substantially from the federal statutory rate primarily due to additional tax benefits recognized related to the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) enacted on March 27, 2020. The CARES Act, among other ~~cumulative adjustments~~things, modified the business interest deduction limitation for tax years beginning in 2019 and 2020 from 30% of adjusted taxable income (“ATI”) to ~~deferred income taxes, which resulted~~50% of ATI. As a result, we recorded an additional tax benefit of $3.2 million in ~~additional~~the six months ended June 30, 2020 to reflect the CARES Act change to our estimated interest limitation for the year ended December 31, 2019. This tax benefit was partially offset by a net tax shortfall for stock-based compensation.

Other receivables, net, on our condensed consolidated balance sheets included federal and state income tax ~~expense. In addition, the adoption~~receivables of ASU 2016-09 on January 1, 2017, (see Note 2) required the current period income tax benefit related to stock compensation to be reflected in the income statement instead of additional paid-in-capital, as previously required. For the nine months ended September 30, 2016, our effective tax rate differed from the federal statutory tax rate primarily due to the application of a valuation allowance that reduced the recognized benefit of certain of our deferred tax assets. In addition, certain state income taxes are calculated on a basis other than pre-tax income (loss). In addition, for both the three months ended September 30, 2017 and 2016, our effective tax rate differed from the federal statutory rate due to the tax impact of derivative income and losses related to our Warrants. Derivative income and losses were excluded from the calculation of our income tax provision and were treated as an unrecognized tax position. For the nine months ended September 30, 2017, our tax provision excluded $0.3 million of tax benefit related to our $0.8 million derivative loss. For the nine months ended September 30, 2016, our tax provision excluded $2.5 million of tax expense related to our $6.4 million derivative income.

For the three and nine months ended September 30, 2017, we reduced to zero our unrecognized tax benefits and deferred tax asset balances associated with derivative income or losses related to our Warrants. The amount of the reduction for both was $43.6 million; therefore, the aggregate reductions did not have an impact to either total income tax expense or our effective tax rate. These reductions followed a decision to no longer pursue a future tax return deduction associated with our cumulative derivative losses related to our Warrants, given our inability, after multiple attempts, to obtain the necessary documentation to support the deduction and complete the related informational reporting requirements.

In accordance with U.S. GAAP, we reduce the value of deferred tax assets to the amount that is more likely than not to be realized in future periods. The ultimate realization of the benefit of deferred tax assets from deductible temporary differences or tax carryovers depends on generating sufficient taxable income during the periods in which those temporary differences become deductible. We considered the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based on these considerations, we relied upon the reversal of certain deferred tax liabilities to realize a portion of our deferred tax assets and established valuation allowances as of September 30, 2017, and December 31, 2016, for other deferred tax assets because of uncertainty regarding their ultimate realization. Our total net deferred tax liability was approximately $15.0$18.7 million as of ~~September~~June 30, ~~2017,~~2021 and ~~approximately $7.7~~$5.8 million as of December 31, ~~2016.~~2020.

8. EARNINGS (LOSS) PER SHARE

We ~~record changes in our unrecognized tax benefits based on anticipated federal~~excluded 0.5 million shares from the calculation of diluted earnings per share for both the three and ~~state tax filing positions on a quarterly basis. For the nine~~six months ended ~~September~~June 30, ~~2017~~2021, and ~~2016, we recorded unrecognized tax benefits of $0.1~~0.8 million and ~~$4.1~~0.6 million ~~respectively.~~

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~


~~13.~~	~~NET EARNINGS (LOSS) PER SHARE~~

~~Basic earnings (loss) per share is computed by dividing net earnings (loss) by the weighted average number of common~~ shares outstanding during the period. Diluted earnings (loss) per share is computed by dividing net earnings (loss) by the weighted average number of common shares outstanding during the period after giving effect to all potentially dilutive securities outstanding during the period.

~~The following is a reconciliation of the components of the basic and diluted earnings (loss) per share calculations~~ for the three and ~~nine~~six months ended ~~September~~June 30, ~~2017 and 2016 (in thousands):~~

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
Numerator:
Income from continuing operations $ 24,276
$ 38,122
$ 29,109
$ 24,970
Loss from discontinued operations, net of taxes (222 ) (166 ) (524 ) (518 )
Numerator for diluted earnings per share $ 24,054
$ 37,956
$ 28,585
$ 24,452

Denominator:
Basic weighted average common shares outstanding 16,028
15,222
15,745
14,978
Restricted stock awards and restricted stock units 84
67
112
84
Warrants 524
939
760
1,111
Stock options 15
12
16
13
Denominator for diluted earnings per share 16,651
16,240
16,633
16,186

~~For the~~ ~~three and nine~~ ~~months ended~~ ~~September 30, 2017~~ ~~and 2016, our~~2020, respectively, because they were anti-dilutive. In all periods, these potentially dilutive shares ~~include~~related to our employee equity awards that vest either over time or upon the ~~shares underlying our restricted~~achievement of certain stock awards, restricted stock units, stock options and Warrants. The following table shows the type and number (in thousands) of potentially dilutive shares excluded from the diluted earnings (loss) per share calculations for the periods presented as their effect would have been anti-dilutive or they have not met their performance target:price targets.

9. COMMITMENTS AND CONTINGENCIES

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
Potentially dilutive shares:
Unvested restricted stock awards and restricted stock units 60
35
62
35
Total potentially dilutive shares 60
35
62
35


~~14.~~	~~COMMITMENTS AND CONTINGENCIES~~

Legal Proceedings

From time to time, and currently, we are subject to various claims and litigation brought by employees, customers and other ~~third-parties~~third parties for, among other matters, personal injuries, property damages, product defects and delay damages that have, or allegedly have, resulted from the conduct of our operations. As a result of these types of claims and litigation, we must periodically evaluate the probability of damages being assessed against us and the range of possible outcomes. In each reporting period, if we determine that the likelihood of damages being assessed against us is probable, and if we believe we can estimate a range of possible outcomes, then we will record a liability. The amount of the liability will be based upon a specific estimate, if we believe a specific estimate to be likely, or it will reflect the low end of our range. Currently, there are no material legal proceedings pending against us.

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~In the future,~~From time to time, we may receive funding deficiency demands ~~from~~or withdrawal liability assessments related to multi-employer pension plans to which we contribute. We are unable to estimate the amount of any ~~potential~~ future ~~funding deficiency~~ demands or assessments because the actions of each of the other contributing employers in the plans has an effect on each of the other contributing employers, and the development of a rehabilitation plan by the trustees and subsequent submittal to and approval by the Internal Revenue Service is not predictable. Further, the allocation of fund assets and return assumptions by trustees are variable, as are actual investment returns relative to the plan assumptions. As of June 30, 2021, the Company had accrued $1.4 million for a withdrawal liability assessment related to a multi-employer pension plan in which the Company participated. The Company continues to dispute and negotiate the assessment.

As of ~~September 30, 2017,~~August 5, 2021, there ~~are~~were no material product defect claims pending against us. Accordingly, our existing accruals for claims against us do not reflect any material amounts relating to product defect claims. While our management is not aware of any facts that would reasonably be expected to lead to material product defect claims against us that would have a material adverse effect on our business, financial condition or results of operations, it is possible that claims could be asserted against us in the future. We do not maintain insurance that would cover all damages resulting from product defect claims. In particular, we generally do not maintain insurance coverage for the cost of removing and rebuilding structures. In addition, our indemnification arrangements with contractors or others, when obtained, generally provide only limited protection against product defect claims. Due to inherent uncertainties associated with estimating unasserted claims in our business, we cannot estimate the amount of any future loss that may be attributable to such unasserted product defect claims related to ready-mixed concrete we have delivered prior to ~~September~~June 30, ~~2017.~~2021.

On March 28, 2017, Hans Ruedelstein, individually and on behalf of all others similarly situated, filed a purported class action lawsuit in the United States District Court of Northern Texas, Fort Worth Division, against the Company, William J. Sandbrook, William M. Brown and Joseph C. Tusa, Jr. alleging violations of certain federal securities laws. The case was filed purportedly on behalf of purchasers of the Company's stock between March 6, 2015 and March 23, 2017. On June 22, 2017, Robert Abric and Donald Bellafiore were appointed as co-lead plaintiffs. On August 24, 2017, co-lead plaintiffs voluntarily dismissed the complaint and on September 8, 2017, the case was terminated by the Court.

We believe that the resolution of ~~all~~any litigation currently pending or threatened against us or any of our subsidiaries will not materially exceed our existing accruals for those matters. However, because of the inherent uncertainty of litigation, there is a risk that we may have to increase our accruals for one or more claims or proceedings to which we ~~or any of our subsidiaries is~~are a party as more information becomes available or proceedings progress, and any such increase in accruals could have a material adverse effect on our consolidated financial condition or results of operations. We expect in the future that we ~~and our operating subsidiaries~~ will, from time to time, be a party to litigation or administrative proceedings that arise in the normal course of our business.

We are subject to federal, state and local environmental laws and regulations concerning, among other matters, air emissions and wastewater discharge. Our management believes we are in substantial compliance with applicable environmental laws and regulations. From time to time, we receive claims from federal and state environmental regulatory agencies and entities asserting that we may be in violation of environmental laws and regulations. Based on experience and the information currently available, our management does not believe that these claims will materially exceed our related accruals. Despite compliance and experience, it is possible that we could be held liable for future charges, which might be material, but are not currently known to us or cannot be estimated by us. In addition, changes in federal or state laws, regulations or requirements, or discovery of currently unknown conditions, could require additional expenditures.

As permitted under Delaware law, we have agreements that provide indemnification of officers and directors for certain events or occurrences while the officer or director is or was serving at our request in such capacity. The maximum potential amount of future payments that we could be required to make under these indemnification agreements is not limited; however, we have a director and officer insurance policy that potentially limits our exposure and enables us to recover a portion of future amounts that may be paid. As a result of the insurance policy coverage, we believe the ~~estimated fair value~~potential liability of these indemnification agreements is minimal. Accordingly, we have not recorded any liabilities for these agreements as of ~~September~~June 30, ~~2017.~~2021.

We and our subsidiaries are parties to agreements that require us to provide indemnification in certain instances when we acquire businesses and real estate and in the ordinary course of business with our customers, suppliers, lessors and service providers.

As of August 5, 2021, there were no material pending claims related to such indemnification.

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

Litigation Related to the Vulcan Merger

As of August 2, 2021, several separate actions (collectively, the “USCR Shareholder Actions”) have been filed in federal courts in New York, Delaware, New Jersey, and Pennsylvania by purported owners of U.S. Concrete common stock in connection with the transactions contemplated by the Merger Agreement: Stein v. U.S. Concrete, Inc., et al. (S.D.N.Y. July 2, 2021); Waterman v. U.S. Concrete, Inc., et al. (S.D.N.Y. July 8, 2021); Clark v. U.S. Concrete, Inc., et al. (D. Del July 9, 2021) (the “Clark Action”); Harris v. U.S. Concrete, Inc., et al. (S.D.N.Y. July 13, 2021); Siddall v. U.S. Concrete, Inc., et al. (D.N.J. July 13, 2021); Whitfield v. U.S. Concrete, Inc., et al (E.D. Pa. July 13, 2021); Murphy v. U.S. Concrete, Inc., et al. (S.D.N.Y. July 14, 2021); Kent v. U.S. Concrete, Inc., et al. (D.N.J. July 27, 2021) (the “Kent Action”); Wilhelm v. U.S. Concrete, Inc., et al. (D. Del July 28, 2021)(the “Wilhelm Action”); Brave v. U.S. Concrete, Inc., et al. (D.N.J. July 30, 2021) (the “Brave Action”) and Beauregard v. U.S. Concrete, Inc., et al. (S.D.N.Y. July 30, 2021)(the “Beauregard Action”). Each of the USCR Shareholder Actions names the Company and its directors as defendants and the Clark Action additionally names former Company director William J. Sandbrook as a defendant. Each of the USCR Shareholder Actions alleges, among other things, that the defendants violated federal securities laws by failing to disclose certain information in the Preliminary Proxy Statement, or, in the case of the Kent Action, Wilhelm Action, Brave Action and Beauregard Action, the Definitive Proxy Statement, on Schedule 14A filed by the Company (the “Proxy”) relating to the Company's financial forecasts and financial analyses conducted by the Company's financial advisors, Evercore Group, L.L.C. (“Evercore”) and BNP Paribas Securities Corp. (“BNP”). Certain of the USCR Shareholder Actions further allege that the defendants violated federal securities laws by failing to disclose certain information in the Proxy relating to the sales process and alleged conflicts of interests for management, financial projections for the Company provided to Evercore and BNP, and the data and inputs underlying the financial valuation analyses that support the fairness opinions of Evercore and BNP. The Clark Action further alleges that the Company's directors breached their fiduciary duties by entering into the Merger Agreement through an unfair process and for inadequate consideration. The plaintiffs in the USCR Shareholder Actions, among other things, seek to enjoin the transactions contemplated by the Merger Agreement, an award of attorneys’ fees and expenses and, in certain instances, damages in an unspecified amount.

The Company believes that the USCR Shareholder Actions are without merit, and the Company and the individual defendants intend to defend against the USCR Shareholder Actions; however, the Company cannot predict the amount of time and expense that will be required to resolve the USCR Shareholder Actions nor their outcomes.

The outcome of any pending or future litigation is uncertain. Such litigation if not resolved, could prevent or delay consummation of the Merger and result in substantial costs of the Company, including any costs associated with the indemnification of directors and officers. One of the conditions to the consummation of the Merger is that no governmental entity of competent jurisdiction (i) enacted, issued or promulgated any law or order that is in effect or (ii) issued or granted any order or injunction (whether temporary, preliminary or permanent) that is in effect, in each case which has the effect of restraining, enjoining or otherwise prohibiting the consummation of the Merger. Therefore, if a plaintiff were successful in obtaining an injunction prohibiting the consummation of the Merger, then such injunction may prevent the Merger from being consummated, or from being consummated within the expected time frame.

Insurance Programs

We maintain third-party insurance coverage against certain ~~risks in amounts we believe are reasonable.~~workers’ compensation, automobile and general liability risks. Under certain components of our insurance program, we share the risk of loss with our insurance underwriters by maintaining high deductibles subject to aggregate annual loss limitations. Generally, our insurance program deductible retentions per occurrence are $1.0 million to $2.0 million for ~~auto,~~ workers’ compensation and general liability ~~insurance programs are~~ ~~$1.0~~and $2.0 million, to $10.0 million for automobile, although certain of our operations are self-insured for workers’ compensation. We ~~fund these deductibles and~~ record ~~an expense~~expenses for expected losses under the programs. ~~We determine the~~The expected losses are determined using a combination of our historical loss experience and subjective assessments of our future loss exposure. The estimated losses are subject to uncertainty, ~~from various sources,~~ including changes in claims reporting patterns, claims settlement patterns, judicial decisions, legislation and economic conditions. Although we believe that the estimated losses we have recorded are reasonable, significant differences related to the items ~~we have~~ noted above could materially affect our insurance obligations and future expense. The amount accrued for self-insurance claims, which is recorded in accrued liabilities ~~in our condensed consolidated balance sheet for estimated losses~~and other long-term obligations and deferred credits, was ~~$15.5~~$34.9 million as of ~~September~~June 30, ~~2017, compared to~~ ~~$13.5~~2021 and $33.0 million as of December 31, ~~2016~~.2020.

~~Performance Bonds~~

Guarantees

In the normal course of business, we ~~are~~and our subsidiaries were contingently liable ~~for performance~~ under ~~$36.2~~$12.9 million in performance bonds that various contractors, states and municipalities have required as of ~~September~~June 30, ~~2017.~~2021. The bonds principally relate to construction contracts, reclamation obligations, licensing and permitting. We and our subsidiaries have indemnified the underwriting insurance company against any exposure under the performance bonds. No material claims have been made against these ~~bonds as~~bonds.

The Company has entered into standby letter of ~~September~~credit arrangements with various banks generally for the purpose of protection against insurance claims. As of June 30, ~~2017.~~2021, the Company had a maximum financial exposure from these standby letters of credit totaling $25.9 million, of which $1.1 million reduces the Company's borrowing availability under its Revolving Facility. See Note 5 for additional information.

~~Employment Agreements~~

10. SEGMENT INFORMATION

We have employment agreements with executive officers and certain key members of management under which severance payments would become payable in the event of specified terminations without cause or after a change of control.

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~


~~15.~~	~~SEGMENT INFORMATION~~

Our ~~two~~2 reportable segments consist of ready-mixed concrete and aggregate products as described below.

Our ready-mixed concrete segment produces and sells ready-mixed concrete. This segment serves the following markets: Texas, ~~Northern~~ California, New York City, New Jersey, Washington, D.C., Philadelphia, Oklahoma and the U.S. Virgin Islands. Our aggregate products segment ~~includes~~produces crushed stone, sand and gravel ~~products~~ and serves the ~~North Texas, West Texas, New York, New Jersey, Oklahoma, and U.S. Virgin Islands~~ markets in which our ready-mixed concrete segment ~~operates.~~operates as well as the West Coast and Hawaii. Other operations and products not associated with a reportable segment include our aggregates distribution operations, building materials stores, hauling operations, ~~lime slurry,~~ ARIDUS^® Rapid Drying Concrete technology, brokered product sales aand recycled aggregates operation, an aggregate distribution operation, and an industrial waterfront marine terminal and sales yard. The financial results of the acquisitions have been included in their respective reportable segment or in other products as of their respective acquisition dates.aggregates.

Our customers are generally involved in the construction industry, which is a cyclical business and is subject to general and more localized economic conditions. In addition, our business is impacted by seasonal variations in weather conditions, which vary by regional market. Accordingly, demand for our products and services during the winter months is typically lower than in other months of the year because of inclement weather. Also, sustained periods of inclement weather and other adverse weather conditions could cause the delay of construction projects during other times of the year.

Our chief operating decision maker evaluates segment performance and allocates resources based on Adjusted EBITDA. We define Adjusted EBITDA as our net income, ~~(loss) from continuing operations~~ excluding the impact of income ~~tax expense (benefit), net interest expense,~~taxes, depreciation, depletion and amortization, ~~derivative income (loss), the~~net interest expense and certain other non-cash, non-recurring and/or unusual, non-operating items including, but not limited to: non-cash stock compensation expense, non-cash change in value of contingent consideration, ~~hurricane-related losses, quarry dredge~~acquisition-related costs, officer transition expenses, purchase accounting adjustments for ~~a specific event,~~inventory, and ~~loss on extinguishment~~realignment initiative costs. Acquisition-related costs consist of ~~debt.~~fees and expenses for accountants, lawyers and other professionals incurred during the negotiation and closing of strategic acquisitions. Acquisition-related costs do not include fees or expenses associated with post-closing integration of strategic acquisitions. Many of the impacts excluded to derive Adjusted EBITDA are similar to those excluded in calculating our compliance with our debt covenants.

We consider Adjusted EBITDA to be an indicator of the operational strength and performance of our business. We have included Adjusted EBITDA because it is a key financial measure used by our management to (1) internally measure our operating performance and (2) assess our ability to service our debt, incur additional debt and meet our capital expenditure requirements.

