SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1996
Commission file numbers 1-11432; 1-11436
FOAMEX L.P.
FOAMEX CAPITAL CORPORATION
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 05-0475617
Delaware 22-3182164
- ------------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
1000 Columbia Avenue
Linwood, PA 19061
- ------------------------------- ----------------------
(Address of principal (Zip Code)
executive offices)
Registrant's telephone number, including area code: (610) 859-3000
--------------
Indicate by check mark whether the registrants (1) have filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) have been subject to such
filing requirements for the past 90 days.
YES X NO
--- ---
Foamex Capital Corporation meets the conditions set forth in General Instruction
H (1) (a) and (b) of Form 10-Q and is therefore filing this form with the
reduced disclosure format.
The number of shares of Foamex Capital Corporation's common stock outstanding as
of May 1, 1996 was 1,000.
Page 1 of 24
Exhibit List on Page 17 of 24
<PAGE>
FOAMEX L.P.
FOAMEX CAPITAL CORPORATION
INDEX
<TABLE>
<CAPTION>
Page
<S> <C>
Part I. Financial Information:
Item 1. Financial Statements
Foamex L.P.
Condensed Consolidated Statements of Operations - Thirteen Week Periods
Ended March 31, 1996 and April 2, 1995 3
Condensed Consolidated Balance Sheets as of March 31, 1996 and December 31, 1995 4
Condensed Consolidated Statements of Cash Flows - Thirteen Week Periods
Ended March 31, 1996 and April 2, 1995 5
Notes to Condensed Consolidated Financial Statements 6
Foamex Capital Corporation
Balance Sheets as of March 31, 1996 and December 31, 1995 10
Notes to Balance Sheets 11
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations 12
Part II. Other Information 17
Exhibit List 17
Signatures 24
</TABLE>
2
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
FOAMEX L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
13 Week Periods Ended
---------------------
March 31, April 2,
1996 1995
--------- --------
(thousands)
NET SALES $243,599 $242,194
COST OF GOODS SOLD 203,318 205,257
-------- --------
GROSS PROFIT 40,281 36,937
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 16,627 16,395
-------- ---------
INCOME FROM OPERATIONS 23,654 20,542
INTEREST AND DEBT ISSUANCE EXPENSE 11,607 12,308
OTHER INCOME, NET 200 172
-------- ---------
INCOME BEFORE PROVISION FOR INCOME TAXES 12,247 8,406
PROVISION FOR INCOME TAXES 412 1,048
-------- ---------
NET INCOME $ 11,835 $ 7,358
======== ========
The accompanying notes are an integral part of the condensed
consolidated financial statements.
3
<PAGE>
FOAMEX L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)
March 31, December 31,
ASSETS 1996 1995
----------- ----------
(thousands)
CURRENT ASSETS:
Cash and cash equivalents $ 6,160 $ 638
Accounts receivable, net 142,258 128,079
Inventories 106,532 106,528
Other current assets 24,122 22,206
--------- ---------
Total current assets 279,072 257,451
PROPERTY, PLANT AND EQUIPMENT, NET 189,230 191,729
COST IN EXCESS OF ASSETS ACQUIRED, NET 130,667 131,498
DEBT ISSUANCE COSTS, NET 18,071 18,703
OTHER ASSETS 15,988 17,631
--------- ---------
TOTAL ASSETS $633,028 $617,012
======== ========
LIABILITIES AND PARTNERS' EQUITY (DEFICIT)
CURRENT LIABILITIES:
Short-term borrowings $ 4,129 $ 2,199
Current portion of long-term debt 8,496 8,511
Accounts payable 73,182 74,101
Accounts payable to related parties 7,862 11,731
Accrued interest 20,372 9,591
Accrued restructuring charges 16,803 19,303
Other accrued liabilities 44,508 43,617
-------- ---------
Total current liabilities 175,352 169,053
-------- --------
LONG-TERM DEBT 431,899 433,956
-------- --------
OTHER LIABILITIES 30,514 26,563
-------- ---------
COMMITMENTS AND CONTINGENCIES - -
-------- ---------
PARTNERS' EQUITY (DEFICIT):
General partner 587 404
Limited partners 55,434 46,080
Note receivable from partner (46,227) (44,444)
Other (14,531) (14,600)
--------- ---------
Total partners' equity (deficit) (4,737) (12,560)
--------- ---------
TOTAL LIABILITIES AND PARTNERS' EQUITY (DEFICIT) $633,028 $617,012
======== ========
The accompanying notes are an integral part of the condensed
consolidated financial statements.
4
<PAGE>
FOAMEX L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
<TABLE>
<CAPTION>
13 Week Periods Ended
----------------------------
March 31, April 2,
1996 1995
----------- -------
(thousands)
<S> <C> <C>
OPERATING ACTIVITIES:
Net income $11,835 $ 7,358
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization 6,193 6,183
Amortization of debt issuance costs and debt discount 706 643
Provision for uncollectible accounts 315 312
Other operating activities 143 605
Changes in operating assets and liabilities (10,864) (5,419)
-------- -------
Net cash provided by operating activities 8,328 9,682
------- -------
INVESTING ACTIVITIES:
Capital expenditures (3,548) (7,148)
Other investing activities 981 79
------- -------
Net cash used for investing activities (2,567) (7,069)
-------- --------
FINANCING ACTIVITIES:
Net proceeds from (repayments of) short-term borrowings 1,930 (333)
Net repayments of revolving loans - (3,000)
Repayment of long-term debt (2,137) (2,498)
Other financing activities (32) (23)
-------- --------
Net cash used for financing activities (239) (5,854)
-------- --------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 5,522 (3,241)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 638 19,974
------- -------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 6,160 $16,733
======= =======
</TABLE>
The accompanying notes are an integral part of the condensed
consolidated financial statements.
5
<PAGE>
FOAMEX L.P. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The condensed consolidated balance sheet as of December 31, 1995 has been
condensed from the audited consolidated balance sheet at that date. The
condensed consolidated balance sheet as of March 31, 1996, and the condensed
consolidated statements of operations and cash flows for the thirteen week
periods ended March 31, 1996 and April 2, 1995 have been prepared by Foamex L.P.
and subsidiaries and have not been audited by Foamex L.P.'s independent
accountants. In the opinion of management, all adjustments, consisting only of
normal recurring adjustments, considered necessary for a fair presentation of
the consolidated financial position, results of operations and cash flows have
been included. In addition, the consolidated financial statements have been
restated to reflect the contribution of Foamex Latin America, Inc. ("Latin
America") by Foamex International Inc. ("Foamex International") as further
discussed in Note 3.
