SUN COAST INDUSTRIES INC /DE/, S-2/A, 1995-03-09

SUN COAST INDUSTRIES INC /DE/
S-2/A, 1995-03-09
PLASTICS PRODUCTS, NEC

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 9, 1995

REGISTRATION STATEMENT NO. 33-89480

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

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------

AMENDMENT NO. 1

FORM S-2
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
SUN COAST INDUSTRIES, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

<TABLE>
<S> <C>
DELAWARE 59-1952968
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)

CYNTHIA R. MORRIS
TREASURER & CHIEF FINANCIAL OFFICER
SUN COAST INDUSTRIES, INC.
2700 SOUTH WESTMORELAND 2700 SOUTH WESTMORELAND
DALLAS, TEXAS 75233 DALLAS, TEXAS 75233
(214) 373-7864 (214) 373-7864
(ADDRESS, INCLUDING ZIP CODE, (NAME, ADDRESS, INCLUDING ZIP CODE,
AND TELEPHONE NUMBER, INCLUDING AREA CODE AND TELEPHONE NUMBER, INCLUDING AREA
OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES) CODE, OF AGENT FOR SERVICE)
</TABLE>

Copies to:

<TABLE>
<S> <C>
JOE DANNENMAIER J. PAGE DAVIDSON
THOMPSON & KNIGHT BASS, BERRY & SIMS
A PROFESSIONAL CORPORATION 2700 FIRST AMERICAN CENTER
1700 PACIFIC AVENUE NASHVILLE, TENNESSEE 37238
SUITE 3300
DALLAS, TEXAS 75201
</TABLE>

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

Approximate date of commencement of proposed sale to the public: As soon
as practicable after the effective date of this Registration Statement.

If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. / /

If the Registrant elects to deliver its latest annual report to security
holders, or a complete and legible facsimile thereof, pursuant to Item 11(a)(1)
of this Form, check the following box./ /

------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(A), MAY
DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2

SUN COAST INDUSTRIES, INC.

CROSS REFERENCE SHEET

PURSUANT TO ITEM 501(B) OF REGULATION S-K

<TABLE>
<CAPTION>
ITEM
NUMBER FORM S-2 CAPTION PROSPECTUS LOCATION OR CAPTION
- ------- ---------------------------------------- ----------------------------------------
<S> <C> <C>
1. Forepart of the Registration Statement Cover Page of Registration Statement and
and Outside Front Cover Page of Prospectus
Prospectus............................
2. Inside Front and Outside Back Cover Inside Front and Outside Back Cover
Pages of Prospectus................... Pages of Prospectus
3. Summary Information, Risk Factors and Prospectus Summary; The Company; Risk
Ratio of Earnings to Fixed Charges.... Factors
4. Use of Proceeds......................... Prospectus Summary; Use of Proceeds
5. Determination of Offering Price......... Not Applicable
6. Dilution................................ Not Applicable
7. Selling Security Holders................ Not Applicable
8. Plan of Distribution.................... Outside Front Cover Page of Prospectus;
Underwriting
9. Description of Securities to be Outside Front Cover Page of Prospectus;
Registered............................ Description of Capital Stock
10. Interests of Named Experts and
Counsel............................... Not Applicable
11. Information with Respect to the Prospectus Summary; The Company; Risk
Registrant............................ Factors; Use of Proceeds; Price Range
of Common Stock and Dividend Policy;
Capitalization; Selected Consolidated
Financial Data; Management's
Discussion and Analysis of Financial
Condition and Results of Operations;
Business; Management; Principal
Stockholders; Description of Capital
Stock; Underwriting; and Consolidated
Financial Statements
12. Incorporation of Certain Information by
Reference............................. Incorporation of Documents by Reference
13. Disclosure of Commission Position on
Indemnification for Securities Act
Liabilities........................... Not Applicable
</TABLE>
<PAGE> 3

Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may
not be sold nor may offers to buy be accepted prior to the time the
registration statement becomes effective. This prospectus shall not
constitute an offer to sell or the solicitation of an offer
to buy nor shall there be any sale of these securities in any State in
which such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such State.

SUBJECT TO COMPLETION, DATED MARCH 9, 1995

PROSPECTUS

1,500,000 SHARES

SUN COAST
[LOGO]
INDUSTRIES, INC.

COMMON STOCK

All the 1,500,000 shares of Common Stock offered hereby are being sold by
Sun Coast Industries, Inc. ("Sun Coast" or the "Company").

The Company's Common Stock is listed on the New York Stock Exchange under
the symbol "SN." On March 7, 1995, the closing price of the Common Stock as
reported on the New York Stock Exchange Composite Tape was $14.00 per share. See
"Price Range of Common Stock and Dividend Policy."

SEE "RISK FACTORS" FOR MATTERS THAT SHOULD BE CONSIDERED BY PROSPECTIVE
PURCHASERS OF THE COMMON STOCK OFFERED HEREBY.

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

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.

<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
PRICE TO PROCEEDS TO
PUBLIC UNDERWRITING COMPANY(2)
DISCOUNT(1)
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Share......................... $ $ $
- -------------------------------------------------------------------------------------------------
Total(3).......................... $ $ $
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- -------------------------------------------------------------------------------------------------
</TABLE>

(1) The Company has agreed to indemnify the Underwriters against certain civil
liabilities, including liabilities under the Securities Act of 1933, as
amended. See "Underwriting."
(2) Before deducting estimated expenses of $250,000 payable by the Company.
(3) The Company has granted to the Underwriters an overallotment option to
purchase up to an aggregate of 225,000 additional shares of Common Stock on
the same terms and conditions as set forth above. If all such shares are
purchased by the Underwriters, total Price to Public will be $ ,
total Underwriting Discount will be $ and total Proceeds to Company
will be $ . See "Underwriting."

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

The shares of Common Stock are offered subject to receipt and acceptance by
the several Underwriters, to prior sale and to the Underwriters' right to reject
any order in whole or in part and to withdraw, cancel or modify the offer
without notice. It is expected that certificates for the shares will be
available for delivery on or about March , 1995.

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

J.C. BRADFORD & CO. A.G. EDWARDS & SONS, INC.

MARCH , 1995

<PAGE> 4
CHEMICALS

[PHOTO]

Sun Coast's urea and melamine compounds are used as raw materials for dozens of
consumer and food service products manufactured by Sun Coast as well as other
manufacturers.

DINNERWARE

[PHOTO] [PHOTO]

[PHOTO]

Casual melamine dinnerware and drinkware manufactured by Sun Coast are sold to
numerous retailers, including Target and Wal-Mart. Sun Coast has also recently
added a line of dinnerware decorated with popular children's characters.

IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE COMMON STOCK
AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH
TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE. SUCH STABILIZING,
IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.

<PAGE> 5

PROSPECTUS SUMMARY

The following summary is qualified in its entirety by the more detailed
information and consolidated financial statements and the notes thereto
appearing elsewhere or incorporated by reference in this Prospectus. Unless
otherwise indicated in this Prospectus, all information assumes no exercise of
the Underwriters' over-allotment option.

THE COMPANY

The Chemical Division manufactures melamine and urea resins and compounds,
which it supplies to other manufacturers and uses in producing its own consumer
and food service products. Sun Coast supplies substantially all the melamine
resin used by Ralph Wilson Plastics Co. ("Ralph Wilson"), the largest U.S.
manufacturer of laminate. Sun Coast is also a leading supplier of urea molding
compounds to U.S. manufacturers of electrical outlet and switch plates. In
fiscal 1994 and the first six months of fiscal 1995, the Chemical Division's
sales were $28.7 million and $16.3 million, or 39.2% and 37.3% of the Company's
sales, respectively.

The Consumer and Food Service Divisions manufacture compression molded
melamine dinnerware and injection molded plastic drinkware, which Sun Coast
sells to retail and commercial markets. Sun Coast sells dinnerware and drinkware
sets, including sets decorated with popular licensed children's characters, to
Target, Venture, Wal-Mart, Toys "R" Us, Dillard's and other retailers. The
Company markets melamine dishes and plates, which are more durable than china
and other plastic dinnerware, to commercial and institutional customers
including restaurants such as Pizza Hut and Boston Chicken, schools and health
care facilities. In fiscal 1994 and the first six months of fiscal 1995, the
combined sales of the Consumer and Food Service Divisions were $21.2 million and
$14.3 million, or 29.0% and 32.9% of the Company's sales, respectively.

The Closures Division manufactures linerless, foil or foam lined and
tamper-evident plastic closures and lids. These closures are used in the
bottling and packaging of food, beverage, chemical and pharmaceutical products.
An example is the Sun-Twist closure, which is a tamper-evident, easy-opening lid
used in the plastic bottling of "hot-fill" beverages such as fruit juices, teas
and isotonic sports drinks. The Closures Division's customers include Clorox,
Hunt-Wesson and Procter & Gamble. In fiscal 1994 and the first six months of
fiscal 1995, sales of the Closures Division were $23.2 million and $13.0
million, or 31.8% and 29.8% of the Company's sales, respectively.

The Custom Laminates Division is a start-up division employing Sun Coast's
proprietary process that permits lamination of images in a range of design,
color and detail that management believes is much broader than other existing
processes. The first application for this product has been for tabletops in
McDonald's restaurants. The Company has begun marketing the process for use in
children's furniture, kitchen and bath counters and backsplashes and commercial
fixtures. The Custom Laminates Division began operations in the fourth quarter
of fiscal 1994 and has not generated significant sales to date.

In 1993, the Company underwent a change in senior management. By
implementing marketing, operational and strategic changes, the new management
team believes it has positioned Sun Coast for growth. The Company's objective is
to be a market leading, high quality manufacturer of melamine and urea-based
resins and compounds and related molded plastic products. Management's strategy
is to aggressively market existing products and to capitalize on the Company's
chemical manufacturing and plastic molding expertise to develop additional
products made from similar materials and processes. The Company continually
seeks to refine its manufacturing operations in order to increase product
quality and reduce costs and emphasizes a high level of service to customers,
maintaining close and frequent communication in order to better meet their
needs. As part of its growth strategy, the Company will consider acquisitions of
complementary product manufacturers.

Management believes that the impact of the operational and strategic
changes is beginning to be reflected in the Company's operating results. In the
first six months of fiscal 1995 (ended December 31, 1994), sales increased by
approximately $9.4 million, or 27.5%, to $43.6 million from $34.2 million in the
comparable prior year period. Net income for the first six months of fiscal 1995
was $1.9 million, a 28.1% increase over the comparable prior year period (before
a fiscal 1994 restructuring charge of $424,000, net of income taxes). See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations."

3
<PAGE> 6

THE OFFERING

<TABLE>
<S> <C>
Common Stock offered by the Company................... 1,500,000 shares
Common Stock to be outstanding after the
offering(1)......................................... 5,505,629 shares
Use of proceeds by the Company........................ To reduce bank indebtedness
NYSE symbol........................................... SN
</TABLE>

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

(1) Excludes 388,905 shares issuable upon exercise of employee stock options
outstanding at February 28, 1995 and 114,269 shares issuable upon exercise
of a warrant held by PruSupply Capital Assets, Inc. See "Description of
Capital Stock -- The PruSupply Warrant and Certain Registration Rights."

SUMMARY CONSOLIDATED FINANCIAL DATA

<TABLE>
<CAPTION>
SIX MONTHS
ENDED
FISCAL YEAR ENDED JUNE 30, DECEMBER 31,
--------------------------------------------------- --------------------
1990 1991 1992 1993 1994 1993 1994
------- ------- ------- ------- ------- ------- -------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Sales........................... $61,757 $58,722 $61,944 $66,806 $73,102 $34,173 $43,579
Costs and expenses:
Cost of sales................. 51,479 47,162 48,419 50,928 56,073 26,274 33,558
Selling, general and
administrative.............. 7,964 8,205 8,918 9,310 10,260 5,065 6,285
Interest, net................. 2,579 2,210 1,709 1,152 1,124 580 799
Restructuring charge(1)....... -- -- -- -- 642 642 --
------- ------- ------- ------- ------- ------- -------
62,022 57,577 59,046 61,390 68,099 32,561 40,642
------- ------- ------- ------- ------- ------- -------
Income (loss) before income
taxes and extraordinary
item........................ (265) 1,145 2,898 5,416 5,003 1,612 2,937
Provision for income taxes
(benefit)(2).................. 207 (404) 1,320 1,773 1,577 565 1,053
------- ------- ------- ------- ------- ------- -------
Income (loss) before
extraordinary item(2)....... (472) 1,549 1,578 3,643 3,426 1,047 1,884
Extraordinary item -- gain
(loss) on debt
restructuring................. 46 (428) -- -- -- -- --
------- ------- ------- ------- ------- ------- -------
Net income (loss)(2)............ $ (426) $ 1,121 $ 1,578 $ 3,643 $ 3,426 $ 1,047 $ 1,884
======= ======= ======= ======= ======= ======= =======
Net income (loss) per common
share(2)(3)(4)................ $ (.16) $ .31 $ .46 $ .92 $ .85(1) $ .26(1) $ .46
======= ======= ======= ======= ======= ======= =======
</TABLE>

<TABLE>
<CAPTION>
DECEMBER 31, 1994
--------------------------
ACTUAL AS ADJUSTED(5)
------- --------------
(IN THOUSANDS)
<S> <C> <C>
BALANCE SHEET DATA:
Working capital............................................................ $15,185 $ 16,452
Total assets............................................................... 53,243 53,243
Long-term debt............................................................. 24,387 6,164
Stockholders' equity....................................................... 17,837 37,327
</TABLE>

- ---------------
(1) During the second quarter of fiscal 1994, the Company recorded a
restructuring charge related to a reduction in its work force and the
consolidation of certain corporate functions. Without this non-recurring
restructuring charge, the Company would have reported net income per common
share of $.96 and $.37 for fiscal 1994 and the six months ended December 31,
1993, respectively. See Note 7 of Notes to the Consolidated Financial
Statements.

(2) Balances for fiscal 1993 and prior years have been restated for the adoption
of Financial Accounting Standard No. 109. See Note 6 of Notes to the
Consolidated Financial Statements.

(3) Per share data has been restated to reflect the one-for-five reverse stock
split effective January 2, 1992.

(4) Net income (loss) per common share assuming full dilution was $(.16), $.31,
$.44, $.91 and $.84 in fiscal years 1990, 1991, 1992, 1993 and 1994,
respectively, and $.26 and $.46 for the six months ended December 31, 1993
and 1994, respectively.

(5) As adjusted to reflect the sale in this offering of 1,500,000 shares of
Common Stock at an assumed offering price of $14.00 (the closing price of
the Common Stock on March 7, 1995) and the application of the estimated net
proceeds therefrom as described under "Use of Proceeds."

4
<PAGE> 7

THE COMPANY

Sun Coast was organized as a Delaware corporation in 1979 and, prior to
1988, had only closure operations, which it maintained through Sun Coast
Closures, Inc., a wholly-owned Florida subsidiary. In 1988, through a merger,
Plastics Manufacturing Company ("PMC") became a wholly-owned subsidiary of Sun
Coast. The Chemical, Consumer and Food Service Divisions were and are all parts
of PMC. PMC was incorporated in Texas in 1946, succeeding a partnership formed
in 1939. It has subsequently been reincorporated in Delaware.

In December 1993, Sun Coast's name was changed from Sun Coast Plastics,
Inc. to Sun Coast Industries, Inc. As used in this Prospectus, unless otherwise
required by context, the terms "Sun Coast" and "Company" refer to Sun Coast
Industries, Inc. and its consolidated subsidiaries.

The Company's principal executive offices are located at 2700 South
Westmoreland, Dallas, Texas 75233, and its telephone number is (214) 373-7864.

RISK FACTORS

In addition to the other information contained or incorporated in this
Prospectus, the following factors should be considered carefully in evaluating
an investment in the Common Stock offered hereby:

COST AND AVAILABILITY OF RAW MATERIALS

The principal raw materials used by the Company are melamine crystals, urea
crystals, styrene acrylonitrile, polypropylene and polyethylene resins,
formaldehyde, cellulose fillers, pigments, plasticizers, curing agents and
lining material. The Company is dependent upon outside suppliers for raw
materials and, therefore, is subject to price increases and delays in shipments
from suppliers. Raw materials costs have historically accounted for a
significant portion of the Company's cost of goods sold. Although the cost of
raw materials used in the Company's operations has been relatively stable in
recent years, prices increased significantly during the first six months of
fiscal 1995, with a higher rate of increase in the second quarter. The most
dramatic change was in the price of formaldehyde due to a world-wide shortage of
methanol, a key component of formaldehyde. The Company's average purchase price
for formaldehyde and other raw materials stabilized in early January 1995. The
Company has generally been able to increase prices to cover cost increases,
although its ability to do so in the future may be limited by competitive or
other factors. No assurance can be given that the Company will continue to have
available necessary raw materials at reasonable prices or that any increases in
raw material costs will not have a material adverse effect on the Company. See
"Business -- Raw Materials."

UNION CONTRACT

Local No. 745 of the International Brotherhood of Teamsters, Chauffeurs,
Warehousemen and Helpers of America (the "Union") is the exclusive collective
bargaining agent for the approximately 380 hourly manufacturing employees at the
Company's Dallas, Texas facilities pursuant to a three-year union contract which
expires on March 31, 1995. A work stoppage resulting from a delay in reaching a
new agreement or a new agreement which results in a material increase in wages
and/or benefits for the hourly manufacturing employees could have a material
adverse effect upon the Company's business and results of operations. There can
be no assurance that a new multi-year contract can be negotiated on terms which
would not have such a material adverse effect. See "Business -- Employees."

NEW PRODUCTS

The continued growth of the Company's business is largely dependent upon
the introduction of new products and increasing market share for existing
products. The Company has increased research and development expenditures with
the goal of developing new products and has undertaken new marketing efforts and
invested in new equipment and processes with the goal of increasing its market
share for existing products. There can be no assurance that the Company will be
able to successfully increase its market share for existing

5
<PAGE> 8

product lines or develop new products or that any new products will achieve
market acceptance. See "Business -- Strategy."

CONSUMER PREFERENCES

The continued growth of the Company, particularly in respect of its
Consumer Division, is dependent on its ability to anticipate and respond to
changing consumer preferences in a timely manner. The Consumer Division's
children's dinnerware sets featuring licensed characters and, to a lesser
extent, its dinnerware and housewares for the adult market, are subject to these
changing preferences. Additionally, there is no assurance that if the Company is
able to correctly anticipate changing consumer preferences in its line of
children's dinnerware it will be able to obtain licenses on acceptable terms for
the most popular children's characters. Although the Company attempts to stay
abreast of trends affecting its products, any failure by the Company to identify
and respond to such trends could adversely affect consumer acceptance of its
products, which in turn could adversely affect the Company's business, financial
condition and results of operations.

RELIANCE ON CERTAIN CUSTOMERS

For the six months ended December 31, 1994 and fiscal 1994, 1993 and 1992,
Ralph Wilson accounted for approximately $5.9 million or 13.5%, $10.6 million or
14.6%, $10.5 million or 15.7%, and $11.4 million or 18.4%, respectively, of the
Company's sales. For the same periods, sales to Superior Manufacturing
Company/Eagle Plastics, Inc. ("Eagle Plastics") accounted for approximately $4.9
million or 11.3%, $8.4 million or 11.5%, $7.0 million or 10.5%, and less than
10%, respectively. Ralph Wilson and Eagle Plastics buy through purchase orders
issued periodically, which can be discontinued at any time. Management believes
that the Company has a good relationship with both Ralph Wilson and Eagle
Plastics; however, the loss of either of these customers or a significant
portion of its business, could adversely affect the business and financial
condition of the Company. See "Business -- Major Customers."

DEPENDENCE ON KEY MANAGEMENT PERSONNEL

The Company's success is largely dependent on the skills, expertise and
efforts of its senior management. The loss of services of R. Carter Pate,
Cynthia R. Morris or Arno F. Pirkau, executive officers of the Company, could
have a material adverse effect on the Company's business and development. None
of these officers has an employment agreement with the Company. See
"Management."

COMPETITION

Each of the businesses in which the Company competes is highly competitive
and its future success will be largely dependent on its ability to provide
quality products and services at competitive prices. There are three other major
U.S. suppliers of melamine and urea molding compounds similar to those supplied
by the Company and many major suppliers of melamine and urea resins. Many of
these suppliers have greater resources than the Company and are parts of large,
diversified companies. The broad dinnerware and housewares market includes
disposables, china and pottery, glass and permanent plastic. Across all these
categories, there are many foreign and domestic manufacturers that have greater
resources than the Company and are parts of large, diversified companies. Sun
Coast competes with several major corporations in the highly competitive
closures market, many of which have greater resources than the Company and are
parts of large, diversified companies. See "Business -- Competition."

6
<PAGE> 9

USE OF PROCEEDS

The net proceeds to the Company from the sale of the 1,500,000 shares of
Common Stock offered by the Company hereby (assuming an offering price of $14.00
per share) are estimated to be approximately $19,490,000 ($22,451,000, if the
Underwriters' over-allotment option is exercised in full), after deducting the
underwriting discount and estimated offering expenses payable by the Company.