Adjusted EBITDA should not be construed as an alternative to, or a better indicator of, operating income or loss, is not based on U.S. GAAP, and is not a measure of our cash flows or ability to fund our cash needs. Our measurements of Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies and may not be comparable to similarly titled measures used in the agreements governing our ~~various agreements, including the Third Loan Agreement and the Indenture.~~debt.

We generally account for inter-segment sales at market prices. Corporate includes executive, administrative, financial, legal, human resources, business development and risk management activities that are not allocated to reportable segments and are excluded from segment Adjusted EBITDA. Eliminations include transactions to account for intercompany activity.

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

The following tables set forth certain financial information relating to our ~~continuing~~ operations by reportable segment ~~(in thousands)~~($ in millions):


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Revenue by Segment:
Ready-mixed concrete
Sales to external customers	$	274.3	$	272.4	$	515.8	$	564.6
Aggregate products
Sales to external customers	25.2		26.1		47.8		47.2
Freight revenue on sales to external customers	11.2		12.1		20.6		22.1
Intersegment sales	16.8		16.3		29.3		28.8
Total aggregate products	53.2		54.5		97.7		98.1
Total reportable segment revenue	327.5		326.9		613.5		662.7
Other products and eliminations	(0.1)		(4.2)		(0.4)		(5.6)
Total revenue	$	327.4	$	322.7	$	613.1	$	657.1

Reportable Segment Adjusted EBITDA:
Ready-mixed concrete	$	30.9	$	38.1	$	55.8	$	69.8
Aggregate products	20.1		21.6		32.6		32.9
Total reportable segment Adjusted EBITDA	$	51.0	$	59.7	$	88.4	$	102.7

Reconciliation of Total Reportable Segment Adjusted EBITDA to Net Income (Loss):
Total reportable segment Adjusted EBITDA	$	51.0	$	59.7	$	88.4	$	102.7
Other products and eliminations from operations	0.7		0.3		0.4		0.4
Corporate overhead	(32.6)		(16.3)		(46.3)		(31.9)
Depreciation, depletion and amortization for reportable segments	(24.2)		(23.7)		(47.1)		(45.5)
Interest expense, net	(10.3)		(11.4)		(20.7)		(22.8)
Loss on extinguishment of debt	(5.5)		0		(5.5)		0
Gain on sale of business	0		0		0.7		0
Realignment initiative costs	0		(0.8)		(0.4)		(0.8)
Change in value of contingent consideration for reportable segments	0		5.8		0.1		5.5

Purchase accounting adjustments for inventory	(0.5)		(2.6)		(0.6)		(4.2)

Corporate, other products and eliminations other income (loss), net	0.2		(0.2)		0.3		(0.3)
Income (loss) before income taxes	(21.2)		10.8		(30.7)		3.1
Income tax benefit (expense)	0.7		(4.3)		5.4		0.6
Net income (loss)	$	(20.5)	$	6.5	$	(25.3)	$	3.7

Three Months Ended
September 30,
Nine Months Ended
September 30,

2017
2016
2017
2016
Revenue:

Ready-mixed concrete

Sales to external customers
$ 323,567

$ 297,858

$ 909,145

$ 770,479
Aggregate products

Sales to external customers
10,972

12,289

32,305

30,756
Intersegment sales
9,987

9,839

29,244

25,641
Total aggregate products 20,959
22,128
61,549
56,397
Total reportable segment revenue
344,526

319,986

970,694

826,876
Other products and eliminations
10,102

8,602

23,993

22,507
Total revenue
$ 354,628

$ 328,588
$ 994,687
$ 849,383

Reportable Segment Adjusted EBITDA:

Ready-mixed concrete
$ 53,627

$ 51,394

$ 144,777

$ 111,809
Aggregate products
6,218

7,005

18,889

15,080
Total reportable segment Adjusted EBITDA
$ 59,845
$ 58,399
$ 163,666
$ 126,889

Reconciliation of Total Reportable Segment Adjusted EBITDA to Income (Loss) From Continuing Operations:

Total reportable segment Adjusted EBITDA $ 59,845
$ 58,399
$ 163,666
$ 126,889
Other products and eliminations from operations 3,315
2,472
9,338
6,704
Corporate overhead (14,051 ) (10,628 ) (39,757 ) (31,150 )
Depreciation, depletion and amortization for reportable segments (15,441 ) (13,036 ) (45,586 ) (35,630 )
Hurricane-related losses for reportable segments (1,854 ) —
(1,854 ) —
Quarry dredge costs for specific event for reportable segment (2,175 ) —
(2,175 ) —
Interest expense, net (10,552 ) (7,635 ) (31,062 ) (19,933 )
Corporate loss on early extinguishment of debt (60 ) —
(60 ) (12,003 )
Corporate derivative income (loss) 13,119
21,772
(791 ) 6,430
Change in value of contingent consideration for reportable segments (719 ) (714 ) (2,047 ) (2,325 )
Corporate, other products and eliminations other income, net 90
69
291
305
Income from continuing operations before income taxes 31,517
50,699
49,963
39,287
Income tax expense (7,241 ) (12,577 ) (20,854 ) (14,317 )
Income from continuing operations $ 24,276
$ 38,122
$ 29,109
$ 24,970

Capital Expenditures:
Ready-mixed concrete $ 5,006
$ 5,807
$ 17,329
$ 17,978
Aggregate products 10,092
1,676
15,769
9,689
Other products and corporate 194
625
886
3,374
Total capital expenditures $ 15,292
$ 8,108
$ 33,984
$ 31,041

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Capital Expenditures:
Ready-mixed concrete(1)	$	10.4	$	4.3	$	11.5	$	8.7
Aggregate products(2)	2.9		2.5		34.0		5.3
Other products and corporate	0.3		0.1		0.5		0.2
Total capital expenditures	$	13.6	$	6.9	$	46.0	$	14.2

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
Revenue by Product:
Ready-mixed concrete $ 323,567
$ 297,858
$ 909,145
$ 770,479
Aggregate products 10,972
12,289
32,305
30,756
Aggregates distribution 8,423
7,381
21,376
18,662
Building materials 7,263
5,577
18,007
14,823
Lime 2,240
3,479
7,380
7,828
Hauling 1,465
1,320
4,066
4,301
Other 698
684
2,408
2,534
Total revenue $ 354,628
$ 328,588
$ 994,687
$ 849,383

As of
September 30, 2017

As of
December 31, 2016
Identifiable Property, Plant And Equipment Assets:
Ready-mixed concrete $ 268,174
$ 229,077
Aggregate products 146,259
87,064
Other products and corporate 24,356
21,271
Total identifiable assets $ 438,789
$ 337,412


~~16.~~	~~SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION~~

~~The Senior Unsecured Notes are fully and unconditionally and jointly and severally guaranteed on a senior unsecured basis by each direct and indirect domestic subsidiary~~(1) Includes $8.2 million for the acquisition of the Company, each a guarantor subsidiary. Each guarantor subsidiary is directly or indirectly 100% owned by the Company. The Senior Unsecured Notes are not guaranteed by any direct or indirect foreign subsidiaries of the Company, each a non-guarantor subsidiary. Consequently, we are required to provide condensed consolidating financial informationrail terminal and bulk storage facility for cementitious materials in ~~accordance with Rule 3-10 of Regulation S-X.~~

The following condensed consolidating financial statements present, in separate columns, financial information for (1) the Parent on a parent only basis, (2) the guarantor subsidiaries on a combined basis, (3) the non-guarantor subsidiaries on a combined basis, (4) the eliminations and reclassifications necessary to arrive at the information for the Company on a consolidated basis, and (5) the Company on a consolidated basis.

The following condensed consolidating financial statements of U.S. Concrete, Inc. and its subsidiaries present investments in consolidated subsidiaries using the equity method of accounting. The principal elimination entries eliminate investments in subsidiaries and intercompany balances and transactions.

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~CONDENSED CONSOLIDATING BALANCE SHEET~~

~~SEPTEMBER 30, 2017~~

~~(in thousands)~~

Parent Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations and Reclassifications U.S. Concrete Consolidated
ASSETS
Current assets:
Cash and cash equivalents $ —
247,873
$ 390
$ —
$ 248,263
Trade accounts receivable, net —
234,671
305
—
234,976
Inventories —
42,084
3,345
—
45,429
Other receivables 8,063
5,946
71
—
14,080
Prepaid expenses —
6,301
27
—
6,328
Other current assets 11,397
1,282
16
(11,397 ) 1,298
Total current assets 19,460
538,157
4,154
(11,397 ) 550,374
Property, plant and equipment, net —
414,760
24,029
—
438,789
Goodwill —
141,407
5,753
—
147,160
Intangible assets, net —
118,676
2,709
—
121,385
Deferred income taxes —
—
558
(558 ) —
Investment in subsidiaries 417,747
—
—
(417,747 ) —
Intercompany receivables 463,096
—
—
(463,096 ) —
Other assets —
1,946
47
—
1,993
Total assets $ 900,303
$ 1,214,946
$ 37,250
$ (892,798 ) $ 1,259,701
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 116
$ 122,260
$ 750
$ —
$ 123,126
Accrued liabilities 17,447
82,624
1,889
(11,397 ) 90,563
Current maturities of long-term debt —
24,841
97
—
24,938
Total current liabilities 17,563
229,725
2,736
(11,397 ) 238,627
Long-term debt, net of current maturities 599,112
64,064
304
—
663,480
Other long-term obligations and deferred credits 1,835
58,172
826
—
60,833
Deferred income taxes —
15,528
—
(558 ) 14,970
Intercompany payables —
454,154
8,942
(463,096 ) —
Total liabilities 618,510
821,643
12,808
(475,051 ) 977,910
Total stockholders' equity 281,793
393,303
24,442
(417,747 ) 281,791
Total liabilities and stockholders' equity $ 900,303
$ 1,214,946
$ 37,250
$ (892,798 ) $ 1,259,701

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~CONDENSED CONSOLIDATING BALANCE SHEET~~

~~DECEMBER 31, 2016~~

~~(in thousands)~~

Parent Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations and Reclassifications U.S. Concrete Consolidated
ASSETS
Current assets:
Cash and cash equivalents $ —
$ 75,576
$ 198
$ —
$ 75,774
Trade accounts receivable, net —
206,426
866
—
207,292
Inventories —
38,856
3,123
—
41,979
Prepaid expenses —
5,516
18
—
5,534
Other receivables 1,200
7,491
—
—
8,691
Other current assets 39,239
2,004
15
(39,239 ) 2,019
Total current assets 40,439
335,869
4,220
(39,239 ) 341,289
Property, plant and equipment, net —
314,332
23,080
—
337,412
Goodwill —
127,518
5,753
—
133,271
Intangible assets, net —
127,798
3,175
—
130,973
Deferred income taxes —
—
561
(561 ) —
Investment in subsidiaries 368,726
—
—
(368,726 ) —
Intercompany receivables 239,776
—
—
(239,776 ) —
Other assets —
2,410
47
—
2,457
Total assets $ 648,941
$ 907,927
$ 36,836
$ (648,302 ) $ 945,402
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 458
$ 108,803
$ 1,433
$ —
$ 110,694
Accrued liabilities 5,365
117,104
2,013
(39,239 ) 85,243
Current maturities of long-term debt —
16,654
—
—
16,654
Derivative liabilities 57,415
—
—
—
57,415
Total current liabilities 63,238
242,561
3,446
(39,239 ) 270,006
Long-term debt, net of current maturities 391,190
41,454
—
—
432,644
Other long-term obligations and deferred credits 5,684
39,613
970
—
46,267
Deferred income taxes —
8,217
—
(561 ) 7,656
Intercompany payables —
233,319
6,457
(239,776 ) —
Total liabilities 460,112
565,164
10,873
(279,576 ) 756,573
Total stockholders' equity 188,829
342,763
25,963
(368,726 ) 188,829
Total liabilities and stockholders' equity $ 648,941
$ 907,927
$ 36,836
$ (648,302 ) $ 945,402

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS~~

~~THREE MONTHS ENDED SEPTEMBER 30, 2017~~

~~(in thousands)~~

Parent Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations and Reclassifications U.S. Concrete Consolidated
Revenue $ —
$ 351,005
$ 3,623
$ —
$ 354,628
Cost of goods sold before depreciation, depletion and amortization —
275,581
3,414
—
278,995
Selling, general and administrative expenses —
28,630
1,426
—
30,056
Depreciation, depletion and amortization —
16,028
565
—
16,593
Change in value of contingent consideration 389
330
—
—
719
Impairment of assets —
—
648
—
648
Loss (gain) on disposal of assets —
(106 ) —
—
(106 )
Operating income (loss) (389 ) 30,542
(2,430 ) —
27,723
Interest expense, net 9,977
574
1
—
10,552
Derivative loss (income) (13,119 ) —
—
—
(13,119 )
Loss on extinguishment of debt 60
—
—
—
60
Other (income) expense, net —
(654 ) (633 ) —
(1,287 )
Income (loss) from continuing operations before income taxes and equity in earnings of subsidiaries 2,693
30,622
(1,798 ) —
31,517
Income tax expense (benefit) (3,930 ) 11,240
(69 ) —
7,241
Income (loss) from continuing operations, net of taxes and before equity in earnings of subsidiaries 6,623
19,382
(1,729 ) —
24,276
Loss from discontinued operations, net of taxes and before equity in earnings of subsidiaries —
(222 ) —
—
(222 )
Income (loss), net of taxes and before equity in earnings of subsidiaries 6,623
19,160
(1,729 ) —
24,054
Equity in earnings of subsidiaries 17,431
—
—
(17,431 ) —
Net income (loss) $ 24,054
$ 19,160
$ (1,729 ) $ (17,431 ) $ 24,054

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS~~

~~THREE MONTHS ENDED SEPTEMBER 30, 2016~~

~~(in thousands)~~

Parent Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations and Reclassifications U.S. Concrete Consolidated
Revenue $ —
$ 323,406
$ 5,182
$ —
$ 328,588
Cost of goods sold before depreciation, depletion and amortization —
249,185
4,292
—
253,477
Selling, general and administrative expenses —
24,438
666
—
25,104
Depreciation, depletion and amortization —
13,529
610
—
14,139
Change in value of contingent consideration 131
583
—
—
714
Loss (gain) on disposal of assets —
(1,003 ) —
—
(1,003 )
Operating income (loss) (131 ) 36,674
(386 ) —
36,157
Interest expense, net 7,105
526
4
—
7,635
Derivative loss (income) (21,772 ) —
—
—
(21,772 )
Other (income) expense, net —
(333 ) (72 ) —
(405 )
Income (loss) from continuing operations, net of taxes and before income taxes and equity in earnings of subsidiaries 14,536
36,481
(318 ) —
50,699
Income tax expense (benefit) (3,219 ) 16,869
(1,073 ) —
12,577
Income (loss) from continuing operations, net of taxes and before equity in earnings of subsidiaries 17,755
19,612
755
—
38,122
Loss from discontinued operations, net of taxes and before equity in earnings of subsidiaries —
(166 ) —
—
(166 )
Income (loss), net of taxes and before equity in earnings of subsidiaries 17,755
19,446
755
—
37,956
Equity in earnings of subsidiaries 20,201
—
—
(20,201 ) —
Net income (loss) $ 37,956
$ 19,446
$ 755
$ (20,201 ) $ 37,956

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
NINE MONTHS ENDED SEPTEMBER 30, 2017
(in thousands)
Parent Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations and Reclassifications U.S. Concrete Consolidated
Revenue $ —
$ 980,496
$ 14,191
$ —
$ 994,687
Cost of goods sold before depreciation, depletion and amortization —
766,605
11,723
—
778,328
Selling, general and administrative expenses —
83,285
2,788
—
86,073
Depreciation, depletion and amortization —
46,957
1,845
—
48,802
Change in value of contingent consideration 669
1,378
—
—
2,047
Impairment of assets —
—
648
—
648
Loss (gain) on disposal or sale of assets —
(498 ) 2
—
(496 )
Operating income (loss) (669 ) 82,769
(2,815 ) —
79,285
Interest expense, net 29,665
1,396
1
—
31,062
Derivative loss (income) 791
—
—
—
791
Loss on extinguishment of debt 60
—
—

60
Other (income) expense, net —
(2,027 ) (564 ) —
(2,591 )
Income (loss) from continuing operations, net of taxes and before income taxes and equity in earnings of subsidiaries (31,185 ) 83,400
(2,252 ) —
49,963
Income tax (benefit) expense (11,397 ) 32,337
(86 ) —
20,854
Income (loss) from continuing operations, net of taxes and before equity in earnings of subsidiaries (19,788 ) 51,063
(2,166 ) —
29,109
Loss from discontinued operations, net of taxes and before equity in earnings of subsidiaries —
(524 ) —
—
(524 )
Income (loss), net of taxes and before equity in earnings of subsidiaries (19,788 ) 50,539
(2,166 ) —
28,585
Equity in earnings of subsidiaries 48,373
—
—
(48,373 ) —
Net income (loss) $ 28,585
$ 50,539
$ (2,166 ) $ (48,373 ) $ 28,585

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
NINE MONTHS ENDED SEPTEMBER 30, 2016
(in thousands)
Parent Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations and Reclassifications U.S. Concrete Consolidated
Revenue $ —
$ 833,589
$ 15,794
$ —
$ 849,383
Cost of goods sold before depreciation, depletion and amortization —
660,889
13,562
—
674,451
Selling, general and administrative expenses —
69,760
1,687
—
71,447
Depreciation, depletion and amortization —
36,709
2,086
—
38,795
Change in value of contingent consideration 315
2,010
—
—
2,325
Loss (gain) on disposal or sale of assets —
(1,016 ) —
—
(1,016 )
Operating income (loss) (315 ) 65,237
(1,541 ) —
63,381
Interest expense, net 18,729
1,192
12
—
19,933
Derivative loss (income) (6,430 ) —
—
—
(6,430 )
Loss on extinguishment of debt 12,003
—
—

12,003
Other (income) expense, net —
(1,357 ) (55 ) —
(1,412 )
Income (loss) from continuing operations, net of taxes and before income taxes and equity in earnings of subsidiaries (24,617 ) 65,402
(1,498 ) —
39,287
Income tax expense (benefit) (12,447 ) 28,449
(1,685 ) —
14,317
Income (loss) from continuing operations, net of taxes and before equity in earnings of subsidiaries (12,170 ) 36,953
187
—
24,970
Loss from discontinued operations, net of taxes and before equity in earnings of subsidiaries —
(518 ) —
—
(518 )
Income (loss), net of taxes and before equity in earnings of subsidiaries (12,170 ) 36,435
187
—
24,452
Equity in earnings of subsidiaries 36,622
—
—
(36,622 ) —
Net income (loss) $ 24,452
$ 36,435
$ 187
$ (36,622 ) $ 24,452