In October 1995, the Board of Directors of Foamex International approved a
plan to evaluate the potential reduction of long-term debt with substantially
all of the proceeds from the possible sale of the home comfort products segment
of Perfect Fit Industries, Inc. ("Perfect Fit") (which comprises substantially
all of the assets of Perfect Fit). Foamex International is continuing to
evaluate the possible sale of this business segment; however, no definitive
commitment has been reached. There can be no assurance that Foamex International
will be able to successfully sell this business segment or as to the price or
terms of any sale. The financial statements of Foamex L.P. do not include any
adjustments that might result from any sale.
Certain information and note disclosures normally included in the financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted in accordance with the rules and regulations of
the Securities and Exchange Commission. These condensed consolidated financial
statements should be read in conjunction with Foamex L.P.'s 1995 consolidated
financial statements and notes thereto as set forth in Foamex L.P.'s Annual
Report on Form 10-K for the fiscal year ended December 31, 1995.
2. INVENTORIES
The components of inventories consist of:
March 31, December 31,
1996 1995
-------- --------
(thousands)
Raw materials and supplies $ 58,256 $ 58,011
Work-in-process 17,870 17,362
Finished goods 30,406 31,155
-------- --------
Total $106,532 $106,528
======== ========
3. RELATED PARTY TRANSACTIONS
In April 1996, Foamex International contributed the foam products operations
of Latin America to Foamex L.P. The contribution was accounted for in a manner
similar to a pooling of interest since the entities are under common control.
Accordingly, all periods presented have been restated to reflect the results of
operations and financial position of Latin America. Net sales and net income of
the separate companies for the periods preceding the contribution were:
6
<PAGE>
FOAMEX L.P. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
3. RELATED PARTY TRANSACTIONS (continued)
13 Week Period Ended March 31, 1996:
<TABLE>
<CAPTION>
Foamex L.P. Latin America Eliminations Combined
(thousands)
<S> <C> <C> <C> <C>
Net sales $238,787 $5,448 $(636) $243,599
======== ====== ===== ========
Net income $ 11,419 $ 416 $ - $ 11,835
======== ====== ===== ========
13 Week Period Ended April 2. 1995:
Net sales $241,486 $ 708 $ - $242,194
======== ====== ===== ========
Net income (loss) $ 7,600 $ (242) $ - $ 7,358
======== ====== ===== ========
</TABLE>
Foamex L.P. has an $87.9 million principal amount note due 2006 from its 98%
limited partner, Foamex-JPS Automotive L.P. ("FJPS"), for $35.3 million (the
"FJPS Note"). The original issue discount of $52.6 million is being amortized
using the weighted average to maturity method over the life of the issue. No
cash interest is payable on the FJPS Note prior to July 2000; rather the FJPS
Note accretes on a daily basis and compounds semiannually at the rate of 15.50%
per annum through June 1996; 15.75% per annum thereafter through June 1997; and
16.00% per annum thereafter through June 2000. Interest will be due semiannually
in cash at 16.00% per annum from July 2000 through the maturity date. The FJPS
Note and related transactions have been classified in partners' equity (deficit)
since the companies are related. Also, the accretion of $1.8 million and $1.5
million for the thirteen week periods ended March 31, 1996 and April 2, 1995
have been reflected as a direct increase in the FJPS Note and the partners'
capital accounts, thereby excluded from the condensed consolidated statements of
operations.
Foamex L.P. has a supply agreement (the "Supply Agreement") with Foamex
International. Pursuant to the terms of the Supply Agreement, at the option of
Foamex L.P., Foamex International will purchase certain raw materials, which are
necessary for the manufacture of Foamex L.P.'s products, and resell such
materials to Foamex L.P. at a price equal to net cost plus reasonable out of
pocket expenses. Management believes that the terms of the Supply Agreement are
no less favorable than those which Foamex L.P. could have obtained from an
unaffiliated third party. During the thirteen week periods ended March 31, 1996
and April 2, 1995, Foamex L.P. purchased approximately $24.1 million and $26.8
million of raw materials under the Supply Agreement. As of March 31, 1996 and
December 31, 1995, Foamex L.P. had accounts payable to Foamex International of
approximately $7.9 million and $11.7 million, respectively, associated with the
Supply Agreement.
4. ENVIRONMENTAL MATTERS
Foamex L.P. has reported to appropriate state authorities that it has found
soil and groundwater contamination in excess of state standards at three
facilities and soil contamination in excess of state standards at four other
facilities. Foamex L.P. has begun remediation and is conducting further
investigations into the extent of the contamination at these facilities and,
accordingly, the extent of the remediation that may ultimately be required. As
of March 31, 1996, Foamex L.P. has environmental accruals of $1.5 million for
the remaining potential remediation costs for these facilities based on
engineering estimates.
Federal regulations require that by 1998 all underground storage tanks
("USTs") be removed or upgraded in most states to meet applicable standards.
Foamex L.P., like many other companies engaged in manufacturing, has USTs that
will require removal. Due to the age of many of Foamex L.P.'s approximately
twelve storage tanks, leakage has occurred from a few of these USTs resulting in
soil and possibly groundwater contamination. Foamex L.P. has accrued costs of
7
<PAGE>
FOAMEX L.P. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
4. ENVIRONMENTAL MATTERS (continued)
$0.5 million based on engineering estimates that the cost of removing the tanks
and remediation costs associated therewith ranges from approximately $0.4
million to $1.1 million. However, the full extent of contamination and,
accordingly, the actual cost of such remediation cannot be predicted with any
degree of certainty at this time. Foamex L.P. believes that its USTs do not pose
a significant risk of environmental liability because of Foamex L.P.'s
monitoring practices for USTs and conditional approval for permanent in-place
closure for certain USTs. However, there can be no assurance that such USTs will
not result in significant environmental liability in the future. Foamex L.P. has
been designated as a Potentially Responsible Party ("PRP") by the United States
Environmental Protection Agency (the "EPA") with respect to eleven sites, with
an estimated total liability to Foamex L.P. for the eleven sites of less than
approximately $0.2 million. Estimates of total cleanup costs and fractional
allocations of liability are generally provided by the EPA or the committee of
PRP's with respect to the specified site. In each case, the participation of
Foamex L.P. is considered to be immaterial.