The Company intends to use the net proceeds to (i) repay the outstanding
balance under its revolving credit facility, which amounted to approximately
$11.8 million at February 28, 1995 and (ii) reduce by approximately $7.7 million
the outstanding balance under its capital expenditure loan, which amounted to
approximately $8.3 million at February 28, 1995. The Company has used these
facilities, together with a term loan (the outstanding balance of which amounted
to approximately $3.8 million at February 28, 1995), to finance expansion. The
revolving credit facility bears interest at the lender's offshore rate, which,
at February 28, 1995, was approximately 9.0% per annum. Amounts outstanding
under the revolving credit facility are due on October 31, 1996, with interest
due on the same date. The term loan and capital expenditure loans mature April
1, 2001 and April 1, 2000, respectively, and bear interest at the lender's
reference rate, which, at February 28, 1995, was approximately 9.0% per annum.

Following the closing of this offering, the Company intends to enter into a
new credit facility, pursuant to a commitment letter dated February 7, 1995. The
new facility will provide up to $35 million of revolving loans for working
capital and general corporate purposes. The Company may use up to $4.4 million
of borrowings under the new facility (assuming the offering contemplated hereby
has been consummated and the proceeds applied as described above) to repay in
full the remaining unpaid balance under its existing capital expenditure loan
and term loan. The Company plans to use the remaining borrowings under the new
facility for working capital, capital improvements to its manufacturing
operations and potential acquisitions. See "Management's Discussion and Analysis
of Financial Condition and Results of Operations -- Liquidity and Capital
Resources."

7
<PAGE> 10

PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY

Since November 3, 1993, the Common Stock of the Company has been listed on
the New York Stock Exchange under the symbol SN. Prior to that date, the Common
Stock was listed on the NASDAQ National Market System. The following table sets
forth, for the periods indicated, the high and low sales prices per share of the
Common Stock.

<TABLE>
<CAPTION>
HIGH LOW
------ ------
<S> <C> <C>
FISCAL 1993
First Quarter.................................................... $ 6.38 $ 5.00
Second Quarter................................................... 8.13 4.75
Third Quarter.................................................... 11.88 7.75
Fourth Quarter................................................... 11.75 9.50
FISCAL 1994
First Quarter.................................................... $14.38 $ 9.25
Second Quarter................................................... 10.75 7.75
Third Quarter.................................................... 13.88 8.25
Fourth Quarter................................................... 14.75 12.50
FISCAL 1995
First Quarter.................................................... $14.88 $11.75
Second Quarter................................................... 17.00 13.63
Third Quarter (through March 7, 1995)............................ 15.63 13.13
</TABLE>

On March 7, 1995, the closing sale price of the Common Stock was $14.00 per
share. At February 15, 1995, there were approximately 2,600 record holders of
the Common Stock.

The Company has never declared or paid cash dividends on the Common Stock.
Management intends to retain any future earnings for the operation and expansion
of the Company's business and does not anticipate paying any cash dividends in
the foreseeable future. The Company's existing credit facility restricts, and
its new credit facility will restrict, the Company's ability to pay dividends.
See Note 5 of Notes to the Consolidated Financial Statements.

8
<PAGE> 11

CAPITALIZATION

The following table sets forth the current portion of long-term debt and
the capitalization of the Company at December 31, 1994 and as adjusted for the
sale by the Company of 1,500,000 shares of Common Stock offered hereby and the
application of the estimated net proceeds therefrom as described under "Use of
Proceeds."

<TABLE>
<CAPTION>
DECEMBER 31, 1994
--------------------------
ACTUAL AS ADJUSTED(1)
------- --------------
(DOLLARS IN THOUSANDS)
<S> <C> <C>
Current portion of long-term debt................................... $ 1,500 $ 233
======= ========
Long-term debt:
Revolving credit.................................................. 11,633 --
Capital expenditure loan.......................................... 6,603 13
Term loan......................................................... 3,600 3,600
Industrial development revenue bonds.............................. 2,250 2,250
Other............................................................. 301 301
------- --------
Total long-term debt...................................... 24,387 6,164
Stockholders' equity:
Common stock, par value $.01 per share: 40,000,000 shares
authorized; 4,005,429 shares issued and outstanding; 5,505,429
shares issued and outstanding, as adjusted(2).................. 40 55
Additional paid-in capital........................................ 11,299 30,774
Retained earnings................................................. 6,498 6,498
------- --------
Total stockholders' equity................................ 17,837 37,327
------- --------
Total capitalization...................................... $42,224 $ 43,491
======= ========
</TABLE>

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

(1) As adjusted to reflect the sale in this offering of 1,500,000 shares of
Common Stock at an assumed offering price of $14.00 (the closing price of
the Common Stock on March 7, 1995) and the application of the estimated net
proceeds therefrom as described under "Use of Proceeds."

(2) Excludes 379,105 shares issuable upon exercise of employee stock options
outstanding at December 31, 1994 and 114,269 shares issuable upon exercise
of warrants held by PruSupply Capital Assets, Inc. See "Description of
Capital Stock -- The PruSupply Warrant and Certain Registration Rights."

9
<PAGE> 12

SELECTED CONSOLIDATED FINANCIAL DATA

The following selected financial data for the periods from July 1, 1989
until December 31, 1994 are derived from the consolidated financial statements
of the Company. The consolidated financial statements for the fiscal years ended
June 30, 1991, 1992, 1993 and 1994 have been audited by KPMG Peat Marwick LLP,
independent certified public accountants. The consolidated financial statements
for the fiscal year ended June 30, 1990 have been audited by other independent
certified public accountants. The following selected financial data for the six
months ended December 31, 1993 and 1994 were derived from the unaudited
historical consolidated financial statements of the Company which, in the
opinion of the Company's management, contain all adjustments, consisting only of
normal recurring adjustments, necessary for a fair presentation thereof. The
data should be read in conjunction with the Consolidated Financial Statements,
the related notes and the audit report, which refers to a change in the method
of accounting for income taxes in fiscal 1994, Management's Discussion and
Analysis of Financial Condition and Results of Operations and the other
financial information included herein.

<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
--------------------------------------------------- --------------------
1990 1991 1992 1993 1994 1993 1994
------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE SHEET DATA:
Working capital(2)............ $ 5,675 $ 4,825 $ 4,786 $ 5,837 $ 9,881 $ 5,378 $15,185
Total assets.................. 34,356 32,280 33,963 38,038 49,884 39,703 53,243
Long-term debt................ 18,400 16,861 13,275 12,930 19,730 12,213 24,387
Stockholders' equity(2)....... 3,745 4,856 8,528 12,171 15,708 13,218 17,837
</TABLE>

(2) Balances for fiscal 1993 and prior years have been restated for the adoption
of Financial Accounting Standard No. 109. See Note 6 of Notes to the
Consolidated Financial Statements.

(3) Per share data has been restated to reflect the one-for-five reverse stock
split effective January 2, 1992.

10
<PAGE> 13

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of the results of operations and financial
condition should be read in conjunction with the Consolidated Financial
Statements and Notes thereto included elsewhere in this Prospectus.

RESULTS OF OPERATIONS

The following table sets forth for the periods indicated items from the
consolidated statements of income as a percentage of sales:

<TABLE>
<CAPTION>
SIX MONTHS
ENDED
FISCAL YEAR ENDED JUNE 30, DECEMBER 31,
-------------------------- ---------------
1992 1993 1994 1993 1994
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Sales............................................ 100.0% 100.0% 100.0% 100.0% 100.0%
Costs and expenses:
Cost of sales.................................. 78.2 76.2 76.7 76.9 77.0
Selling, general and administrative............ 14.4 13.9 14.0 14.8 14.5
Interest, net.................................. 2.7 1.7 1.5 1.7 1.8
Restructuring charge........................... -- -- 0.9 1.9 --
----- ----- ----- ----- -----
95.3 91.8 93.1 95.3 93.3
----- ----- ----- ----- -----
Income before income taxes..................... 4.7 8.2 6.9 4.7 6.7
Provision for income taxes..................... 2.2 2.7 2.2 1.7 2.4
----- ----- ----- ----- -----
Net income............................. 2.5% 5.5% 4.7% 3.0% 4.3%
===== ===== ===== ===== =====
</TABLE>

Six Months Ended December 31, 1994 Compared to Six Months Ended December 31,
1993

Sales increased 27.5% to $43.6 million for the six months ended December
31, 1994 (the "fiscal 1995 period") from $34.2 million for the six months ended
December 31, 1993 (the "fiscal 1994 period"). Sales in the Chemical Division
increased 21.1% to $16.3 million in the fiscal 1995 period from $13.4 million in
the fiscal 1994 period, primarily as a result of increased market share due, the
Company believes, to superior service and high product quality. Sales in the
Consumer and Food Service Divisions increased 47.9% to $14.3 million in the
fiscal 1995 period from $9.7 million in the fiscal 1994 period, resulting from
expansion into new markets (principally children's dinnerware) as well as new
advertising and promotional campaigns and introduction of new products. Sales in
the Closures Division increased 17.4% to $13.0 million in the fiscal 1995 period
from $11.0 million in the fiscal 1994 period, resulting from the addition of new
products and customers.

Cost of sales as a percentage of sales increased to 77.0% for the fiscal
1995 period from 76.9% in the fiscal 1994 period. The slight decline in gross
margin was primarily the result of raw material price increases which were
partially offset by increased prices charged to customers and a change in
product mix resulting from the Company's expansion into the higher margin market
for children's dinnerware. While raw materials prices have increased in fiscal
1995 and may increase further during the year, the Company believes that its
implementation of numerous productivity improvements and cost containment
procedures in the manufacturing process together with price increases to
customers should continue to offset any additional raw material price increases.
See "Risk Factors -- Cost and Availability of Raw Materials."

Selling, general and administrative expense ("SG&A") increased 24.1% to
$6.3 million for the fiscal 1995 period from $5.1 million for the fiscal 1994
period due to increased sales volume, product development costs, research and
development expenditures and advertising campaigns. SG&A declined as a
percentage of sales to 14.5% in the fiscal 1995 period from 14.8% in the fiscal
1994 period.

Interest expense increased 37.8% to $799,000 for the fiscal 1995 period
from $580,000 for the fiscal 1994 period due to increased borrowings and higher
interest rates on outstanding loan amounts. The average

11
<PAGE> 14

borrowing during the fiscal 1995 period was $23.4 million compared to $14.2
million during the fiscal 1994 period.

Net income increased 79.9% to $1.9 million ($0.46 per share) for the fiscal
1995 period from $1.0 million ($0.26 per share) for the fiscal 1994 period as a
result of higher sales volumes and the other factors described above. In the
second quarter of fiscal 1994, the Company recorded a non-recurring
restructuring charge of $642,000 ($424,000, net of income taxes) which included
costs related to a reduction in the number of its employees by approximately 5%
and the consolidation of certain manufacturing and corporate functions such as
management information systems, insurance coverage and benefit programs.
Approximately $370,000 of the charge related to severance packages, related
legal services and outplacement services. Approximately $80,000 related to
consolidation of manufacturing operations and the remainder of the charge
related to non-recurring fees and costs incurred to outsource and consolidate
certain corporate functions. Cost savings of approximately $1.0 million are
anticipated annually as a result of this restructuring. However, these cost
savings have been and will likely continue to be offset by additional investment
in new product and market development and marketing efforts. Excluding the
restructuring charge, net income increased 28.1% in the 1995 period as compared
to the 1994 period. See Note 7 of Notes to the Consolidated Financial
Statements.

Fiscal Year Ended June 30, 1994 Compared to Fiscal Year Ended June 30, 1993

Sales increased 9.4% to $73.1 million in fiscal 1994 from $66.8 million in
fiscal 1993. This increase was attributable to volume increases and the
introduction of new products, primarily in the Closures Division for which sales
increased 22.6% to $23.2 million in fiscal 1994 from $19.0 million in the prior
year. The Closure Division's major new product introduction was its proprietary
closure for the growing "hot-fill" beverage market. The Chemical Division's
sales increased 8.3% to $28.7 million in fiscal 1994 from $26.5 million in
fiscal 1993 primarily as a result of increased market share due, the Company
believes, to superior service and high product quality. The Consumer and Food
Service Divisions experienced relatively flat revenue ($21.2 million and $21.3
million in fiscal 1994 and fiscal 1993, respectively) due to a sluggish retail
economy early in fiscal 1994 and the lack of strong marketing efforts or new
product development in prior years.

Cost of sales as a percent of sales increased to 76.7% in fiscal 1994 from
76.2% in fiscal 1993. The slight deterioration in gross margin was the result of
higher raw materials costs and expenses incurred in redesigning manufacturing
processes and material handling in the Chemical, Consumer and Food Service
Divisions' Dallas, Texas facility, which were only partially offset by certain
cost efficiencies due to increased sales volume.

SG&A increased 10.2% to $10.3 million in fiscal 1994 from $9.3 million in
fiscal 1993 due primarily to increases in advertising, research and development
and salaries. SG&A as a percentage of sales was 14.0% in fiscal 1994 and 13.9%
in fiscal 1993.

Interest expense decreased slightly to $1,124,000 in fiscal 1994 from
$1,152,000 in fiscal 1993 as a result of the Company's restructuring of its
credit facility which resulted in slightly lower interest rates. These rate
reductions were partially offset by increases in borrowings used to fund the
Company's growth. The average borrowings during fiscal 1994 were $14.2 million
compared to $11.9 million during fiscal 1993.

Net income decreased 5.9% to $3.4 million in fiscal 1994 from $3.6 million
in fiscal 1993. Certain non-recurring factors had the effect of reducing fiscal
1994 net income and increasing fiscal 1993 net income, thus masking the
operational improvements realized during fiscal 1994. The restructuring charge
incurred in the second quarter of fiscal 1994 decreased fiscal 1994 net income
by $424,000, net of tax ($0.11 per share). The retroactive restatement of
earnings pursuant to Financial Accounting Standard No. 109 ("FAS 109") resulted
in an increase to fiscal 1993 net income of $126,000 ($.03 per share). Without
these two non-recurring factors, net income for fiscal 1994 and 1993 would have
been $3.9 million and $3.5 million, respectively. This would have represented a
$333,000 or 9.5% increase in net income from fiscal 1993 to fiscal 1994.

12
<PAGE> 15

Fiscal Year Ended June 30, 1993 Compared to Fiscal Year Ended June 30, 1992

Sales increased 7.8% to $66.8 million in fiscal 1993 from $61.9 million in
fiscal 1992 as a result of increased volume in fiscal 1993. Sales in the
Chemical Division increased 11.8% to $26.5 million in fiscal 1993 from $23.7
million in fiscal 1992 as a result of market share improvement. Sales in the
Closures Division increased 12.6% to $19.0 million in fiscal 1993 from $16.9
million in fiscal 1992 and were favorably impacted by the addition of new
products and customers. Sales in the Consumer and Food Service Divisions
remained relatively stable due to a continued slow retail economy and a prior
year non-recurring customer promotional campaign.

Cost of sales as a percent of sales decreased to 76.2% in fiscal 1993 from
78.2% in fiscal 1992. This improvement in gross margin was primarily the result
of stable raw material prices and increasing sales in fiscal 1993 as compared to
fiscal 1992.

SG&A increased 4.4% to $9.3 million in fiscal 1993 from $8.9 million in
fiscal 1992 primarily due to increases in salaries. SG&A as a percentage of
sales decreased to 13.9% in fiscal 1993 from 14.4% in fiscal 1992.

Interest expense decreased 32.6% to $1.2 million in fiscal 1993 from $1.7
million in fiscal 1992 primarily as a result of debt retirements and lower
average interest rates.

Net income increased 130.9% to $3.6 million in fiscal 1993 from $1.6
million in fiscal 1992. Both years' net income was affected by the retroactive
restatement of earnings for the effect of FAS 109. Fiscal 1993 net income was
increased $126,000 and fiscal 1992 net income was decreased $740,000 for this
restatement. Prior to the adoption of FAS 109, net income for fiscal 1993 and
fiscal 1992 was approximately $3.5 million and $2.3 million, respectively.
Factors contributing to improved net income included slightly higher gross
margins and reduced interest expense.

QUARTERLY RESULTS

The following table sets forth selected quarterly financial information.
This information is derived from unaudited consolidated financial statements
that include, in the opinion of management, all normal and recurring adjustments
that are necessary for a fair statement of the results for such periods. The
operating results for any quarter are not necessarily indicative of results for
any future period.

Although the Company believes that its business is not significantly
seasonal, sales in the second quarter of its fiscal year have historically been
lower than other quarters, with sales in the third and fourth quarters higher
due to higher sales of dinnerware and drinkware during the spring and summer
seasons.

<TABLE>
<CAPTION>
FISCAL 1993 FISCAL 1994 FISCAL 1995
------------------------------------- --------------------------------------- -----------------
1ST 2ND 3RD 4TH 1ST 2ND 3RD 4TH 1ST 2ND
QUARTER QUARTER QUARTER QUARTER QUARTER QUARTER QUARTER QUARTER QUARTER QUARTER
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Sales...................... $16,706 $15,899 $16,880 $17,321 $17,261 $16,912 $18,875 $20,054 $22,289 $21,290
Costs and expenses:
Cost of sales............ 12,804 12,223 12,797 13,105 13,338 12,936 14,230 15,569 16,962 16,596
Selling, general and
administrative......... 2,401 2,341 2,436 2,132 2,506 2,559 2,657 2,538 3,283 3,002
Interest, net............ 305 292 271 283 287 293 232 312 385 414
Restructuring
charge(1).............. -- -- -- -- -- 642 -- -- -- --
------- ------- ------- ------- ------- ------- ------- ------- ------ -------
15,510 14,856 15,504 15,520 16,131 16,430 17,119 18,419 20,630 20,012
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Income before income
taxes.................. 1,196 1,043 1,376 1,801 1,130 482 1,756 1,635 1,659 1,278
Provision for income
taxes(2)................. 466 334 432 541 393 172 659 353 634 419
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net income(2).............. $ 730 $ 709 $ 944 $ 1,260 $ 737 $ 310 $ 1,097 $ 1,282 $ 1,025 $ 859
======= ======= ======= ======= ======= ======= ======= ======= ======= =======
Net income per common
share(2)................. $ .18 $ .18 $ .24 $ .32 $ .19 $ .08 (1) $ .28 $ .30 $ .25 $ .21
======= ======= ======= ======= ======= ======= ======= ======= ======= =======
</TABLE>

13
<PAGE> 16

recurring restructuring charge, the Company would have reported net income
per common share of $.19 for the quarter ended December 31, 1993. See Note 7
of Notes to the Consolidated Financial Statements.

(2) Balances for fiscal 1993 have been restated for the adoption of FAS 109. See
Note 6 of Notes to the Consolidated Financial Statements.

LIQUIDITY AND CAPITAL RESOURCES

Management reviews the Company's working capital, accounts receivable and
relationship of debt to equity on a continuing basis. The Company's growth has
been financed through cash generated from operations and long-term debt
financing. During fiscal 1994 the Company generated cash flow from operations of
$4.0 million and increased net borrowings by an additional $5.5 million. In the
first six months of fiscal 1995, the Company used $1.1 million of cash flow from
operations and increased net borrowings by $4.7 million. The Company invested
$1.8 million in accounts receivable and $2.3 million in inventory during fiscal
1994, primarily because of increased sales levels and the financial support
necessary for higher backlog. Working capital increased $4.0 million from fiscal
1993 to fiscal 1994.

Capital expenditures for fiscal 1994 were $9.0 million, of which $3.4
million was used to purchase new machinery, equipment and tooling to support
incremental sales growth in the Closures Division, $3.3 million was used to
improve productivity and reduce manufacturing costs in the Chemical and Consumer
Products Divisions and approximately $500,000 was spent on tooling in these
divisions.

The Company's negative cash flow from operations of $1.1 million during the
first six months of fiscal 1995 primarily resulted from an increase in accounts
receivable of $600,000, additional investment in inventory of $2.2 million and a
reduction in payables and accrued expenses of $3.3 million, all of which are
related to the significant growth in sales and advance purchases of inventory to
offset raw material price increases. As a result, working capital increased by
$5.3 million between June 30, 1994 and December 31, 1994. Working capital
requirements may increase further in fiscal 1995 to the extent that sales
continue to increase.

Capital expenditures for the six months ended December 31, 1994 were $4.4
million and are expected to be approximately $8 to $10 million for all of fiscal
1995. These expenditures relate primarily to expanding capacity to meet
increased sales demand and implementing productivity improvements.

To finance capital expenditure activity and increased working capital
requirements, the Company borrowed an additional $4.7 million under its credit
facility during the six months ended December 31, 1994. Substantially all of the
capital expenditures are discretionary and have been funded primarily from
borrowings under the Company's credit facility.

At December 31, 1994, the Company had cash equivalents of $1.2 million and
working capital of $15.2 million. In addition, the Company had long-term debt
outstanding of $25.9 million (including current portion), with a weighted
average interest rate at December 31, 1994 of 7.7%.