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS~~

~~NINE MONTHS ENDED SEPTEMBER 30, 2017~~

~~(in thousands)~~

Parent Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations U.S. Concrete Consolidated
Net cash provided by operating activities $ (905 ) $ 95,217
$ 363
$ (10,429 ) $ 84,246
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment —
(31,416 ) (2,568 ) —
(33,984 )
Payments for acquisitions, net of cash acquired 469
(57,265 ) —
—
(56,796 )
Proceeds from disposals of property, plant and equipment —
1,001
2
—
1,003
Proceeds from disposals of businesses —
1,305
—
—
1,305
Investment in subsidiaries (646 ) —
—
646
—
Advance for note receivable (8,063 ) —
—
—
(8,063 )
Net cash (used in) provided by investing activities (8,240 ) (86,375 ) (2,566 ) 646
(96,535 )
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of debt 211,500
—
—
—
211,500
Proceeds from exercise of stock options and warrants 2,695
—
—
—
2,695
Payments of other long-term obligations (2,925 ) (4,789 ) (8 ) —
(7,722 )
Payments for other financing —
(14,317 ) —
—
(14,317 )
Debt issuance costs (4,332 ) —
—
—
(4,332 )
Other treasury share purchases (3,046 ) —
—
—
(3,046 )
Intercompany funding (194,747 ) 182,561
2,403
9,783
—
Net cash (used in) provided by financing activities 9,145
163,455
2,395
9,783
184,778
NET INCREASE IN CASH AND CASH EQUIVALENTS —
172,297
192
—
172,489
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD —
75,576
198
—
75,774
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ —
$ 247,873
$ 390
$ —
$ 248,263

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS~~

~~NINE MONTHS ENDED SEPTEMBER 30, 2016~~

~~(in thousands)~~

Parent Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations U.S. Concrete Consolidated
Net cash (used in) provided by operating activities $ (4,117 ) $ 94,789
$ 1,618
$ —
$ 92,290
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment —
(28,780 ) (2,261 ) —
(31,041 )
Payments for acquisitions, net of cash acquired —
(124,481 ) —
—
(124,481 )
Proceeds from disposals of property, plant and equipment —
1,920
—
—
1,920
Proceeds from disposals of businesses —
375
—
—
375
Investment in subsidiaries (300 ) —
—
300
—
Net cash used in investing activities (300 ) (150,966 ) (2,261 ) 300
(153,227 )
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from revolver borrowings 128,904
—
—
—
128,904
Repayments of revolver borrowings (173,904 ) —
—
—
(173,904 )
Proceeds from issuance of debt 400,000
—
—
—
400,000
Repayments of debt (200,000 ) —
—
—
(200,000 )
Premium paid on early retirement of debt (8,500 ) —
—
—
(8,500 )
Proceeds from exercise of stock options and warrants 166
—
—
—
166
Payments of other long-term obligations (657 ) (3,486 ) —
—
(4,143 )
Payments for other financing —
(8,880 ) —
—
(8,880 )
Debt issuance costs (7,786 ) —
—
—
(7,786 )
Other treasury share purchases (2,825 ) —
—
—
(2,825 )
Intercompany funding (130,981 ) 130,113
1,168
(300 ) —
Net cash provided by financing activities 4,417
117,747
1,168
(300 ) 123,032
NET INCREASE IN CASH AND CASH EQUIVALENTS —
61,570
525
—
62,095
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD —
3,854
71
—
3,925
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ —
$ 65,424
$ 596
$ —
$ 66,020

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~


~~17.~~	~~PENDING ACQUISITION~~

On September 29, 2017, we entered into an arrangement agreement (the "Arrangement Agreement") with Polaris Materials Corporation ("Polaris"), a Canadian corporation, to purchase all of the issued and outstanding common shares of Polaris at a purchase price of C$3.40 per share (references to "C$" are for Canadian dollars) by way of a statutory plan of arrangement (the "Arrangement"). The price per share implies an aggregate fully diluted equity value for Polaris of approximately C$309 million. Upon completion of the Arrangement, Polaris will be an indirect wholly owned subsidiary of the Company. The transaction is expected to close in the fourth quarter of 2017, subject to approval by Polaris' securityholders at a special meeting of the securityholders, approval by the Supreme Court of British Columbia, and other customary closing conditions. We expect to finance the transaction with a combination of cash on hand and borrowings under our Revolving Facility (see Note 8).

In connection with the Arrangement, Polaris terminated the previously announced arrangement agreement among Polaris, Vulcan Materials Company and its wholly owned subsidiary dated August 25, 2017, (the "Vulcan Agreement"). In connection with terminating the Vulcan Agreement, we received a C$10 million promissory note ($8.1 million as of September 30, 2017) from Polaris ("Polaris Note") in exchange for cash Polaris used to pay the Vulcan Agreement termination fee. The Polaris Note bears interest at a rate of 6.75% per annum, is payable on demand in Canadian dollars, and is recorded in other receivables in our condensed consolidated balance sheets.

~~U.S. CONCRETE, INC. AND SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~


~~18.~~	~~HURRICANES IRMA AND MARIA~~

On September 6, 2017, Hurricane Irma made landfall on the U.S. Virgin Island of Saint Thomas. On September 19, 2017, Hurricane Maria made landfall on Saint Croix. These storms resulted in extensive damage, flooding, and power outages throughout the~~islands~~, and power had not been fully restored as of the date of this filing. We are currently in the process of assessing the full extent of the damages to our operations; due to the ongoing conditions on the islands, we are unable at this time to quantify the impact to our consolidated financial statements. There is uncertainty as to the magnitude of the losses associated with these storms, including the potential, if any, for insurance recoveries. To date, we have identified approximately $0.6 million of impaired tangible assets, which has been recorded in the condensed consolidated statement of operationsStockton, California for the three and ~~nine~~six months ended ~~September~~June 30, ~~2017. The damages may result in~~2021.

(2) Includes $28.7 million for the additional impairment of certain tangible and/or intangible assets. As of September 30, 2017, the assets in our U.S. Virgin Islands operations totaled $37.3 million, which included $3.3 million of inventory, $0.8 million of cash and other current assets, $8.5 million of goodwill and other intangible assets, and $24.0 million of property, plant, and equipment (of which $11.8 million is mineral reserves).

~~CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS~~

~~Certain statements and information in this Quarterly Report on Form 10-Q may constitute “forward-looking statements” within the meaning~~acquisition of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, without limitation, statements concerning plans, objectives, goals, projections, strategies, future events or performance, and underlying assumptions and other statements, which are not statements of historical facts. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “intends,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” or “continue,” the negative of such terms or other comparable terminology. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting us will be those that we anticipate. All comments concerning our expectations for future operating results are based on our forecasts for our existing operations and do not include the potential impact of any future acquisitions. Our forward-looking statements involve significant risks and uncertainties (some of which are beyond our control) and assumptions that could cause actual results to differ materially from our historical experience and our present expectations or projections.

~~Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, those summarized below:~~

~~general economic and business conditions, which will, among other things, affect demand for new residential and commercial construction;~~

~~our ability to successfully identify, manage, and integrate acquisitions;~~

~~the cyclical nature of, and changes in, the real estate and construction markets, including pricing changes by our competitors;~~

governmental requirements and initiatives, including those related to mortgage lending, financing or deductions, funding for public or infrastructure construction, land usage, and environmental, health, and safety matters;

~~disruptions, uncertainties or volatility in the credit markets that may limit our, our suppliers' and our customers' access to capital;~~

~~our ability to successfully implement our operating strategy;~~

~~weather conditions;~~

~~our substantial indebtedness~~property and the ~~restrictions imposed~~underlying royalty agreement associated with the Orca Quarry on ~~us by the terms of our indebtedness;~~

~~our ability to maintain favorable relationships with third parties who supply us with equipment and essential supplies;~~

~~our ability to retain key personnel and maintain satisfactory labor relations; and~~

~~product liability, property damage, results of litigation, and other claims and insurance coverage issues.~~

For additional information regarding known material factors that could cause our actual results to differ from our projected results, please see “Risk Factors” in Item 1A of Part I of our Annual Report on Form 10-KVancouver Island, British Columbia, Canada for the ~~year~~six months ended ~~December 31, 2016.~~June 30, 2021.

Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statements after the date they are made, whether as a result of new information, future events or otherwise, except as required by federal securities laws.


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Revenue by Product:
Ready-mixed concrete	$	274.3	$	272.4	$	515.8	$	564.6
Aggregate products	36.4		38.2		68.4		69.3
Other(1)	16.7		12.1		28.9		23.2
Total revenue	$	327.4	$	322.7	$	613.1	$	657.1

(1) Includes building materials, aggregates distribution, hauling and other.


	June 30, 2021		December 31, 2020
Identifiable Property, Plant and Equipment Assets:
Ready-mixed concrete	$	289.5	$	286.9
Aggregate products	495.6		478.1
Other products and corporate	21.7		23.2
Total identifiable assets	$	806.8	$	788.2



~~Item 2.~~	~~Management’s Discussion and Analysis of Financial Condition and Results of Operations~~

~~For a discussion of our commitments not discussed below and our critical accounting policies, see “Management’s~~Item 2. Management's Discussion and Analysis of Financial Condition and Results of ~~Operations”~~Operations

The following discussion should be read in ~~Item 7 of Part II of~~conjunction with the accompanying quarterly unaudited condensed consolidated financial statements as well as our Annual Report on Form 10-K for the year ended December 31, ~~2016 (the “2016 Form~~2020 (“2020 10-K”).

Our ~~Business~~

~~U.S. Concrete, Inc. is~~2020 10-K includes additional information about our significant and critical accounting policies, as well as a ~~Delaware corporation, which was founded~~detailed discussion of the most significant risks associated with our financial condition and ~~incorporated in 1997. We began operations in 1999, which is~~operating results. Unless noted otherwise, the ~~year we completed our initial public offering. In this report, we~~discussions that follow refer to ~~U.S. Concrete,~~the three months ended June 30, 2021 as “the quarter” and the six months ended June 30, 2021 as “the first six months” and compare the results to the three months and six months ended June 30, 2020, respectively.

Pending Acquisition by Vulcan Materials Company

On June 6, 2021, Vulcan Materials Company (“Vulcan”), Grizzly Merger Sub I, Inc., a wholly owned subsidiary of Vulcan (“Grizzly Merger Sub”) and ~~its subsidiaries~~the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”). The Merger Agreement provides that, subject to the terms and conditions set forth therein, Grizzly Merger Sub will merge with and into the Company (the “Merger”), with the Company surviving the Merger and becoming a wholly owned subsidiary of Vulcan. Subject to the terms and conditions of the Merger Agreement, at the effective time of the Merger, each issued and outstanding share of USCR Stock (other than such shares (i) owned by the Company, Vulcan or Grizzly Merger Sub or owned by any wholly owned subsidiary of Vulcan (other than Grizzly Merger Sub) or of the Company or (ii) exercising dissenters rights in accordance with Section 262 of the General Corporation Law of the State of Delaware) will be converted into the right to receive $74.00 in cash, without interest. The transaction has been unanimously approved by the boards of directors of both companies and is expected to close in the second half of 2021, subject to the receipt of required regulatory approvals, approval by our stockholders, and other customary closing conditions. If the Merger is consummated, USCR Stock will be delisted from Nasdaq and deregistered under the Securities Exchange Act of 1934, as ~~“we,” “us,” “our,” “U.S. Concrete”~~amended.

The Merger Agreement provides each of the Company and Vulcan with certain termination rights and, under certain circumstances, may require the Company or ~~the “Company”, unless we specifically state otherwise, or the content indicates otherwise.~~ Vulcan to pay a $50.0 million termination fee.

General

We are a leading ~~producer~~heavy building materials supplier of aggregates and ready-mixed concrete in select geographic markets in the United States, ~~and~~ the U.S. Virgin ~~Islands. We operate~~Islands and Canada. The geographic markets for our products are generally local, except for our Canadian aggregate products operation, Polaris Materials Corp. (“Polaris”), which primarily serves markets in California. Our customers are generally involved in the construction industry, which is a cyclical business and is subject to general and more localized economic conditions. In addition, our business is impacted by seasonal variations in weather conditions, which vary by regional market. Our operating results are subject to fluctuations in the level and mix of construction activity that occur in our markets. The level of activity affects the demand for our products, while the product mix of activity among the various segments of the construction industry affects both our relative competitive strengths and our operating margins. Commercial and industrial projects generally provide more opportunities to sell value-added products that are designed to meet the high-performance requirements of these types of projects. We conduct our business primarily through two ~~primary~~reportable segments: ~~(1)~~ ready-mixed concrete and ~~(2)~~ aggregate products. ~~Discontinued operations primarily represent the remaining lease activity for our precast operations, which were sold in prior years.~~

~~Ready-Mixed Concrete.~~Ready-mixed concrete. Our ready-mixed concrete segment (which represented ~~91.4%~~84.1% of our revenue for the ~~nine~~six months ended ~~September~~June 30, ~~2017)~~2021) engages principally in the formulation, preparation and ~~production~~delivery of ready-mixed concrete ~~en route~~ to our customers’ job sites. We provide ~~our~~ ready-mixed concrete from our operations in Texas, Northern California, New York City, New Jersey, Washington, D.C., ~~Northern California,~~Philadelphia, Oklahoma and the U.S. Virgin Islands.

Ready-mixed concrete is a highly versatile construction material that results from combining coarse and fine aggregates, such as gravel, crushed stone and sand, with water, various chemical admixtures and cement. We also provide services intended to reduce our customers’ overall construction costs by lowering the installed, or “in-place,” cost of concrete. These services include the formulation of mixtures for specific design uses, on-site and lab-based product quality control and customized delivery programs to meet our customers’ needs.

Aggregate ~~Products.~~products. Our aggregate products segment (which represented ~~3.2%~~11.2% of our revenue for the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2021, excluding ~~$29.2~~$29.3 million of intersegment sales) produces crushed stone, sand and gravel from 17our aggregates facilities located in British Columbia, Canada; Texas; Oklahoma; New ~~Jersey, Texas, Oklahoma,~~Jersey; New York; and the U.S. Virgin Islands. We sell these aggregates for use in commercial, industrial, and public works projects, ~~in the markets they serve,~~ as well as consume them internally in the production of ready-mixed concrete. We produced approximately ~~4.4~~6.3 million tons of aggregates during the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2021, with ~~Texas and~~ Canada representing 35%, Texas/Oklahoma representing ~~50%~~37%, New ~~Jersey~~Jersey/New York representing ~~45%~~26%, and the U.S. Virgin Islands representing 5%2% of the total production. We ~~consumed 55% of~~believe our ~~aggregate production internally and sold 45% to third-party customers during the nine months ended September 30, 2017. Our~~ aggregate reserves provide us with additional raw materials sourcing flexibility and supply availability.

~~Overview~~Coronavirus Impact

~~We typically serve customers~~The coronavirus (“COVID-19”) pandemic began to impact our operations in March 2020 when residents throughout the ~~general proximity~~U.S. began varying periods under “stay-at-home” or “shelter-in-place” orders and has continued to impact numerous aspects of our ~~plants,~~business since then. We continue to follow the enhanced safety and health protocols established in 2020, while following evolving state and local guidelines, and we have maintained our focus on cost containment efforts to help minimize the resulting impact to our operating results. In addition, we continue to monitor the impact of the pandemic on our customers and our ~~operating results~~pipeline. The long-term impact to our business remains unknown because we are ~~subject~~unable to accurately predict the impact of COVID-19 due to various uncertainties, including the severity of the virus, the duration of the outbreak, the impact of variants of the virus, the availability and efficacy of vaccines, the speed at which such vaccines are administered, the likelihood of a resurgence of positive cases, actions that may be taken by governmental authorities intended to minimize the spread of the pandemic or to stimulate the economy and other unintended consequences. Accordingly, business disruption related to the COVID-19 outbreak may continue to cause significant fluctuations in ~~the level and mix of construction activity that occur in~~ our local markets. The level of construction activity affects the demand for our products, while the product mix of activity among the various segments of the construction industry affects both our relative competitive strengths and our operating margins. Commercial and industrial projects generally provide more opportunities to sell value-added products that are designed to meet the high-performance requirements of these types of projects.

~~Our customers are generally involved in the construction industry, which is a cyclical~~ business, and is subject to general and more localized economic conditions. Our business is impacted by seasonal changes in weather conditions, precipitation and other weather-related conditions, such as freezing temperatures, snowstorms, droughts, flooding or hurricanes, which vary by regional market. Accordingly, because of inclement weather,impact demand for our products and ~~services during the winter months is typically lower than in other months~~our workforce availability and magnify risks associated with our business and operations.

Acquisitions and Business Combinations

On February 24, 2020, we acquired all of the ~~year. Also, sustained periods~~equity of ~~inclement weather~~Coram Materials Corp. and ~~other adverse weather conditions could cause the delay~~certain of ~~construction projects during other times of the year.~~

~~Consolidated~~its affiliates, a sand and gravel products provider located on Long Island in New York. On November 7, 2020, we acquired a ready-mixed concrete ~~average selling prices increased 3.0%~~business in our West Region.

On March 12, 2021, we acquired property and the underlying royalty agreement associated with the Orca Quarry on Vancouver Island, British Columbia, Canada for $28.7 million (the “Orca Acquisition”). We made this investment to eliminate future royalty payments, which had previously been recognized in cost of goods sold excluding depreciation, depletion and amortization in our condensed consolidated statements of operations.

On April 20, 2021, we purchased a rail terminal and bulk storage facility for cementitious materials in Stockton, California for $8.2 million that is currently leased to and operated by a third party (the “Stockton Acquisition”). We made this investment to increase the ~~three months ended September 30, 2017, as compared~~control and stability over our raw material supply chain to ~~the three months ended September 30, 2016, resulting in the 26th consecutive fiscal quarter of increased average selling prices year-over-year. For the nine months ended September 30, 2017,~~support our West Region ready-mixed concrete sales volume increased 13.3% to 6.7 million cubic yards as compared to the nine months ended September 30, 2016. Ready-mixed concrete sales prices and volume in the nine months ended 2017 as compared to the same period in 2016 were up overall primarily due to increased construction activity and ready-mixed concrete segment acquisitions completed last year.business.

~~On September 6, 2017, Hurricane Irma made landfall on the U.S. Virgin Island of Saint Thomas. On September~~

19 2017, Hurricane Maria made landfall on Saint Croix. These storms resulted in extensive damage, flooding, and power outages throughout the islands, and power had not been fully restored as of the date of this filing. We are currently in the process of assessing the full extent of the damages to our operations; due to the ongoing conditions on the islands we are unable at this time to quantify the impact to our consolidated financial statements. There is uncertainty as to the magnitude of the losses associated with these storms, including the potential, if any, for insurance recoveries. To date, we have identified approximately $0.6 million of impaired tangible assets, which is included in our results for the three and nine months ended September 30, 2017. The damages may result in the additional impairment of certain tangible and/or intangible assets. As of September 30, 2017, the assets in our U.S. Virgin Islands operations totaled $37.3 million, which included $3.3 million of inventory, $0.8 million of cash and other current assets, $8.5 million of goodwill and other intangible assets, and $24.0 million of property, plant, and equipment (of which $11.8 million is mineral reserves). In 2016, our U.S. Virgin Islands operations accounted for about 2% of the Company's total revenue.

Results of Operations

The ~~following table sets forth selected historical statement~~discussions that follow reflect results for the three and six months ended June 30, 2021 (“quarter” and “first six months of ~~operations information for each of~~2021”, respectively) compared to the ~~periods indicated.~~three and six months ended June 30, 2020, respectively, unless otherwise noted.