As of March 31, 1996, the aggregate environmental liability amounts to $6.4
million, $1.6 million of which is included in current liabilities. In addition,
Foamex L.P. has a receivable of $0.6 million, net of an allowance of
approximately $1.0 million relating to potential disagreements regarding the
scope of the indemnification, for indemnification of environmental liabilities
from former owners of Foamex L.P., which is included in current assets. Foamex
L.P. believes that realization of the receivables established for
indemnification is probable.
Although it is possible that new information or future developments could
require Foamex L.P. to reassess its potential exposure relating to all pending
environmental matters, management believes that, based upon all currently
available information, the resolution of such environmental matters will not
have a material adverse effect on Foamex L.P.'s operations, financial position,
capital expenditures or competitive position. The possibility exists, however,
that new environmental legislation and/or environmental regulations may be
adopted, or other environmental conditions may be found to exist, that may
require expenditures not currently anticipated and that may be material.
5. LITIGATION
As of May 3, 1996, Foamex L.P. and Trace International Holdings Inc. ("Trace
Holdings") were two of multiple defendants in actions filed on behalf of
approximately 4,400 persons in various United States federal and state courts
and one Canadian provincial court by recipients of breast implants, some of
which allege substantial damages, but most of which allege unspecified damages
for personal injuries of various types. Five of these cases seek to allege
claims on behalf of all breast implant recipients or other allegedly affected
parties, but no class has been approved or certified by the court. In addition,
three cases have been filed alleging claims on behalf of approximately 2,597
residents of Australia, New Zealand, England, and Ireland. During 1995, Foamex
L.P. and Trace Holdings were granted summary judgments and dismissed as
defendants from all cases in the federal courts of the United States and the
state courts of California. Appeals for these decisions were withdrawn and the
decisions are final. In addition, two of the cases filed on behalf of 903
foreign plaintiffs were dismissed on the grounds that the cases could not be
brought in the United States courts. This decision is subject to appeal. Foamex
L.P. believes that the number of suits and claimants may increase. Although
breast implants do not contain foam, certain silicone gel implants were produced
using a polyurethane foam covering fabricated by independent distributors or
fabricators from bulk foam purchased from Foamex L.P. or Trace Holdings. Neither
Foamex L.P. nor Trace Holdings recommended, authorized or approved the use of
its foam for these purposes. While it is not feasible to predict or determine
the outcome of these actions, based on management's present assessment of the
merits of pending claims, after consultation with the general counsel of Trace
Holdings, notwithstanding potential indemnity from the manufacturers of
polyurethane covered breast implants, management believes that the disposition
of matters that are pending or that may reasonably be anticipated to be asserted
8
<PAGE>
FOAMEX L.P. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
5. LITIGATION (continued)
should not have a material adverse effect on either Foamex L.P.'s or Trace
Holdings' consolidated financial position or results of operations. In addition,
Foamex L.P. is also indemnified by Trace Holdings for any such liabilities
relating to foam manufactured prior to the capitalization of Foamex L.P. in
October 1990. Although Trace Holdings has paid Foamex L.P.'s litigation
expenses, pursuant to such indemnification, and management believes Trace
Holdings will be in a position to continue to pay such expenses, there can be no
assurance that Trace Holdings will be able to provide such indemnification.
Based on information available at this time with respect to the potential
liability, notwithstanding the indemnification provided by Trace Holdings and
the coverage provided by Trace Holdings' and Foamex L.P.'s liability insurance,
Foamex L.P. believes that the proceedings should not ultimately result in any
liability that would have a material adverse effect on the financial position or
results of operations of Foamex L.P. If management's assessment of Foamex L.P.'s
liability with respect to these actions is incorrect, such actions could have a
material adverse effect on Foamex L.P.
Foamex L.P. is one of multiple defendants in actions alleging bodily injury
and diminution in property value as a result of alleged violations of Tennessee
hazardous waste regulations at Foamex L.P.'s Morristown, Tennessee facilities.
Recticel Foam Corporation ("RFC") has indemnified Foamex L.P. with respect to
losses arising from certain events, such as this alleged violation, that had
occurred prior to October 2, 1990. Based on information available at this time
with respect to the potential liability, after consultation with the general
counsel of Trace Holdings, notwithstanding the indemnification provided by RFC,
the guaranty of such indemnification by RFC's parent company, Recticel s.a., and
the coverage provided by Foamex L.P.'s liability insurance, Foamex L.P. believes
that the proceedings should not ultimately result in any liability that would
have a material adverse effect on the financial position or results of
operations of Foamex L.P. If management's assessment of Foamex L.P.'s liability
with respect to these actions is incorrect, such actions could have a material
adverse effect on Foamex L.P.
Foamex L.P. is party to various other lawsuits, both as defendant and
plaintiff, arising in the normal course of business. It is the opinion of
management that the disposition of these lawsuits will not individually or in
the aggregate, have a material adverse effect on the financial position or
results of operations of Foamex L.P. If management's assessment of Foamex L.P.'s
liability with respect to these actions is incorrect, such actions could have a
material adverse effect on Foamex L.P.'s consolidated financial position.
9
<PAGE>
FOAMEX CAPITAL CORPORATION
(A Wholly-Owned Subsidiary of Foamex L.P.)
BALANCE SHEETS (unaudited)
<TABLE>
<CAPTION>
March 31, December 31,
ASSETS 1996 1995
-------- --------
(thousands)
<S> <C> <C>
CASH $ 1 $ 1
======== ========
LIABILITIES AND STOCKHOLDER'S EQUITY
COMMITMENTS AND CONTINGENCIES $ - $ -
-------- --------
STOCKHOLDER'S EQUITY:
Common stock, par value $.01 per share;
1,000 shares authorized, issued and outstanding - -
Additional paid-in capital 1 1
-------- --------
TOTAL STOCKHOLDER'S EQUITY $ 1 $ 1
======== =======
</TABLE>
The accompanying notes are an integral part of the balance sheets.