The Company's existing credit facility of $27.0 million is secured by
substantially all the assets of the Company. The facility provides for
borrowings under three separate note arrangements -- (i) a $4.0 million term
loan payable in quarterly installments through April 1, 2001, (ii) a $10.0
million capital expenditure term loan payable in quarterly installments through
April 1, 2000, and (iii) a $13.0 million revolving loan. As of December 31,
1994, outstanding borrowings under the credit facility included $3.9 million
under the term loan, $7.6 million under the capital expenditure term loan, and
$11.6 million under the revolving credit line. At December 31, 1994, incremental
borrowing availability under the credit facility was approximately $2.4 million
under the capital expenditure term loan and $1.4 million under the revolving
credit line. In addition, the credit facility provides for the issuance of up to
$2.0 million of letters of credit, subject to the borrowing availability under
the revolving credit line.

Subject to the closing of this offering, the Company intends to enter into
a new credit facility pursuant to a commitment letter dated February 3, 1995.
The new facility would be unsecured and would provide a revolving line of credit
in the amount of $25.0 million to finance growth and working capital needs,
capital

14
<PAGE> 17

expenditures and acquisitions. The Company may use up to $4.4 million of
borrowings under the new facility (assuming the offering contemplated hereby has
been consummated and the proceeds applied as described in "Use of Proceeds") to
repay in full the balance under its existing credit facility not repaid from the
net proceeds from this offering. See "Use of Proceeds."

The Company believes that the net proceeds of this offering, borrowings
under the Company's new credit facility and cash flows from operations will be
adequate to fund operations and expansion through fiscal 1997. Although the
Company has no present definitive acquisition agreements, the Company's growth
strategy includes strategic acquisitions using stock, cash, debt or a
combination thereof. Depending on the terms of the acquisition, the Company may
need to incur additional indebtedness or issue additional equity securities to
make any such acquisition.

INFLATION

The effect of inflation on operating costs has been minimal in recent
years. However, the cost of raw materials used in the Company's operations
increased significantly during the first six months of fiscal 1995, with a
higher rate of increase in the second quarter. The most dramatic change was in
the price of formaldehyde due to a world-wide shortage of methanol, a key
component of formaldehyde. The Company's average purchase price for formaldehyde
and other raw materials stabilized in early January 1995. The Company has
generally been able to increase prices to cover cost increases, although its
ability to do so in the future may be limited by competitive or other factors.
See "Risk Factors -- Cost and Availability of Raw Materials." The effect of
inflation-driven costs on the Company's overall operating costs is not expected
to be greater for the Company than its competitors in fiscal 1995.

15
<PAGE> 18

BUSINESS

GENERAL

Sun Coast manufactures and sells melamine and urea resins and compounds
and, from these and other materials, molds consumer and commercial plastic
products, including dinnerware, drinkware and closures. Sun Coast's five
divisions have leveraged similar manufacturing processes, combined purchasing of
raw materials and developed proprietary technologies, enabling the Company to
realize manufacturing efficiencies and a significant presence in markets for
several of its products. The Chemical Division manufactures melamine and urea
resins and compounds, which it supplies to other manufacturers and uses in
producing its own consumer and food service products. The Consumer and Food
Service Divisions manufacture compression molded melamine dinnerware and
injection molded plastic drinkware, which Sun Coast sells to retail and
commercial markets. The Closures Division manufactures linerless, foil or foam
lined and tamper-evident plastic closures and lids. These closures are used in
the bottling and packaging of food, beverage, chemical and pharmaceutical
products. The Custom Laminates Division is a start-up division employing Sun
Coast's proprietary process that permits lamination of images in a range of
design, color and detail that management believes is much broader than other
existing processes. The Company has begun marketing the process for use in
children's furniture and kitchen and bath counters and backsplashes and
commercial fixtures.

In early 1993, the Company underwent a change in senior management. By
implementing marketing, operational and strategic changes, the new management
team believes it has positioned Sun Coast for growth. Sun Coast has undertaken
new marketing and product development efforts; invested in equipment and
processes to enhance operating efficiency and increase production capacity;
consolidated corporate functions; and begun upgrading its management information
systems.

STRATEGY

Sun Coast's objective is to be a market leading, high quality manufacturer
of melamine and urea resins and compounds and related molded plastic products.
The key elements of the Company's strategy for achieving this objective are
noted below.

Product and Process Innovation. Sun Coast seeks to use its plastic molding
and chemical manufacturing expertise to develop new products made from materials
and processes similar to those used to manufacture its current products.
Employing its plastic molding expertise and its knowledge of the dinnerware
market, the Company began manufacturing and selling licensed children's
dinnerware in fiscal 1994. Using the same molding expertise, Sun Coast is also
developing a line of bed and bath products. Employing its chemical manufacturing
expertise, the Company developed the proprietary process now used by the Custom
Laminates Division. The first application of this process has been for tabletops
in McDonald's restaurants. Sun Coast has begun marketing the custom laminate
process for use in children's furniture, kitchen and bath counters and
backsplashes and commercial fixtures. Sun Coast is also developing decorative
tiles for counters, backsplashes and floors that would be compression molded
from melamine in the same way Sun Coast now molds dinnerware. Further, the
Company is exploring production within the Chemical Division's existing facility
of specialty melamine and urea resins for industrial applications that the
Company presently does not manufacture. In addition to the internal development
of new products, the Company will consider acquisitions of complementary product
manufacturers.

Refinement of Manufacturing Operations. Sun Coast believes that many of
its customers select the Company because of its ability to consistently meet
their specifications for product quality and delivery. The bulk of the products
manufactured by the Chemical and Closures Divisions are sold to customers with
large scale manufacturing operations that function optimally with consistent,
high quality supplies of materials. The Company continually seeks to develop and
implement manufacturing refinements to more closely monitor product consistency
and quality. For example, the Closures Division has developed proprietary
electronic gauges that provide significantly closer tolerances (up to .0001 of
an inch) for closure dimensions than mechanical gauges used by many other
closure manufacturers. With this greater accuracy, the Company maintains
statistical process control that minimizes product variation. Also critical to
this process control is

16
<PAGE> 19

the Closures Division's physical measurement and verification of every dimension
of each new steel mold. Sun Coast has refined manufacturing operations not only
to enhance product quality, but also to reduce costs and increase efficiency. In
its Chemical, Consumer and Food Services Divisions, the Company has implemented
a compensation system which incentivizes its hourly employees to increase
throughput and reduce cycle times and scrap. The Chemical Division has also
installed a bulk handling system for raw materials to facilitate purchasing
economies and increase handling efficiency.

Customer Service. The Company provides a high level of service to its
customers, maintaining close and frequent communication in order to better
identify, understand and meet their needs. Sun Coast's detailed understanding of
the operations and business of its customers is critical to maintaining
relationships with those customers. The Chemical and Closures Divisions provide
their customers with product design and technical assistance as well as in-depth
on-site training. The Consumer and Food Service Divisions provide their
customers with detailed marketing assistance.

Aggressive Marketing. During the past two fiscal years, Sun Coast's
management team has taken steps to strengthen its sales staff and has
significantly increased the Company's marketing budget. The Company has
increased its attendance at trade shows and its purchase of advertising space in
industry publications. The sales staff is also pursuing larger customer accounts
and customers that are in industries or markets not previously served by the
Company. Senior management of Sun Coast has also become more actively involved
in the pursuit of new business opportunities. In fiscal 1994, the Company began
promoting a uniform "Sun Coast" brand identity for all its products to increase
awareness of the Company's name and array of products.

CHEMICAL DIVISION

Sun Coast manufactures melamine and urea resins and molding compounds at
its facilities in Dallas, Texas, and Murfreesboro, Tennessee. Sun Coast believes
that its proprietary formulations and technical expertise enable it to provide
consistently high quality chemical products. The Company sells these products
directly to its customers, which use them as raw materials in their own
manufacturing processes. In the first six months of fiscal 1995 and in fiscal
1994, the Chemical Division's sales were $16.3 million and $28.7 million, or
37.3% and 39.2%, of the Company's sales, respectively.

Melamine resists scratching, breaking and chipping; it also resists grease
and weak acid; and it is odorless and easy to clean. Urea is similar in nature
but less expensive to produce and less durable than melamine. Sun Coast uses its
own melamine compounds to manufacture dinnerware and it supplies melamine
compounds to other manufacturers of dinnerware and consumer products. Sun Coast
is also the leading supplier of melamine resin to manufacturers of decorative
laminate, which is used for countertops and tabletops and other furniture and
fixture surfaces. The Company supplies substantially all the melamine resin used
by Ralph Wilson, the largest U.S. manufacturer of laminate. Sun Coast is a
leading supplier of urea and melamine molding compounds to U.S. manufacturers of
electrical outlet and switch plates. These manufacturers include Eagle Plastics,
Leviton Manufacturing and General Electric.

Melamine resin is made principally from melamine crystals, formaldehyde and
water which are combined in a heated reactor. Urea resin is made using a similar
process with the same raw materials, with the substitution of urea crystals for
melamine crystals. Molding compounds are made from melamine or urea resin and
purified cellulose fillers, pigments, plasticizers and curing agents. These
materials are combined in a wet mixture, dried and ground to a fine powder. In
January 1995, the Company added equipment at its Dallas facility that has
increased its annual capacity to produce melamine and urea compounds by
approximately 20%.

There are three other major U.S. suppliers of melamine and urea molding
compounds similar to those supplied by the Company and many major suppliers of
melamine and urea resins. Some of these suppliers have greater resources than
the Company and are parts of large, diversified companies. In this highly
competitive market, the Company competes on the basis of product quality,
customer service and price.

17
<PAGE> 20

CONSUMER DIVISION

Sun Coast manufactures and, through Company and independent sales
representatives, markets melamine dinnerware and injection molded plastic
drinkware and housewares to retail distribution channels. In fiscal 1994, the
Company entered the market for licensed children's products. These products
include dinnerware, flatware and drinkware decorated with popular children's
characters, including Saban Entertainment's Mighty Morphin Power RangersTM, the
syndicated children's show. Crayola(C) brand, as well as Tiny Toons Adventures
and Animaniacs* licensed characters from Warner Bros., are among other new
licenses featured on licensed dinnerware and related products. The Company has
also recently begun to market imported plastic dinnerware and drinkware. Sun
Coast sells its consumer products to Target, Venture, Toys "R" Us, Wal-Mart,
Dillard's and other retailers. In the first six months of fiscal 1995 and in
fiscal 1994, the combined sales of the Consumer and Food Service Divisions were
$14.3 million and $21.2 million, or 32.9% and 29.0%, of the Company's sales,
respectively.

Melamine dinnerware is considered the top-of-the-line plastic dinnerware.
It is harder than other plastic dinnerware and generally more durable than most
other dinnerware, including that made of china, pottery, glass and other
plastics. Sun Coast offers melamine dinnerware in designer styles and colors
that enhance product demand. The Company compression molds melamine dinnerware
from its own molding compounds at its Dallas, Texas facility. After an initial
softening period, permitting the compound to flow through the mold, the compound
undergoes a chemical reaction and converts to a hard, infusible and insoluble
form. After a short curing period, the product is removed from the mold,
finished, inspected and packaged.

Sun Coast also manufactures and distributes injection molded drinkware and
other household products, using high speed injection molds and machinery.
Injection molded resins, such as styrene, SAN, polypropylene and polyethylene,
are molded under heat and pressure and cooled to form the desired shape. Sun
Coast's primary market is the United States with minor sales to Canada and
Mexico.

The broad dinnerware and housewares market includes disposables, china and
pottery, glass and permanent plastic. Across all these categories, there are
many manufacturers in the U.S. and abroad that have greater resources than the
Company and are parts of large, diversified companies. However, the Company is
aware of only three principal U.S. competitors that manufacture melamine
dinnerware and believes that it has one of the largest market shares. In this
highly competitive market, the Company competes on the basis of product quality,
price and customer service.

Sun Coast believes that its current emphasis on product innovation, design
and customer service provides opportunities for growth in its current and new
consumer product markets.

FOOD SERVICE DIVISION

Sun Coast manufactures and sells melamine dinnerware and injection molded
plastic drinkware to the restaurant and hotel market. The Food Service Division
is operated at the Company's Dallas, Texas and Murfreesboro, Tennessee
facilities. Sun Coast sells these products directly and through distributors and
independent representatives. Pizza Hut, Grandy's and Boston Chicken are among
Sun Coast's restaurant customers. The Company also sells these products, and
insulated meal distribution systems, directly to schools, hospitals, nursing
homes and correctional facilities.

Melamine's durability and other physical qualities make it attractive and
cost effective for use in commercial and institutional settings, where heavy use
and breakage are common. Moreover, the ability to incorporate decorative and
customized colors, designs and logos in melamine dinnerware also contribute to
demand in these markets.

Sun Coast markets its melamine dinnerware and drinkware products to
restaurants and institutions as more durable substitutes for china and glass
products. The initial purchase premium of melamine dinnerware

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

*ANIMANIACS and TINY TOONS ADVENTURES, characters, names, and all related
indicia are trademarks of Warner Bros.(C) 1994 Warner Bros.

18
<PAGE> 21

is usually offset within one year by the monthly expense reductions in breakage
and replacement of china dinnerware. Melamine dinnerware is also an
environmentally friendly alternative to disposables. With respect to food
service products, the Company faces many of the same competitive circumstances
noted above in connection with consumer products.

CLOSURES DIVISION

Sun Coast manufactures linerless, foil or foam lined and tamper-evident
plastic closures and lids. The Company markets these products directly, and
through distributors and sales representatives, to manufacturers of packaged
food, beverages, pharmaceuticals and chemicals. These plastic closures seal
food, beverage, pharmaceutical and chemical containers also made of plastic. The
Closures Division's customers include Clorox, Hunt-Wesson and Procter & Gamble.
In the first six months of fiscal 1995 and in fiscal 1994, sales of the Closures
Division were $13.0 million and $23.2 million, or 29.8% and 31.8%, of the
Company's sales, respectively.

Plastic closures are injection molded from polypropylene or polyethylene.
Key factors such as cycle time, the optimal number of mold cavities and the
quality of the mold are important in attaining production efficiency and cost
control. Sun Coast performs optional manufacturing operations, including
printing and closure lining, desired by some customers. Manufacturing operations
are conducted at the Company's Sarasota, Florida and Dallas, Texas facilities.
Sun Coast prototypes custom closures for the purpose of testing and qualifying
the closures for use with customers' products.

Plastic closures offer an advantage over metal ones, because metal closures
may chemically react with some foods. Plastic closures also allow the use of a
foil lined induction inner-seal for tamper evidence -- a feature metal closures
lack. Sun Coast's lined closures are used with a variety of food and beverage
products, including juices, sauces, dressings and peanut butter. The design of
the Company's Sun-Tab foil seal, widely used in peanut butter packaging,
incorporates a series of three small tabs that extend over the edge of the
container. The consumer grasps any one of the tabs to easily remove the entire
liner. Sun Coast owns several patents encompassing closure and tamper-evident
band designs as well as a patent on a plastic closure for hermetic, pressure or
vacuum sealing of glass or plastic bottles and jars.

The Company's Sun-Twist closure is used as a tamper-evident, easy-opening
seal for "hot-fill" beverages, including fruit juices, teas and isotonic sport
drinks. The "hot-fill" market is one of the fastest growing for the Closures
Division. This market has developed in connection with beverage packers'
replacement of glass bottles with polyethylene terephthalate ("PET") bottles,
which are highly attractive to consumers because they are lightweight and have
the clarity of glass. Packers began using PET bottles for multi-serve quantities
and are now extending the use of the bottles to single-serve quantities. The
Company anticipates that this extension to single-serve hot-fill packaging may
substantially broaden demand for hot-fill plastic closures.

Sun Coast competes with several major corporations in the highly
competitive closures market. The Company is a medium size manufacturer in this
industry and competes primarily on price, quality, delivery and service. The
Company believes that there is potential for further growth within the Closures
Division through adding new customers and products and continuing conversions
from metal to plastic closures among the Company's customers.

CUSTOM LAMINATES DIVISION

The Custom Laminates Division markets the products from a process developed
by Sun Coast that permits high pressure lamination of printed graphics in a
complete range of color, shading and detail. Management believes the process
achieves a visual quality not available through other existing methods, which
reproduce only basic patterns or simple images in a limited range of color and
without shading or detail. The competing method that offers the best graphic
quality is labor intensive and, consequently, slow and expensive. The first
application of Sun Coast's laminate process has been tabletops in McDonald's
restaurants. The Company is marketing the process for use in children's
furnishings and products, kitchen and bath counters and backsplashes and
commercial fixtures. The Custom Laminates Division began operations in the
fourth quarter of fiscal 1994 and has not generated significant sales to date.

19
<PAGE> 22

HISTORICAL BACKLOG

The Company's backlog is comprised of written purchase orders and
contracts, substantially all of which are cancelable on short -- generally 30
days' -- notice. There is no assurance that some portion of the backlog may not
be cancelled or that the level of backlog at any particular time is an
appropriate indicator of the future operating performance of the Company.

Backlog for products of the Chemical Division increased 81.4% to $2.7
million at December 31, 1994 from $1.5 million at December 31, 1993. This
increase reflects increased market share, which management attributes to the
consistency of the Chemical Division's product quality and its level of customer
service.

Backlog for products of the Consumer and Food Service Divisions increased
13.2% to $902,000 at December 31, 1994 from $797,000 at December 31, 1993. This
increase reflects management's recent sales and marketing efforts and the
introduction of new products. In December 1993, the Company had no licensed
children's dinnerware products. Backlog for these products at December 31, 1994
was approximately $500,000.

Backlog for products of the Closures Division increased 8.1% to $48.1
million at December 31, 1994 from $44.5 million at December 31, 1993. This
increase reflects new customers for "hot-fill" products, new customers for
existing products and existing customers renewing expiring long-term agreements.

In the Chemical, Consumer and Food Service Divisions, orders are generally
shipped within 30 to 60 days of receipt. In the Closures Division, orders are
based primarily on customers' annual estimated needs. Other orders are for
specific quantities and some are multi-year. Customer commitments require
delivery of a quantity of closures per month for a specific number of months,
with seasonal variations. These commitments are generally subject to
cancellation at the discretion of the customer on 30 days' notice to the
Company; however, longer term contracts do include cancellation penalties.
Customer written purchase orders for specific quantities are generally filled as
received, either out of inventory or current production.

MAJOR CUSTOMERS

The Company frequently bids for large contracts for its chemical products
and any such bid, if successful, may result in one customer accounting for more
than 10% of the Company's sales in a given fiscal year. In the first six months
of fiscal 1995 and in fiscal 1994, 1993 and 1992, sales of chemical products to
Ralph Wilson accounted for approximately $5.9 million or 13.5%, $10.6 million or
14.6%, $10.5 million or 15.7%, and $11.4 million or 18.4%, respectively, of Sun
Coast's sales. In the first six months of fiscal 1995, and in fiscal 1994 and
1993, sales of chemical products to Eagle Plastics accounted for approximately
$4.9 million or 11.3%, $8.4 million or 11.5%, and $7.0 million or 10.5%, of the
Company's sales, but were less than 10% of sales in fiscal 1992.

The Company has sold chemical products to Ralph Wilson for more than 20
years on the basis, the Company believes, of quality, service, delivery and
price. Ralph Wilson and Eagle Plastics buy through purchase orders issued
periodically, which can be discontinued at any time. Management believes that
the Company has a good relationship with both Ralph Wilson and Eagle Plastics,
however, the loss of either of these customers or a significant portion of its
business, could adversely affect the business and financial condition of the
Company. See Note 10 of Notes to the Consolidated Financial Statements and "Risk
Factors -- Reliance on Certain Customers."

RESEARCH AND DEVELOPMENT

The Company has research and development laboratories at its principal
manufacturing facilities in Texas and Florida, where it continuously tests its
products and endeavors to develop new products to complement those presently
offered. The Company employs five people in research and development, three of
whom are chemists. Research and development expenditures for the first six
months of fiscal 1995 and fiscal 1994, 1993 and 1992 were $429,000, $731,000,
$514,000 and $474,000, respectively.

20
<PAGE> 23

RAW MATERIALS

The principal raw materials used by the Company in manufacturing plastic
products and compounds are melamine crystals, urea crystals, styrene
acrylonitrile, polypropylene and polyethylene resins, formaldehyde, cellulose
fillers, pigments, plasticizers, curing agents and lining material. These
materials historically have been available in sufficient quantities for the
Company's needs.

Although the cost of raw materials used in the Company's operations has
been relatively stable in the recent years, their prices increased significantly
during the first six months of fiscal 1995, with a higher rate of increase in
the second quarter. The most dramatic change was in the price of formaldehyde
due to a world-wide shortage of methanol, a key component of formaldehyde. The
Company's average purchase price for formaldehyde and other raw materials
stabilized in early January 1995. The Company has generally been able to
increase prices to cover cost increases, although its ability to do so in the
future may be limited by competitive or other factors. See "Risk Factors -- Cost
and Availability of Raw Materials."

EMPLOYEES

At December 31, 1994 Sun Coast had 690 employees, of whom 158 are office or
clerical and 532 hourly manufacturing. The Union is the exclusive collective
bargaining agent for the approximately 380 hourly manufacturing employees at the
Company's Dallas, Texas facilities pursuant to a three-year union contract which
expires on March 31, 1995. See "Risk Factors -- Union Contract." None of the
Company's 132 hourly employees at its Sarasota, Florida facility or the 17
hourly employees at its Murfreesboro, Tennessee facility is represented by a
labor union. Management believes that it has a good relationship with its
employees.