(amounts in thousands, except selling prices and percentages)
Three Months Ended
September 30, Increase/ (Decrease) Nine Months Ended
September 30, Increase/ (Decrease)
2017 2016
%⁽¹⁾
2017 2016
%⁽¹⁾
(unaudited) (unaudited)
Revenue $ 354,628
$ 328,588
7.9% $ 994,687
$ 849,383
17.1%
Cost of goods sold before depreciation, depletion and amortization 278,995
253,477
10.1 778,328
674,451
15.4
Selling, general and administrative expenses 30,056
25,104
19.7 86,073
71,447
20.5
Depreciation, depletion and amortization 16,593
14,139
17.4 48,802
38,795
25.8
Change in value of contingent consideration 719
714
0.7 2,047
2,325
(12.0)
Impairment of assets 648
—
NM 648
—
NM
Loss (gain) on disposal of assets, net (106 ) (1,003 ) (89.4) (496 ) (1,016 ) (51.2)
Operating income 27,723
36,157
(23.3) 79,285
63,381
25.1
Interest expense, net 10,552
7,635
38.2 31,062
19,933
55.8
Derivative loss (income) (13,119 ) (21,772 ) (39.7) 791
(6,430 ) NM
Loss on extinguishment of debt 60
—
NM 60
12,003
99.5
Other income, net (1,287 ) (405 ) 217.8 (2,591 ) (1,412 ) 83.5
Income from continuing operations before income taxes 31,517
50,699
(37.8) 49,963
39,287
27.2
Income tax expense 7,241
12,577
(42.4) 20,854
14,317
45.7
Income from continuing operations 24,276
38,122
(36.3) 29,109
24,970
16.6
Loss from discontinued operations, net of taxes (222 ) (166 ) 33.7 (524 ) (518 ) 1.2
Net income $ 24,054
$ 37,956
(36.6%) $ 28,585
$ 24,452
16.9%

Ready-mixed Concrete Data:

Average selling price per cubic yard $ 136.62
$ 132.70
3.0 % $ 135.16
$ 129.64
4.3 %
Sales volume in cubic yards 2,366
2,240
5.6 % 6,719
5,929
13.3 %

Aggregates Data:
Average selling price per ton $ 12.25
$ 11.93
2.7 % $ 12.56
$ 11.78
6.6 %
Sales volume in tons 1,502
1,595
(5.8 )% 4,277
4,205
1.7 %


	Three Months Ended June 30,				%	Six Months Ended June 30,				%
($ in millions except selling prices)	2021		2020		Change(1)	2021		2020		Change(1)
Revenue	$	327.4	$	322.7	1.5%	$	613.1	$	657.1	(6.7)%
Cost of goods sold excluding depreciation, depletion and amortization	259.4		250.1		3.7	492.5		524.0		(6.0)
Selling, general and administrative expenses	48.3		31.7		52.4	77.6		65.4		18.7
Depreciation, depletion and amortization	25.7		25.2		2.0	50.1		48.6		3.1
Change in value of contingent consideration	—		(5.8)		100.0	(0.1)		(5.5)		98.2
Gain on sale/disposal of assets and business, net	(0.1)		(0.1)		—	(1.6)		(0.1)		(1,500.0)
Operating income (loss)	(5.9)		21.6		(127.3)	(5.4)		24.7		(121.9)
Interest expense, net	10.3		11.4		(9.6)	20.7		22.8		(9.2)
Loss on extinguishment of debt	5.5		—		NM	5.5		—		NM
Other income, net	(0.5)		(0.6)		(16.7)	(0.9)		(1.2)		25.0
Income (loss) before income taxes	(21.2)		10.8		(296.3)	(30.7)		3.1		(1,090.3)
Income tax expense (benefit)	(0.7)		4.3		(116.3)	(5.4)		(0.6)		(800.0)
Net income (loss)	(20.5)		6.5		(415.4)	(25.3)		3.7		(783.8)
Amounts attributable to non-controlling interest	(0.2)		(0.1)		(100.0)	(0.2)		0.2		(200.0)
Net income (loss) attributable to U.S. Concrete	$	(20.3)	$	6.6	(407.6)%	$	(25.1)	$	3.5	(817.1)%

Ready-Mixed Concrete Data:
Average selling price (“ASP”) per cubic yard	$	138.18	$	137.18	0.7%	$	139.72	$	140.77	(0.7)%
Sales volume in thousand cubic yards	1,968		1,982		(0.7)%	3,672		4,003		(8.3)%

Aggregate Products Data:
ASP per ton(2)	$	13.50	$	12.83	5.2%	$	13.42	$	12.56	6.8%
Sales volume in thousand tons	3,034		3,188		(4.8)%	5,620		5,820		(3.4)%

(1) ~~"NM"~~“NM” is defined as ~~"Not Meaningful".~~“not meaningful.”

(2) Our calculation of ASP excludes freight and certain other ancillary revenue and may differ from other companies in the construction materials industry.

Revenue. Revenue for the ~~three months ended September 30, 2017, grew 7.9%~~quarter increased 1.5%, or ~~$26.0~~$4.7 million, resulting from an increase in sales of ready-mixed concrete and other products that was partially offset by lower revenue from aggregate products. Our results were impacted by regional differences in weather and levels of construction activity, lingering effects of COVID-19 pandemic-related delays in construction jobs, and demand for our products. Our East Region realized an increase in sales volume for the quarter, in both ready-mixed concrete and aggregate products. Our Central Region was impacted by inclement weather and cement supply allocations, with a decline in ready-mixed concrete volumes, but a slight increase in sales of aggregate products. Our West Region experienced declines in sales volumes of both ready-mixed concrete and aggregate products, with expectations for construction activity to ~~$354.6 million from $328.6 million~~increase in the ~~comparable 2016~~second half of 2021. Our overall ready-mixed concrete ASP increased 0.7% during the quarter ~~primarily~~ due to ~~recent acquisitions~~product and ~~organic growth. We estimate that acquisitions completed since January 1, 2016, accounted~~geographic mix. While sales volume of aggregate products for ~~$39.9 million of~~the quarter declined 4.8%, higher ASP helped mitigate the impact on revenue for the ~~three months ended September 30, 2017. Except for~~aggregate products segment. Higher sales volumes of aggregate products in our East Region in the ~~North Texas market,~~quarter were more than offset by sales declines in other markets, particularly our West Region, which was impacted by unusually wet weather during the three months ended September 30, 2017, the major metropolitan markets in which we operate reported higher total revenue as a result of timing and mix of projects. We estimate that inclement weather in Texas during the quarter resulted in a deferral of sales volume of approximately 200,000 cubic yards of ready-mixed concrete and 90,000 tons of aggregates. Hurricanes Irma and Maria, which hit our U.S. Virgin Islands ("USVI") operations in September 2017, also had a negative impact on our total revenue as our USVI operations have been essentially shut down following the storms. Ready-mixed concrete sales, including revenuelower demand from recent acquisitions, contributed 98.7%, or $25.7 million, of our revenue growth, driven by a 5.6% increase in volume and a 3.0% increase in our average selling price. Aggregate products sales in the third quarter of 2017 declined $1.1 million, or 5.3%, to $21.0 million from $22.1 million in the 2016 third quarter, resulting from a 5.8% decrease in volume and were partially offset by a 2.7% increase in average selling price. Other products revenue and eliminations, which includes building materials stores, hauling operations, lime slurry, brokered product sales, a recycled aggregates operation, an aggregate distribution operation, an industrial waterfront marine terminal and sales yard, and eliminations of our intersegment sales, increased $1.5 million, or 17.4%, in the 2017 third quarter to $10.1 million from $8.6 million in the 2016 third quarter.construction activity.

Revenue for the ~~nine~~first six months ~~ended September 30, 2017, grew 17.1%, or $145.3 million,~~of 2021 decreased 6.7%. Impacted by both the regional effects of inclement weather and the lingering effect of COVID-19 pandemic-related delays on construction jobs, ready-mixed concrete volumes were down in all regions. In addition, our average ready-mixed concrete ASP was lower due to ~~$994.7 million from $849.4 million~~product and geographic mix. Power disruptions associated with Winter Storm Uri forced us to suspend operations in Texas temporarily in February 2021. Higher rain levels in Texas also negatively impacted construction activity in the ~~comparable nine~~first six months ~~ended September 30, 2016, primarily~~of 2021. Increases in our aggregate products segment ASP helped to mitigate the decline in sales volume of aggregates; however, pass through freight was lower in the first six months of 2021 due to ~~recent acquisitions and organic growth. We estimate that acquisitions completed since January 1, 2016, accounted for $122.0 million of revenue for~~ the ~~nine months ended September 30, 2017. All of our major markets experienced higher total revenue for the nine months ended September 30, 2017, compared to the prior year period. Ready-mixed concrete~~lower sales including revenue from recent acquisitions, contributed 95.4%, or $138.7 million of our revenue growth, driven by a 13.3% increase in volume and a 4.3% increase in our average selling price. Aggregate products sales grew $5.2 million, or 9.1%, to $61.5 million from $56.4 million, resulting primarily from a 6.6% increase in average selling price and a 1.7% increase in volume. ~~Other products revenue and eliminations, as described above, increased $1.5 million, or 6.6%, to $24.0 million for the nine months of 2017 as compared to $22.5 million in the same period in 2016.~~

Cost of goods sold ~~before~~excluding depreciation, depletion and amortization ("(“DD~~&A"~~&A”). Cost of goods sold ~~before~~excluding DD&A increased ~~by $25.5 million, or 10.1%, to $279.0 million in~~for the ~~third~~ quarter, ~~of 2017 from $253.5 million in~~with the ~~comparable 2016 quarter. Our costs increased primarily due to volume growth~~majority resulting from ~~acquisitions in our ready-mixed concrete segment, resulting in~~ higher ~~material~~variable costs (particularly plant costs and delivery costs, ~~and plant variable costs,~~ which includes primarily labor and benefits, utilities, and repairs and maintenance. Costs also increased due to quarry dredge costs for a specific event. During the third quarter of 2017, our fixed costs, which primarily consist of leased equipment costs, property taxes, dispatch costs, quality control, and plant management, increased over the comparable prior year period primarily due toinclude higher ~~personnel and equipment costs needed to operate our facilities,~~fuel costs) as well as higher ~~overall~~ fixed costs to operate more locations and trucks than in the previous year. As a percentage of revenue, cost of goods sold before DD&A increased by 1.6% in the third quarter of 2017 compared to the third quarter of 2016. costs.

Cost of goods sold ~~before~~excluding DD&A ~~includes the impact of costs in our USVI operations~~decreased for the ~~month of September 2017 with minimal corresponding revenues due to Hurricanes Irma and Maria.~~

~~For the~~ first ~~nine~~six months of ~~2017, cost~~2021, but as a percentage of ~~goods sold before DD&A increased by $103.8 million, or 15.4%, to $778.3 million from $674.5 million~~sales were not fully leveraged with the decline in the first nine months of 2016. Similar to the third quarter, our costs increased primarily due to volume growth resulting from acquisitions in our ready-mixed concrete segment. During the first nine months of 2017, our fixed costs increased over the comparable prior year period primarilyrevenue due to higher plant costs, ~~to operate our facilities, as well as additional locations~~particularly repair and ~~trucks than in the previous year. Cost of goods sold before DD&A also includes the impact of~~maintenance costs, ~~in our USVI operations for the month of September 2017 with minimal corresponding revenues due to Hurricanes Irma~~ and Maria, and increased due to quarry dredge costs for a specific event. As a percentage of revenue, cost of goods sold before DD&A decreased by 1.2% in the first nine months of 2017 compared to the first nine months of 2016.fuel costs.

Selling, general and administrative expenses. Selling, general and administrative ~~("SG&A")~~ expenses increased ~~$5.0~~$16.6 million, or ~~19.7%~~52.4%, ~~to $30.1 million~~ for the quarter, ~~ended September 30, 2017, from $25.1~~primarily due to a $12.2 million increase in stock-compensation expense and an increase in professional fees associated with the ~~corresponding 2016 quarter.~~Merger, partially offset by lower personnel expenses. The increase in stock-based compensation expense was ~~primarily attributable~~due to ~~certain incremental reserves on specific receivables, higher self-insurance costs, and personnel and other general administrative costs incurred~~the increase in our stock price from the time the 2021 annual equity award was approved by our ~~corporate~~Board of Directors as of March 1, 2021 to when our stockholders approved the equity plan amendment to add shares to the equity plan (and the award was deemed granted for accounting purposes) at our annual stockholders' meeting on May 13, 2021, including certain performance thresholds being met, and ~~regional offices to support our growth initiatives and acquisition infrastructure. As a percentage of revenue, SG&A expenses increased to 8.5% in~~ the ~~2017 third quarter from 7.6% in the 2016 third quarter.~~award level.

For the first nine months of 2017, SG&A expenses increased $14.7 million, or 20.5%, to $86.1 million from $71.4 million in the first nine months of 2016. The increase was primarily attributable to certain incremental reserves on specific receivables, higher self-insurance costs, and personnel expenses and otherSelling, general and administrative expenses ~~by our corporate and regional~~

~~offices to support our growth initiatives and acquisition infrastructure. As a percentage of revenue, SG&A expenses increased to 8.7%~~were higher in the first ~~nine~~six months of ~~2017~~2021 due primarily to an $11.4 million increase in stock-based compensation expense and $4.4 million of incremental professional expenses, partially offset by lower expenses resulting from ~~8.4% in the first nine months of 2016.~~our cost saving initiatives.

~~Depreciation, depletion and amortization.~~ DD&A expense increased $2.5 million, or 17.4%, to $16.6 million for the quarter ended September 30, 2017, from $14.1 million in the corresponding quarter of 2016, primarily related to depreciation on additional plants, equipment and mixer trucks purchased to service increased demand or acquired through recent acquisitions as well as incremental intangible amortization expense of $0.9 million related to our acquisitions.

For the first nine months of 2017, DD&A expense increased $10.0 million, or 25.8%, to $48.8 million from $38.8 million in the first nine months of 2016, primarily related to depreciation on additional plants, equipment and mixer trucks purchased to service increased demand or acquired through recent acquisitions as well as incremental intangible amortization expense of $4.3 million related to our acquisitions.

Change in value of contingent consideration.~~For both of the three month periods ended September 30, 2017 and 2016, we recorded a~~ The non-cash ~~loss~~gain on the ~~change in value~~revaluation of contingent consideration recorded during the second quarter and first six months of 2020 resulted from changes in management's expectations in 2020 EBITDA.

Gain on sale/disposal of assets and business, net. The first six months of 2021 included gains from sales of a non-core piece of real estate in Texas and certain ready-mixed concrete plants in Oklahoma.

Income taxes. We recorded an income tax benefit of $0.7 ~~million. For the nine months ended September 30, 2017, we recorded a non-cash loss on the change in value of contingent consideration of $2.0~~ million ~~compared to a non-cash loss of $2.3~~and $5.4 million for the ~~same~~three and six months ended June 30, 2021, respectively, using the discrete method. The discrete method treats the year-to-date period ~~in 2016. These non-cash losses are related~~as if it was the annual period and determines the income tax expense or benefit on that basis. We have historically calculated the provision for income taxes during interim reporting periods by applying an estimate of the annual effective tax rate for the full year to ~~fair value~~“ordinary” income or loss for the reporting period. However, for the three and six-month periods ended June 30, 2021, we determined that since minor changes in contingent consideration associated with certain of our acquisitions. The key inputs in determining the fair value of our contingent consideration of $52.6 million at September 30, 2017, included discount rates ranging from 5.00% to 15.75% and management's estimates of future sales volumes and EBITDA. Changes in these inputs impact the valuation of our contingent consideration andestimated “ordinary” income would result in ~~gain or loss each quarterly period. The non-cash loss from fair value~~significant changes in ~~contingent consideration for~~ the ~~first nine months~~estimated annual effective tax rate, our historical method would not provide a reliable estimate of ~~2017 was~~income tax benefit. Our effective tax rate utilizing the discrete method differed substantially from the statutory tax rate primarily due to (1) significant Section 162(m) limitations on executive compensation and (2) our estimated interest expense limitation in accordance with the ~~passage of time. The non-cash loss~~Tax Cuts and Jobs Act for which a full valuation allowance is anticipated. These differences reduced the income tax benefit recorded for the ~~first nine~~three and six months ~~of 2016~~ended June 30, 2021, which was ~~due to the passage of time as well as changes in the probability-weighted assumptions related to the achievement of sales volumes.~~

~~Operating income.~~ Operating income decreased to $27.7 million in the third quarter of 2017 from $36.2 million in the corresponding quarter of 2016, a decrease of $8.5 million. As a percentage of revenue, operating margins decreased to 7.8% for the quarter ended September 30, 2017, from 11.0% during the same quarter of 2016, reflecting the impact of hurricane losses, quarry dredge costs for a specific event, the negative impact of weather-related delays in some of our major markets that generally produce higher gross margin projects, and a shift in the geographic and project mix of our sales.

For the first nine months of 2017, operating income increased to $79.3 million from $63.4 million in the first nine months of 2016, an increase of $15.9 million. As a percentage of revenue, operating margins increased to 8.0% for the first nine months of 2017, from 7.5% during the first nine months of 2016, primarily reflecting a shift in the geographic and project mix of our sales partially offset by ~~the impact~~excess tax benefits recognized for stock-based compensation.

We recorded an income tax expense of ~~hurricane losses, the negative impact~~$4.3 million and an income tax benefit of ~~weather-related delays in some of our major markets that generally produce higher gross margin projects, and quarry dredge costs for a specific event.~~

~~Interest expense, net.~~ ~~Net interest expense increased by $3.0 million to $10.6~~$0.6 million for the quarter ended September 30, 2017, from $7.6 million for the comparable 2016 quarter primarily due to the January 2017 issuance of $200 million of long-term debt. For the first nine months of 2017, net interest expense increased by $11.2 million to $31.1 million from $19.9 million for the first nine months of 2016 due primarily to higher debt levels, partially offset by a lower interest rate compared to the notes that were outstanding through June 7, 2016.

~~Derivative loss (income).~~ For the quarter ended September 30, 2017, we recorded non-cash derivative income of $13.1 million compared to $21.8 million derivative income for the corresponding 2016 quarter related to fair value changes in our warrants that were issued on August 31, 2010 (the "Warrants")three and expired on August 31, 2017. Each quarter the Warrants were outstanding, we determined the fair value of our derivative liabilities, and the changes resulted in either income or loss. During the quarter ended September 30, 2017, all remaining unexercised warrants expired, which contributed to the derivative income for the quarter. The key inputs in determining the fair value of our derivative liabilities included our stock price, stock price volatility, and risk free interest rates. Non-cash income and losses from fair value changes in the Warrants were primarily due to the decreases and increases, respectively, in the price of our common stock.

~~For the first nine~~six months ended ~~September~~June 30, 2017 and 2016, we recorded a non-cash derivative loss of $0.8 million and a non-cash derivative income of $6.4 million, respectively, related to fair value changes in our Warrants, which for 2017 included their expiration on August 31, 2017. These impacts were primarily due to fluctuations in the price of our common stock as described above.

~~Income taxes.~~ ~~For the three months ended September 30, 2017 and 2016, we recorded income tax expense allocated to continuing operations of $7.2 million and $12.6 million,~~2020, respectively. For the ~~first nine~~six months ended ~~September~~June 30, ~~2017 and 2016, we recorded income tax expense allocated to continuing operations of $20.9 million and $14.3 million, respectively.~~

~~For the first nine months ended September 30, 2017,~~2020, our effective tax rate differed substantially from the federal statutory rate primarily due to ~~cumulative adjustments to deferred income taxes, which resulted in~~ additional ~~income~~ tax ~~expense. In addition, the January 1, 2017 adoption of new accounting rules~~benefits recognized related to ~~employee stock-based compensation required~~ the ~~current period~~Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) enacted on March 27, 2020. The CARES Act, among other things, modified the business interest deduction limitation for tax years beginning in 2019 and 2020 from 30% of adjusted taxable income (“ATI”) to 50% of ATI. As a result, we recorded an additional tax benefit ~~related to stock compensation to be reflected~~of $3.2 million in the ~~income statement instead of additional paid-in-capital~~six months ended June 30, 2020 to reflect the CARES Act change to our estimated interest limitation for the year ended December 31, 2019. This tax benefit was partially offset by a net tax shortfall for stock-based compensation.