10
<PAGE>
FOAMEX CAPITAL CORPORATION
(A Wholly-Owned Subsidiary of Foamex L.P.)
Notes to Balance Sheets (unaudited)
1. ORGANIZATION
Foamex Capital Corporation ("FCC'), a wholly-owned subsidiary of Foamex
L.P., was formed for the sole purpose of obtaining financing from external
sources.
2. COMMITMENTS AND CONTINGENCIES
FCC is a joint obligor on the following borrowings of Foamex L.P.:
9 1/2% Senior Secured Notes due 2000 ("Senior Secured Notes")
The $116.7 million principal amount Senior Secured Notes were issued on
June 3, 1993 and bear interest at the rate of 9 1/2% payable semiannually on
each June 1 and December 1. The Senior Secured Notes mature on June 1, 2000. In
December 1993, in conjunction with Foamex International Inc's. ("Foamex
International") initial public offering, Foamex L.P. defeased $43.3 million of
Senior Secured Notes. The Senior Secured Notes are collateralized by a
first-priority lien on substantially all of the assets of Foamex L.P. except for
receivables, real estate and fixtures. The Senior Secured Notes may be redeemed
at the option of Foamex L.P., in whole or in part, at any time on or after June
1, 1998, initially at 101.583% of their principal amount, plus accrued interest,
and declining to 100% on or after June 1, 1999. The Senior Secured Notes have
been guaranteed, on a senior secured basis, by General Felt Industries, Inc.
("General Felt") and, on a senior unsecured basis, by Foamex International and
Perfect Fit Industries, Inc. ("Perfect Fit")
11 1/4% Senior Notes due 2002 ("Senior Notes")
The $150.0 million principal amount Senior Notes bear interest at the rate
of 11 1/4% payable semiannually on each April 1 and October 1. The Senior Notes
mature on October 1, 2002. The Senior Notes may be redeemed at the option of
Foamex L.P., in whole or in part, at any time on or after October 1, 1997,
initially at 104.219% of their principal amount, plus accrued interest, and
declining to 100% on or after October 1, 2000. The Senior Notes have been
guaranteed, on a senior basis, by General Felt, Perfect Fit, and Foamex
International.
11 7/8% Senior Subordinated Debentures due 2004 ("Subordinated Debentures")
The $126.0 million principal amount Subordinated Debentures bear interest
at the rate of 11 7/8% payable semiannually on each April 1 and October 1. The
Subordinated Debentures mature on October 1, 2004. The Subordinated Debentures
may be redeemed at the option of Foamex L.P., in whole or in part, at any time
on or after October 1, 1997, initially at 105.938% of their principal amount,
plus accrued interest, and declining to 100% on or after October 1, 2002. The
Subordinated Debentures are subordinated in right of payment to all senior
indebtedness, including the Senior Secured Notes and the Senior Notes. The
Subordinated Debentures have been guaranteed, on a senior subordinated basis, by
General Felt, Perfect Fit, and Foamex International.
11 7/8% Senior Subordinated Debentures, Series B ("Series B Debentures")
The $7.0 million principal amount Series B Debentures were issued July 30,
1993 by Foamex L.P. in an exchange offer to holders of senior subordinated
debentures issued in connection with the acquisition of General Felt on March
23, 1993. The Series B Debentures have terms substantially similar to the
Subordinated Debentures, except that holders of the Series B Debentures are
entitled to receive proceeds from an asset sale only if any proceeds remain
after an offer to repurchase has been made to the holders of the Subordinated
Debentures. The Series B Debentures have been guaranteed on a senior
subordinated basis by General Felt and Perfect Fit.
11
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Foamex L.P. is one of the largest manufacturers of flexible polyurethane
foam and foam products in North America and currently operates in two business
segments, polyurethane foam products and home comfort products. The following
discussion should be read in conjunction with the condensed consolidated
financial statements and related notes thereto of Foamex L.P. included in this
report.
In October 1995, the Board of Directors of Foamex International Inc.
("Foamex International") approved a plan to evaluate the potential reduction of
long-term debt with substantially all of the proceeds from the possible sale of
the home comfort products segment of Perfect Fit Industries, Inc. ("Perfect
Fit") (which comprises substantially all of the assets of Perfect Fit). Foamex
International is continuing to evaluate the possible sale of this business
segment; however, no definitive commitment has been reached. There can be no
assurance that Foamex International will be able to successfully sell this
business segment or as to the price or terms of any sale. The financial
statements of Foamex L.P. do not include any adjustments that might result from
any sale.
In October 1995, the Board of Directors of Foamex International also
approved an operational plan to improve the profitability of Foamex L.P.'s foam
products segment. The operational plan consists of (i) reducing layers of
management through organizational realignment, (ii) the consolidation of
thirteen foam production, fabrication or branch locations, (iii) implementing
additional procedures to reduce manufacturing costs, including process redesign
to eliminate non-value added operations, (iv) reducing selling, general and
administrative expenses through cost containment and (v) reducing inventory
levels through improved forecasting and the effect of the plant consolidations.
The operational plan and other actions are expected to result in estimated
annualized savings in excess of $50.0 million, with expected savings in 1996 of
approximately $30.0 million of which it is estimated that Foamex L.P. realized
approximately $4.4 million of savings under the operational plan during the
first quarter of 1996. The consolidation of the thirteen foam production,
fabrication or branch locations (referred to above) and the closure of two
manufacturing facilities in the home comfort products segment are collectively
referred to herein as the restructuring plan. As of March 31, 1996, Foamex L.P.
has closed twelve locations included in the restructuring plan and it is
expected that the restructuring plan will be substantially completed by year
end. There can be no assurance that Foamex L.P. will be able to successfully
implement the foregoing.(1)
Foamex L.P.'s automotive foam customers are predominantly automotive
original equipment manufacturers or other automotive suppliers. As such, the
sales of these product lines are directly related to the overall level of
passenger car and light truck production in North America. Also, Foamex L.P.'s
sales are sensitive to sales of new and existing homes, changes in personal
disposable income and seasonality. Foamex L.P. typically experiences two
seasonally slow periods during each year, in early July and in late December,
due to scheduled plant shutdowns and holidays.