PROPERTIES

The Company owns a 72,000 square foot office, manufacturing and warehouse
building in Sarasota, Florida and two facilities in Dallas, Texas -- one
consisting of a 348,000 square foot office and manufacturing building and a
75,000 square foot warehouse and the other consisting of a 60,000 square foot
manufacturing building. At the Florida facility and at the 60,000 square foot
Texas facility, the Company manufactures closures. At the larger Texas facility,
the Company manufactures melamine and plastic injection molded consumer and food
service products and chemical products. Both Texas facilities secure the
Company's existing indebtedness. The Company also leases a 40,000 square foot
warehouse in Sarasota. In Murfreesboro, Tennessee, the Company leases
approximately 20,000 square feet under a lease expiring in February 1999, with
five one year options to extend the lease. At the Tennessee facility, the
Company manufactures chemical products and meal distribution and temperature
maintenance systems. The Company believes that its properties are adequate for
current uses.

LEGAL PROCEEDINGS

The Company is a defendant in certain legal proceedings that management
regards as normal to its business. The Company was recently successful in
obtaining a temporary injunction order in a Texas state court against the former
vice president of research and development directing him to refrain from
disclosing trade secrets and other confidential information of the Company. A
trial on a permanent injunction is set for May 1995. The Company plans to amend
its pleadings in this matter to further include a request for a declaratory
judgment as to its ownership of an application for a patent on the laminating
process employed by its Custom Laminates Division. In the opinion of management,
the ultimate outcome of the legal proceedings to which the Company is a party
will not materially affect its financial position or the results of its
operations.

21
<PAGE> 24

MANAGEMENT

Information regarding Sun Coast's directors and executive officers
including their respective ages at March 7, 1995, is set forth below.

<TABLE>
<CAPTION>
NAME AGE POSITION WITH COMPANY
---- --- ---------------------
<S> <C> <C>
Stephen P. Smiley......................... 46 Chairman of the Board of Directors
R. Carter Pate............................ 40 President, Chief Executive Officer and Director
Arno F. Pirkau............................ 52 Executive Vice President and Director
Cynthia R. Morris......................... 40 Chief Financial Officer, Treasurer and Secretary
James M. Hoak............................. 51 Director
James D. Ireland III...................... 44 Director
James H. Miller........................... 68 Director
James R. Parish........................... 48 Director
</TABLE>

Mr. Smiley was elected Chairman of the Board of Sun Coast in September
1992, having been a director since July 1992. Mr. Smiley is a co-founder of
Cypress Capital Corporation, a private investment firm, and has been its
President since 1991. Prior to founding Cypress Capital Corporation in 1991, Mr.
Smiley was most recently involved in venture capital and leveraged buyout
activities for Citicorp in Dallas, Texas. Mr. Smiley had been with Citicorp for
15 years, ten of which were spent in Dallas, where, in the mid-1980s, he was in
charge of the energy lending business. Mr. Smiley is also a director of
Parcelway System Holding Co., a privately-held company engaged in the courier
business.

Mr. Pate was elected President, Chief Executive Officer and a Director of
Sun Coast in April 1993. Mr. Pate was a founder of Pate, Winters & Stone, Inc.,
a management consulting firm headquartered in Dallas, and served as its
President from its inception in 1989 until joining Sun Coast in April 1993. In
addition, from January 1992 until April 1993, Mr. Pate was President and Chief
Executive Officer of Tidel Engineering, Inc., a manufacturer of cash and
environmental control systems. He has also served as Trustee of the Nelson
Bunker Hunt Liquidating Trust and Chief Executive Officer and Chief Financial
Officer for companies in retailing, manufacturing and oil and gas.

Mr. Pirkau is President and General Manager of the Closures Division. He is
a co-founder of Sun Coast. He has been a director since 1982 and has been Sun
Coast's Executive Vice President since 1988. From the Closures Division's
inception until 1988, he was its Vice President of Manufacturing. In 1988 he was
promoted to Executive Vice President. In 1991 he additionally became the
Closures Division's General Manager and in 1993 he was elected its President.

Ms. Morris was elected Sun Coast's Chief Financial Officer, Treasurer and
Secretary in September 1993. From July 1991 until September 1993 she was an
Audit Partner in the public accounting firm of Price Waterhouse, where she began
her career in 1980. Ms. Morris was the Partner-in-charge of the Mergers and
Acquisitions Group of Price Waterhouse in Dallas. At Price Waterhouse, she
served retail, franchising, manufacturing and distribution clients.

Mr. Hoak has been a director of Sun Coast since July 1992. He has been
Chairman of Heritage Media Corporation, a broadcasting and in-store marketing
company, since August 1987. Mr. Hoak is also Chairman and President of James M.
Hoak & Co., an investment and merchant bank. Mr. Hoak is a co-founder of Cypress
Capital Corporation, a private investment firm, and has been its Chairman since
its founding in 1991. Mr. Hoak also served as Chairman of Crown Media, Inc., a
cable television company, from February 1991 to January 1995. From 1971 to 1987,
Mr. Hoak served as President, Chief Executive Officer and director of Heritage
Communications, Inc., an operator of cable television systems, and from 1987 to
1990 he served as Chairman of the Board. Mr. Hoak is a director of Midwest
Resources, Inc., Pier I Imports, Inc., Airgas, Inc. and Texas Industries, Inc.

Mr. Ireland has been a director of Sun Coast since 1989. He has been a
managing director of Capital One Partners since January 1993 and is President of
Briseis Capital Corporation. Both are privately-held merchant banking and
advisory firms. Mr. Ireland is also Chairman of First Colorado Corporation, a
developer of natural

22
<PAGE> 25

resource projects and ranching properties. From 1986 to 1991, Mr. Ireland was
Chairman, and, from 1989 to 1991 President, of Olympia Broadcasting Corporation,
a broadcasting company which, in June 1990, filed a petition for protection
under Chapter XI of the Federal Bankruptcy Act. Mr. Ireland is also a director
of Cleveland-Cliffs, Inc., the largest North American producer of iron ore.

Mr. Miller retired in June 1992 as President of Sun Coast. He was elected a
director and Chief Operating Officer in 1988 and President in 1989. Mr. Miller
had been employed since 1950 by the company that today consists of the Chemical,
Consumer and Food Service Divisions and had served as its President and Chief
Executive Officer since 1983.

Mr. Parish has been a director of Sun Coast since August 1994. He has been
President and sole shareholder of Parish Partners, Inc., a privately-held
investment, merchant banking and advisory firm, since April 1991. Mr. Parish is
also a director of several privately-held firms, all primarily engaged in the
food service and/or hospitality business. From 1983 until 1991 Mr. Parish was
Executive Vice President, Chief Financial Officer, Treasurer and a Director of
Chili's, Inc. (now named Brinker International), a publicly-held restaurant
company. Mr. Parish held executive and financial positions with several
companies in the investment banking, commodity-processing, food and beverage,
and oil and gas industries prior to his employment by Brinker International.

CERTAIN INFORMATION REGARDING EXECUTIVE COMPENSATION

The following table summarizes the compensation during the past three years
of the Sun Coast executive officers whose compensation exceeded $100,000 during
the fiscal year ended June 30, 1994.

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
---------------
AWARDS
---------------
ANNUAL COMPENSATION SECURITIES
------------------------------------- UNDERLYING
OTHER ANNUAL OPTIONS ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION (NO. OF SHARES) COMPENSATION
- ----------------------------- ---- -------- ------- ------------ --------------- ------------
<S> <C> <C> <C> <C> <C> <C>
R. Carter Pate............... 1994 $200,000(3) $40,000 $7,200(1) 25,000 $ 763(2)
President and Chief Executive 1993 $ 35,000 $ -0- $1,200(1) 100,000 $ -0-
Officer of Sun Coast
Arno F. Pirkau............... 1994 $123,878 $51,458 $7,380(1) 10,000 $9,969(4)
Executive Vice President of 1993 $119,892 $47,895 $7,380(1) 5,000 $9,969(4)
Sun Coast and President of 1992 $115,801 $31,524 $7,380(1) -0- $8,714(4)
the Closures Division
Cynthia R. Morris............ 1994 $104,166 $24,000 $ -0- 60,000 $ 276(6)
Chief Financial Officer,
Treasurer and Secretary of
Sun Coast(5)
</TABLE>

- ---------------
(1) The Company pays Mr. Pate a $600 per month car allowance and leases a car
for Mr. Pirkau at $615 per month.

(2) For Mr. Pate, this amount consisted of Company contributions to a defined
contribution plan of $289 and term life insurance premiums of $474.

(3) Mr. Pate was elected President and Chief Executive Officer in April 1993 at
an annual salary of $200,000, with bonus provisions for achieving targeted
results.

(4) For Mr. Pirkau, these amounts consisted in fiscal years 1994, 1993 and 1992
of Company contributions to a defined contribution plan of $9,042, $9,042
and $7,905, respectively, and term life insurance premiums of $927, $927 and
$809, respectively.

(5) Ms. Morris was elected Chief Financial Officer, Secretary and Treasurer of
Sun Coast on September 1, 1993, at an annual salary of $125,000 with bonus
provisions for achieving financial and acquisition results.

(6) For Ms. Morris, this amount represents term life insurance premiums.

23
<PAGE> 26

PRINCIPAL STOCKHOLDERS

The following table sets forth certain information as of March 7, 1995, and
as adjusted to reflect the sale of the Common Stock offered by this Prospectus,
with respect to the beneficial ownership of the Company's outstanding Common
Stock by (i) each person known by the Company to own beneficially more than 5%
of the outstanding Common Stock, (ii) each of the directors and executive
officers of the Company and (iii) all directors and executive officers of the
Company as a group. Except as otherwise indicated, each stockholder shown in the
table has sole voting and investment power with respect to all shares listed as
beneficially owned by such stockholder.

<TABLE>
<CAPTION>
NUMBER OF PERCENTAGE PERCENTAGE
BENEFICIALLY OWNERSHIP PRIOR OWNERSHIP
NAME OWNED SHARES(1) TO OFFERING AFTER OFFERING
- ------------------------------------------------- --------------- --------------- --------------
<S> <C> <C> <C>
PRINCIPAL STOCKHOLDERS:

James M. Hoak(2)................................. 401,249 10.0% 7.3%
13355 Noel Road, Suite 1350
Dallas, Texas 75240

Pioneering Management Corporation(3)............. 329,800 8.2% 6.0%
60 State Street
Boston, Massachusetts 02114

DIRECTORS AND OFFICERS:
James M. Hoak(2)................................. 407,149 10.2% 7.4%
James D. Ireland III(4).......................... 61,238 1.5% 1.1%
James H. Miller(5)............................... 101,930 2.5% 1.8%
James R. Parish.................................. 3,978 * *
R. Carter Pate(6)................................ 30,400 * *
Arno F. Pirkau(7)................................ 114,628 2.8% 2.1%
Stephen P. Smiley(8)............................. 4,178 * *
Cynthia R. Morris(9)............................. 13,500 * *
All directors and executive officers
as a group (8 persons)(10)..................... 731,101 17.7% 13.0%
</TABLE>

- ---------------
* Indicates less than 1% of the outstanding shares of Common Stock.

(1) Pursuant to the rules of the Securities and Exchange Commission (the
"Commission"), certain shares of the Company's Common Stock which a
beneficial owner has the right to acquire within 60 days of the date hereof
pursuant to the exercise of stock options are deemed outstanding for the
purposes of computing the percentage ownership of such owner but are not
deemed outstanding for purposes of computing the percentage ownership of
any other person.

(2) Mr. Hoak is a director of the Company. Includes (i) 9,149 shares, of which
Mr. Hoak disclaims beneficial ownership, owned by his wife and (ii) 200
shares with respect to which Mr. Hoak has the right to acquire beneficial
ownership upon exercise of currently exercisable options.

(3) Beneficial ownership of such shares reported in a Schedule 13G filed by
Pioneering Management Corporation, a registered investment advisor, with
respect to its beneficial ownership of the Company's Common Stock.

(4) Includes (i) 1,989 shares, of which Mr. Ireland disclaims beneficial
ownership, owned by his wife, (ii) 1,990 shares held in a custodial account
for the benefit of his minor children and (iii) 200 shares with respect to
which Mr. Ireland has the right to acquire beneficial ownership upon
exercise of currently exercisable options.

(5) Includes 40,200 shares with respect to which Mr. Miller has the right to
acquire beneficial ownership upon exercise of currently exercisable
options.

24
<PAGE> 27

(6) Includes 20,000 shares with respect to which Mr. Pate has the right to
acquire beneficial ownership upon exercise of currently exercisable
options.

(7) Includes 60,200 shares with respect to which Mr. Pirkau has the right to
acquire beneficial ownership upon exercise of currently exercisable
options.

(8) Includes 200 shares with respect to which Mr. Smiley has the right to
acquire beneficial ownership upon exercise of currently exercisable
options.

(9) Includes 8,000 shares with respect to which Ms. Morris has the right to
acquire beneficial ownership upon exercise of currently exercisable
options.

(10) Includes 129,000 shares with respect to which such persons have the right
to acquire beneficial ownership upon exercise of currently exercisable
options.

DESCRIPTION OF CAPITAL STOCK

The authorized capital stock of the Company consists of 40,000,000 shares
of Common Stock, par value $.01 per share. As of the date of this Prospectus,
there were 4,005,629 shares of Common Stock issued and outstanding.

Holders of Common Stock have no preemptive rights to purchase or subscribe
for securities of the Company, and the Common Stock is not convertible or
subject to redemption by the Company. In the event of the dissolution of the
Company, holders of Common Stock are entitled to share ratably in all of the
assets of the Company remaining, if any, after satisfaction of the debts and
liabilities of the Company and any preferential rights of the holders of any
outstanding Preferred Stock. The outstanding shares of Common Stock, including
the shares of Common Stock offered by this Prospectus, are validly issued, fully
paid and non-assessable.

Holders of Common Stock are entitled to receive cash dividends when and as
declared by the Board of Directors of the Company out of funds legally available
therefor after payment of, or provision for, full dividends (on a cumulative
basis, if applicable) on any shares of Preferred Stock then outstanding. Future
policy with respect to dividends on the Common Stock will be determined by the
Board of Directors based upon conditions then existing, including the Company's
earnings and financial condition, capital requirements and other relevant facts.
See "Price Range of Common Stock and Dividend Policy."

VOTING

Holders of Common Stock are entitled to cast one vote for each share held
of record on matters submitted to a vote of the stockholders of the Company.
Shares of Common Stock do not have cumulative voting rights with respect to the
election of directors. Directors are elected by a plurality of the shares of
Common Stock represented at the meeting. Approval of any other matter that is
submitted to the stockholders requires the affirmative vote of the holders of a
majority of the shares of Common Stock represented at the meeting. The holders
of a majority of the shares entitled to vote shall constitute a quorum at
meetings of stockholders.

THE PRUSUPPLY WARRANT AND CERTAIN REGISTRATION RIGHTS

PruSupply Capital Assets, Inc. ("PruSupply"), an affiliate of The
Prudential Insurance Company of America, holds a Stock Subscription Warrant (the
"PruSupply Warrant") to purchase up to 114,269 shares of the Company's Common
Stock at an initial purchase price of $13.13 per share. The PruSupply Warrant
was originally issued in 1988 and is currently exercisable and will terminate,
if not previously exercised, on September 30, 2002. The PruSupply Warrant
contains provisions which afford PruSupply protection from dilution upon the
occurrence of certain events including stock splits, stock dividends, stock
reclassifications and combinations and certain issuances by the Company of
additional shares of Common Stock, which could include this offering.

25
<PAGE> 28

The PruSupply Warrant also provides for certain rights to the holder
thereof with respect to the registration under the Securities Act of 1933, as
amended (the "Securities Act"), of the shares of Common Stock subject to the
PruSupply Warrant. The holders of all of the Common Stock issued upon exercise
of the PruSupply Warrant may, subject to certain restrictions, require that the
Company use its best efforts to register for public resale all of such shares
requested to be registered under the Securities Act. In addition, if the Company
proposes to register any shares of its Common Stock under the Securities Act,
the holders of the shares so entitled to registration rights may require the
Company to include all or a portion of such shares in any such registration. All
fees, costs and expenses of such registrations (other than any underwriting
discounts or commissions relating to such shares) will be borne by the Company.
The Company's obligation to register shares is subject to certain conditions and
qualifications, including that the underwriter, if any, of any offering related
to such registration has the right, subject to certain conditions, to reduce the
number of such shares to be included in the registration. PruSupply has waived
its registration rights in connection with this offering.

LIMITATION OF DIRECTOR LIABILITY

The Certificate of Incorporation of the Company limits the liability of
directors of the Company (in their capacity as directors but not in their
capacity as officers) to the Company or its stockholders to the fullest extent
permitted by Delaware law. Specifically, a director of the Company will not be
personally liable for monetary damages for breach of a director's fiduciary duty
as a director, except for any matter in respect of which such director shall be
liable under Section 174 of Title 8 of the Delaware Code (relating to the
Delaware General Corporation Law) or any amendment thereto or successor
provision thereto or shall be liable by reason that, in addition to any and all
other requirements for such liability, he (i) shall have breached his duty of
loyalty to the corporation or its stockholders, (ii) shall not have acted in
good faith or, in failing to act, shall not have acted in good faith, (iii)
shall have acted in a manner involving intentional misconduct or a knowing
violation of law, or, in failing to act, shall have acted in a manner involving
intentional misconduct or a knowing violation of law, or (iv) shall have derived
an improper personal benefit.

ANTI-TAKEOVER PROVISIONS

The Company is subject to Section 203 of the Delaware General Corporation
Law which, subject to certain exceptions, prohibits a Delaware corporation from
engaging in a business combination (as defined therein) with an "interested
stockholder" (defined generally as any person who beneficially owns 15% or more
of the outstanding voting stock of the Company or any person affiliated with
such person) for a period of three years following the date that such
stockholder became an interested stockholder, unless (i) prior to such date the
board of directors of the corporation approved either the business combination
or the transaction which resulted in the stockholder becoming an interested
stockholder, or (ii) upon consummation of the transaction which resulted in the
stockholder becoming an interested stockholder, the interested stockholder owned
at least 85% of the voting stock of the corporation outstanding at the time the
transaction commenced, excluding for purposes of determining the number of
shares outstanding those shares owned (x) by persons who are directors and also
officers and (y) by employee stock plans in which the employee participants do
not have the right to determine confidentially whether shares held subject to
the plan will be tendered in a tender or exchange offer, or (iii) on or
subsequent to such date the business combination is approved by the board of
directors and authorized at an annual or special meeting of stockholders, and
not by written consent, by the affirmative vote of at least 66 2/3% of the
outstanding voting stock which is not owned by the interested stockholder.

TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar for the Common Stock is American Stock
Transfer, and its address is 40 Wall Street, New York, New York 10005.

26
<PAGE> 29

UNDERWRITING

Pursuant to the Underwriting Agreement, and subject to the terms and
conditions thereof, the Underwriters named below, acting through J.C. Bradford &
Co. and A.G. Edwards & Sons, Inc., as representatives of the several
underwriters (the "Representatives"), have agreed, severally, to purchase from
the Company the number of shares of Common Stock set forth opposite their
respective names.

<TABLE>
<CAPTION>
NUMBER
NAME OF UNDERWRITER OF SHARES
------------------- ---------
<S> <C>
J.C. Bradford & Co......................................................
A.G. Edwards & Sons, Inc................................................

---------
Total......................................................... 1,500,000
========
</TABLE>

In the Underwriting Agreement, the Underwriters have agreed, subject to the
terms and conditions therein set forth, to purchase all shares of Common Stock
offered hereby if any such shares are purchased.

The Company has been advised by the Representatives that the Underwriters
propose initially to offer the shares of Common Stock to the public at the
public offering price set forth on the cover page of this Prospectus and to
certain dealers at such price less a concession not in excess of $ per
share. The Underwriters may allow and such dealers may reallow a concession not
in excess of $ per share to certain other dealers. After the shares are
released for sale to the public, the offering price and such concessions may be
changed by the Underwriters. The Representatives have informed the Company that
the Underwriters do not intend to confirm sales to accounts over which they
exercise discretionary authority without such accounts' specific advance
consent.

The offering of shares of Common Stock is made for delivery when, as, and
if accepted by the Underwriters and subject to prior sale and to withdrawal,
cancellation or modification of the offer without notice. The Underwriters
reserve the right to reject any order for the purchase of the shares.

The Company has granted to the Underwriters an option, exercisable not
later than 30 days from the date of this Prospectus, to purchase up to an
additional 225,000 shares of Common Stock to cover over-allotments. To the
extent that the Underwriters exercise this option, each of the Underwriters will
have a firm commitment to purchase approximately the percentage thereof which
the number of shares of Common Stock to be purchased by it shown in the table
above bears to 1,500,000, and the Company will be obligated, pursuant to the
option, to sell such shares to the Underwriters. The Underwriters may exercise
such option only to cover over-allotments made in connection with the sale of
shares of the Common Stock offered hereby. If purchased, the Underwriters will
sell such additional shares on the same terms as those on which the 1,500,000
shares are being offered.