Other receivables, net, on the balance sheet, as previously required. For additional information regarding our adoption of these accounting rules, see the information set forth in Note 2, “Recent Accounting Pronouncements,” to our condensed consolidated ~~financial statements~~balance sheets included ~~in Part I of this report.~~

~~For the first nine months ended September 30, 2016, our effective tax rate differed from the~~ federal ~~statutory tax rate primarily due to the application of a valuation allowance that reduced the recognized benefit of our deferred tax assets. In addition, certain~~and state income ~~taxes are calculated on a basis different from pre-tax income (loss).~~

~~In addition, for both the nine months ended September 30, 2017 and 2016, our effective~~ tax ~~rate differed from the federal statutory rate due to the tax impact~~receivables of our Warrants, for which we recorded a non-cash derivative loss of $0.8 million for the nine months ended September 30, 2017, and a non-cash derivative income of $6.4 million for the nine months ended September 30, 2016. These changes were excluded from the calculation of our income tax provision, and the amount was treated as an unrecognized tax position.

We recorded a tax benefit of $0.1 million for discontinued operations in both the three months ended September 30, 2017 and 2016. We recorded a tax benefit of $0.3 million for discontinued operations in both the nine months ended September 30, 2017 and 2016. All taxes were allocated between continuing operations and discontinued operations for the nine months ended September 30, 2017 and 2016.

For the three and nine months ended September 30, 2017, we reduced to zero our unrecognized tax benefits and deferred tax asset balances associated with derivative income or losses related to our Warrants. The amount of the reduction for both was $43.6 million; as such, the aggregate reductions did not have an impact to either total income tax expense or our effective tax rate. These reductions followed a decision to no longer pursue a future tax return deduction associated with our cumulative derivative losses related to our Warrants, given our inability, after multiple attempts, to obtain the necessary documentation to support the deduction and complete the related informational reporting requirements.

In accordance with U.S. GAAP, the recognized value of deferred tax assets must be reduced to the amount that is more likely than not to be realized in future periods. The ultimate realization of the benefit of deferred tax assets from deductible temporary differences or tax carryovers depends on the generation of sufficient taxable income during the periods in which those temporary differences become deductible. We considered the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based on these considerations, we relied upon the reversal of certain deferred tax liabilities to realize a portion of our deferred tax assets and established a valuation allowance as of September 30, 2017, and December 31, 2016, for other deferred tax assets because of uncertainty regarding their ultimate realization. Our total net deferred tax liability was approximately $15.0 million and $7.7$18.7 million as of ~~September~~June 30, ~~2017,~~2021 and $5.8 million as of December 31, ~~2016, respectively.~~2020.

Segment ~~information~~Operating Results

Our chief operating decision maker reviews operating results based on our two reportable segments, which are ready-mixed concrete and aggregate products, and evaluates segment performance and allocates resources based on Adjusted EBITDA. We define Adjusted EBITDA as our net income, ~~(loss) from continuing operations~~ excluding the impact of income ~~tax expense (benefit), net interest expense,~~taxes, depreciation, depletion and amortization, ~~derivative loss (income), the~~net interest expense and certain other non-cash, non-recurring and/or unusual, non-operating items including, but not limited to: non-cash stock compensation expense, non-cash change in value of contingent consideration, ~~hurricane-related losses, quarry dredge~~acquisition-related costs, officer transition expenses, purchase accounting adjustments for inventory and realignment initiative costs. Acquisition-related costs consist of fees and expenses for accountants, lawyers and other professionals incurred during the negotiation and closing of strategic acquisitions. Acquisition-related costs do not include fees or expenses associated with post-closing integration of strategic acquisitions. Many of the impacts excluded to derive Adjusted EBITDA are similar to those excluded in calculating our compliance with our debt covenants.

We consider Adjusted EBITDA to be an indicator of the operational strength and performance of our business. We have included Adjusted EBITDA because it is a ~~specific event,~~key financial measure used by our management to (1) internally measure our operating performance and ~~loss on extinguishment of debt.~~(2) assess our ability to service our debt, incur additional debt and meet our capital expenditure requirements.

Adjusted EBITDA should not be construed as an alternative to, or a better indicator of, operating income or loss, is not based on accounting principles generally accepted in the United States of America (“U.S. ~~GAAP,~~GAAP”), and is not a measure of our cash flows or ability to fund our cash needs. Our measurements of Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies and may not be comparable to similarly titled measures used in agreements that govern our ~~various agreements, including~~debt.

See the ~~Third Loan Agreement and the Indenture.~~

~~See~~ prior discussion of revenue within this Item 2 as well as Note ~~15, "Segment Information,"~~10, “Segment Information” to our condensed consolidated financial statements in this report for additional information regarding our segments and the reconciliation of Adjusted EBITDA to ~~income (loss) from continuing operations before income taxes.~~net income.

~~Ready-mixed~~Ready-Mixed Concrete


	Three Months Ended June 30,				Increase/ (Decrease)			Six Months Ended June 30,				Increase/ (Decrease)
($ in millions except selling prices)		2021			2020			%	2021			2020			%
Ready-Mixed Concrete Segment:
Revenue		$	274.3		$	272.4		0.7%	$	515.8		$	564.6		(8.6)%
Segment revenue as a percentage of total revenue		83.8		%	84.4		%		84.1		%	85.9		%
Adjusted EBITDA		$	30.9		$	38.1		(18.9)%	$	55.8		$	69.8		(20.1)%
Adjusted EBITDA as a percentage of segment revenue		11.3		%	14.0		%		10.8		%	12.4		%

Ready-Mixed Concrete Data:
ASP per cubic yard(1)		$	138.18		$	137.18		0.7%	$	139.72		$	140.77		(0.7)%
Sales volume in thousand cubic yards		1,968			1,982			(0.7)%	3,672			4,003			(8.3)%

~~The following table sets forth key financial information for our ready-mixed concrete segment for~~(1) Calculation excludes certain ancillary revenue that is reported within the ~~periods indicated:~~segment.

(amounts in thousands, except selling prices and percentages)
Three Months Ended
September 30, Increase/ (Decrease) Nine Months Ended
September 30, Increase/ (Decrease)
2017 2016 % 2017 2016 %

Ready-mixed Concrete Segment:
Revenue $ 323,567
$ 297,858
8.6% $ 909,145
$ 770,479
18.0%
Segment revenue as a percentage of total revenue 91.2 % 90.6 % 91.4 % 90.7 %

Adjusted EBITDA $ 53,627
$ 51,394
4.3% $ 144,777
$ 111,809
29.5%
Adjusted EBITDA as a percentage of segment revenue 16.6 % 17.3 % 15.9 % 14.5 %

Ready-mixed Concrete Data:
Average selling price per cubic yard $ 136.62
$ 132.70
3.0% $ 135.16
$ 129.64
4.3%
Sales volume in thousands of cubic yards 2,366
2,240
5.6% 6,719
5,929
13.3%

~~Revenue.~~ ~~Our ready-mixed concrete sales provided 91.2% and 90.6% of our total~~Adjusted EBITDA. Despite slightly higher revenue in the ~~third~~ quarter, ~~of 2017~~increases in plant costs and 2016, respectively. Segment revenue for the third quarter of 2017 increased $25.7 million, or 8.6%, from the comparable 2016 period. We estimate that acquisitions completed since January 1, 2016, contributed $39.9 million of revenue to our third quarter of 2017 ready-mixed concrete segment revenue as compared to an estimate of $31.8 million of revenue related to our third quarter of 2016 results.

The third quarter of 2017 revenue increase was driven by a 5.6% increase in sales volume, or 0.1 million cubic yards, providing $16.7 million, or approximately 65.0%, of our ready-mixed concrete revenue growth and a 3.0% increase in average selling price providing $9.0 million, or approximately 35.0%, of our ready-mixed concrete revenue growth. Average selling price increased in the major metropolitan markets in which we operate except Northern California, which was essentially flat in the third quarter of 2017 as compared to the third quarter of 2016. However, our sales volume increase is primarily due to the Northern California market, which increased 0.1 million cubic yards. or 25.3% as compared to the third quarter of 2016. Except North Texas, which was negatively impacted by unusually wet weather in the third quarter of 2017, total revenue was higher in all the major metropolitan markets in which we operate in the third quarter of 2017 as compared to the third quarter 2016. We estimate that inclement weather in Texasdelivery costs, including fuel costs, resulted in a ~~deferral~~year-over-year contraction of sales volume of approximately 200,000 cubic yards of ready-mixed concrete in the third quarter of 2017. Hurricanes Irma and Maria that hit our USVI operations in September 2017 also had a negative impact on our ready-mixed concrete revenue as our USVI operations have been essentially shut down following the storms.

~~For the nine months ended September 30, 2017 and 2016, our ready-mixed concrete sales provided 91.4% and 90.7% of our total revenue, respectively. Segment revenue~~segment Adjusted EBITDA. While overall costs for the first ~~nine~~six months of 2017 increased $138.7 million, or 18.0%, from the first nine months of 2016. We estimate that acquisitions completed since January 1, 2016, contributed $122.0 million of revenue to our first nine months of 2017 ready-mixed concrete segment revenue as compared to an estimate of $34.9 million of revenue related to our 2016 results.

Our ready-mixed concrete revenue increase for the first nine months of 2017, was driven by a 13.3% increase in sales volume, or 0.8 million cubic yards, providing $102.4 million, or approximately 73.9%, of our ready-mixed concrete revenue growth and a 4.3% increase in average selling price providing $36.3 million, or approximately 26.1%, of our ready-mixed concrete revenue growth. Average selling price increased in all the major metropolitan markets in which we operate except Northern California, which was essentially flat for the first nine months of 2017 as compared to2021 were lower than the same ~~time~~ period ~~in 2016. Our sales volume and ready-mixed concrete revenue were higher in all of the major metropolitan markets in which we operate compared to the prior~~last year, ~~despite significant weather-related challenges during the summer in certain of our major metropolitan markets.~~

~~Adjusted EBITDA.~~ Adjusted EBITDA for our ready-mixed concrete segment grew to $53.6 million in the third quarter of 2017 from $51.4 million in the third quarter of 2016, an increase of $2.2 million, or 4.3%. Driving this growth was a 5.6% increase in sales volume and a 3.0% increase in our average selling price, which resulted in $25.7 million in higher revenue, despite significant weather-related delays during the 2017 quarter. Partially offsetting the growth in revenue was increased cost of goods sold associated with the higher volume of sales. Our variable costs, which include primarily material costs, labor and benefits costs, utilities,plant and delivery costs ~~were all higher due primarily to~~as a percent of sales did not decrease at the increased volume and recent acquisitions. During the third quarter of 2017, we also experienced raw materials price increases from our vendors, which increased our cost of goods sold. However, we were generally able to pass these price increases along to our customers. Our fixed costs, which consist primarily of equipment rental, plant management, property taxes, quality control, and dispatch costs, increasedsame rate as revenue, resulting in the 2017 third quarter compared to the prior year third quarter due to higher personnel and equipment costs needed to operate our facilities, as well as higher overall fixed costs to operate more locations and trucks than in the previous year. Segmentlower Adjusted EBITDA as a ~~percentage~~percent of segment revenue ~~was 16.6% in the third quarter of 2017 versus 17.3% in 2016, reflecting the geographic and project mix of our revenue and cost.~~year over year.

For the nine months ended September 30, 2017, Adjusted EBITDA for our ready-mixed concrete segment grew to $144.8 million from $111.8 million in the first nine months of 2016, an increase of $33.0 million, or 29.5%. Driving this growth was 13.3% increase in sales volume and a 4.3% increase in our average selling price, which resulted in $138.7 million in higher revenue, despite significant weather-related delays during 2017. Partially offsetting the higher revenue was increased cost of goods sold associated with the higher volume of sales. Our variable costs were all higher due primarily to the increased volume and recent acquisitions. During the first nine months of 2017, higher prices to purchase raw materials from our vendors increased our cost of goods sold. However, we were generally able to pass these price increases along to our customers. Our fixed costs increased in 2017 compared to the prior year, due to higher personnel and equipment costs needed to operate our facilities, as well as higher overall fixed costs to operate more locations and trucks than in the previous year. Segment Adjusted EBITDA as a percentage of segment revenue was 15.9% in the first nine months of 2017 versus 14.5% the first nine months of 2016, reflecting the geographic and project mix of our revenue and cost.

Aggregate Products


	Three Months Ended June 30,				Increase/ (Decrease)			Six Months Ended June 30,				Increase/ (Decrease)
($ in millions except selling prices)		2021			2020			%	2021			2020			%
Aggregate Products Segment:
Sales to external customers		$	25.2		$	26.1			$	47.8		$	47.2
Freight revenue on sales to external customers		11.2			12.1				$	20.6		$	22.1
Intersegment sales(1)		16.8			16.3				$	29.3		$	28.8
Total aggregate products revenue		$	53.2		$	54.5		(2.4)%	$	97.7		$	98.1		(0.4)%
Segment revenue, excluding intersegment sales, as a percentage of total revenue		11.1		%	11.8		%		11.2		%	10.5		%
Adjusted EBITDA		$	20.1		$	21.6		(6.9)%	$	32.6		$	32.9		(0.9)%
Adjusted EBITDA as a percentage of total aggregate products revenue		37.8		%	39.6		%		33.4		%	33.5		%

Aggregate Products Data:
ASP per ton(2)		$	13.50		$	12.83		5.2%	$	13.42		$	12.56		6.8%
Sales volume in thousand tons		3,034			3,188			(4.8)%	5,620			5,820			(3.4)%

~~The following table sets forth key financial information for our~~(1) We sell aggregate products ~~segment for the periods indicated:~~

(amounts in thousands, except selling prices and percentages)
Three Months Ended
September 30, Increase/ (Decrease) Nine Months Ended
September 30, Increase/ (Decrease)
2017 2016 % 2017 2016 %

Aggregate Products Segment:
Revenue $ 20,959
$ 22,128
(5.3)% $ 61,549
$ 56,397
9.1%
Segment revenue, excluding intersegment sales, as a percentage of total revenue 3.1 % 3.7 % 3.2 % 3.6 %

Adjusted EBITDA $ 6,218
$ 7,005
(11.2)% $ 18,889
$ 15,080
25.3%
Adjusted EBITDA as a percentage of segment revenue 29.7 % 31.7 % 30.7 % 26.7 %

Aggregates Data:

Average selling price per ton $ 12.25
$ 11.93
2.7% $ 12.56
$ 11.78
6.6%
Sales volume in tons 1,502
1,595
(5.8)% 4,277
4,205
1.7%

~~Revenue.~~Sales for our aggregate products segment provided 3.1% and 3.7% of our total revenue for the third quarter of 2017 and 2016, respectively, excluding intersegment sales of $10.0 million and $9.8 million, respectively. Segment revenue declined $1.2 million, or 5.3%, compared to prior year levels primarily due to the hurricanes that hit our USVI operations in September 2017 and resulted in a nearly complete shutdown of those operations following the storms, as well as the impact of abnormally wet weather in our North Texas operations. We estimate that inclement weather in Texas during the quarter resulted in a deferral of sales volume of approximately 90,000 tons of aggregates.

~~We sell our aggregates to external customers and also sell them internally~~ to our ready-mixed concrete segment at market price. ~~Approximately 47.7%~~

(2) Our calculation excludes freight and certain other ancillary revenue. Our definition and calculation of ~~our third quarter 2017 aggregate products sales were to our ready-mixed concrete segment, versus 44.5%~~ASP may differ from other companies in the ~~third quarter of 2016. Our average selling price increased 2.7% in the third quarter of 2017 as compared to the third quarter of 2016.~~construction materials industry.

Adjusted EBITDA.For the first nine months of 2017, sales for our aggregate products segment provided 3.2% and 3.6% of our total revenue for 2017 and 2016, respectively, excluding intersegment sales of $29.2 million and $25.6 million, respectively. Segment revenue grew $5.2 million, or 9.1%, compared to prior year levels, primarily due to the increase in average selling price and higher sales volume. Of our first nine months of 2017 aggregate product segment sales, 47.5% were to our ready-mixed concrete segment, versus 45.5% in the first nine months of 2016.

~~Adjusted EBITDA.AdjustedEBITDA for our aggregate products segment decreased by $0.8 million to $6.2 million in the third~~ quarter, ~~of 2017 from $7.0 million in the third quarter of 2016, primarily as a result of lower production volumes, including the impact of weather-related days during the third quarter of 2017. Overall, our~~ segment Adjusted EBITDA as a ~~percentage~~percent of segment revenue ~~decreased~~declined 180 basis points, while revenue declined 2.4%. The impact of lower revenue on Adjusted EBITDA was mitigated by the build-up of inventory to 29.7% in the third quarter of 2017 from 31.7% in the third quarter of 2016, primarily due to the decrease in revenue that did not leverage our fixed costs. Our quarry fixed costs primarily include equipment rental, property taxes, and plant management costs.

provide product for future construction activity. For the first ~~nine~~six months of 2017, our aggregate products segment Adjusted EBITDA increased by $3.8 million to $18.9 million from $15.1 million in the first nine months of 2016, primarily as a result of higher revenue, partially offset by the related higher cost of goods sold. Our variable costs increased primarily due to higher production. Our variable costs include quarry labor and benefits, utilities, repairs and maintenance, delivery, fuel, and pit costs to prepare the stone and gravel for use. Our quarry fixed costs, primarily include equipment rental, property taxes, and plant management costs. Overall, our segment2021, Adjusted EBITDA as a ~~percentage~~percent of ~~segment~~ revenue ~~increased to 30.7%~~declined 10 basis points while revenue declined 40 basis points. An increase in average ASP for the first ~~nine~~six months of ~~2017~~2021 mitigated the impact on revenue from ~~26.7%~~lower sales volumes, and delivery costs were lower, as fewer ships were needed in our West Region to meet the ~~first nine months of 2016, primarily due to higher revenue.~~lower customer demand.

Liquidity and Capital Resources

~~Overview~~

Our primary sources of liquidity are cash generated from operations, available cash and cash equivalents, and access to our asset-based revolving credit facility, ~~(the "Revolving Facility"). During the first quarter~~which provides for borrowings of ~~2017,~~up to $300.0 million, subject to a borrowing base. As of June 30, 2021, we increased our liquidity by issuing $200.0 million aggregate principal amount of 6.375% senior unsecured notes due in 2024. During the third quarter of 2017, we entered into the Third Amended and Restated Loan and Security Agreement (the "Third Loan Agreement"), which among other things, increased the revolving commitments from $250.0 million to $350.0 million and extended the maturity date to August 31, 2022.