13 Week Period Ended March 31, 1996 Compared to 13 Week Period Ended
April 2, 1995
Consolidated Results of Operations
Net sales for 1996 were $243.6 million as compared to $242.2 million in
1995. The $1.4 million or 0.6% increase in net sales was primarily due to an
increase in the home comfort products segment's net sales as discussed in "Home
Comfort Products Segment Results of Operations".
Gross profit as a percentage of net sales for 1996 increased to 16.5%
from 15.3% in 1995 primarily due to selling price increases and improved
material and production efficiencies in the foam products segment.
(1) This paragraph contains forward-looking statements and should be read in
conjunction with the discussion regarding forward-looking statements set
forth on Page 5 of Foamex L.P.'s Annual Report on Form 10-K.
12
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Income from operations increased to $23.7 million for 1996 from $20.5
million in 1995 primarily due to improved gross profit margins as discussed
above. Selling, general and administrative expenses remained fairly consistent
at $16.6 million for 1996 as compared to $16.4 million in 1995.
Net income increased to $11.8 million for 1996 from $7.4 million in 1995
primarily due to the reasons cited above and a decrease in interest and debt
issuance expense of $0.7 million. The decrease in interest and debt issuance
expense was primarily due to favorable results from interest rate swap
agreements and a reduction in long-term debt outstanding.
Operating results for 1996 are expected to be influenced by various
internal and external factors. These factors include, among other things, (i)
the implementation of an operational plan to improve the profitability of the
foam products segment, (ii) the completion of the consolidation of thirteen foam
production, fabrication or branch locations and the closure of two manufacturing
facilities in the home comfort products segment, (iii) the potential reduction
of long-term debt with substantially all of the proceeds from the possible sale
of the home comfort products segment, (iv) additional raw material price
increases, if any, by Foamex L.P.'s chemical suppliers and (v) Foamex L.P.'s
success in passing on selling price increases to recover previous raw material
cost increases.(1)
Foam Products Segment Results of Operations
Net sales for 1996 were $218.4 million as compared to $218.2 million in
1995. Carpet cushion net sales for 1996 decreased 6.5% to $63.5 million from
$67.9 million in 1995 primarily due to reduced net sales volume of certain
carpet cushion products. Also, 1995 included net sales from a promotional
program that was not continued in 1996. Cushioning foam net sales for 1996
increased 7.5% to $81.5 million from $75.8 million in 1995 primarily due to the
April 1995 acquisition of a company which manufactures cushioning products,
increased net sales volume of bedding related products and increased selling
prices. Automotive foam net sales for 1996 decreased 4.1% to $56.3 million from
$58.7 million in 1995 primarily due to the reduction of automotive vehicle
production in 1996 as compared to 1995. Technical foam net sales for 1996
increased 8.2% to $17.1 million from $15.8 million in 1995 primarily due to
increased selling prices and increased net sales volume.
Gross profit as a percentage of net sales increased to 16.5% for 1996
from 15.0% in 1995 primarily due to selling price increases and improved
material and production efficiencies.
Income from operations increased to $22.5 million for 1996 from $19.8
million in 1995 primarily due to improved gross profit margins as discussed
above offset by an increase of $0.7 million in selling, general and
administrative expenses for 1996 as compared to 1995 primarily due to management
realignment under the operational plan.
Home Comfort Products Segment Results of Operations
Net sales for 1996 increased 5.0% to $25.2 million from $24.0 million in
1995 primarily due to increased net sales volume of decorative bedding products.
Gross profit as a percentage of net sales decreased to 16.9% for 1996 from 17.8%
in 1995 primarily due to competitive pricing pressures in the retail industry.
Income from operations increased to $1.2 million for 1996 from $0.8
million in 1995. Selling, general and administrative expenses as a percentage of
net sales decreased to 12.0% during 1996 from 14.6% in 1995 primarily due to the
elimination of certain benefits for an officer who resigned in February 1996.
(1) This paragraph contains forward-looking statements and should be read in
conjunction with the discussion regarding forward-looking statements set
forth on Page 5 of Foamex L.P.'s Annual Report on Form 10-K.
13
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Foamex Capital Corporation ("FCC")
FCC is solely a co-issuer of certain indebtedness of Foamex L.P. and FCC
has no other material operations.
Liquidity and Capital Resources
Liquidity
Foamex L.P.'s operating cash requirements consist principally of working
capital requirements, scheduled payments of principal and interest on
outstanding indebtedness and capital expenditures. Foamex L.P. believes that
cash flow from operating activities, cash on hand and periodic borrowings under
its revolving credit agreement, if necessary, will be adequate to meet the
operating cash requirements. The ability to meet operating cash requirements
could be impaired if Foamex L.P. were to fail to comply with any of the
covenants contained in the Foamex L.P. credit facility (the "Foamex L.P. Credit
Facility") and such noncompliance was not cured by Foamex L.P. or waived by the
lenders. Foamex L.P. was in compliance with the covenants of the Foamex L.P.
Credit Facility as of March 31, 1996 and expects to be in compliance for the
foreseeable future. The ability of Foamex L.P. to make distributions to Foamex
International is restricted by the terms of its financing agreements.
Cash and cash equivalents increased $5.6 million during 1996 to $6.2
million at March 31, 1996 from $0.6 million at December 31, 1995 primarily due
to improved operating results offset by capital expenditures and scheduled debt
repayments. Working capital increased $15.3 million for 1996 to $103.7 million
at March 31, 1996 from $88.4 million at December 31, 1995. The net operating
assets and liabilities (comprised of accounts receivable, inventories and
accounts payable) increased $15.1 million to $175.6 million at March 31, 1996
from $160.5 million at December 31, 1995 primarily due to an increase in
accounts receivable and a decrease in accounts payable. The increase in accounts
receivable was primarily due to an increase in net sales for March 1996 as
compared to December 1995. In addition, accrued interest increased approximately
$10.8 million due to an interest payment due date in April 1996.
Cash Flow from Operating Activities
Cash flow from operating activities was $8.3 million and $9.7 million in
1996 and 1995, respectively. Cash flow from operating activities decreased for
1996 as compared to 1995 primarily due to an increased use of cash by operating
assets and liabilities offset by improved operating results.