The Company and all executive officers and directors have agreed that they
will not, without the prior written consent of the Representatives, sell,
transfer, assign or otherwise dispose of any shares of the Common Stock or
options, warrants or rights to acquire Common Stock owned by them prior to the
expiration of 120 days from the date of this Prospectus.

The Underwriting Agreement provides that the Company will indemnify the
Underwriters and controlling persons, if any, against certain liabilities,
including liabilities under the Securities Act, or will contribute to payments
which the Underwriters or any such controlling persons may be required to make
in respect thereof.

27
<PAGE> 30

LEGAL MATTERS

The validity of the Common Stock offered hereby is being passed upon for
the Company by Thompson & Knight, a Professional Corporation, Dallas, Texas and
for the Underwriters by Bass, Berry & Sims, Nashville, Tennessee.

EXPERTS

The consolidated financial statements and schedules of Sun Coast at June
30, 1993 and 1994 and for each of the three fiscal years in the period ended
June 30, 1994, have been included and incorporated by reference herein and in
the Registration Statement in reliance upon the reports of KPMG Peat Marwick
LLP, independent certified public accountants, appearing elsewhere and
incorporated by reference herein and in the Registration Statement, and upon the
authority of such firm as experts in accounting and auditing. The report of KPMG
Peat Marwick LLP covering the June 30, 1994 financial statements refers to a
change in the method of accounting for income taxes.

AVAILABLE INFORMATION

The Company has filed with the Commission a registration statement on Form
S-2 (as amended and together with all exhibits and schedules thereto, the
"Registration Statement") under the Securities Act with respect to the shares of
Common Stock offered by this Prospectus. As permitted by the rules and
regulations of the Commission, this Prospectus does not contain all of the
information set forth in the Registration Statement. For further information
with respect to the Company and the Common Stock offered, reference is made to
the Registration Statement. Statements contained in this Prospectus concerning
the provisions of any contract, agreement or other documents are not necessarily
complete. With respect to each contract, agreement or other document filed as an
exhibit to the Registration Statement, reference is made to the exhibit for the
complete contents of the exhibit, and each statement concerning its provisions
is qualified in its entirety by such reference.

The Company is subject to the information requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith, files reports, proxy statements and other information with the
Commission. The Registration Statement, as well as such reports, proxy
statements and other information, may be inspected and copied at the offices of
the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 and at its
regional offices at 7 World Trade Center, 14th Floor, New York, New York 10048
and Northwestern Atrium Center, 500 West Madison Street, 14th Floor, Chicago,
Illinois 60661-2551. Copies of such materials may also be obtained by mail at
prescribed rates from the Public Reference Section of the Commission at its
principal office at 450 Fifth Street, N.W., Washington, D.C. 20549. In addition,
such materials can also be inspected at the offices of the New York Stock
Exchange, 20 Broad Street, New York, New York 10005, on which exchange the
Company's Common Stock is listed.

INCORPORATION OF DOCUMENTS BY REFERENCE

The Company's Annual Report on Form 10-K for the year ended June 30, 1994
and its Quarterly Reports on Form 10-Q for the quarters ended September 30, 1994
and December 31, 1994, which were filed with the Commission pursuant to Section
13(a) or 15(d) of the Exchange Act, are incorporated herein by reference and
made a part of this Prospectus. Any statement contained in a document
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus.

The Company will provide without charge to each person, including any
beneficial owner, to whom a copy of this Prospectus is delivered, upon the
written or oral request of any such person, a copy of any or all of the
documents incorporated by reference herein (other than exhibits to such
documents which are not specifically incorporated by reference in such
documents). Written requests should be addressed to: Sun Coast Industries, Inc.,
2700 South Westmoreland, Dallas, Texas 75233, Attention: Cynthia R. Morris,
Chief Financial Officer. Telephone requests may be directed to Ms. Morris at
(214) 373-7864.

28
<PAGE> 31

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Independent Auditors' Report.......................................................... F-2
Consolidated Balance Sheets as of June 30, 1993 and 1994, and December 31, 1994
(unaudited)......................................................................... F-3
Consolidated Statements of Income for the three years ended June 30, 1994 and for the
six months ended December 31, 1993 and 1994 (unaudited)............................. F-4
Consolidated Statements of Cash Flows for the three years ended June 30, 1994 and for
the six months ended December 31, 1993 and 1994 (unaudited)......................... F-5
Consolidated Statements of Stockholders' Equity for the three years ended June 30,
1994 and for the six months ended December 31, 1993 and 1994 (unaudited)............ F-6
Notes to Consolidated Financial Statements............................................ F-7
</TABLE>

F-1
<PAGE> 32

INDEPENDENT AUDITORS' REPORT

The Board of Directors
Sun Coast Industries, Inc.:

We have audited the accompanying consolidated balance sheets of Sun Coast
Industries, Inc. as of June 30, 1993 and 1994 and the related consolidated
statements of income, cash flows and stockholders' equity for each of the years
in the three-year period ended June 30, 1994. These consolidated financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated financial
statements based on our audits.

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

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Sun Coast
Industries, Inc. as of June 30, 1993 and 1994, and the results of their
operations and their cash flows for each of the years in the three-year period
ended June 30, 1994, in conformity with generally accepted accounting
principles.

As discussed in Note 6 to the financial statements, the Company changed its
method of accounting for income taxes in accordance with Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes."

KPMG Peat Marwick LLP

Dallas, Texas
August 23, 1994

F-2
<PAGE> 33

SUN COAST INDUSTRIES, INC.

CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
------------------- ------------
1993 1994 1994
------- ------- ------------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents................................ $ 1,229 $ 1,824 $ 1,200
Accounts receivable, net of allowance for doubtful
accounts of $229 in 1993, $163 in 1994 and $180 in
December 1994......................................... 7,798 9,519 10,154
Inventories.............................................. 7,529 9,864 12,055
Other current assets..................................... 463 1,162 882
------- ------- --------
Total current assets............................. 17,019 22,369 24,291
Property, plant and equipment.............................. 18,589 24,555 27,016
Intangible assets.......................................... 1,354 1,146 723
Other assets............................................... 1,076 1,814 1,213
------- ------- --------
$38,038 $49,884 $ 53,243
======= ======= ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable......................................... $ 3,979 $ 6,493 $ 3,552
Accrued expenses......................................... 3,695 3,702 3,363
Current portion of long-term debt........................ 2,788 1,498 1,500
Deferred income taxes.................................... 720 795 691
------- ------- --------
Total current liabilities........................ 11,182 12,488 9,106
Other liabilities.......................................... 90 90 45
Long-term debt............................................. 12,930 19,730 24,387
Deferred income taxes...................................... 1,665 1,868 1,868
Commitments and contingencies (Note 11)
Stockholders' equity:
Common stock, $.01 par value; 40,000,000 shares
authorized; issued and outstanding 3,955,822 shares in
1993, 3,974,314 shares in 1994 and 4,005,429 in
December 1994......................................... 40 40 40
Additional paid-in capital............................... 10,943 11,054 11,299
Retained earnings........................................ 1,188 4,614 6,498
------- ------- --------
Total stockholders' equity....................... 12,171 15,708 17,837
------- ------- --------
$38,038 $49,884 $ 53,243
======= ======= ========
</TABLE>

See accompanying notes to consolidated financial statements.

F-3
<PAGE> 34

SUN COAST INDUSTRIES, INC.

CONSOLIDATED STATEMENTS OF INCOME
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEARS ENDED JUNE 30, DECEMBER 31,
------------------------------- -------------------
1992 1993 1994 1993 1994
------- ------- ------- ------- -------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Sales.................................. $61,944 $66,806 $73,102 $34,173 $43,579
------- ------- ------- ------- -------
Costs and expenses:
Cost of sales........................ 48,419 50,928 56,073 26,274 33,558
Selling, general and
administrative.................... 8,918 9,310 10,260 5,065 6,285
Interest, net........................ 1,709 1,152 1,124 580 799
Restructuring charge................. -- -- 642 642 --
------- ------- ------- ------- -------
59,046 61,390 68,099 32,561 40,642
------- ------- ------- ------- -------
Income before income taxes............. 2,898 5,416 5,003 1,612 2,937
Provision for income taxes............. 1,320 1,773 1,577 565 1,053
------- ------- ------- ------- -------
Net income................... $ 1,578 $ 3,643 $ 3,426 $ 1,047 $ 1,884
======= ======= ======= ======= =======
Net income per common share............ $ .46 $ .92 $ .85 $ .26 $ .46
======= ======= ======= ======= =======
Net income per common share -- assuming
full dilution........................ $ .44 $ .91 $ .84 $ .26 $ .46
======= ======= ======= ======= =======
</TABLE>

See accompanying notes to consolidated financial statements.

F-4
<PAGE> 35

SUN COAST INDUSTRIES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEARS ENDED JUNE 30, DECEMBER 31,
----------------------------- ------------------
1992 1993 1994 1993 1994
------- ------- ------- ------- -------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Cash flows from operating activities:
Net income................................. $ 1,578 $ 3,643 $ 3,426 $ 1,047 $ 1,884
Adjustments to reconcile net income to net
cash provided by operations:
Depreciation and amortization........... 2,359 2,512 3,282 1,577 2,454
Deferred income taxes................... 794 (68) 279 1,023 (104)
Loss (gain) on sale or retirement of
property, plant and equipment......... 111 (155) (7) -- --
Allowance for doubtful accounts......... 79 172 117 50 17
Changes in assets and liabilities:
Accounts receivable................... (1,538) (188) (1,838) 825 (652)
Inventories........................... 53 (789) (2,335) (467) (2,191)
Other current assets.................. (102) (30) (699) (695) 280
Other assets.......................... (611) (13) (738) (526) 525
Accounts payable and accrued
expenses........................... 1,091 307 2,521 (498) (3,325)
------- ------- ------- ------- -------
Net cash provided by (used in)
operations....................... 3,814 5,391 4,008 2,336 (1,112)
------- ------- ------- ------- -------
Cash flows from investing activities:
Capital expenditures....................... (1,767) (4,404) (9,034) (3,178) (4,416)
Sale of property, plant and equipment...... -- 200 -- -- --
Increase in intangibles.................... (11) (75) -- -- --
------- ------- ------- ------- -------
Net cash used in investing
activities....................... (1,778) (4,279) (9,034) (3,178) (4,416)
------- ------- ------- ------- -------
Cash flows from financing activities:
Net proceeds (repayments) of revolving
credit line............................. (2,937) 229 5,171 26 5,334
Proceeds from long-term debt............... 169 1,478 2,397 608 --
Repayments of long-term debt............... (1,201) (2,067) (2,058) (541) (675)
Issuance of common stock................... 2,094 -- 111 -- 245
------- ------- ------- ------- -------
Net cash provided by (used in)
financing activities............. (1,875) (360) 5,621 93 4,904
------- ------- ------- ------- -------
Change in cash and equivalents............... 161 752 595 (749) (624)
Cash and equivalents at beginning of
period..................................... 316 477 1,229 1,229 1,824
------- ------- ------- ------- -------
Cash and equivalents at end of period........ $ 477 $ 1,229 $ 1,824 $ 480 $ 1,200
======= ======= ======= ======= =======
</TABLE>

See Notes 5 and 6 for supplementary disclosures.

See accompanying notes to consolidated financial statements.

F-5
<PAGE> 36

SUN COAST INDUSTRIES, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
THREE YEARS ENDED JUNE 30, 1994 AND SIX MONTHS ENDED
DECEMBER 31, 1994 (UNAUDITED)
(DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
COMMON STOCK ADDITIONAL RETAINED TOTAL
-------------------- PAID-IN EARNINGS STOCKHOLDERS'
SHARES AMOUNT CAPITAL (DEFICIT) EQUITY
--------- ------ ---------- -------- -------------
<S> <C> <C> <C> <C> <C>
At June 30, 1991...................... 3,442,157 $ 35 $ 8,854 $ (4,033) $ 4,856
Issuance of common stock to Board of
Directors........................... 19,600 -- 23 -- 23
Redemption of stock................... 360 -- -- -- --
Exercise of options................... 18,892 -- 71 -- 71
Exercise of warrants.................. 470,600 5 1,995 -- 2,000
Net income............................ -- -- -- 1,578 1,578
--------- ---- -------- -------- -------
At June 30, 1992...................... 3,951,609 40 10,943 (2,455) 8,528

Issuance of fractional shares......... 61 -- -- -- --
Exercise of options................... 4,152 -- -- -- --
Net income............................ -- -- -- 3,643 3,643
--------- ---- -------- -------- -------
At June 30, 1993...................... 3,955,822 40 10,943 1,188 12,171

Exercise of options................... 18,492 -- 111 -- 111
Net income............................ -- -- -- 3,426 3,426
--------- ---- -------- -------- -------
At June 30, 1994...................... 3,974,314 40 11,054 4,614 15,708

Exercise of options (unaudited)....... 31,115 -- 245 -- 245
Net income (unaudited)................ -- -- -- 1,884 1,884
--------- ---- -------- -------- -------
At December 31, 1994 (unaudited)...... 4,005,429 $ 40 $ 11,299 $ 6,498 $17,837
========= ==== ======== ======== =======
</TABLE>

See accompanying notes to consolidated financial statements.

F-6
<PAGE> 37

SUN COAST INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 1992, 1993 AND 1994

NOTE 1 -- THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business

Sun Coast Industries, Inc. (the "Company") manufactures and sells melamine
and urea resins and compounds and, from these and other materials, molds
consumer and commercial plastic products, including dinnerware, drinkware and
closures. The Company has manufacturing facilities in Texas, Florida and
Tennessee and offers its products through five divisions. The Chemical Division
manufactures melamine and urea resins and compounds, which it supplies to other
manufacturers and uses in producing its own consumer and food service products.
The Consumer and Food Service Divisions manufacture compression molded melamine
dinnerware and injection molded plastic drinkware, which the Company sells to
retail and commercial markets. The Closures Division manufactures linerless,
foil or foam lined and tamper-evident plastic closures and lids. These closures
are used to bottle or package food, beverage, chemical and pharmaceutical
products. The Custom Laminates Division is a start-up division employing the
Company's proprietary process that permits lamination of images in a range of
design, color and detail for use in furniture and countertops. No sales were
generated for this latest division during fiscal 1994.

Industry Segment

The Company operates in a single industry segment, supplying consumer and
commercial related plastic products on a direct and indirect basis, utilizing
similar production processes and methods.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company
and its subsidiaries, all of which are wholly-owned. All significant
intercompany balances and transactions have been eliminated in consolidation.
Certain amounts in previously issued financial statements have been reclassified
to conform with the current year financial statement presentation.

Inventories

The Closures Division's inventories are valued at the lower of cost or
market, with cost determined utilizing the first-in, first-out (FIFO) method.
Substantially all other inventories are valued at the lower of cost or market,
with cost determined utilizing the last-in, first-out (LIFO) method.

Property, Plant and Equipment

Property, plant and equipment are carried at cost and depreciated using the
straight-line method over the estimated useful lives of the related assets.
Lives assigned to asset categories are 5 to 15 years for machinery and
equipment, 30 to 35 years for buildings and 5 years for molds. Machinery and
equipment under capital leases are stated at the present value of minimum lease
payments. Renewals and improvements that significantly add to the productive
capacity or extend the useful life of an asset are capitalized. Repairs and
maintenance are charged to expense as incurred.

Intangible Assets

Intangible assets are stated at cost and consist primarily of patents,
goodwill and licensing rights. Intangible assets are amortized on the
straight-line method over their estimated useful lives. The carrying values and
amortization periods of intangibles are periodically evaluated by the Company to
determine whether current events and circumstances warrant adjustment.

F-7
<PAGE> 38

SUN COAST INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Advertising Costs

The Company expenses the costs of advertising as incurred, except for
direct-response advertising and catalog costs which are capitalized and
amortized over their expected periods of future benefit (generally six months).
Direct response advertising and catalog costs consist primarily of printing and
contract services for catalogs to market the Company's products.

The total advertising costs reported as an asset was $27,000 and $169,000
at June 30, 1993 and 1994, respectively. Advertising expense for fiscal years
1992, 1993 and 1994 was $718,000, $659,000 and $921,000, respectively.

Income Taxes

In 1994, the Company adopted the guidelines of Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes" ("Statement 109") on
a retroactive basis. The cumulative effect of the change in method of accounting
has been reported as an adjustment of beginning deficit for the year ended June
30, 1992. Under Statement 109, deferred income taxes are provided for temporary
differences between financial and tax reporting. Income taxes are provided for
taxes currently payable based on taxable income. The principal differences are
described in Note 6.

Environmental Costs

A liability for environmental assessments and/or cleanup is accrued when it
is probable a loss has been incurred and is estimable. No significant liability
exists at June 30, 1994.

Net Income Per Common Share

Net income per common share is computed by dividing net income by the
weighted average number of common shares outstanding during each year after
giving effect to stock options and warrants considered to be dilutive common
stock equivalents. The weighted average number of common shares outstanding was
3,466,835 in 1992, 3,951,953 in 1993 and 4,032,554 in 1994.

Net income per share, assuming full dilution for 1993 and 1994, is
determined in a similar manner using the greater of the average or ending
quarterly market prices of common stock. Net income per share, assuming full
dilution for 1992, is determined on the assumption that certain warrants (see
Note 8) were exercised on July 1, 1991. Common stock options were not considered
in the calculation of net income per common share assuming full dilution for
1992, as they were anti-dilutive. The weighted average number of common shares
outstanding assuming full dilution was 3,565,333 in 1992, 4,001,681 in 1993 and
4,057,175 in 1994.

Revenue Recognition

Sales are recognized when the product is shipped.

Research and Development

Research and development costs associated with new product development and
testing are expensed as incurred. Research and development costs amounted to
$474,000, $514,000 and $731,000 in fiscal years 1992, 1993 and 1994,
respectively.

Statement of Cash Flows

For purposes of the statements of cash flows, the Company considers all
highly liquid investments with original maturities of three months or less to be
cash equivalents. Cash equivalents consist of $100,000 of

F-8
<PAGE> 39

SUN COAST INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

certificates of deposit at June 30, 1993 (none in 1994). Noncash capital lease
financing transactions totaled $95,000 and $418,000 in fiscal years 1992 and
1993, respectively.

Interim Financial Information

In the opinion of management, the unaudited interim consolidated financial
information of the Company contains all adjustments, consisting only of those of
a normal recurring nature, necessary to present fairly the Company's financial
position as of December 31, 1994, and the results of its operations and cash
flows for the six months ended December 31, 1993 and 1994, and changes in
stockholders' equity for the six months ended December 31, 1994. The results of
operations for the six months ended December 31, 1993 and 1994 are not
necessarily indicative of the results to be expected for the full year.

NOTE 2 -- INVENTORIES

<TABLE>
<CAPTION>
1993 1994
------ ------
(IN THOUSANDS)
<S> <C> <C>
Raw materials...................................................... $2,601 $3,471
Work-in-process.................................................... 440 917
Finished goods..................................................... 4,441 5,185
------ ------
7,482 9,573
LIFO reserve....................................................... 97 342
Obsolescence reserve............................................... (50) (51)
------ ------
$7,529 $9,864
====== ======
</TABLE>

Approximately 74% and 78% of the consolidated inventories were valued using
the LIFO method at June 30, 1993 and 1994, respectively. Replacement cost
approximates LIFO cost at June 30, 1993 and 1994.

NOTE 3 -- PROPERTY, PLANT AND EQUIPMENT

<TABLE>
<CAPTION>
1993 1994
-------- --------
(IN THOUSANDS)
<S> <C> <C>
Land........................................................... $ 634 $ 634
Building....................................................... 6,747 6,673
Machinery and equipment........................................ 11,211 14,134
Machinery and equipment under capital lease.................... 5,389 5,213
Molds.......................................................... 5,740 8,924
Furniture and fixtures, leasehold improvements and other....... 1,664 4,109
-------- --------
31,385 39,687
Less accumulated depreciation and amortization................. (12,796) (15,132)
-------- --------
$ 18,589 $ 24,555
======== ========
</TABLE>

Accumulated amortization of machinery and equipment under capital lease was
$3,700,000 and $3,876,000 at June 30, 1993 and 1994, respectively.