~~We ended the quarter with $248.3~~had $20.9 million of cash and cash equivalents ~~an increase~~and $214.7 million of ~~$172.5 million from December 31, 2016. At September 30, 2017, based on our~~available borrowing ~~base, we had a maximum of $245.8 million available~~capacity under the Revolving Facility (as defined below), providing a total available liquidity of ~~$494.1~~$235.6 million. The increase in our unused availability under the Revolving Facility to $245.8 million at September 30, 2017, from $221.3 million at December 31, 2016, was primarily due to increases in eligible accounts receivable and eligible trucks and machinery balances. We had no outstanding borrowings under the Revolving Facility as of September 30, 2017.

The following key financial ~~metrics~~measurements reflect certain aspects of our financial ~~position and capital resources as of September 30, 2017, and December 31, 2016 (dollars in thousands):~~condition:


($ in millions)	June 30, 2021		December 31, 2020
Cash and cash equivalents	$	20.9	$	11.1
Working capital	$	100.4	$	56.3
Total debt	$	789.1	$	702.4

September 30, 2017 December 31, 2016
Cash and cash equivalents $ 248,263
$ 75,774
Working capital $ 311,747
$ 71,283

Total debt ⁽¹⁾
$ 688,418
$ 449,298
Total stockholders' equity 281,791
188,829
Total capital $ 970,209
$ 638,127

Maximum availability under our Revolving Facility $ 245,800
$ 221,300

(1) Total debt includes long-term debt and unamortized premiums on long-term debt net of unamortized debt issuance costs, current maturities of long-term debt, capital leases, notes payable, and any outstanding borrowings under the Revolving Facility.

Our primary liquidity needs over the next 12 months consist of (1) ~~financing seasonal~~ working capital requirements; (2) ~~servicing our indebtedness;~~debt service obligations; (3) ~~purchasing property and equipment;~~capital expenditures; and (4) payments related to strategic ~~acquisitions.~~activity. Our primary portfolio strategy includes ~~strategic~~ acquisitions in ~~targeted~~various regions and markets. ~~We may seek financing for acquisitions, including additional debt or equity capital.~~

Our working capital needs are typically at their lowest level in the first quarter, increase in the second and third quarters to fund increases in accounts receivable and inventories during those periods, and then decrease in the fourth quarter. Availability under the ~~Third Loan Agreement~~Revolving Facility is governed by a borrowing base primarily determined by our eligible accounts receivable, inventory, mixer trucks and machinery. Our borrowing base also typically declines during the first quarter due to lower accounts receivable balances as a result of normal seasonality of our business caused by winter weather.

The projection of our cash needs is based upon many factors, including without limitation, our expected volume, pricing, cost of materials and capital expenditures. ~~We anticipate that our federal and state income tax payments will increase in 2017 as compared to prior years as we substantially exhausted our remaining operating loss carryforwards during 2016.~~ Based on our projected cash needs, we believe that cash on hand, availability under the Revolving Facility, and cash generated from operations will provide us with sufficient liquidity in the ordinary course of business, not including potential acquisitions. To help mitigate the impact of the COVID-19 pandemic on our cash needs, we initiated business contingency planning and will continue to adjust those plans as needed. If, however, availability under the Revolving Facility, cash on hand and our operating cash flows are not adequate to fund our operations, we would need to obtain other equity or debt financing or sell assets to provide additional liquidity.

The principal factors that could adversely affect the amount of our internally generated funds include:

•deterioration of revenue, due to lower volume and/or pricing, because of weakness in the markets in which we ~~operate;~~operate or due to COVID-19 operating restrictions;

•declines in gross margins due to shifts in our product mix, or increases in fixed or variable costs or the ~~cost~~impact of ~~our raw materials and fuel;~~COVID-19;

•any deterioration in our ability to collect our accounts receivable from customers as a result of weakening in construction demand or payment difficulties experienced by our ~~customers;~~customers, including from COVID-19;

•any further COVID-19 impacts to our business; and

•inclement weather beyond normal patterns that could reduce our sales volumes.

Cash Flows


	Six Months Ended June 30,
($ in millions)	2021		2020
Net cash provided by (used in):
Operating activities	$	4.4	$	84.1
Investing activities	(43.2)		(154.1)
Financing activities	48.7		46.9
Effect of exchange rates on cash and cash equivalents	(0.1)		—
Net increase (decrease) in cash and cash equivalents	$	9.8	$	(23.1)

Our net cash provided by operating activities generally reflects the cash effects of transactions and other events used in the determination of net income or loss, including non-controlling interest. Overall, the decline in cash generated from operations was driven primarily by the timing impacts of certain vendor payments, inclement weather and COVID-19 on our operations, and higher payments of incentive compensation.

In addition to purchases of machinery, equipment, mixer trucks and vehicles to service our business in both periods, investing activities in the six months ended June 30, 2021 included the $28.7 million Orca Acquisition and the $8.2 million Stockton Acquisition. Investing activities in the six months ended June 30, 2020 included $140.2 million for the acquisition of a sand and gravel products producer on Long Island in New York.

For the year ending December 31, 2021, we continue to expect to invest (excluding acquisitions such as the Stockton Acquisition and the Orca Acquisition) between $40 million and $50 million in capital expenditures, including expenditures financed through finance leases. Certain capital expenditures may be subject to approvals as provided for in the Merger Agreement. We continue to monitor the COVID-19 pandemic and related economic repercussions for consideration of our capital expenditure levels. Through August 5, 2021, we have invested $36.9 million in current year acquisitions.

Financing activities during the six months ended June 30, 2021 included $296.2 million of net proceeds from our Term Loans issuance, redemption of $200.0 million of our 2024 Notes including a $3.2 million redemption premium (see discussion below), $3.0 million of net repayments under our Revolving Facility (as defined below) to operate our business and fund acquisitions and investments in property, plant and equipment. During the six months ended June 30, 2021, we made payments of $17.6 million primarily related to our finance leases and promissory notes and paid $8.2 million for contingent and deferred consideration obligations. Financing activities during the first six months of 2020 included $56.5 million of net borrowings under our Revolving Facility and $14.5 million of financing proceeds primarily for our Texas greenfield aggregates operation. In addition, during the first six months of 2020, we made payments of $10.8 million primarily related to our finance leases and promissory notes and paid $9.9 million for contingent and deferred consideration obligations. Cash provided by financing activities in the first six months of 2020 benefited from the deferral of $8.4 million of promissory note and finance lease payments that were deferred to mitigate the cash flow impact from the COVID-19 pandemic.

The discussion that follows provides a description of our arrangements relating to our outstanding indebtedness.

~~Senior Secured~~Asset Based Revolving Credit Facility (“Revolving Facility”)

~~On August 31, 2017, we entered into the Third Loan Agreement~~We have a Revolving Facility with certain financial institutions named therein as lenders ~~(the “Lenders”)~~ and Bank of America, N.A., as agent for the ~~Lenders, which amended and restated a Second Loan Agreement. The Third Loan Agreement matures August 31, 2022 and~~lenders that provides for up to ~~$350.0~~$300.0 million of ~~financing.~~revolving borrowings. The ~~Third Loan Agreement~~Revolving Facility also permits the incurrence of other secured indebtedness not to exceed certain ~~amounts~~amounts. The Revolving Facility provides for swingline loans up to a $15.0 million sublimit and letters of credit up to a $50.0 million sublimit. Loans under the Revolving Facility are in the form of either base rate loans or the London Interbank Offered Rate (“LIBOR”) loans denominated in U.S. dollars.

On June 25, 2021, we and certain of our subsidiaries, as ~~defined.~~co-borrowers and as guarantors, entered into the Fourth Amended and Restated Loan Security Agreement (the “Fourth Loan Agreement”), which amended and restated the Third Amended and Restated Loan and Security Agreement, dated as of August 31, 2017 (the “Third Loan Agreement”). Among other things, the Fourth Loan Agreement extended the maturity date to June 25, 2026 and amended certain terms of the Third Loan Agreement, including, without limitation, permitting the incurrence of the loans under the Term Loan Agreement (as defined below). In connection with entering into the Fourth Loan Agreement, we incurred $1.5 million of debt issuance costs.

The obligations under the Fourth Loan Agreement are secured by first priority security interests in accounts receivable, inventory and certain other personal property of the Company and its subsidiaries (the “ABL Collateral”) and second priority liens on and security interests in certain real property of the Company's subsidiaries and certain personal property of the Company and its subsidiary guarantors that is not ABL Collateral (the “Term Loan Collateral”).

Our actual maximum credit availability under the Revolving Facility varies from time to time and is determined by calculating the value of our eligible accounts receivable, inventory, mixer trucks and machinery, minus reserves imposed by the Lenders and other adjustments, ~~all~~ as specified in the ~~Third~~Fourth Loan Agreement. ~~The Third Loan Agreement provides for swingline loans up to a $15.0 million sublimit, and letters of credit up to a $50.0 million sublimit. Loans~~Our availability under the Revolving Facility ~~are in the form of either base rate loans or “LIBOR loans” denominated in U.S. dollars.~~at June 30, 2021 was $214.7 million.

The ~~Third~~Fourth Loan Agreement contains usual and customary ~~negative~~ covenants including, but not limited to, restrictions on our, our co-borrower subsidiaries', and our guarantor subsidiaries' ability to consolidate or merge; substantially change the nature of our business; sell, lease or otherwise transfer any of our assets; create or incur indebtedness; create liens; pay dividends or make other distributions; make loans; prepay certain indebtedness; and make investments or acquisitions. The ~~negative~~ covenants are subject to certain exceptions as specified in the ~~Third~~Fourth Loan Agreement. The ~~Third~~Fourth Loan Agreement also requires that we, upon the occurrence of certain events, maintain a fixed charge coverage ratio of at least 1.0 to 1.0 for each period of 12 calendar ~~months, as determined in accordance with the Third Loan Agreement.~~months. As of ~~September~~June 30, ~~2017,~~2021, we were in compliance with all covenants under the ~~Third~~Fourth Loan Agreement.

Term Loans

On June 25, 2021, we entered into a secured term loan agreement (the “Term Loan Agreement”) with certain subsidiaries, as guarantors, JPMorgan Chase Bank, N.A., as administrative agent and collateral agent, and the lenders and other named parties. The Term Loan Agreement provides for $300.0 million in aggregate principal amount of term loans (the “Term Loans”), which will mature on June 25, 2028. In connection with entering into the Term Loan Agreement, we incurred $4.6 million of debt issuance costs. Proceeds of the Term Loans will be used for general corporate purposes, including repayment of certain borrowings under the Fourth Loan Agreement and redemption of the Company's 6.375% senior unsecured notes due 2024 (the “2024 Notes”), as further discussed below.

The Term Loans bear interest at the Company's option of either: (1) the LIBOR (subject to a floor of 0.50%) plus a margin of 2.75% or (2) a base rate (which is equal to the greatest of prime rate, the Federal Reserve Bank of New York effective rate plus 0.50% and LIBOR plus 1.00%, and is subject to a floor of 1.50%) plus a margin of 1.75%. Additionally, the Term Loans were issued at a price of 99.75%. The Term Loans are secured by a first priority lien on and security interest in the Term Loan Collateral and a second priority security interest in the ABL Collateral. The Term Loan Agreement contains customary representations, warranties, covenants and events of default, but does not contain any financial maintenance covenants.

Termination of Delayed Draw Term Loan Facility

On June 25, 2021, in connection with entering into the Term Loan Agreement, we terminated the Credit and Guaranty Agreement, dated as of April 1, 2020, among the Company, certain subsidiaries as guarantors, Bank of America, N.A., as administrative agent and collateral agent, the lenders and other parties named therein (the “Delayed Draw Term Loan Agreement”). There were no outstanding borrowings under the Delayed Draw Term Loan at the time of termination. The Delayed Draw Term Loan was secured by a first priority lien on and security interest in the Term Loan Collateral. During the three months ended June 30, 2021, we incurred a $2.3 million pre-tax loss on the Delayed Draw Term Loan termination due to write-off of unamortized debt issuance costs.

Redemption of 2024 Notes

On June 26, 2021, we redeemed all of the $200.0 million outstanding 2024 Notes, at a price of 101.594% of the principal amount plus accrued, unpaid interest. During the three months ended June 30, 2021, we incurred a $3.1 million pre-tax loss on this redemption, which included the redemption premium of $3.2 million and a $1.4 million write-off of unamortized debt issuance costs, net of $1.5 million of unamortized issuance premium.

Senior Unsecured Notes ~~due 2024~~

OnAt June ~~7, 2016,~~30, 2021, we ~~completed an offering of~~had outstanding $400.0 million aggregate principal amount of ~~6.375%~~5.125% senior unsecured ~~senior~~ notes due ~~2024 ("2024 Notes"~~2029 (“2029 Notes”). ~~We used a portion~~

The 2029 Notes are governed by the Indenture dated as of September 23, 2020, among U.S. Concrete, Inc. (the “Issuer”), the ~~proceeds from the 2024 Notes to repay all of our outstanding borrowings on the Revolving Facility~~subsidiary guarantors party thereto and ~~to redeem all $200.0 million of our 8.5% senior secured notes due 2018. On January 9, 2017, we completed an offering of $200.0 million aggregate principal amount of additional 2024 Notes~~U.S. Bank National Association, as trustee (the ~~"Additional Notes," and together with the 2024 Notes, the "Senior Unsecured Notes"~~“2029 Indenture”) ~~at an issue price of 105.75%~~. The ~~terms of the Additional Notes are identical~~2029 Indenture contains customary covenants, including negative covenants that restrict our ability and our restricted subsidiaries ability to the terms of the existing 2024 Notes, other than the issue date, the issue price, the first interest payment date, and the provisions relating to transfer restrictions and registration rights. We used the net proceeds from the offering of the Additional Notes to increase our liquidity.

engage in certain transactions. The ~~Senior Unsecured~~2029 Notes accrue interest at a rate of ~~6.375%~~5.125% per annum, ~~and interest~~which is ~~due~~payable on ~~June~~March 1 and ~~December~~September 1 of each year. The ~~Senior Unsecured~~2029 Notes mature on ~~June~~March 1, ~~2024~~2029 and are redeemable at our option prior to maturity at prices specified in ~~an indenture (the "Indenture") dated as of June 7, 2016, by and among U.S. Concrete, Inc., as issuer,~~ the ~~subsidiary guarantors party thereto, and U.S. Bank National Association, as trustee.~~ 2029 Indenture.

The Indenture contains negative covenants that restrict our ability and our restricted subsidiaries' ability to engage in certain transactions and also contains customary events of default. The Senior Unsecured2029 Notes ~~are issued by U.S. Concrete, Inc., the parent company, and~~ are guaranteed on a full and unconditional senior unsecured basis by each of ~~our~~the Issuer's restricted subsidiaries (each, a “Guarantor Subsidiary,” and collectively, the “Guarantor Subsidiaries”) that ~~guarantees~~guarantee any obligations under the Revolving Facility ~~or that guarantees~~and certain of ~~our~~the Issuer's other indebtedness or certain indebtedness of ~~our~~the Issuer's restricted subsidiaries (other than a foreign ~~restricted subsidiaries~~subsidiary or domestic subsidiary thereof that ~~guarantee~~guarantees only indebtedness incurred by ~~another~~a foreign ~~subsidiary)~~subsidiary or a domestic subsidiary thereof). Each Guarantor Subsidiary is directly or indirectly 100% owned by the Issuer. The guarantees are joint and several. ~~U.S. Concrete, Inc.~~The Issuer does not have any independent assets or ~~operations, and none~~operations. There are no significant restrictions in the 2029 Indenture on the ability of ~~its~~the Guarantor Subsidiaries to make distributions to the Issuer. The 2029 Notes are not guaranteed by any of the Issuer's direct or indirect foreign subsidiaries ~~guarantee~~(or any domestic subsidiaries of any such foreign subsidiaries), U.S. Virgin Islands subsidiaries or domestic subsidiaries that are not wholly owned (collectively, the ~~Senior Unsecured Notes.~~“Non-Guarantor Subsidiaries”).

The ~~Senior Unsecured~~2029 Notes and the guarantees thereof are effectively subordinated to all of ~~our~~the Issuer's and ~~our guarantors'~~the Guarantor Subsidiaries' existing and future secured obligations, including obligations under the Revolving Facility, the Term Loans, our finance leases and our promissory notes, to the extent of the value of the collateral securing such obligations; senior in right of payment to any of our and ~~our guarantors'~~the Guarantor Subsidiaries' future subordinated indebtedness; pari passu in right of payment with any of our and ~~our guarantors'~~the Guarantor Subsidiaries' existing and future senior indebtedness, including ~~our~~the Issuer's and ~~our guarantors'~~the Guarantor Subsidiaries' obligations under the Revolving ~~Facility;~~Facility, the Term Loans and our finance leases; and structurally subordinated to all existing and future indebtedness and other claims and liabilities, including trade payables and preferred stock, of any ~~non-guarantor subsidiaries.~~Non-Guarantor Subsidiaries.

For additional information regarding our guarantor and non-guarantor subsidiaries, see the information set forth in Note 16, “Supplemental Condensed Consolidating Financial Information,” to our condensed financial statements included in Part I of this report.

Other Debt

We have financing agreements with various lenders primarily for the purchase of mixer trucks and other machinery and equipment with ~~$89.1~~$95.8 million of remaining ~~principle~~principal as of ~~September~~June 30, ~~2017.~~2021.

For additional information regarding our arrangements relating to outstanding indebtedness, see the information set forth in Note ~~8, “Debt,”~~5, “Debt” to our condensed consolidated financial statements included in ~~Part I of~~ this report.

~~Cash Flows~~

Our net cash provided by operating activities generally reflects the cash effects of transactions and other events used in the determination of net income or loss. Net cash provided by operating activities was $84.2 million for the nine months ended September 30, 2017, compared to $92.3 million for the nine months ended September 30, 2016. Overall the generation of cash from operations in the first nine months of 2017 and 2016 was driven by the revenue and operating performance of the Company.

We used $96.5 million to fund investing activities during the nine months ended September 30, 2017, compared to $153.2 million for the nine months ended September 30, 2016. We paid $56.8 million and $124.5 million to fund acquisitions during the first nine months of 2017 and the first nine months of 2016, respectively. In addition, we incurred capital expenditures of $34.0 million and $31.0 million for the nine months ended September 30, 2017, and September 30, 2016, respectively, to fund purchases of mixer trucks, plant, and other equipment to service our business. We also loaned $8.1 million to Polaris Materials Corporation ("Polaris") in exchange for a promissory note during the nine months ended September 30, 2017, related to a planned acquisition of Polaris, which is expected to close in the fourth quarter of 2017.

Our net cash provided by financing activities was $184.8 million for the nine months ended September 30, 2017, as compared to $123.0 million for the comparable period of 2016. Financing activities during the first nine months of 2017 included the proceeds from our $200.0 million Additional Notes offering, including the premium on the issue price and net of related debt issuance costs. In addition, we made payments of $14.3 million related to our capital leases and other financings and paid $7.7 million for contingent and deferred consideration obligations. Also during the first nine months of 2017, we received proceeds of $2.7 million from exercises of warrants and stock options. Financing activities during the first nine months of 2016 included the proceeds from our $400.0 million 2024 Notes offering, net of related debt issuance costs; redemption of our $200.0 million 2018 Notes including an $8.5 million redemption premium; and repayment of our existing borrowings under our Revolving Facility. In addition, we made payments of $8.9 million related to our capital leases and other financings and paid $4.1 million for contingent consideration obligations. Also during the first nine months of 2016, we received proceeds of $0.2 million from exercises of warrants and stock options.