Cash Flow from Investing Activities
During 1996, Foamex L.P. spent approximately $3.5 million on capital
expenditures and expects to maintain spending for capital expenditures at this
level for the foreseeable future.
Cash Flow from Financing Activities
As of March 31, 1996, there were no outstanding revolving credit
borrowings under the Foamex L.P. Credit Facility with unused availability of
approximately $34.5 million. Borrowings by Foamex Canada Inc. as of March 31,
1996 were $4.1 million under a revolving credit agreement with unused
availability of approximately $0.3 million.
14
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Interest Rate Swap Agreements
Foamex L.P. enters into interest rate swaps to lower funding costs and/or
to manage interest costs and exposure to changing interest rates. Foamex L.P.
does not hold or issue financial instruments for trading purposes. Foamex L.P.
has an interest rate swap agreement with a notional amount of $150.0 million
through June 2000. Under the swap agreement, Foamex L.P. is obligated to make
variable payments based on LIBOR in exchange for fixed payments at a rate of
5.81% per annum by the swap partner payable semiannually in arrears. Interest
expense will be subject to fluctuations in LIBOR. Foamex L.P. is exposed to
credit loss in the event of nonperformance by the swap partner; however, the
occurrence of this event is not anticipated.
Also, Foamex L.P. has an interest rate swap agreement, as amended, for a
notional amount of $150.0 million through December 1998. Under this agreement,
Foamex L.P. has made variable payments based on LIBOR with a cap of 5.5% and a
floor of 4.75% per annum for the six months ended in June 1995 and variable
payments based on LIBOR with a floor of 4.75% per annum for the six months ended
in December 1995 and is obligated to make fixed payments at a rate of 5.81% per
annum, for the remainder of the agreement, in exchange for variable payments by
the swap partner at the rate of LIBOR plus 0.80% per annum for the six months
ended in June 1995, LIBOR plus 0.72% per annum for the six months ended in
December 1995, LIBOR plus 1.89% per annum for the six months ended in June 1996,
LIBOR plus 1.83% per annum for the six months ended in December 1996 and 12.34%
per annum less LIBOR for the remainder of the term of the agreement, payable
semiannually in arrears. The swap partner has the ability to terminate the swap
agreement in December 1996. Foamex L.P. is exposed to credit loss in the event
of nonperformance by the swap partner; however, the occurrence of this event is
not anticipated. Interest expense will be subject to fluctuations in LIBOR. The
effect of the two interest rate swaps described above was a favorable adjustment
to interest expense of $0.8 million and $0.6 million for 1996 and 1995,
respectively.
Environmental Matters
Foamex L.P. is subject to extensive and changing environmental laws and
regulations. Expenditures to date in connection with Foamex L.P.'s compliance
with such laws and regulations did not have a material adverse effect on
operations, financial position, capital expenditures or competitive position.
The amount of liabilities recorded by Foamex L.P. in connection with
environmental matters as of March 31, 1996 was $6.4 million. In addition, as of
March 31, 1996, Foamex L.P. has receivables of $0.6 million, net of $1.0 million
allowance relating to potential disagreements regarding the scope of the
indemnification, for indemnification of environmental liabilities from former
partners. Although it is possible that new information or future developments
could require Foamex L.P. to reassess its potential exposure to all pending
environmental matters, including those described in the footnotes to Foamex
L.P.'s consolidated financial statements, management believes that, based upon
all currently available information, the resolution of all such pending
environmental matters will not have a material adverse effect on Foamex L.P.'s
operations, financial position, capital expenditures or competitive position.
The possibility exists, however, that new environmental legislation and/or
environmental regulations may be adopted, or other environmental conditions may
be found to exist, that may require expenditures not currently anticipated and
that may be material.
15
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Inflation and Other Matters
There was no significant impact on Foamex L.P.'s operations as a result
of inflation for the periods presented. In some circumstances, market conditions
or customer expectations may prevent Foamex L.P. from increasing the price of
its products to offset the inflationary pressures that may increase its costs in
the future.
16
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
Reference is made to the description of the legal proceedings
contained in the Foamex L.P. Annual Report on Form 10-K for the fiscal
year ended December 31, 1995.
The information from Notes 4 and 5 of the condensed consolidated
financial statements of Foamex L.P. and subsidiaries as of March 31,
1996 (unaudited) is incorporated herein by reference.
Item 2. Changes in Securities.
None.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
Item 5. Other Information.
None.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
3.1(a) - Restated Certificate of Incorporation of Foamex International.
3.2(a) - By-laws of Foamex International.
3.3(a) - Fourth Amended and Restated Agreement of Limited Partnership
of Foamex L.P., dated as of December 14, 1993, by and among
FMXI and Trace Foam, as general partners, and Foamex
International, as a limited partner (the "Partnership
Agreement").
3.4(n) - First Amendment to the Fourth Amendment and Restated
Agreement of Limited Partnership of Foamex L.P., dated June 28,
1994.
3.5(a) - Certificate of Incorporation of FMXI.
3.6(a) - By-laws of FMXI.
3.7(e) - Certificate of Incorporation of FCC.
3.8(e) - By-laws of FCC.
3.9(c) - Certificate of Incorporation of GFI Acquisition Corp.
3.10(c) - Certificate of Amendment to the Certificate of Incorporation of
GFI Acquisition Corp.
3.11(c) - Certificate of Amendment to the Certificate of Incorporation of
General Felt.
3.12(n) - Certificate of Incorporation of Perfect Fit.
3.13(n) - By-laws of Perfect Fit.
4.1(b) - Indenture, dated as of June 3, 1993, among Foamex L.P. and
FCC, as joint and several obligors, General Felt, as Guarantor,
and Shawmut Bank, National Association ("Shawmut"), as trustee,
relating to $160,000,000 principal amount of 9 1/2% Senior
Secured Notes due 2000, including form of Senior Secured Note.
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4.2(a) - First Supplemental Indenture, dated as of November 18, 1993,
among Foamex International and FCC, as Issuers, General Felt
and Perfect Fit, as Guarantors and Shawmut, as trustee,
relating to the Senior Secured Notes.
4.3(a) - Second Supplemental Indenture, dated as of December 14, 1993,
among Foamex L.P. and FCC, as Issuers, Foamex International,
General Felt, and Perfect Fit, as Guarantors and Shawmut, as
trustee, relating to the Senior Secured Notes.