F-9
<PAGE> 40

SUN COAST INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 4 -- ACCRUED EXPENSES

<TABLE>
<CAPTION>
1993 1994
------ ------
(IN THOUSANDS)
<S> <C> <C>
Salaries and other benefits........................................ $1,703 $1,404
Interest........................................................... 74 215
Taxes payable...................................................... 628 627
Other.............................................................. 1,290 1,456
------ ------
$3,695 $3,702
====== ======
</TABLE>

NOTE 5 -- LONG-TERM DEBT

<TABLE>
<CAPTION>
1993 1994
------- -------
<S> <C> <C>
Term loan........................................................ $ 8,410 $ 4,000
Revolving credit line............................................ 3,284 8,455
Capital expenditures term loan................................... 985 6,000
Industrial development revenue bonds............................. 2,625 2,476
Capitalized lease obligations, 4.9% to 12.33%, various
installments through 1996, secured by equipment................ 414 297
------- -------
15,718 21,228
Less current portion............................................. (2,788) (1,498)
------- -------
$12,930 $19,730
======= =======
</TABLE>

On April 29, 1994, the Company amended its existing loan agreement to
reduce the interest rate, modify the repayment schedule and reallocate
outstanding borrowings among loan components. The amended loan agreement
consists of a total facility under the agreement of $24 million and is comprised
of the following: (1) a $4 million, seven-year amortizing secured loan (Term
Loan); (2) a $10 million, six-year amortizing secured loan (Capital Expenditure
Term Loan) limited to 80% of the orderly liquidation value of equipment, as
defined; and (3) a $10 million revolving loan (the Revolving Credit Line) with
availability determined by reference to a borrowing base of eligible accounts
receivable and inventory of the Company. Borrowing availability under the
Revolving Credit Line at June 30, 1994 was $1,545,000. The Revolving Credit Line
is available for the term of the loan agreement. Interest rates on the loans
approximate the prime rate (6.86% weighted average at June 30, 1994). The loan
agreement also provides for the issuance of up to $2 million of letters of
credit, subject to the borrowing availability under the Revolving Credit Line.
Substantially all of the Company's property, equipment, receivables and
inventory are pledged as collateral.

The loan agreement contains various covenants, including maintaining
certain financial ratios and tests, limitations on the incurrence of debt and
the amount of capital expenditures, investments and dividends. The primary
financial covenants include ratios of cash flow to the current portion of
long-term debt, total debt to tangible net worth, current assets to current
liabilities and the maintenance of minimum net worth, all as defined. The
Company was in compliance with its financial covenants as of June 30, 1994.

The industrial development revenue bonds were used to finance the cost of a
new production and office facility (completed during 1988) and certain machinery
in Florida. Total bond proceeds were $3,600,000. The bonds bear interest at 78%
of prime, are payable in monthly installments of $12,500 through 2011, and are
secured by the underlying facility and equipment.

The estimated fair value of the Company's debt approximates the outstanding
net book value at June 30, 1994. Interest paid (net of $110,000 capitalized in
1994) amounted to $1,746,000 in 1992, $1,177,000 in 1993 and $885,000 in 1994.

F-10
<PAGE> 41

SUN COAST INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Scheduled debt maturities (excluding capital lease obligations) subsequent
to June 30, 1994 are as follows: $1,417,000 in 1995, $9,871,000 in 1996,
$1,417,000 in 1997, $1,417,000 in 1998, $1,417,000 in 1999 and $5,392,000
thereafter.

NOTE 6 -- INCOME TAXES

As discussed in Note 1, the Company adopted Statement 109 in 1994 and has
applied the provisions of Statement 109 retroactively. The cumulative effect of
this change ($1,876,000) as of July 1, 1991 has been reflected as an adjustment
of beginning deficit for the year ended June 30, 1992. As a result of applying
Statement 109, net income was increased (decreased) by $(740,000), or ($.21) per
share, in 1992 and $126,000, or $.03 per share, in 1993.

The provision for income taxes consists of the following (in thousands):

<TABLE>
<CAPTION>
1992 1993 1994
------ ------ ------
<S> <C> <C> <C>
Current:
Federal................................................ $ 310 $1,644 $1,187
State.................................................. 216 197 111
------ ------ ------
526 1,841 1,298
Deferred federal and state............................... 794 (68) 279
------ ------ ------
$1,320 $1,773 $1,577
====== ====== ======
Income taxes paid........................................ $ 99 $1,739 $1,225
====== ====== ======
</TABLE>

A reconciliation of the federal statutory tax rate with the effective tax
rate follows:

<TABLE>
<CAPTION>
1992 1993 1994
------ ------ ------
<S> <C> <C> <C>
Statutory tax rate....................................... 34.0% 34.0% 34.0%
State income taxes, net of federal income tax
benefit............................................. 4.9 2.4 1.9
Other.................................................. 6.6 (3.7) (4.4)
---- ---- ----
Effective tax rate....................................... 45.5% 32.7% 31.5%
==== ==== ====
</TABLE>

F-11
<PAGE> 42

SUN COAST INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The tax effects of temporary differences that give rise to significant
portions of deferred tax assets and liabilities follow (in thousands):

<TABLE>
<CAPTION>
1993 1994
------- -------
<S> <C> <C>
Deferred tax assets:
Allowance for doubtful accounts................................ $ 86 $ 59
Accrued expenses............................................... 205 149
Other.......................................................... -- 15
------- -------
Total gross deferred tax assets........................ 291 223
------- -------
Deferred tax liabilities:
Property, plant and equipment.................................. (1,665) (1,868)
Inventories.................................................... (933) (937)
Other.......................................................... (78) (81)
------- -------
Total gross deferred tax liabilities................... (2,676) (2,886)
------- -------
Net deferred tax liability............................. $(2,385) $(2,663)
======= =======
</TABLE>

No valuation allowance related to deferred tax assets was necessary for any
of the periods presented as management believes it is more likely than not that
such deferred tax assets will be realized.

NOTE 7 -- RESTRUCTURING CHARGE

During the second quarter of fiscal year 1994, the Company recorded a
restructuring charge related to an approximate 8% reduction in the number of
Texas employees and the consolidation of certain corporate functions such as
management information systems, insurance coverage and benefit plans. The charge
included costs to reduce personnel levels ($370,000), consolidate manufacturing
operations ($80,000) and outsource and consolidate certain corporate functions
($192,000). The restructuring reserve was fully utilized as of June 30, 1994.

NOTE 8 -- STOCKHOLDERS' EQUITY

Stock Warrants

In 1992, outstanding warrants to purchase 470,600 shares of the Company's
common stock were exercised by the holder at $4.25 per share, resulting in
proceeds to the Company of $2,000,050. In connection with obtaining financing
for the purchase of a subsidiary, the Company issued warrants to purchase
114,269 shares of common stock at $13.13 per share. The warrants are exercisable
through 2002. There are no other warrants outstanding at June 30, 1994.

Stock Options

The 1994 Long Term Incentive Plan ("1994 Plan") was adopted by the Board of
Directors on May 3, 1994 and is subject to shareholder approval. The 1994 Plan
provides that officers and key employees may be granted stock appreciation
rights, restricted stock, performance share awards, nonqualified stock options
or incentive stock options for the purchase of the Company's common stock. Up to
250,000 shares of the Company's common stock may be issued on exercise of
options and rights granted under this plan. The type, terms, and timing of
options granted will be determined at the discretion of the Board of Directors.

F-12
<PAGE> 43

SUN COAST INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

No future grants will be made under the Company's previous incentive stock
option plans. At June 30, 1994, previously granted options for 351,300 shares
remain outstanding under these plans.

On December 3, 1993, the Board of Directors adopted the 1994 Director Stock
Option Plan whereby each non-employee director and Chairman shall be granted
1,000 options initially and 500 options each fiscal year ended June 30, 1994 and
thereafter for purchase of the Company's common stock at the fair market value
at the date of grant. This plan is also subject to shareholder approval.

Transactions in stock options under these plans are summarized as follows:

<TABLE>
<CAPTION>
SHARES PRICE RANGE
------- --------------
<S> <C> <C>
Options outstanding at July 1, 1992....................... 198,870 $5.50 -- 15.00
Options granted......................................... 146,000 $10.00 -- 10.125
Options exercised....................................... (12,225) $5.95 -- 7.50
Options terminated...................................... (1,140) $5.95 -- 9.40
-------
Options outstanding at June 30, 1993...................... 331,505 $5.50 -- 15.00
Options granted......................................... 117,500 $10.75 -- 14.25
Options exercised....................................... (24,455) $5.50 -- 9.40
Options terminated...................................... (15,750) $5.95 -- 11.90
-------
Options outstanding at June 30, 1994
(191,100 options exercisable)........................... 408,800 $5.50 -- 15.00
=======
</TABLE>

During fiscal years 1993 and 1994, the Company offered to settle options
held by certain employees of the Company by issuing shares of stock equal in
value to the appreciation of the Company's stock over the stated option price. A
total of 12,100 and 9,140 options were exercised in 1993 and 1994, respectively,
in this manner, resulting in the issuance of 4,027 and 3,233 shares.

Certain principal officers had been granted additional nonqualifying
options to purchase shares at market prices. On May 14, 1992, all remaining
18,892 options were exercised at the option price of $3.75 per share.

Reverse Stock Split

Effective December 6, 1991, the stockholders approved a one-for-five
reverse stock split effective January 2, 1992. The reverse split reduced the
Company's issued stock by 13,848,466 shares. Common stock was reduced by
approximately $138,000 with a corresponding increase to additional paid-in
capital to reflect the reduction to $.01 par value per share. The Company's
consolidated financial statements and all per share amounts have been restated
to reflect the reverse stock split. During fiscal year 1993, the Board of
Directors authorized 61 additional common stock shares to account for fractional
shares held by stockholders at the time of the reverse stock split.

NOTE 9 -- PENSION, RETIREMENT, PROFIT SHARING AND SAVINGS PLANS

The Company has two pension plans covering bargaining unit employees and
substantially all other employees. Benefits under the bargaining unit plan are
set by contract with the union at a fixed amount per year of service, which also
requires contributions at certain intervals, as stipulated in the union
contract. Benefits under the other plan were frozen effective February 1, 1994.

F-13
<PAGE> 44

SUN COAST INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Pension cost and significant assumptions follow (in thousands):

<TABLE>
<CAPTION>
1992 1993 1994
----- ----- -----
<S> <C> <C> <C>
Non-union employees' plan:
Service cost -- benefits earned during the period........ $ 59 $ 125 $ 125
Interest cost on projected benefit obligation............ 148 170 176
Actual return on assets.................................. (139) (154) (177)
Net amortization and deferral of gains and losses........ (5) (5) (5)
Net curtailment gain..................................... -- -- (158)
Union plan................................................. 105 97 97
----- ----- -----
Net periodic pension cost........................ $ 168 $ 233 $ 58
===== ===== =====
</TABLE>

<TABLE>
<S> <C> <C> <C>
Weighted average discount rate............................. 8.5% 8.0% 7.5%
Rate of increase in compensation level..................... 5.0 5.0 4.5
Long-term rate of return on plan assets.................... 7.0 7.0 7.0
</TABLE>

A summary of the plans' funded status and amounts recognized in the
Company's consolidated balance sheets follow (in thousands):

<TABLE>
<CAPTION>
1993 1994
------- -------
<S> <C> <C>
Actuarial present value of benefit obligations:
Accumulated benefit obligation, including vested benefits of
$4,555 and $4,676 in 1993 and 1994, respectively.............. $ 4,576 $ 4,676
======= =======
Projected benefit obligation..................................... $(5,008) $(4,676)
Plan assets at fair value........................................ 5,128 5,042
------- -------
Plan assets in excess of projected benefit obligation............ 120 366
Unrecognized net transition asset................................ (53) --
Unrecognized net loss............................................ 144 --
------- -------
Prepaid pension asset included in other assets..................... $ 211 $ 366
======= =======
</TABLE>

The Company and its subsidiaries had defined contribution profit sharing
and savings plans for the benefit of employees. Company contributions to the
profit sharing and savings plans were $339,000, $345,000 and $203,000 for fiscal
years 1992, 1993 and 1994, respectively. The Florida subsidiary also maintained
a separate retirement savings plan which qualifies under Internal Revenue Code
Section 401(k). Company contributions were approximately $20,000, $56,000 and
$28,000 for fiscal years 1992, 1993 and 1994, respectively. Effective July 1,
1994, the above described profit sharing and savings plans were merged into one
Company-wide plan.

NOTE 10 -- BUSINESS AND CREDIT CONCENTRATION

The Company frequently bids for large contracts for its products which may
result in individual customers accounting for more than 10% of its net sales in
a given fiscal year. Sales to a single customer were approximately $11,393,000,
$10,476,000 and $10,649,000 for fiscal years 1992, 1993 and 1994, respectively.
Sales to a second customer were approximately $7,004,000 and $8,401,000 in
fiscal years 1993 and 1994, respectively. No other customers represented more
than 10% of the Company's net sales in 1992, 1993 or 1994. The Company had
accounts receivable balances from these major customers of approximately
$1,858,000 and $2,087,000 as of June 30, 1993 and 1994, respectively. Customers
from many geographic

F-14
<PAGE> 45

SUN COAST INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

locations are granted credit on an unsecured basis. Management believes that
sufficient allowances for doubtful accounts have been provided as of June 30,
1993 and 1994.

NOTE 11 -- COMMITMENTS AND CONTINGENCIES

The Company leases certain equipment used in the manufacturing of products.
Rental expense under operating leases was $492,000, $503,000 and $448,000 in
fiscal years 1992, 1993 and 1994, respectively. Future minimum lease payments
under capital and operating leases with initial or remaining terms of one year
or more at the end of fiscal year 1994 follow (in thousands):

<TABLE>
<CAPTION>
YEAR ENDING JUNE 30, CAPITAL OPERATING
-------------------- ------- ---------
<S> <C> <C>
1995.............................................................. $81 $ 499
1996.............................................................. 86 336
1997.............................................................. 91 200
1998.............................................................. 39 98
1999.............................................................. -- 90
</TABLE>

Under the Company's insurance programs, coverage is obtained for
catastrophic exposures as well as those risks required to be insured by law or
contract. The Company is responsible for certain expected losses related
primarily to workers' compensation. Provisions for losses expected under this
program are recorded based upon the Company's estimates of the aggregate
liability for claims incurred. Such estimates utilize certain actuarial
assumptions followed in the insurance industry.

In February 1983, the United States Environmental Protection Agency (EPA)
commenced an investigation of releases of hazardous substances at the
Bio-Ecology Systems disposal site in Grand Prairie, Texas. The Company was
considered one of approximately 103 responsible parties by the EPA as a
subsidiary of the Company sent materials to the site for disposal. The Company
reached a settlement in 1994 with the EPA, providing for a release from all
claims for a settlement payment of $5,000.

The Company is a party to various claims, legal actions and complaints
arising in the ordinary course of business. Management believes that the
disposition of these matters will not have a material impact on the financial
condition or results of operations of the Company.

NOTE 12 -- SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)

Selected quarterly financial data are summarized as follows (dollars in
thousands, except per share data):

<TABLE>
<CAPTION>
FISCAL YEAR 1993 QUARTERS FISCAL YEAR 1994 QUARTERS
------------------------------------- -------------------------------------
FIRST SECOND THIRD FOURTH FIRST SECOND THIRD FOURTH
------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues...................................... $16,706 $15,899 $16,880 $17,321 $17,261 $16,912 $18,875 $20,054
Gross margin.................................. 3,902 3,676 4,083 4,217 3,923 3,976 4,645 4,485
Income before income tax and
extraordinary items......................... 1,196 1,043 1,376 1,801 1,130 482 1,756 1,635
Net income.................................... 730 709 944 1,260 737 310 1,097 1,282
Per common share.............................. .18 .18 .24 .32 .19 .08 .28 .30
</TABLE>

F-15
<PAGE> 46
CLOSURES

[PHOTO] [PHOTO] [PHOTO]

Sun Coast's lined closures are used to seal and package food, beverage,
chemical and pharmaceutical products.

CUSTOM LAMINATES

[PHOTO] [PHOTO]

Custom Laminates Division's proprietary process allows Sun Coast to custom
design a wide range of colorful laminate products, including tabletops,
children's furniture and kitchen and bath counters and backsplashes.
<PAGE> 47
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS IN CONNECTION WITH THE OFFERING
MADE HEREBY AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT
BE RELIED UPON. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES TO
WHICH IT RELATES, OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY
SUCH SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION MAY NOT
BE LEGALLY MADE. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY DATE SUBSEQUENT TO THE DATE
HEREOF.

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

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Prospectus Summary.................... 3
The Company........................... 5
Risk Factors.......................... 5
Use of Proceeds....................... 7
Price Range of Common Stock and
Dividend Policy..................... 8
Capitalization........................ 9
Selected Consolidated Financial
Data................................ 10
Management's Discussion and Analysis
of Financial Condition and Results
of Operations....................... 11
Business.............................. 16
Management............................ 22
Principal Stockholders................ 24
Description of Capital Stock.......... 25
Underwriting.......................... 27
Legal Matters......................... 28
Experts............................... 28
Available Information................. 28
Incorporation of Documents by
Reference........................... 28
Index to Consolidated Financial
Statements.......................... F-1
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

1,500,000 SHARES

[SUN COAST
INDUSTRIES, INC. LOGO]

COMMON STOCK

----------------------
PROSPECTUS
----------------------

J.C. BRADFORD & CO.

A.G. EDWARDS & SONS, INC.

MARCH , 1995

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 48

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, incurred or to be incurred in connection
with the sale of the Common Stock being registered (all amounts are estimated
except the SEC Registration Fee, the NASD Filing Fee and the New York Stock
Exchange Filing Fee) all of which will be paid by the Registrant:

<TABLE>
<S> <C>
SEC Registration Fee.................................................... $ 8,923
NASD Filing Fee......................................................... 3,088
New York Stock Exchange Filing Fee...................................... 6,037
Blue Sky Qualification Fees and Expenses (including legal expenses)..... 10,000
Accounting Fees......................................................... 25,000
Legal Fees and Expenses................................................. 90,000
Transfer Agent and Registrar Fees....................................... 1,000
Printing and Engraving.................................................. 75,000
Miscellaneous........................................................... 30,952
--------
Total................................................................... $250,000
========
</TABLE>

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS

Article Tenth of the Registrant's Certificate of Incorporation, as amended
provides as follows:

To the fullest extent permitted by applicable law, no director of the
Corporation shall be personally liable to the Corporation or its
stockholders for any matter in respect of which such director shall be
liable under Section 174 of Title 8 of the Delaware Code (relating to the
Delaware General Corporation Law) or any amendment thereto or successor
provision thereto or shall be liable by reason that, in addition to any and
all other requirements for such liability, he (i) shall have breached his
duty of loyalty to the corporation or its stockholders, (ii) shall not have
acted in good faith or, in failing to act, shall not have acted in good
faith, (iii) shall have acted in a manner involving intentional misconduct
or a knowing violation of law, or, in failing to act, shall have acted in a
manner involving intentional misconduct or a knowing violation of law, or
(iv) shall have derived an improper personal benefit.

Section 145 of the General Corporation Law of the State of Delaware permits
(and in certain circumstances requires) Delaware corporations, such as the
Registrant, to indemnify directors and officers thereof under certain conditions
and subject to certain limitations.

Article VI of the Registrant's Bylaws provides as follows:

Section 1. General. The Corporation shall indemnify, and advance Expenses
(as this and all other capitalized words used in this Article VI and not
previously defined in these bylaws are defined in Section 14 of this Article VI)
to, Indemnitee to the fullest extent permitted by applicable law in effect on
the date of the effectiveness of these bylaws, and to such greater extent as
applicable law may thereafter permit. The rights of Indemnitee provided under
the preceding sentence shall include, but not be limited to, the right to be
indemnified to the fullest extent permitted by sec. 145(b) of the D.G.C.L. in
Proceedings by or in the right of the Corporation and to the fullest extent
permitted by Proceedings by or in the right of the Corporation and to the
fullest extent permitted by sec. 145(a) of the D.G.C.L. in all other
Proceedings. The provisions set forth below in this Article VI are provided in
furtherance, and not by way of limitation, of the obligations expressed in this
Section 1.

Section 2. Expenses Related to Proceedings. If Indemnitee is, by reason
of his or her Corporate Status, a witness in or a party to and is successful, on
the merits or otherwise, in any Proceeding, he or she shall be indemnified
against all Expenses actually and reasonably incurred by him or her or on his or
her

II-1
<PAGE> 49

behalf in connection therewith. If Indemnitee is not wholly successful in such
Proceeding but is successful, on the merits or otherwise, as to any Matter in
such Proceeding, the Corporation shall indemnify Indemnitee against all Expenses
actually and reasonably incurred by him or her or on his or her behalf relating
to each Matter. The termination of any Matter in such a Proceeding by dismissal,
with or without prejudice, shall be deemed to be a successful result as to such
Matter.

Section 3. Advancement of Expenses. Indemnitee shall be advanced Expenses
within ten days after requesting them to the fullest extent permitted by sec.
145(e) of the D.G.C.L.

Section 4. Request for Indemnification. To obtain indemnification
Indemnitee shall submit to the Corporation a written request with such
information as is reasonably available to Indemnitee. The Secretary of the
Corporation shall promptly advise the Board of Directors of such request.