~~Cement and Other Raw Materials~~

We obtain most of the materials necessary to manufacture ready-mixed concrete on a daily basis. These materials include cement, other cementitious materials (fly ash and blast furnace slag), and aggregates (stone, gravel and sand), in addition to certain chemical admixtures. With the exception of chemical admixtures, each plant typically maintains an inventory level of these materials sufficient to satisfy its operating needs for a few days. Our inventory levels do not decline significantly or comparatively with declines in revenue during seasonally low periods. We generally maintain inventory at specified levels to maximize purchasing efficiencies and to be able to respond quickly to customer demand.

Typically, cement, other cementitious materials, and aggregates represent the highest-cost materials used in manufacturing a cubic yard of ready-mixed concrete. We purchase cement from a few suppliers in each of our major geographic markets. Chemical admixtures are generally purchased from suppliers under national purchasing agreements.

Overall, prices for cement and aggregates increased in the first nine months of 2017, compared to the same period in 2016, in most of our major geographic markets. Generally, we negotiate with suppliers on a company-wide basis and at the local market level to obtain the most competitive pricing available for cement and aggregates. We believe the demand for cement is increasing and will warrant scrutiny as construction activity increases. Today, in most of our markets, we believe there is an adequate supply of cement and aggregates.

~~Acquisitions~~

Our portfolio strategy includes strategic acquisitions in various regions and markets, and we may seek arrangements to finance any such acquisitions, which financing arrangements may include additional debt or equity capital.

~~For a description of our recent acquisitions, see the information set forth in Note 3, “Acquisitions” to our condensed consolidated financial statements included in Part I of this report.~~

~~Off-Balance Sheet Arrangements~~

We do not currently have any off-balance sheet arrangements that have had or are reasonably likely to have a material current or future effect on our financial condition, revenue or expenses, results of operations, liquidity, capital expenditures, or capital resources. From time to time, we enter into non-cancelable operating leases that are not reflected on our balance sheet. At September 30, 2017, we had $14.3 million of undrawn letters of credit outstanding. We are also contingently liable for performance under $36.2 million in performance bonds relating to our operations.

Inflation

We experienced minimal increases in operating costs during the ~~first nine months~~second quarter of ~~2017~~2021 related to inflation. However, in non-recessionary conditions, cement prices and certain other raw material prices, including aggregates, have generally risen faster than regional inflationary rates. When these price increases have occurred, we have generally been able to mitigate ~~our~~the cost increases with price increases we ~~obtained~~obtain for selling our products. Cement supply in Texas has been disrupted by temporary closures of certain cement producers' plants. As a result, our cement supply has been constrained, and cement prices began to rise in March 2021. We implemented price increases in April 2021 and will continue to do so as needed to help mitigate the impact of these increases.

Critical Accounting Policies

We prepared the preceding discussion based on the accompanying interim unaudited condensed consolidated financial statements, which have ~~outlined~~been prepared in accordance with U.S. GAAP. Such preparation of financial statements requires the use of estimates and assumptions by management in determining the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Estimates are based on historical experience, currently available information and various other assumptions that we believe to be reasonable under the circumstances. These estimates form the basis for making judgments about the carrying values of assets and liabilities that are not readily available from other sources. Actual results could differ from those estimates. We described our critical accounting policies in Item 7 of Part II of ~~the 2016 Form~~our 2020 10-K. Our critical accounting policies involve the use of estimates in the recording of business combinations, goodwill and intangible assets and any related impairment, accruals for self-insurance, accruals for income taxes, and assessing impairment of long-lived ~~assets, accounting for derivative instruments, and accounting for contingent consideration.~~assets. See Note 1, ~~"Organization~~“Organization and Summary of Significant Accounting ~~Policies,"~~Policies” to our condensed consolidated financial statements included in Item 8 of Part II of the ~~2016 Form~~2020 10-K ~~and Note 2, "Recent Accounting Pronouncements,” to our condensed consolidated financial statements included in Part I of this report~~ for a discussion of our critical and significant accounting policies.

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

Certain statements and information in this report may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, without limitation, statements concerning plans, objectives, goals, projections, strategies, future events or performance, and underlying assumptions and other statements, which are not statements of historical facts. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “intend,” “should,” “expect,” “plan,” “target,” “anticipate,” “believe,” “estimate,” “outlook,” “predict,” “potential,” or “continue,” the negative of such terms or other comparable terminology. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting us will be those that we anticipate. All discussions concerning our expectations for future operating results are based on our forecasts for our existing operations and do not include the potential impact of any future acquisitions. Our forward-looking statements involve significant risks and uncertainties (some of which are beyond our control) and assumptions that could cause actual results to differ materially from our historical experience and our present expectations or projections.

Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, those summarized below:

•the occurrence of any event, change, or other circumstances that could give rise to the termination of the Merger Agreement;

•the inability to obtain the requisite shareholder approval for the proposed Merger or the failure to satisfy other conditions to completion of the proposed Merger, including the receipt of regulatory approvals;

•risks that the proposed Merger disrupts our current plans and operations;

•the amount of the costs, fees, and expenses and charges related to the Merger;

•the results of litigation related to the Merger;

•the expected timing and anticipated closing of the Merger,

•general economic and business conditions, which will, among other things, affect demand for commercial and residential construction;

•our ability to successfully implement our operating strategy;

•our ability to successfully identify, manage, and integrate acquisitions;

•governmental requirements and initiatives, including those related to mortgage lending, financing or deductions, funding for public or infrastructure construction, land usage, and environmental, health, and safety matters;

•seasonal and inclement weather conditions, which impede the placement of ready-mixed concrete;

•the cyclical nature of, and changes in, the real estate and construction markets, including pricing changes by our competitors;

•our ability to maintain favorable relationships with third parties who supply us with equipment and essential supplies;

•our ability to retain key personnel and maintain satisfactory labor relations;

•disruptions, uncertainties or volatility in the credit markets that may limit our, our suppliers' and our customers' access to capital;

•product liability, property damage, results of litigation and other claims and insurance coverage issues;

•our substantial indebtedness and the restrictions imposed on us by the terms of our indebtedness;

•the effects of currency fluctuations on our results of operations and financial condition;

•the length and severity of the COVID-19 pandemic;

•the pace of recovery following the COVID-19 pandemic;

•our ability to implement cost containment strategies; and

•the adverse effects of the COVID-19 pandemic on our business, the economy and the markets we serve.

For additional information regarding known material factors that could cause our actual results to differ from our projected results, please see “Risk Factors” in Item 1A of Part I of our 2020 10-K and “Risk Factors” in Item 1A of Part II of our subsequent quarterly reports on Form 10-Q.



~~Item 3.~~	Item 3. Quantitative and Qualitative Disclosures About Market Risk

~~We do not use derivative instruments to hedge risks relating to our ongoing business operations or for speculative purposes. However, we~~There have been ~~required to account for our Warrants as derivative instruments.~~

~~During~~no material changes from the ~~nine months ended September 30, 2017, we recorded a non-cash loss from fair value changes in our Warrants of approximately $0.8 million, due primarily to an increase in the price~~information previously reported under Part II, Item 7A of our ~~common stock. The Warrants were issued to holders of our predecessor common stock pro rata based on a holder’s stock ownership and any remaining unexercised Warrants expired on August 31, 2017.~~2020 10-K.

Borrowings under our Revolving Facility expose us to certain market risks. Interest on amounts drawn varies based on the floating rates under the Third Loan Agreement. We had no outstanding borrowings under this facility as of September 30, 2017.

Our operations are subject to factors affecting the overall strength of the U.S. economy and economic conditions impacting financial institutions, including the level of interest rates, availability of funds for construction and level of general construction activity. A significant decrease in the level of general construction activity in any of our market areas may have a material adverse effect on our consolidated revenue and earnings.

Item 4. Controls and Procedures

~~Acquisitions~~Acquisition

On September 29, 2017, we acquired the assets of Action Supply Co., Inc., A-1 Materials, Inc., L.C. Frey Company, Inc. and Central Supply Company d.b.a. Harbor Ready-Mix, (collectively, the "2017 3rd Quarter Acquisitions"). We are in the process of integrating ~~each of the 2017 3rd Quarter Acquisitions.~~Sugar City Building Materials Co. (“Sugar City”), which we acquired in November 2020. Management’s assessment and conclusion on the effectiveness of the Company’s disclosure controls and procedures as of ~~September~~June 30, ~~2017,~~2021 excludes an assessment of the internal control over financial reporting related to ~~each~~Sugar City. Sugar City represented 0.3% of ~~the 2017 3rd Quarter Acquisitions. The 2017 3rd Quarter Acquisitions represented less than 1% of both~~our consolidated total assets and 0.3% of our consolidated revenue included in our condensed consolidated financial statements as of and for the ~~nine~~six months ended ~~September~~June 30, ~~2017.~~2021.

Disclosure Controls and Procedures

~~As of September 30, 2017, our management, with the participation of our principal executive officer and our principal financial officer, evaluated the effectiveness~~Based on their evaluation of our disclosure controls and procedures (as defined in ~~Rule 13a-15(e) of~~Rules 13a-15 and 15d-15 under the Securities Exchange Act of 1934 ~~as amended~~ (the “Exchange Act”))~~, which~~ as of the end of the period covered by this report, our principal executive officer and principal financial officer concluded our disclosure controls and procedures are ~~designed~~effective to ~~provide reasonable assurance~~ensure that ~~the~~ information required to be disclosed by us in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the ~~Securities and Exchange Commission's~~SEC’s rules and ~~forms. Disclosure controls~~forms and ~~procedures include controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in the reports that we file or submit under the Exchange Act~~ is accumulated and communicated to management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

~~As disclosed in our 2016 Form 10-K, management determined that the material weakness identified in our Amendment No. 1 on Form 10-K/A for 2015 in our internal control over financial reporting relating~~ There are inherent limitations to the ~~accuracy~~effectiveness of any system of disclosure controls and presentation of accounting for income taxes, including the income tax provision and related tax assets and liabilities as of December 31, 2015 was not fully remediated. A material weakness is a control deficiency, or combination of control deficiencies, that results in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected.

~~As a result of this material weakness, our principal executive officer and principal financial officer have concluded that the Company’s~~procedures. Accordingly, even effective disclosure controls and procedures ~~were not effective at the~~can only provide reasonable assurance ~~level as~~ of ~~September 30, 2017.~~achieving their control objectives.

~~Remediation Efforts~~

~~The following steps to strengthen our internal controls related to accounting for income taxes were either implemented or in process during the nine months ended September 30, 2017:~~

~~the hiring of a tax manager experienced in accounting for income taxes under U.S. GAAP and taxation of multinational corporations;~~

~~the engagement of a third-party tax advisory firm to assist in the preparation and review of the quarterly income tax accounting;~~

the finalization of the initial implementation of the selected document management software, which will allow for its utilization, beginning in the fourth quarter of 2017, to assist in improving the documentation related to management review controls and the overall organization of control related documentation;

the finalization of phase one of the implementation process related to the selected income tax accounting software, which will allow for its utilization in the fourth quarter of 2017 to prepare year-end accounting for income taxes;

~~the establishment of documentation standards for management review controls; and~~

~~the reassessment of the balance between preventative and detective type internal controls, which resulted in an increase in preventative controls.~~

As we continue to evaluate and take actions to improve our internal control over financial reporting in the area of accounting for income taxes, we may enhance certain of the remediation measures described in our 2016 Form 10-K. We intend to complete the implementation of our remediation plan during 2017. The successful remediation of this material weakness will require review and evidence of the effectiveness of the related internal controls as part of our next annual assessment of our internal control over financial reporting as of December 31, 2017.

In light of the material weakness as of December 31, 2016, prior to the filing of this Quarterly Report on Form 10-Q for the three months ended September 30, 2017, management determined that key quarterly controls were performed timely and that additional procedures were performed, including validating the completeness and accuracy of the underlying data used to support the amounts reported in the quarterly financial statements. These control activities and additional procedures have allowed us to conclude that, notwithstanding the material weakness disclosed in the 2016 Form 10-K, the consolidated financial statements in this Form 10-Q fairly present, in all material respects, our financial position, results of operations, and cash flows for the periods presented in conformity with U.S. GAAP.

Changes in Internal Control over Financial Reporting

~~We completed a number of acquisitions in the nine months ended September 30, 2017.~~ As part of our ongoing integration activities related to the Sugar City acquisition, we continue to implement our controls and procedures ~~at the businesses we acquire~~ and to augment our company-wide controls to reflect the risks inherent in ~~our acquisitions.~~the acquisition. Throughout the integration process, we monitor these efforts and take corrective action as needed to reinforce the application of our controls and procedures. Other than the foregoing, ~~and except as described above,~~ during the quarter ended ~~September~~June 30, ~~2017,~~2021, there were no ~~other~~ changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION



~~Item 1.~~	Item 1. Legal Proceedings

The information set forth under the ~~heading~~headings “Legal Proceedings” and “Litigation Related to the Vulcan Merger” in Note ~~14,~~9, “Commitments and ~~Contingencies,”~~Contingencies” to our condensed consolidated financial statements included in Part I of this report is incorporated by reference into this Item 1.

With respect to administrative or judicial proceedings arising under any federal, state, or local provisions that have been enacted or adopted regulating the discharge of materials into the environment or primarily for the purpose of protecting the environment, we have determined that we will disclose any such proceeding if we reasonably believe such proceeding will result in monetary sanctions, exclusive of interest and costs, of at least $1.0 million. We believe that this threshold is reasonably designed to result in disclosure of environmental proceedings that are material to our business or financial condition. Applying this threshold, there were no environmental matters to disclose for this period.



~~Item 1A.~~	Item 1A. Risk Factors

There have been no material changes in our risk factors as previously disclosed in “Risk Factors” in Item 1A of Part I of the ~~Form 10-K.~~2020 10-K other than shown below related to the potential Merger. Readers should carefully consider the factors discussed in “Risk Factors” in Item 1A of Part I1 of the ~~Form~~2020 10-K, which could materially affect our business, financial condition or future results. ~~Those~~The risks described in the 2020 10-K are not the only risks ~~we face.~~facing our Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.

The announcement and pendency of the Merger Agreement could have an adverse effect on our business.

On June 6, 2021, we entered into the Merger Agreement with Vulcan, and Grizzly Merger Sub, pursuant to which, upon the terms and subject to the conditions set forth in the Merger Agreement, Grizzly Merger Sub will merge with and into the Company, with the Company surviving the Merger and becoming a wholly owned subsidiary of Vulcan.

We have scheduled a special meeting of our stockholders for August 16, 2021, so they can vote on whether to adopt the Merger Agreement. Upon the terms and subject to the conditions set forth in the Merger Agreement, at the effective time of the Merger, except as otherwise provided in the Merger Agreement, each share of our common stock issued and outstanding immediately prior to the effective time of the Merger will be canceled and automatically converted into the right to receive $74.00 in cash, without interest.

Uncertainty about the effect of the proposed Merger on our employees, customers, and suppliers may have an adverse effect on our business and operations that may be material to our company. There may be adverse effects on our ability to attract, recruit, retain and motivate current and prospective employees who maybe uncertain about their future roles following completion of the merger, and the possibility that our employees could lose productivity as a result of the uncertainty regarding their employment following the Merger. Any loss or distraction of such employees could have an adverse effect on our business and operations. In addition, we have diverted, and will continue to divert, significant management attention and resources towards the completion of the Merger, which could adversely affect our business and operations.

Our customers may experience uncertainty associated with the Merger, including with respect to concerns about possible changes to our products, services or policies. Similarly, our suppliers may experience uncertainty associated with the Merger, including with respect to current or future ~~results.~~business relationships with us. Uncertainty may cause customers to refrain from purchasing our products and services, and suppliers may seek to change existing business relationships, which could result in an adverse effect on our business, operations, and financial condition in a way that may be material to our company.

Pursuant to the terms of the Merger Agreement, we are subject to certain restrictions on the conduct of our business, including the ability in certain cases to enter into contracts, acquire or dispose of assets, incur indebtedness, or incur capital expenditures, until the Merger becomes effective or the Merger Agreement is terminated. These restrictions may prevent us from taking actions with respect to our business that we may consider advantageous and result in our inability to respond effectively to competitive pressures and industry developments, and may otherwise harm our business and operations.

The Merger is subject to receipt of approval from our stockholders as well as the satisfaction of other closing conditions in the Merger Agreement.

The Merger Agreement contains a number of customary conditions to complete the Merger, including, (1) the approval of the Merger by the holders of a majority of the outstanding shares of common stock, (2) the absence of any law or injunction prohibiting the Merger, (3) the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act, (4) subject to certain exceptions, the accuracy of the other party’s representations and warranties, (5) the absence of a material adverse effect with respect to the Company, and (6) performance in all material respects by each party of its obligations under the Merger.

We can provide no assurance that all required approvals will be obtained or that all closing conditions will be satisfied, and, if all required approvals are obtained and the closing conditions are satisfied, we can provide no assurance as to the terms, conditions and timing of such approvals or the timing of the completion of the Merger. Any delay in completing the Merger could cause us not to realize some or all of the benefits that we expect to achieve if the Merger is successfully completed within its expected timeframe.

The failure to complete the Merger could adversely affect our business, financial condition, operating results, and stock price.

Completion of the Merger is subject to certain conditions beyond our control that may prevent, delay, or otherwise adversely affect its completion in a material way, including the expiration or termination of applicable waiting periods under antitrust and competition laws, and similar competition approvals or consents that must be obtained from regulatory entities in the United States. The process to obtain regulatory approvals could substantially delay, or prevent, the consummation of the Merger. There can be no assurance that these conditions to the completion of the merger will be satisfied in a timely manner or at all. If the Merger is not completed, our stock price could fall to the extent its current market price reflects an assumption that the Merger will be completed, and it is uncertain when, if ever, our stock price would return to the price at which our shares currently trade.

In addition, the Merger Agreement provides that we will be required to pay Vulcan Material Company a termination fee of $50 million in certain circumstances. Further, a failure to complete the Merger may result in negative publicity and a negative impression of us in the investment community and may necessitate us having to obtain additional financing, which may be unavailable on terms favorable to us, or at all. Any disruption to our business resulting from the announcement and pendency of the Merger and from intensifying competition from our competitors, including any adverse changes in our relationships with our customers, suppliers, and employees could continue or accelerate in the event of a failure to complete the Merger. We have been and may be subject to additional legal proceedings related to the transactions contemplated by the Merger Agreement. There can be no assurance that our business, these relationships, or our financial condition will not be adversely affected, as compared to the condition prior to the announcement of the Merger, if the Merger is not consummated.



~~Item 2.~~	Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table provides information with respect to our purchases ~~by the Company~~ of shares of our common stock during the ~~three month~~three-month period ended ~~September~~June 30, ~~2017:~~2021:


Calendar Month	Total Number of Shares Purchased (1)	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares That May Yet Be Purchased Under Plans or Programs
April 1 - 30, 2021	—	$	—	—	$	—
May 1 - 31, 2021	49,372	55.60		—	—
June 1 - 30, 2021	24,614	73.48		—	—
Total	73,986	$	61.55	—	$	—

(1)Represents shares of our common stock acquired from employees who elected for us to make their required tax payments upon vesting of certain restricted shares by withholding a number of those vested shares having a value on the date of vesting equal to their tax obligations.