4.4(b) - Company Pledge Agreement, dated as of June 3, 1993, by Foamex
L.P. in favor of Shawmut, as trustee for the holders of the
Senior Secured Notes.
4.5(b) - Company Pledge Agreement, dated as of June 3, 1993, by FCC in
favor of Shawmut, as trustee for the holders of the Senior
Secured Notes.
4.6(b) - Subsidiary Pledge Agreement, dated as of June 3, 1993, by
General Felt in favor of Shawmut, as trustee for the holders of
the Senior Secured Notes.
4.7(b) - Company Security Agreement, dated as of June 3, 1993, by Foamex
L.P. and FCC in favor of Shawmut, as trustee for the holders of
the Senior Secured Notes.
4.8(a) - Foamex L.P. Pledge Agreement, dated November 18, 1993, in
connection with the Senior Secured Notes.
4.9(b) - Subsidiary Security Agreement, dated as of June 3, 1993, by
General Felt in favor of Shawmut, as trustee for the holders of
the Senior Secured Notes.
4.10(b) - Collateral Assignment of Patents and Trademarks, dated as of
June 3, 1993, by Foamex L.P. in favor of Shawmut, as trustee
for the holders of the Senior Secured Notes.
4.11(b) - Collateral Assignment of Patents and Trademarks, dated as of
June 3, 1993, by FCC in favor of Shawmut, as trustee for the
holders of the Senior Secured Notes.
4.12(b) - Collateral Assignment of Patents and Trademarks, dated as of
June 3, 1993, by General Felt in favor of Shawmut, as trustee
for the holders of the Senior Secured Notes.
4.13(a) - Pledge Agreement of Perfect Fit, dated November 18, 1993, in
connection with the Senior Secured Notes.
4.14(c) - Indenture, dated as of October 13, 1992, among Foamex L.P.,
FCC, and The Connecticut National Bank, as trustee, relating to
$150,000,000 principal amount of 11 1/4% Senior Notes due 2002,
including form of Senior Note.
4.15(d) - First Supplemental Indenture, dated as of March 23, 1993,
among Foamex L.P. and FCC, as joint and several obligors,
General Felt, as Guarantor, and Shawmut Bank Connecticut,
National Association (formerly The Connecticut National Bank)
("Shawmut Connecticut"), as trustee, relating to the Senior
Notes.
4.16(a) - Second Supplemental Indenture, dated as of November 18, 1993,
among Foamex L.P. and FCC, as Issuers, General Felt, and
Perfect Fit, as Guarantors and Shawmut Connecticut, as trustee,
relating to the Senior Notes.
4.17(a) - Third Supplemental Indenture, dated as of December 14, 1993,
among Foamex L.P. and FCC, as Issuers, Foamex International,
General Felt, and Perfect Fit, as Guarantors and Shawmut
Connecticut, as trustee, relating to the Senior Notes.
4.18(m) - Fourth Supplemental Indenture, dated as of October 31, 1994,
among Foamex L.P. and FCC as Issuers, Foamex International as
Parent Guarantor, General Felt, and Perfect Fit as Guarantors
and Shawmut Connecticut, as Trustee, relating to the Senior
Notes.
4.19(c) - Indenture, dated as of October 13, 1992, among Foamex L.P.,
FCC, and Shawmut Bank, ("Shawmut"), as trustee, relating to
$126,000,000 principal amount of 117/8% Senior Subordinated
Debentures due 2004, including form of Senior Subordinated
Debenture.
4.20(d) - First Supplemental Indenture, dated as of March 23, 1993,
among Foamex L.P. and FCC, as joint and several obligors,
General Felt, as Guarantor, and Shawmut, as trustee, relating
to the Senior Subordinated Debentures.
4.21(a) - Second Supplemental Indenture, dated as of November 18, 1993,
among Foamex L.P. and FCC, as Issuers, General Felt and Perfect
Fit, as Guarantors and Shawmut, as trustee, relating to the
Senior Subordinated Debentures.
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4.22(b) - Third Supplemental Indenture, dated as of December 14, 1993,
among Foamex L.P. and FCC, as Issuers, Foamex International,
General Felt, and Perfect Fit, as Guarantors and Shawmut, as
trustee, relating to the Senior Subordinated Debentures.
4.23(i) - Indenture, dated as of June 28, 1994, among FJPS and FJCC, as
Issuers, Trace Holdings, as guarantor, and Shawmut Connecticut,
as trustee, relating to $116,745,000 principal amount of Senior
Secured Discount Debentures due 2004, including form of Senior
Secured Discount Debenture.
4.24(m) - Pledge Agreement, dated as of June 28, 1994, made by FJPS in
favor of Shawmut, as collateral agent for the holders of the
Senior Secured Discount Debentures.
4.25(i) - Senior Note, dated June 28, 1994, in the aggregate principal
amount of $87,943,103.14 due July 1, 2006, executed by FJPS to
Foamex L.P.
4.26(m) - Pledge Agreement, dated as of June 28, 1994, among FJPS in
favor of Foamex L.P. to secure its obligations under its Senior
Note due 2006.
4.27(m) - Pledge Agreement, dated as of June 28, 1994, made by JPS
Automotive L.P. in favor of Foamex L.P. to secure FJPS's
obligations under its Senior Note due 2006.
4.28(o) - Commitment letter, dated July 18, 1995, from The Bank of Nova
Scotia to Foamex Canada.
4.29(d) - Agreement of Undertaking, dated as of December 31, 1991,
between Foamex L.P. and The Bank of Nova Scotia.
4.30(i) - Second Amended and Restated Credit Agreement, dated as of
June 28, 1994, among Foamex L.P., General Felt, Perfect Fit,
Trace Foam, FMXI, Citibank, N.A., The Bank of Nova Scotia, the
institutions from time to time parties thereto as lenders, the
institutions parties thereto as issuing banks and Citibank,
N.A. and The Bank of Nova Scotia, as Administrative Agents (the
"Credit Agreement").
4.31(m) - First Amendment to Second Amended and Restated Credit
Agreement of Foamex L.P., dated as of August 19, 1994.
4.32(m) - Second Amendment to Second Amended and Restated Credit
Agreement of Foamex L.P., dated as of November 11, 1994.