Section 5. Determining Entitlement to Indemnification if No Change of
Control. If there has been no Change of Control at the time the request for
Indemnification is sent, Indemnitee's entitlement to indemnification shall be
determined in accordance with sec. 145(d) of the D.G.C.L. If entitlement to
indemnification is to be determined by Independent Counsel, the Corporation
shall furnish notice to Indemnitee within ten days after receipt of the request
for indemnification, specifying the identity and address of Independent Counsel.
Indemnitee may, within fourteen days after receipt of such written notice of
selection, deliver to the Corporation a written objection to such selection.
Such objection may be asserted only on the ground that the Independent Counsel
so selected does not meet the requirements of Independent Counsel and the
objection shall set forth with particularity the factual basis of such
assertion. If there is an objection to the selection of Independent Counsel,
either the Corporation or Indemnitee may petition the Court of Chancery of the
State of Delaware or any other court of competent jurisdiction for a
determination that the objection is without a reasonable basis and/or for the
appointment of Independent Counsel selected by the court.

Section 6. Determining Entitlement to Indemnification if Change of
Control. If there has been a Change of Control at the time the request for
indemnification is sent, Indemnitee's entitlement to indemnification shall be
determined in a written opinion by Independent Counsel selected by Indemnitee.
Indemnitee shall give the Corporation written notice advising of the identity
and address of the Independent Counsel so selected. The Corporation may, within
seven days after receipt of such written notice of selection, deliver to
Indemnitee a written objection to such selection. Indemnitee may, within five
days after the receipt of such objection from the Corporation, submit the name
of another Independent Counsel and the Corporation may, within seven days after
receipt of such written notice of selection, deliver to Indemnitee a written
objection to such selection. Any objection is subject to the limitations in
Section 5 of this Article VI. Indemnitee may petition the Court of Chancery of
the State of Delaware or any other court of competent jurisdiction for a
determination that the Corporation's objection to the first and/or second
selection of Independent Counsel is without a reasonable basis and/or for the
appointment as Independent Counsel of a person selected by the court.

Section 7. Procedures of Independent Counsel. If there has been a Change
of Control before the time the request for indemnification is sent by
Indemnitee, Indemnitee shall be presumed (except as otherwise expressly provided
in this Article VI) to be entitled to indemnification upon submission of a
request for indemnification in accordance with Section 4 of this Article VI, and
thereafter the Corporation shall have the burden of proof to overcome the
presumption in reaching a determination contrary to the presumption. The
presumption shall be used by Independent Counsel as a basis for a determination
of entitlement to indemnification unless the Corporation provides information
sufficient to overcome such presumption by clear and convincing evidence or the
investigation, review and analysis of Independent Counsel convinces him or her
by clear and convincing evidence that the presumption should not apply.

Except in the event that the determination of entitlement to
indemnification is to be made by Independent Counsel, if the person or persons
empowered under Section 5 or 6 of this Article VI to determine entitlement to
indemnification shall not have made and furnished to Indemnitee in writing a
determination within sixty days after receipt by the Corporation of the request
therefor, the requisite determination of entitlement to indemnification shall be
deemed to have been made and Indemnitee shall be entitled to such

II-2
<PAGE> 50

indemnification unless Indemnitee knowingly misrepresented a material fact in
connection with the request for indemnification or such indemnification is
prohibited by law. The termination of any Proceeding or of any Matter therein,
by judgment, order, settlement or conviction, or upon a plea of nolo contendere
or its equivalent, shall not (except as otherwise expressly provided in this
Article VI) of itself adversely affect the right of Indemnitee to
indemnification or create a presumption that (a) Indemnitee did not act in good
faith and in a manner that he or she reasonably believed, in the case of conduct
in his or her official capacity as a director of the Corporation, to be in the
best interests of the Corporation or in all other cases that at least his or her
conduct was not opposed to the Corporation's best interests, or (b) with respect
to any criminal Proceeding, that Indemnitee had reasonable cause to believe that
his or her conduct was unlawful.

Section 8. Expenses of Independent Counsel. The Corporation shall pay any
and all reasonable fees and expenses of Independent Counsel incurred acting
pursuant to this Article VI and in any proceeding to which it is a party or
witness in respect of its investigation and written report and shall pay all
reasonable fees and expenses incident to the procedures in which such
Independent Counsel was selected or appointed. No Independent Counsel may serve
if a timely objection has been made to his or her selection until a court has
determined that such objection is without a reasonable basis.

Section 9. Trial De Novo. In the event that (a) a determination is made
pursuant to Section 5 or 6 of this Article VI that Indemnitee is not entitled to
indemnification under this Article VI, (b) advancement of Expenses is not timely
made pursuant to Section 3 of this Article VI, (c) Independent Counsel has not
made and delivered a written opinion determining the request for indemnification
(i) within ninety days after being appointed by a court, (ii) within ninety days
after objections to his or her selection have been overruled by a court or (iii)
within ninety days after the time for the Corporation or Indemnitee to object to
his or her selection or (d) payment of indemnification is not made within five
days after a determination of entitlement to indemnification has been made or
deemed to have been made pursuant to Section 5, 6 or 7 of this Article VI,
Indemnitee shall be entitled to an adjudication in any court of competent
jurisdiction of his or her entitlement to such indemnification or advancement of
Expenses. In the event that a determination shall have been made that Indemnitee
is not entitled to indemnification, any judicial proceeding or arbitration
commenced pursuant to this Section 9 shall be conducted in all respects as a de
novo trial on the merits, and Indemnitee shall not be prejudiced by reasons of
that adverse determination. If a Change of Control shall have occurred, in any
judicial proceeding commenced pursuant to this Section 9, the Corporation shall
have the burden of proving that Indemnitee is not entitled to indemnification or
advancement of Expenses, as the case may be. If a determination shall have been
made or deemed to have been made that Indemnitee is entitled to indemnification,
the Corporation shall be bound by such determination in any judicial proceeding
commenced pursuant to this Section 9, or otherwise, unless Indemnitee knowingly
misrepresented a material fact in connection with the request for
indemnification, or such indemnification is prohibited by law.

The Corporation shall be precluded from asserting in any judicial
proceeding commenced pursuant to this Section 9 that the procedures and
presumptions of this Article VI are not valid, binding and enforceable and shall
stipulate in any such court that the Corporation is bound by all provisions of
this Article VI. In the event that Indemnitee, pursuant to this Section 9, seeks
a judicial adjudication to enforce his or her rights under, or to recover
damages for breach of, this Article VI, Indemnitee shall be entitled to recover
from the Corporation, and shall be indemnified by the Corporation against, any
and all Expenses actually and reasonably incurred by him or her in such judicial
adjudication, but only if he or she prevails therein. If it shall be determined
in such judicial adjudication that Indemnitee is entitled to receive part but
not all of the indemnification or advancement of Expenses sought, the Expenses
incurred by Indemnitee in connection with such judicial adjudication or
arbitration shall be appropriately prorated.

Section 10. Non-Exclusivity. The rights of indemnification and to receive
advancement of Expenses as provided by this Article VI shall not be deemed
exclusive of any other rights to which Indemnitee may at any time be entitled
under applicable law, the Certificate of Incorporation, these Bylaws, any
agreement, a vote of stockholders, a resolution of the Board of Directors or
otherwise. No amendment, alteration or repeal of this Article VI or any
provision hereof shall be effective as to any Indemnitee for acts, events and
circumstances that occurred, in whole or in part, before such amendment,
alteration or repeal. The provisions

II-3
<PAGE> 51

of this Article VI shall continue as to an Indemnitee whose Corporate Status has
ceased and shall inure to the benefit of his or her heirs, executors and
administrators.

Section 11. Insurance and Subrogation. To the extent the Corporation
maintains an insurance policy or policies providing liability insurance for
directors or officers of the Corporation or of any other corporation,
partnership, joint venture, trust employee benefit plan or other enterprise
which such person serves at the request of the Corporation, Indemnitees shall be
covered by such policy or policies in accordance with its or their terms to the
maximum extent of coverage available for any such director or officer under such
policy or policies.

In the event of any payment hereunder, the Company shall be subrogated to
the extent of such payment to all the rights of recovery of Indemnitee, who
shall execute all papers required and take all action necessary to secure such
rights, including execution of such documents as are necessary to enable the
Company to bring suit to enforce such rights.

The Company shall not be liable under this Article VI to make any payment
of amounts otherwise indemnifiable hereunder if, and to the extent that,
Indemnitee has otherwise actually received such payment under any insurance
policy, contract, agreement or otherwise.

Section 12. Severability. If any provision or provisions of this Article
VI shall be held to be invalid, illegal or unenforceable for any reason
whatsoever, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby; and, to the
fullest extent possible, the provisions of this Article VI shall be construed so
as to give effect to the intent manifested by the provision held invalid,
illegal or unenforceable.

Section 13. Certain Persons Not Entitled to
Indemnification. Notwithstanding any other provision of this Article VI, no
person shall be entitled to indemnification or advancement of Expenses under
this Article VI with respect to any Proceeding, or any Matter therein, brought
or made by such person against the Corporation.

Section 14. Definitions. For purposes of this Article VI:

"Change of Control" means a change in control of the Corporation after the
date of adoption of these bylaws in any one of the following circumstances: (a)
there shall have occurred an event required to be reported in response to Item
6(e) of Schedule 14A of Regulation 14A (or in response to any similar item on
any similar schedule or form) promulgated under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), whether or not the Corporation is then
subject to such reporting requirement; (b) any "person" (as such term is used in
Sections 13(d) and 14(d) of the Exchange Act) shall have become the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Corporation representing 20% or more of the
combined voting power of the Corporation's then outstanding voting securities
without prior approval of at least two-thirds of the members of the Board of
Directors in office immediately prior to such person's attaining such percentage
interest; (c) the Corporation is a party to a merger, consolidation, sale of
assets or other reorganization, or a proxy contest, as a consequence of which
members of the Board of Directors in office immediately prior to such
transaction or event constitute less than a majority of the Board of Directors
thereafter or (d) during any period of two consecutive years, individuals who at
the beginning of such period constituted the Board of Directors (including for
this purpose any new director whose election or nomination for election by the
Corporation's stockholders was approved by a vote of at least two-thirds of the
directors then still in office who were directors at the beginning of such
period) cease for any reason to constitute at least a majority of the Board of
Directors.

"Corporate Status" describes the status of a person who is or was a
director, officer or employee or agent of the Corporation or of any other
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise which such person is or was serving at the request of the
Corporation.

"D.G.C.L." means the Delaware General Corporation Law, as currently in
effect or as amended from time to time.

II-4
<PAGE> 52

"Expenses" shall include reasonable attorneys' fees, retainers, court
costs, transcript costs, fees of experts, witness fees, travel expenses,
duplicating costs, printing and binding costs, telephone charges, postage,
delivery service fees, and all other disbursements or expenses of the types
customarily incurred in connection with prosecuting, defending, preparing to
prosecute or defend, investigating or being or preparing to be a witness in a
Proceeding.

"Indemnitee" includes any person who is, or is threatened to be made, a
witness in or a party to any Proceeding as described in Section 1 or 2 of this
Article by reason of his or her Corporate Status.

"Independent Counsel" means a law firm, or member of a law firm, that is
experienced in matters of corporation law and neither presently is, nor in the
five years previous to his or her selection or appointment has been, retained to
represent: (a) the Corporation or Indemnitee in any matter material to either
such party, (b) any other party to the Proceeding giving rise to a claim for
indemnification hereunder or (c) the beneficial owners, directly or indirectly,
of securities of the Corporation representing 5% or more of the combined voting
power of the Corporation's then outstanding voting securities.

"Matter" is a claim, a material issue, or a substantial request for relief.

"Proceeding" includes any action, suit, arbitration, alternate dispute
resolution mechanism, investigation, administrative hearing or any other
proceeding, whether civil, criminal, administrative or investigative, except one
initiated by an Indemnitee pursuant to Section 9 of this Article VI to enforce
his or her rights under this Article VI.

Section 15. Notices. Any communication required or permitted to the
Corporation shall be addressed to the Secretary of the Corporation and any such
communication to Indemnitee shall be given in writing by depositing the same in
the United States mail, with postage thereon prepaid, addressed to the person to
whom such notice is directed at the address of such person on the records of the
Corporation, and such notice shall be deemed given at the time when the same
shall be so deposited in the United States mail.

Section 16. Contractual Rights. The right to be indemnified or to the
advancement or reimbursement of Expenses (i) is a contract right based upon good
and valuable consideration, pursuant to which Indemnitee may sue as if these
provisions were set forth in a separate written contract between him or her and
the Corporation, (ii) is and is intended to be retroactive and shall be
available as to events occurring prior to the adoption of these provisions and
(iii) shall continue after any rescission or restrictive modification of such
provisions as to events occurring prior thereto.

II-5
<PAGE> 53

ITEM 16. EXHIBITS

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------ ----------------------------------------------------------------------------------
<S> <C>
1.1+ Form of Underwriting Agreement
3.1 Certificate of Incorporation of Sun Coast Industries, Inc., as amended (filed as
Exhibit 3.1 to the Company's Quarterly Report on Form 10-Q for the Quarter Ended
March 31, 1994 and incorporated herein by reference).
3.2 Bylaws of Sun Coast Industries, Inc. (filed as Exhibit 3.2 to the Company's
Quarterly Report on Form 10-Q for the Quarter Ended March 31, 1994 and
incorporated herein by reference).
4.1+ Stock Subscription Warrant dated August 23, 1993 issued to PruSupply Capital
Assets, Inc.
4.2+ Registration Rights Agreement dated as of January 8, 1988 between Sun Coast
Industries, Inc. and The Prudential Insurance Company of America.
5.1+ Opinion of Thompson & Knight, A Professional Corporation.
10.1 Amended and Restated Loan and Security Agreement dated as of April 29, 1994 among
Bank of America Texas, N.A., Sun Coast Holdings, Inc., Sun Coast Closures, Inc.,
Plastics Manufacturing Company, Sun Coast Industries, Inc., Alliance
Manufacturing, Inc. and Custom Laminates, Inc. (filed as Exhibit 10.1 to the
Company's Quarterly Report on Form 10-Q for the Quarter Ended March 31, 1994 and
incorporated herein by reference).
10.2 Amended and Restated Capital Expenditures Term Note effective as of April 29, 1994
executed by Sun Coast Holdings, Inc. in the face amount of $10,000,000 payable to
the order of Bank of America Texas, N.A. (filed as Exhibit 10.2 to the Company's
Quarterly Report on Form 10-Q for the Quarter Ended March 31, 1994 and
incorporated herein by reference).
10.3 Term Note effective as of March 13, 1991 executed by Plastics Manufacturing
Company in the face amount of $11,500,000 payable to the order of SPBC, Inc.
(filed as Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q for the
Quarter Ended March 31, 1994 and incorporated herein by reference).
10.4 Amended and Restated Continuing Guaranty by Plastics Manufacturing Company, dated
as of April 29,1994 for the benefit of Bank of America Texas, N.A. (filed as
Exhibit 10.4 to the Company's Quarterly Report on Form 10-Q for the Quarter Ended
March 31, 1994 and incorporated herein by reference).
10.5 Amended and Restated Continuing Guaranty by Sun Coast Closures, Inc., dated as of
April 29, 1994 for the benefit of Bank of America Texas, N.A. (filed as Exhibit
10.5 to the Company's Quarterly Report on Form 10-Q for the Quarter Ended March
31, 1994 and incorporated herein by reference).
10.6 Continuing Guaranty by Sun Coast Industries, Inc., dated as of April 29, 1994 for
the benefit of Bank of America Texas, N.A. (filed as Exhibit 10.6 to the Company's
Quarterly Report on Form 10-Q for the Quarter Ended March 31, 1994 and
incorporated herein by reference).
10.7 Continuing Guaranty by Alliance Manufacturing, Inc., dated as of April 29, 1994
for the benefit of Bank of America Texas, N.A. (filed as Exhibit 10.6 to the
Company's Quarterly Report on Form 10-Q for the Quarter Ended March 31, 1994 and
incorporated herein by reference).
10.8 Continuing Guaranty by Custom Laminates, Inc., dated as of April 29, 1994 for the
benefit of Bank of America Texas, N.A. (filed as Exhibit 10.8 to the Company's
Quarterly Report on Form 10-Q for the Quarter Ended March 31, 1994 and
incorporated herein by reference).
10.9 Assignment of Notes, Liens, and Loan Documents executed by Bank America Business
Credit, Inc. successor to SPBC, Inc. (filed as Exhibit 10.9 to the Company's
Quarterly Report on Form 10-Q for the Quarter Ended March 31, 1994 and
incorporated herein by reference).
10.10 Assumption Agreement dated as of April 29, 1994 among Sun Coast Holdings, Inc.,
Plastics Manufacturing Company, Sun Coast Closures, Inc., Sun Coast Industries,
Inc., and Bank of America Texas, N.A. (filed as Exhibit 10.10 to the Company's
Quarterly Report on Form 10-Q for the Quarter Ended March 31, 1994 and
incorporated herein by reference).
10.11 Modification of Note and Deed of Trust effective as of April 29, 1994 among Bank
of America Texas, N.A., Plastics Manufacturing Company, Sun Coast Industries, Inc.
and Sun Coast Holdings, Inc. (filed as Exhibit 10.11 to the Company's Quarterly
Report on Form 10-Q for the Quarter Ended March 31, 1994 and incorporated herein
by reference).
10.12 1984 Incentive Stock Option Plan (filed as Exhibit 4.1 to the Company's
Registration Statement on Form S-8 filed with the Securities and Exchange
Commission on March 15, 1993 and incorporated herein by reference).
</TABLE>

II-6
<PAGE> 54

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------ ----------------------------------------------------------------------------------
<S> <C>
10.13+ First Amendment to Amended and Restated Loan and Security Agreement dated as of
September 21, 1994.
10.14+ Second Amendment to Amended and Restated Loan and Security Agreement dated as of
November 23, 1994.
10.15 1987 Incentive Stock Option Plan (filed as Exhibit 4.1 to the Company's
Registration Statement on Form S-8 filed with the Securities and Exchange
Commission on March 15, 1993 and incorporated herein by reference).
10.16 1993 Incentive and Non-Statutory Stock Option Plan (filed as Exhibit 4.1 to the
Company's Registration Statement on Form S-8 filed with the Securities and
Exchange Commission on March 15, 1993 and incorporated herein by reference.).
10.17 1994 Long-Term Incentive Plan (filed as Exhibit 4.1 to the Company's Registration
Statement on Form S-8 filed with the Securities and Exchange Commission on
December 16, 1994 and incorporated herein by reference).
10.18 1994 Director Stock Option Plan (filed as Exhibit 4.1 to the Company's
Registration Statement on Form S-8 filed with the Securities and Exchange
Commission on December 16, 1994 and incorporated herein by reference).
10.19 Employee Stock Purchase Plan.
10.20+ Loan, Mortgage and Security Agreement between Manatee County, Florida and Sun
Coast Plastics, Inc. dated as of December 1, 1985 relating to Manatee County,
Florida Industrial Development Revenue Bonds, 1985 Series (Sun Coast Plastics,
Inc. Project).
10.21+ Trust Indenture between Manatee County, Florida and Sun Bank, National
Association, as Trustee, dated as of December 1, 1985, relating to Manatee County,
Florida Industrial Development Revenue Bonds, 1985 Series (Sun Coast Plastics,
Inc. Project).
10.22+ United States of America, State of Florida, Manatee County Industrial Development
Revenue Bond, 1985 Series (Sun Coast Plastics, Inc. Project).
23.1 Consent of KPMG Peat Marwick LLP.
23.2+ Consent of Thompson & Knight, A Professional Corporation (included in their
opinion filed as Exhibit 5.1).
24.1+ Power of Attorney (included on the signature page of this Registration Statement).
</TABLE>

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

+ Previously filed.

ITEM 17. UNDERTAKINGS

Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.

The undersigned registrant also undertakes that:

(1) For purposes of determining any liability under the Securities
Act, the information omitted from the form of prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.

(2) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.

II-7
<PAGE> 55

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Sun Coast
Industries, Inc. has duly caused this Amendment No. 1 to the Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Dallas County, Texas on March 9, 1995.

SUN COAST INDUSTRIES, INC.

By: /s/ CYNTHIA R. MORRIS

Cynthia R. Morris

Vice President -- Finance,

Treasurer and Secretary

Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 1 to the Registration Statement has been signed by the following persons in
the capacities and on the dates indicated.