Calendar Month
Total Number of
Shares
Acquired ⁽¹⁾

Average Price
Paid Per Share

Total Number of
Shares Purchased as
Part of Publicly
Announced Plans or
Programs ⁽²⁾

Approximate Dollar Value
of Shares That May Yet Be
Purchased Under Plans or
Programs ⁽²⁾
July 1 - July 31, 2017 397
$ 78.71
—
$ 50,000,000
August 1 - August 31, 2017 2,478
76.45
—
50,000,000
September 1 - September 30, 2017 —
—
—
50,000,000
Total 2,875
$ 76.76
—
$ 50,000,000


~~(1)~~	The total number of shares purchased includes shares of our common stock acquired from employees who elected for us to make their required tax payments upon vesting of certain restricted shares by withholding a number of those vested shares having a value on the date of vesting equal to their tax obligations.


~~(2)~~	The Second Share Repurchase Program was approved by our Board on March 1, 2017, and allows us to repurchase up to $50.0 million of our common stock effective April 1, 2017, until the earlier of March 31, 2020, or a determination by the Board to discontinue the Second Share Repurchase Program. The Second Share Repurchase Program does not obligate us to acquire any specific number of shares.



~~Item 4.~~	~~Mine Safety Disclosures~~

Item 4. Mine Safety Disclosures

The information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in Exhibit 95.1 to this ~~Quarterly Report on Form 10-Q.~~report.

Item 6. Exhibits



~~Item 6.~~			~~Exhibits~~



2.1*	—~~Arrangement Agreement,~~A greement and Plan of Merger , dated as of ~~September 29, 2017,~~June 6, 2021 by and among Vulcan Material Company, Grizzly Merger Sub I, Inc. and U.S. Concrete, ~~Inc., 1134771 B.C. Ltd., and Polaris Materials Corporation~~Inc . (incorporated by reference to Exhibit ~~2.1~~2.1 to the ~~Company’s~~ Company's Current Report on Form ~~8-K dated October~~ 8-K filed on June 7 , 20 2 ~~2017~~1 (File No. ~~001-34530)~~00 1 -34530 )).
3.1*		—Amended and Restated Certificate of Incorporation of U.S. Concrete, Inc. (incorporated by reference to Exhibit 1 to the Company's Registration Statement on Form 8-A/A filed on August 31, 2010 (File No. 000-26025)).
3.2*		—Third Amended and Restated By-Laws of U.S. Concrete, Inc. (incorporated by reference to Exhibit 2 to the Company's Registration Statement on Form 8-A/A filed on August 31, 2010 (File No. 000-26025)).
3.3*		—Amendment No. 1 to Third Amended and Restated Bylaws of U.S. Concrete, Inc. (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on November 20, 2015 (File No. 001-34530)).
10.1*†		—~~Consulting Agreement, dated as of July 1, 2017, by and between~~Amendment to the U.S. Concrete, Inc. ~~and Joseph C. Tusa, Jr.~~Long Term Incentive Plan (incorporated by reference to Exhibit 10.1 to the ~~Company’s~~Company's Current Report on Form 8-K ~~dated July 6, 2017~~filed on May 1 4 , 2021 (File No. 001-34530)).
10.2*†		—~~Third~~Fourth Amended and Restated Loan and Security Agreement, dated ~~as of August 31, 2017,~~ June 25 , 2021, by and among U.S. Concrete, Inc.,certain of its subsidiaries parties thereto, certain ~~lender~~lenders parties thereto, and Bank of America, N.A., as agent for the lenders (incorporated by reference to Exhibit 10.1 to the ~~Company’s~~Company's Current Report on Form 8-K dated ~~September 1, 2017~~on June 2 5 , 2021 (File No. 001-34530)).
10.3*†		—~~Offer Letter~~Credit and Guaranty Agreement, dated June 25, 2021, among U.S. Concrete, Inc.,t he guarantors party t hereto, the financial institutions from time to ~~John Kuntz, dated~~time parties thereto and JPMorgan Chase Bank ,N.A., as ~~of September 5, 2017,~~administrative a gent (incorporated by reference to Exhibit ~~10.1~~10.2 to the ~~Company’s~~Company's Current Report on Form 8-K dated ~~September 8, 2017~~on June 25, 2021 (File No. 001-34530)).
~~10.4*†~~31.1		—Amendment to Consulting Agreement, dated as of September 1, 2017, by and between U.S. Concrete, Inc. and Joseph C. Tusa, Jr. (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K dated September 8, 2017 (File No. 001-34530)).
~~10.5*†~~	—Consulting Agreement, dated as of September 14, 2017, by and between U.S. Concrete, Inc. and Eugene I. Davis (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated September 20, 2017 (File No. 001-34530)).
~~10.6*†~~	—Executive Severance Agreement, by and between U.S. Concrete, Inc. and John E. Kunz, dated October 2, 2017 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated October 6, 2017 (File No. 001-34530)).
~~10.7*†~~	—Indemnification Agreement, by and between U.S. Concrete, Inc. and John E. Kunz, dated October 2, 2017 (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K dated October 6, 2017 (File No. 001-34530)).
~~12.1~~	~~—Ratio of Earnings to Fixed Charges.~~
~~31.1~~	—Certification of Periodic Report pursuant to Rule 13a-14(a) and Rule 15d-14(a).
31.2		—Certification of Periodic Report pursuant to Rule 13a-14(a) and Rule 15d-14(a).
32.1		—Certification pursuant to 18 U.S.C. Section 1350.
32.2		—Certification pursuant to 18 U.S.C. Section 1350.
95.1		—Mine Safety Disclosures.
101.INS		—XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH		—Inline XBRL Taxonomy Extension Schema ~~Document~~Document.
101.CAL		—Inline XBRL Taxonomy Extension Calculation Linkbase ~~Document~~Document.
101.DEF		—Inline XBRL Taxonomy Extension Definition Linkbase ~~Document~~Document.
101.LAB		—Inline XBRL Taxonomy Extension Label Linkbase ~~Document~~Document.
101.PRE		—Inline XBRL Taxonomy Extension Presentation Linkbase ~~Document~~Document.
104		—Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

* Incorporated by reference to the filing indicated.

~~† Management contract or compensatory plan or arrangement.~~

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		U.S. CONCRETE, INC.

Date:	August 5, 2021	By:	/s/ Gibson T. Dawson
			Gibson T. Dawson
			Vice President, Corporate Controller and Chief Accounting Officer
			(Principal Accounting Officer)


		~~U.S. CONCRETE, INC.~~

~~Date:~~	~~November 3, 2017~~	~~By:~~	~~/s/ John E. Kunz~~
	~~John E. Kunz~~
	~~Senior Vice President and Chief Financial Officer~~
	~~(Principal Financial Officer)~~



Delaware						76-0586680
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification Number)


Title of each class	Trading symbol	Name of each exchange on which registered
Common Stock, par value $0.001	USCR	The Nasdaq Stock Market LLC



	September 30, 2017			December 31, 2016
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	248,263		$	75,774
Trade accounts receivable, net of allowances of $6,284 and $5,960 as of September 30, 2017, and December 31, 2016, respectively	234,976			207,292
Inventories	45,429			41,979
Other receivables	14,080			8,691
Prepaid expenses	6,328			5,534
Other current assets	1,298			2,019
Total current assets	550,374			341,289
Property, plant and equipment, net of accumulated depreciation, depletion, and amortization of $167,874 and $137,629 as of September 30, 2017, and December 31, 2016, respectively	438,789			337,412
Goodwill	147,160			133,271
Intangible assets, net	121,385			130,973
Other assets	1,993			2,457
Total assets	$	1,259,701		$	945,402
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	123,126		$	110,694
Accrued liabilities	90,563			85,243
Current maturities of long-term debt	24,938			16,654
Derivative liabilities	—			57,415
Total current liabilities	238,627			270,006
Long-term debt, net of current maturities	663,480			432,644
Other long-term obligations and deferred credits	60,833			46,267
Deferred income taxes	14,970			7,656
Total liabilities	977,910			756,573
Commitments and contingencies (Note 14)
Stockholders' equity:
Preferred stock	—			—
Common stock	18			17
Additional paid-in capital	317,254			249,832
Accumulated deficit	(10,711		)	(39,296		)
Treasury stock, at cost	(24,770		)	(21,724		)
Total stockholders' equity	281,791			188,829
Total liabilities and stockholders' equity	$	1,259,701		$	945,402



	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
Revenue	$	354,628		$	328,588		$	994,687		$	849,383
Cost of goods sold before depreciation, depletion and amortization	278,995			253,477			778,328			674,451
Selling, general and administrative expenses	30,056			25,104			86,073			71,447
Depreciation, depletion and amortization	16,593			14,139			48,802			38,795
Change in value of contingent consideration	719			714			2,047			2,325
Impairment of assets	648			—			648			—
Loss (gain) on disposal of assets, net	(106		)	(1,003		)	(496		)	(1,016		)
Operating income	27,723			36,157			79,285			63,381
Interest expense, net	10,552			7,635			31,062			19,933
Derivative loss (income)	(13,119		)	(21,772		)	791			(6,430		)
Loss on extinguishment of debt	60			—			60			12,003
Other income, net	(1,287		)	(405		)	(2,591		)	(1,412		)
Income from continuing operations before income taxes	31,517			50,699			49,963			39,287
Income tax expense	7,241			12,577			20,854			14,317
Income from continuing operations	24,276			38,122			29,109			24,970
Loss from discontinued operations, net of taxes	(222		)	(166		)	(524		)	(518		)
Net income	$	24,054		$	37,956		$	28,585		$	24,452

Basic income (loss) per share:
Income from continuing operations	$	1.51		$	2.50		$	1.85		$	1.67
Loss from discontinued operations, net of taxes	(0.01		)	(0.01		)	(0.03		)	(0.04		)
Net income per share – basic	$	1.50		$	2.49		$	1.82		$	1.63

Diluted income (loss) per share:
Income from continuing operations	$	1.46		$	2.35		$	1.75		$	1.54
Loss from discontinued operations, net of taxes	(0.01		)	(0.01		)	(0.03		)	(0.03		)
Net income per share – diluted	$	1.45		$	2.34		$	1.72		$	1.51

Weighted average shares outstanding:
Basic	16,028			15,222			15,745			14,978
Diluted	16,651			16,240			16,633			16,186



	Common Stock
	# of Shares		Par Value		Additional Paid-In Capital		Accumulated Deficit			Treasury Stock			Total Equity
BALANCE, December 31, 2016	15,696		$	17	$	249,832	$	(39,296	)	$	(21,724	)	$	188,829
Stock-based compensation expense	—		—		6,523		—			—			6,523
Restricted stock vesting	13		—		—		—			—			—
Restricted stock grants, net of cancellations	139		—		—		—			—			—
Stock options exercised	6		—		132		—			—			132
Warrants exercised	834		1		60,767		—			—			60,768
Other treasury share purchases	(44	)	—		—		—			(3,046		)	(3,046		)
Net income	—		—		—		28,585			—			28,585
BALANCE, September 30, 2017	16,644		$	18	$	317,254	$	(10,711	)	$	(24,770	)	$	281,791



	2017 Acquisitions
Accounts receivable ⁽¹⁾	$	1,126
Inventory	504
Other current assets	40
Property, plant and equipment	55,315
Definite-lived intangible assets	5,884
Total assets acquired	62,869
Current liabilities	674
Total liabilities assumed	674
Goodwill	12,164
Total consideration (fair value) ⁽²⁾	$	74,359



	2016 Acquisitions
Cash	$	9
Accounts receivable ⁽¹⁾	12,314
Inventory	1,249
Other current assets	68
Property, plant and equipment	34,918
Definite-lived intangible assets	47,144
Total assets acquired	95,702
Current liabilities	7,055
Other long-term liabilities	3,713
Total liabilities assumed	10,768
Goodwill	60,583
Total consideration (fair value) ⁽²⁾	$	145,517



	Weighted Average Amortization Period (In Years)	Fair Value At Acquisition Date
Customer relationships	6.00	$	37,764
Non-compete agreements	5.00	5,807
Leasehold interests	5.00	4,955
Trade names	4.95	4,118
Favorable Contract	3.67	384
Total		$	53,028



	Year Ending December 31,
2017 (remainder of the year)	$	2,350
2018	9,398
2019	9,133
2020	8,604
2021	7,679
Thereafter	5,427
Total	$	42,591



	September 30, 2017		December 31, 2016
Raw materials	$	41,486	$	38,752
Building materials for resale	2,263		1,923
Other	1,680		1,304
Total inventories	$	45,429	$	41,979



	Ready-Mixed Concrete Segment		Aggregate Products Segment		Other Non-Reportable Segments		Total
Balance at December 31, 2016	$	127,515	$	2,494	$	3,262	$	133,271
2017 acquisitions ⁽¹⁾	12,164		—		—		12,164
Adjustment for prior period business combination⁽²⁾	549		1,176		—		1,725
Balance at September 30, 2017	$	140,228	$	3,670	$	3,262	$	147,160



	As of September 30, 2017
	Gross		Accumulated Amortization			Net		Weighted Average Remaining Life (In Years)
Definite-lived intangible assets
Customer relationships	$	85,993	$	(25,041	)	$	60,952	5.30
Trade names	45,756		(7,353		)	38,403		19.62
Non-competes	17,375		(7,673		)	9,702		3.24
Leasehold interests	12,480		(2,956		)	9,524		6.85
Favorable contracts	4,034		(2,708		)	1,326		1.54
Total definite-lived intangible assets	165,638		(45,731		)	119,907		9.79
Indefinite-lived intangible assets
Land rights⁽¹⁾	1,478		—			1,478
Total purchased intangible assets	$	167,116	$	(45,731	)	$	121,385



	As of December 31, 2016
	Gross		Accumulated Amortization			Net		Weighted Average Remaining Life (In Years)
Definite-lived intangible assets
Customer relationships	$	82,174	$	(16,414	)	$	65,760	5.97
Trade names	44,456		(4,948		)	39,508		20.20
Non-competes	16,862		(5,160		)	11,702		3.81
Leasehold interests	12,480		(1,693		)	10,787		7.46
Favorable contract	3,650		(1,912		)	1,738		1.67
Total definite-lived intangible assets	159,622		(30,127		)	129,495		10.19
Indefinite-lived intangible assets
Land rights⁽¹⁾	1,478		—			1,478
Total purchased intangible assets	$	161,100	$	(30,127	)	$	130,973



	Year Ending December 31,
2017 (remainder of the year)	$	5,362
2018	21,018
2019	19,176
2020	16,985
2021	15,561
Thereafter	41,805
Total	$	119,907



	September 30, 2017		December 31, 2016
Accrued materials	$	17,827	$	20,349
Accrued compensation and benefits	16,724		16,553
Accrued insurance reserves	16,409		15,206
Accrued interest	12,871		2,217
Accrued property, sales and other taxes	8,811		11,829
Deferred consideration	6,448		9,227
Contingent consideration, current portion	2,322		2,418
Deferred rent	2,270		2,232
Other	6,881		5,212
Total accrued liabilities	$	90,563	$	85,243



	September 30, 2017			December 31, 2016
Senior unsecured notes due 2024 and unamortized premium⁽¹⁾	$	610,337		$	400,000
Senior secured credit facility	—			—
Capital leases	62,490			37,860
Other financing	26,817			20,248
Debt issuance costs	(11,226		)	(8,810		)
Total debt	688,418			449,298
Less: current maturities	(24,938		)	(16,654		)
Long-term debt, net of current maturities	$	663,480		$	432,644



		Fair Value
Derivative Instruments Not Designated As Hedging Instruments Under ASC 815	Balance Sheet Classification	September 30, 2017		December 31, 2016
Warrants	Derivative liabilities	$	—	$	57,415



		Three Months Ended
Derivative Instruments Not Designated As Hedging Instruments Under ASC 815	Classification in Statement of Operations	September 30, 2017			September 30, 2016
Warrants	Derivative loss (income)	$	(13,119	)	$	(21,772	)



		Nine Months Ended
Derivative Instruments Not Designated As Hedging Instruments Under ASC 815	Classification in Statement of Operations	September 30, 2017		September 30, 2016
Warrants	Derivative loss (income)	$	791	$	(6,430	)



	September 30, 2017
	Total		Level 1		Level 2		Level 3
Contingent consideration, including current portion ^{(1) (2) (3) (4) (5)}	$	52,554	$	—	$	—	$	52,554
	$	52,554	$	—	$	—	$	52,554



	Contingent Consideration
Balance at December 31, 2016	$	32,212
Acquisitions ⁽¹⁾	20,621
Total losses included in earnings ⁽²⁾	2,047
Payment on contingent consideration	(2,326		)
Balance at September 30, 2017	$	52,554



	As of September 30, 2017		As of December 31, 2016
Identifiable Property, Plant And Equipment Assets:
Ready-mixed concrete	$	268,174	$	229,077
Aggregate products	146,259		87,064
Other products and corporate	24,356		21,271
Total identifiable assets	$	438,789	$	337,412



	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations and Reclassifications			U.S. Concrete Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	—	247,873		$	390	$	—		$	248,263
Trade accounts receivable, net	—		234,671		305		—			234,976
Inventories	—		42,084		3,345		—			45,429
Other receivables	8,063		5,946		71		—			14,080
Prepaid expenses	—		6,301		27		—			6,328
Other current assets	11,397		1,282		16		(11,397		)	1,298
Total current assets	19,460		538,157		4,154		(11,397		)	550,374
Property, plant and equipment, net	—		414,760		24,029		—			438,789
Goodwill	—		141,407		5,753		—			147,160
Intangible assets, net	—		118,676		2,709		—			121,385
Deferred income taxes	—		—		558		(558		)	—
Investment in subsidiaries	417,747		—		—		(417,747		)	—
Intercompany receivables	463,096		—		—		(463,096		)	—
Other assets	—		1,946		47		—			1,993
Total assets	$	900,303	$	1,214,946	$	37,250	$	(892,798	)	$	1,259,701
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	116	$	122,260	$	750	$	—		$	123,126
Accrued liabilities	17,447		82,624		1,889		(11,397		)	90,563
Current maturities of long-term debt	—		24,841		97		—			24,938
Total current liabilities	17,563		229,725		2,736		(11,397		)	238,627
Long-term debt, net of current maturities	599,112		64,064		304		—			663,480
Other long-term obligations and deferred credits	1,835		58,172		826		—			60,833
Deferred income taxes	—		15,528		—		(558		)	14,970
Intercompany payables	—		454,154		8,942		(463,096		)	—
Total liabilities	618,510		821,643		12,808		(475,051		)	977,910
Total stockholders' equity	281,793		393,303		24,442		(417,747		)	281,791
Total liabilities and stockholders' equity	$	900,303	$	1,214,946	$	37,250	$	(892,798	)	$	1,259,701



Calendar Month	Total Number of Shares Acquired ⁽¹⁾	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs ⁽²⁾	Approximate Dollar Value of Shares That May Yet Be Purchased Under Plans or Programs ⁽²⁾
July 1 - July 31, 2017	397	$	78.71	—	$	50,000,000
August 1 - August 31, 2017	2,478	76.45		—	50,000,000
September 1 - September 30, 2017	—	—		—	50,000,000
Total	2,875	$	76.76	—	$	50,000,000