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------------------------------------------- ---------------------------- --------------
<S> <C> <C>
/s/ STEPHEN P. SMILEY* Chairman of the March 9, 1995
Stephen P. Smiley Board of Directors

/s/ R. CARTER PATE* President, Chief Executive March 9, 1995
R. Carter Pate Officer and Director

/s/ CYNTHIA R. MORRIS Vice President -- Finance March 9, 1995
Cynthia R. Morris Treasurer and Secretary
(Principal Financial and
Accounting Officer)

/s/ JAMES M. HOAK* Director March 9, 1995
James M. Hoak

/s/ JAMES D. IRELAND III* Director March 9, 1995
James D. Ireland III

/s/ JAMES H. MILLER* Director March 9, 1995
James H. Miller

/s/ JAMES R. PARISH* Director March 9, 1995
James R. Parish

/s/ ARNO F. PIRKAU* Director March 9, 1995
Arno F. Pirkau

*By: /s/ CYNTHIA R. MORRIS
Cynthia R. Morris
Attorney-in-fact
</TABLE>

II-8
<PAGE> 56

INDEX TO EXHIBITS

<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NUMBER DESCRIPTION PAGE
------ ---------------------------------------------------------------------------------------------
<S> <C> <C>
1.1+ Form of Underwriting Agreement
3.1 Certificate of Incorporation of Sun Coast Industries, Inc., as amended (filed as
Exhibit 3.1 to the Company's Quarterly Report on Form 10-Q for the Quarter Ended
March 31, 1994 and incorporated herein by reference).
3.2 Bylaws of Sun Coast Industries, Inc. (filed as Exhibit 3.2 to the Company's
Quarterly Report on Form 10-Q for the Quarter Ended March 31, 1994 and
incorporated herein by reference).
4.1+ Stock Subscription Warrant dated August 23, 1993 issued to PruSupply Capital
Assets, Inc.
4.2+ Registration Rights Agreement dated as of January 8, 1988 between Sun Coast
Industries, Inc. and The Prudential Insurance Company of America.
5.1+ Opinion of Thompson & Knight, A Professional Corporation.
10.1 Amended and Restated Loan and Security Agreement dated as of April 29, 1994 among
Bank of America Texas, N.A., Sun Coast Holdings, Inc., Sun Coast Closures, Inc.,
Plastics Manufacturing Company, Sun Coast Industries, Inc., Alliance
Manufacturing, Inc. and Custom Laminates, Inc. (filed as Exhibit 10.1 to the
Company's Quarterly Report on Form 10-Q for the Quarter Ended March 31, 1994 and
incorporated herein by reference).
10.2 Amended and Restated Capital Expenditures Term Note effective as of April 29, 1994
executed by Sun Coast Holdings, Inc. in the face amount of $10,000,000 payable to
the order of Bank of America Texas, N.A. (filed as Exhibit 10.2 to the Company's
Quarterly Report on Form 10-Q for the Quarter Ended March 31, 1994 and
incorporated herein by reference).
10.3 Term Note effective as of March 13, 1991 executed by Plastics Manufacturing
Company in the face amount of $11,500,000 payable to the order of SPBC, Inc.
(filed as Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q for the
Quarter Ended March 31, 1994 and incorporated herein by reference).
10.4 Amended and Restated Continuing Guaranty by Plastics Manufacturing Company, dated
as of April 29,1994 for the benefit of Bank of America Texas, N.A. (filed as
Exhibit 10.4 to the Company's Quarterly Report on Form 10-Q for the Quarter Ended
March 31, 1994 and incorporated herein by reference).
10.5 Amended and Restated Continuing Guaranty by Sun Coast Closures, Inc., dated as of
April 29, 1994 for the benefit of Bank of America Texas, N.A. (filed as Exhibit
10.5 to the Company's Quarterly Report on Form 10-Q for the Quarter Ended March
31, 1994 and incorporated herein by reference).
10.6 Continuing Guaranty by Sun Coast Industries, Inc., dated as of April 29, 1994 for
the benefit of Bank of America Texas, N.A. (filed as Exhibit 10.6 to the Company's
Quarterly Report on Form 10-Q for the Quarter Ended March 31, 1994 and
incorporated herein by reference).
10.7 Continuing Guaranty by Alliance Manufacturing, Inc., dated as of April 29, 1994
for the benefit of Bank of America Texas, N.A. (filed as Exhibit 10.6 to the
Company's Quarterly Report on Form 10-Q for the Quarter Ended March 31, 1994 and
incorporated herein by reference).
10.8 Continuing Guaranty by Custom Laminates, Inc., dated as of April 29, 1994 for the
benefit of Bank of America Texas, N.A. (filed as Exhibit 10.8 to the Company's
Quarterly Report on Form 10-Q for the Quarter Ended March 31, 1994 and
incorporated herein by reference).
10.9 Assignment of Notes, Liens, and Loan Documents executed by Bank America Business
Credit, Inc. successor to SPBC, Inc. (filed as Exhibit 10.9 to the Company's
Quarterly Report on Form 10-Q for the Quarter Ended March 31, 1994 and
incorporated herein by reference).
10.10 Assumption Agreement dated as of April 29, 1994 among Sun Coast Holdings, Inc.,
Plastics Manufacturing Company, Sun Coast Closures, Inc., Sun Coast Industries,
Inc., and Bank of America Texas, N.A. (filed as Exhibit 10.10 to the Company's
Quarterly Report on Form 10-Q for the Quarter Ended March 31, 1994 and
incorporated herein by reference).
10.11 Modification of Note and Deed of Trust effective as of April 29, 1994 among Bank
of America Texas, N.A., Plastics Manufacturing Company, Sun Coast Industries, Inc.
and Sun Coast Holdings, Inc. (filed as Exhibit 10.11 to the Company's Quarterly
Report on Form 10-Q for the Quarter Ended March 31, 1994 and incorporated herein
by reference).
</TABLE>

<PAGE> 57

<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NUMBER DESCRIPTION PAGE
------ ------------------------------------------------------------------------------- ------------
<S> <C> <C>
10.12 1984 Incentive Stock Option Plan (filed as Exhibit 4.1 to the Company's
Registration Statement on Form S-8 filed with the Securities and Exchange
Commission on March 15, 1993 and incorporated herein by reference).
10.13+ First Amendment to Amended and Restated Loan and Security Agreement dated as of
September 21, 1994.
10.14+ Second Amendment to Amended and Restated Loan and Security Agreement dated as of
November 23, 1994.
10.15 1987 Incentive Stock Option Plan (filed as Exhibit 4.1 to the Company's
Registration Statement on Form S-8 filed with the Securities and Exchange
Commission on March 15, 1993 and incorporated herein by reference).
10.16 1993 Incentive and Non-Statutory Stock Option Plan (filed as Exhibit 4.1 to the
Company's Registration Statement on Form S-8 filed with the Securities and
Exchange Commission on March 15, 1993 and incorporated herein by reference.).
10.17 1994 Long-Term Incentive Plan (filed as Exhibit 4.1 to the Company's Registration
Statement on Form S-8 filed with the Securities and Exchange Commission on
December 16, 1994 and incorporated herein by reference).
10.18 1994 Director Stock Option Plan (filed as Exhibit 4.1 to the Company's
Registration Statement on Form S-8 filed with the Securities and Exchange
Commission on December 16, 1994 and incorporated herein by reference).
10.19 Employee Stock Purchase Plan.
10.20+ Loan, Mortgage and Security Agreement between Manatee County, Florida and Sun
Coast Plastics, Inc. dated as of December 1, 1985 relating to Manatee County,
Florida Industrial Development Revenue Bonds, 1985 Series (Sun Coast Plastics,
Inc. Project).
10.21+ Trust Indenture between Manatee County, Florida and Sun Bank, National
Association, as Trustee, dated as of December 1, 1985, relating to Manatee County,
Florida Industrial Development Revenue Bonds, 1985 Series (Sun Coast Plastics,
Inc. Project).
10.22+ United States of America, State of Florida, Manatee County Industrial Development
Revenue Bond, 1985 Series (Sun Coast Plastics, Inc. Project).
23.1 Consent of KPMG Peat Marwick LLP.
23.2+ Consent of Thompson & Knight, A Professional Corporation (included in their
opinion filed as Exhibit 5.1).
24.1+ Power of Attorney (included on the signature page of this Registration Statement).
</TABLE>

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

+ Previously filed.

<PAGE> 1
EXHIBIT 10.19

SUN COAST INDUSTRIES, INC.

AMENDED AND RESTATED EMPLOYEE STOCK PURCHASE PLAN

SUN COAST INDUSTRIES, INC., a Delaware corporation (the "Company"),
has adopted this Amended and Restated Employee Stock Purchase Plan (the "Plan")
to be effective as of May 1, 1994 (the "Effective Date"), as amended June 27,
1994 and December 6, 1994.

1. Purpose. The purpose of the Plan is to provide a convenient
means by which the eligible employees of the Company may become stockholders in
the Company. The Board of Directors of the Company believes that it is
desirable to permit the employees of the Company to participate in the
ownership of the Company through the purchase of shares of Common Stock.

2. Term of Plan. The Plan shall commence on the Effective Date
and remain in effect from year to year thereafter, but may be modified,
amended, restated or discontinued by the Company at any time.

3. Eligibility. All regular full-time non-union employees of the
Company who are at least 18 years of age shall be eligible to participate in
the Plan for so long as they remain employed by the Company. Employees of any
subsidiary of the Company that now or may hereafter exist shall also be
eligible to participate in the Plan, and the term "Company" as used herein
shall be deemed to include any such subsidiary to the extent appropriate.

4. Participation. Each person who will be an eligible employee
on any January 1 or July 1 during the term of the Plan may elect to participate
in the Plan by executing and delivering to the Company's Personnel Director, on
or before the immediately preceding December 24 or June 25, respectively, a
form to be furnished by the Company (hereinafter referred to as a "payroll
deduction authorization") authorizing and instructing the Company to deduct
from his or her payroll check for each pay period a specified amount to be
applied to the purchase of Common Stock for such employee under the Plan. Such
election shall be effective for the twelve month period beginning on such
January 1 or July 1, and shall remain in effect until amended in accordance
with this Section 4 or until such eligible employee withdraws from
participation in the Plan or his or her participation is otherwise terminated.

Notwithstanding the foregoing, the first Plan year began on May 1,
1994 and shall end on December 31, 1994. The original Plan, prior to amendment
required that eligible employees have been employed continuously for at least
twelve months. With the elimination of this requirement from the plan the
following applies to new eligible employees: (a) a person who has joined the
Company since April 30, 1993, but on or before June 27, 1994, who wants to
begin participation by August 1, 1994, must submit a completed payroll
deduction form by July 15, 1994 and (b) a person who joins the Company after
June
<PAGE> 2
27, 1994, who wants to begin participation by the first day of the second month
following his or her initial date of employment, must submit a completed
payroll deduction form by the 15th day of the first month following such
initial date.

Each payroll deduction authorization shall request withholding, by
means of substantially equal payroll deductions over the Plan year, of an
amount which shall not, for any pay period, exceed 40% of the employee's total
base compensation for such pay period. The payroll deduction authorized by the
employee shall not be less than Ten Dollars ($10.00) per pay period, and
payroll deductions must be in whole dollar amounts only. If the employee's
compensation for any pay period is insufficient to permit the withholding of
the requested amount in compliance with the foregoing limitations, no
withholding will be made for the employee for such pay period.

A participant in the Plan may change his or her payroll deduction
amount by written notice delivered to the Company's Personnel Director on or
before the December 24 immediately preceding the January 1, or the June 25
immediately preceding the July 1, with respect to which the change is to be
effective. A payroll deduction amount may be decreased (but not increased) by
a participating employee on a date other than January 1 or July 1 upon a
showing of special circumstances that, in the opinion of the Board of Directors
of the Company, warrant a decrease in such amount.

5. Withdrawal from the Plan. A participating employee may
withdraw from participation in the Plan at any time by signing and delivering
to the Company's Personnel Director a withdrawal notice. If the employee
decides to re- enter the Plan, the employee must deliver a new payroll
deduction authorization to the Company's Personnel Director in accordance with
Section 4. Any participating employee who is a reporting person for the
purposes Section 16 of the Securities and Exchange Act ("Section 16 Reporting
Person") and who withdraws from the Plan may not re-enter until six (6) months
have passed from the date of his or her withdrawal, and may only do so at the
beginning of a Plan year in accordance with Section 4. Such employees shall
also be treated as having withdrawn in the event he or she obtains custody of
shares pursuant to Section 7. Any other participating employee who withdraws
from the Plan may not re-enter until the beginning of a Plan year in accordance
with Section 4.

6. Purchase of Stock. On or before the fifth day of each month
the Company will remit to the firm appointed by the Company to administer and
act as financial agent under the Plan (hereinafter referred to as the
"Custodian") the total of all deductions made under the Plan with respect to
the previous calendar month. The Custodian will apply the funds to the
purchase of shares of Common Stock through the New York Stock Exchange at
prevailing market prices. Stock purchases with the remittance shall be
completed within thirty (30) days following the date of remittance. Purchases
will be made in the name of the Custodian for the account of the Sun Coast
Industries, Inc. Employee Stock Purchase Plan and will commence after the
remittance of one month's deductions to the Custodian.

-2-
<PAGE> 3
If the Custodian is unable to purchase the maximum whole number of
shares of Common Stock that would otherwise be purchasable with the remittance
for any calendar month, the shares that are purchased will be allocated pro
rata among the participating employees in proportion to their respective
payroll deduction amounts. The funds remaining with the Custodian after the
purchase of such shares will be returned to the Company by the Custodian no
later than 35 days following the date of the Custodian's receipt of the
remittance. The Company will return such funds to the participating employees,
in proportion to their interests therein, as soon as practicable thereafter.

7. Custody and Issuance of Stock. Each participating employee
will be credited by the Custodian each calendar month with his or her pro rata
share of the purchased shares, including fractional shares to the fourth
decimal place. Records of the Company maintained under the Plan will be
confidential. Each participating employee shall have the right at any time to
require the Custodian to release from custody the shares of Common Stock
theretofore purchased for such employee, and to receive a certificate or
certificates representing such whole shares of Common Stock and the cash
equivalent of any fractional shares. Stock certificates will be issued to a
participating employee in accordance with this paragraph upon written request
to the Custodian. Such stock certificates will be registered in the name of
the employee or in the name of another person or persons as instructed by the
employee and will be delivered to the employee or to his or her order. The
employee shall be responsible for, and shall pay to the Custodian, any fees and
charges of the transfer agent and registrar for the Company's Common Stock in
connection with any issuance of stock certificates to or upon the order of such
employee pursuant to the Plan. The Custodian will convert fractional shares to
cash by selling them on the open market in the manner contemplated by Section
11 of the Plan.

8. Stock Splits and Rights, Dividends and Other Distributions.
Cash dividends and other cash distributions received by the Custodian with
respect to the shares held in its custody hereunder will be credited pro rata
to the accounts of participating employees in accordance with their respective
interests in the shares with respect to which the dividends or distributions
are paid or made, and will be applied, as soon as practicable after receipt
thereof by the Custodian, to the purchase of additional shares of Common Stock
for the respective accounts of such employees. Stock splits or dividends paid
in shares of Common Stock that are received by the Custodian with respect to
shares held in its custody hereunder will be allocated to the participating
employees in whole shares and in fractional shares to the fourth decimal place
in accordance with their interests in the shares with respect to which the
stock dividends are paid or the stock split relates. Share options or rights
or other property, other than shares of Common Stock, received by the Custodian
as distribution on shares held in its custody hereunder shall be sold by the
Custodian for the accounts of the participating employees, and the Custodian
shall treat the proceeds of such sale in the same manner as cash dividends
received by the Custodian on shares held in its custody hereunder.

9. Expenses. Except as provided in Sections 7, 11 and 13 hereof,
the reasonable fees and charges of the Custodian and all costs of maintaining
records and executing

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<PAGE> 4
transfers hereunder will be borne by the Company. Brokerage fees and
commissions for the purchase (but not the sale) of shares shall also be borne
by the Company. The Company will pay all costs incurred by it in connection
with payroll deductions. The Company will not make any contributions to the
Plan for the benefit of its employees, and each participating employee will pay
the full purchase price of the shares of Common Stock purchased for his or her
account pursuant to the Plan.

10. Designation of Custodian. Subject to its right to terminate
the designation, the Company has designated First Interstate Bank of Texas,
N.A. as the Custodian hereunder. The Custodian is the financial agent who is
charged with the responsibility of safekeeping of funds paid in and the shares
purchased under the Plan, after receipt of remittance by the Company each
calendar month, and until the shares are issued to the employees or cash
balances refunded.

11. Sale of Shares. Upon two days' or more written notice from a
participating employee to the Custodian, shares of Common Stock credited to the
participating employee's account maintained by the Custodian may be sold by
such employee (while the employee remains employed with the Company) on the
15th day or last day of each month, or, if the New York Stock Exchange is not
open on such day, on the next day on which it is open. Such sale shall be made
by the Custodian, at market price, as the first available trade on such day
next following completion of the two-day notice period. The participating
employee shall be responsible for, and shall pay, any fees or charges of the
Custodian, brokerage fees and commissions and other charges identified with and
incurred as a result of the sale. When the sale transaction is consummated,
the Custodian will forward to such employee a check for the proceeds of the
sale, net of the fees, commissions and other charges, together with a statement
detailing the terms of the sale, fees and commissions incurred and remaining
account balance.

12. Responsibility. Neither the Company, the Custodian nor any
broker through whom purchase orders are executed shall have any responsibility
or liability, other than liabilities arising out of applicable securities laws,
for any act or thing done or left undone, including, without limiting the
generality of the foregoing, any action taken with respect to the price, time,
quantity or other conditions and circumstances of the purchase of shares, in
accordance with the terms of the Plan. A determination by the Board of
Directors of the Company as to any question that may arise regarding the Plan's
conduct or operation shall be final.

13. Termination. In the event of the death or termination of
employment of a participating employee, the discontinuance of the Plan by the
Company or the election of a participating employee to withdraw from the Plan
for any reason, the participating employee, or in the event of death, such
deceased participant's designated beneficiary (or if no such beneficiary has
been designated, his or her legal representative in accordance with the
applicable laws of descent and distribution), shall have the right to elect to
receive a

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distribution of the shares of Common Stock being held for such employee's
account under the Plan or the cash equivalent thereof.

If such employee, beneficiary or representative elects to receive
Common Stock, all full shares being held for the employee's account under the
Plan will be transferred to such employee, beneficiary or representative or to
his or her order, and a certificate or certificates evidencing such shares will
be delivered as promptly as practicable, subject to the receipt by the
Custodian of documentation properly evidencing the rights and authority of the
beneficiary or representative of any deceased employee. Such employee,
beneficiary or representative shall be responsible for, and shall pay to the
Custodian, any fees and charges of the transfer agent and registrar for the
Company's Common Stock in connection with the issuance of stock certificates to
or upon the order of such employee, beneficiary or representative pursuant to
this paragraph. Fractional share balances that have been credited to the
employee will be converted into cash through sale by the Custodian, at market
price, as soon as practicable after the employee's termination of employment,
death or withdrawal from the Plan, as the case may be. In the event of
discontinuance of the Plan, interests in fractional shares will be liquidated
by the Custodian in a like manner and the proceeds distributed pro rata.

If such employee, beneficiary or representative elects to receive
cash, all full and fractional shares being held for the employee's account
under the Plan will be sold for such employee, beneficiary or representative by
the Custodian in accordance with Section 11 of the Plan, subject to the receipt
by the Custodian of documentation properly evidencing the rights and authority
of the beneficiary or representative of any deceased employee. The employee,
beneficiary or representative shall be responsible for, and shall pay, any fees
or charges of the Custodian, brokerage fees and commissions and other charges
identified with and incurred as a result of the sale.

14. Withholding Taxes. All amounts subject to withholding with
respect to each participating employee's (i) payroll deduction amounts under
the Plan and (ii) participation in the Plan will be deducted from such
participating employee's wages after reduction for his or her payroll deduction
amounts, and will not reduce the participating employee's payroll deduction
amounts allocated to the Plan hereunder.

15. Stockholder Rights. Each participating employee shall at all
times be the beneficial owner of all shares of Common Stock being held for his
or her account under the Plan. The Custodian shall deliver to each
participating employee notices of stockholder meetings, proxy statements and
other communications distributed by the Company to its stockholders. Prior to
the time the Custodian makes delivery to the participating employee of the
shares of Common Stock hereunder, the Custodian will exercise all voting rights
pertaining to each participating employee's pro rata share of such shares in
accordance with written directions, if any, given to the Custodian by such
participating employee prior to the date fixed for such exercise; in the
absence of such directions, the Custodian will exercise

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such voting rights in accordance with the applicable rules and regulations of
the Securities and Exchange Commission and the New York Stock Exchange then in
effect.

16. Statement of Account. The Custodian shall furnish each
participating employee with a statement promptly after the end of each Plan
year (and more frequently if the Board of Directors of the Company deems it
appropriate) indicating the dollar amount invested and the number of shares
purchased during the Plan year (or such shorter period as may be specified by
the Board of Directors of the Company), and the total number of shares (full
and fractional) credited to such employee's account, and such other pertinent
information as the Custodian may deem reasonable or necessary.

17. Effective Date of the Plan. With respect to all persons other
than Section 16 Reporting Persons, the Plan shall become effective as of the
Effective Date. With respect to Section 16 Reporting Person, the Plan shall
become effective as of December 2, 1994.

IN WITNESS WHEREOF, this Amended and Restated Employee Stock Purchase
Plan has been executed at Dallas, Texas on this 6th day of December, 1994.

SUN COAST INDUSTRIES, INC.

By: ____________________________________
Cynthia R. Morris, CFO and Treasurer

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EXHIBIT 23.1

INDEPENDENT AUDITOR'S CONSENT
-----------------------------

The Board of Directors
Sun Coast Industries, Inc.:

We consent to the use of our reports included and incorporated by reference
herein and to the references to our firm under the headings "Selected
Consolidated Financial Data" and "Experts" in the prospectus. Our reports
refer to a change in the method of accounting for income taxes.

/s/ KPMG PEAT MARWICK LLP
KPMG Peat Marwick LLP

Dallas, Texas
March 2, 1995