4.33(m) - Third Amendment to Second Amended and Restated Credit
Agreement of Foamex L.P., dated as of February 8, 1995.
4.34(o) - Fourth Amendment to Second Amended and Restated of Foamex L.P.,
dated as of June 30, 1995.
4.35(p) - Fifth Amendment to Second Amended and Restated of Foamex L.P.,
dated as of February 27, 1996.
4.36(p) - Letter of Consent to Waiver to the Second Amended and Rested
Foamex L.P. Credit Agreement, dated December 21, 1995.
4.37(p) - Letter of Consent to Waiver of the Second Amended and Restated
Foamex L.P. Credit Agreement, dated January 25, 1996.
4.38(a) - Guaranties, dated November 18, 1993, executed by each of
Foamex L.P., General Felt and Perfect Fit, as guarantor,
respectively, in favor of Citibank, N.A., as Administrative
Agent, for the ratable benefit of the lenders and the issuing
banks, guaranteeing the obligations of one another under the
Credit Agreement.
4.39(a) - Guaranty, dated November 18, 1993, executed by FCC in favor
of Citibank, N.A., as Administrative Agent, for the ratable
benefit of the lenders and the issuing banks, guaranteeing the
obligations of Foamex L.P., General Felt and Perfect Fit under
the Credit Agreement.
4.40(i) - Amended and Restated Guaranty, dated as of June 28, 1994,
executed by Foamex International in favor of Citibank, N.A. and
The Bank of Nova Scotia, as Administrative Agents, for the
ratable benefit of the lenders and the issuing banks under the
Credit Agreement.
4.41(p) - First Amendment to Amended and Restated Guaranty, dated June
30, 1995, executed by Foamex International in favor of
Citibank, N.A. and The Bank of Nova Scotia, as Administrative
Agents, for the ratable benefit of the lenders and the issuing
banks under the Credit Agreement.
4.42(p) - Second Amendment to Amended and Restated Guaranty, dated
February 27, 1996, executed by Foamex International in favor of
Citibank, N.A. and The Bank of Nova Scotia, as Administrative
Agents, for the ratable benefit of the lenders and the issuing
banks under the Credit Agreement.
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4.43(a) - Security Agreements, dated November 18, 1993, executed by
each of Foamex L.P., General Felt, Perfect Fit, and FCC,
respectively, and Citibank N.A., as Administrative Agent for
the lenders and the issuing banks under the Credit Agreement.
4.44(i) - Amendatory Agreement, dated as of June 28, 1994, among Foamex
L.P., General Felt, Perfect Fit, FCC, and Citibank, N.A., as
collateral agent under the Credit Agreement.
4.45(a) - Intercreditor Agreement, dated as of November 18, 1993, by
and between Citibank, N.A., as Administrative Agent under the
Credit Agreement and Shawmut, as trustee under the Foamex L.P.
Senior Secured Note Indenture.
4.46(a) - Subordinated Promissory Note, dated as of May 6, 1993, in the
original principal amount of $7,014,864 executed by Foamex L.P.
to Rallis.
4.47(a) - Marely Loan Commitment Agreement, dated as of December 14,
1993, by and between Foamex International and Marely.
4.48(a) - DLJ Loan Commitment Agreement, dated as of December 14, 1993,
by and between Foamex International and DLJ Funding.
4.49(o) - Promissory Note, dated July 7, 1995, in the aggregate principal
amount of $4,372,516, executed by Trace Holdings to Foamex L.P.
4.50 - Promissory Note, dated December 8, 1995, in the aggregate
principal amount of $2,000,000 executed by Foamex International
to Foamex L.P.
10.1(b) - Interest Rate and Currency Exchange Agreement, dated as of
June 14, 1993, among Foamex L.P., FCC, and Salomon Brothers
Holdings Company Inc ("Salomon Holdings").
10.2(m) - Swap Agreement, dated as of March 31, 1994, and amended in
November 1994, by and between Foamex L.P. and Citibank, N.A.
10.3 - Amended Confirmation Letter Agreement, dated as of February 2,
1996, by and between Foamex L.P. and Citibank, N.A.
10.4(b) - Revised Swap Transaction Letter Agreement, dated as of June
10, 1993, among Foamex L.P., FCC and Salomon Holdings.
10.5(d) - Reimbursement Agreement, dated as of March 23, 1993, between
Trace Holdings and General Felt.
10.6(d) - Shareholder Agreement, dated December 31, 1992, among
Recticel, s.a., Recticel Holding Noord B.V., Foamex L.P.,
Beamech Group Limited, LME-Beamech, Inc., James Brian Blackell,
and Prefoam AG relating to foam technology sharing arrangement.
10.7(e) - Asset Transfer Agreement, dated as of October 2, 1990, between
Trace Holdings and the Foamex L.P. (the "Trace Holdings Asset
Transfer Agreement").
10.8(e) - First Amendment, dated as of December 19, 1991, to the Trace
Holdings Asset Transfer Agreement.
10.9(e) - Amended and Restated Guaranty, dated as of December 19, 1991,
made by Trace Foam in favor of Foamex L.P.
10.10(e) - Asset Transfer Agreement, dated as of October 2, 1990, between
RFC and Foamex L.P. (the "RFC Asset Transfer Agreement").
10.11(e) - First Amendment, dated as of December 19, 1991, to the RFC
Asset Transfer Agreement.
10.12(e) - Schedule 5.03 to the RFC Asset Transfer Agreement (the "5.03
Protocol").
10.13(d) - The 5.03 Protocol Assumption Agreement, dated as of October 13,
1992, between RFC and Foamex L.P.
10.14(d) - Letter Agreement between Trace Holdings and Recticel
regarding the Recticel guaranty, dated as of July 22, 1992.
10.15(e) - Supply Agreement between Recticel s.a., formerly known as
Gechem s.a., and Foamex L.P., dated as of August 1, 1991.
10.16(i) - Supply Agreement, dated June 28, 1994, between Foamex L.P. and
Foamex International.
10.17(i) - First Amended and Restated Tax Sharing Agreement, dated as of
December 14, 1993, among Foamex L.P., Trace Foam, FMXI, and
Foamex International.
10.18(i) - Tax Sharing Agreement, dated as of June 28, 1994, among FJPS
and Foamex International.
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10.19(d) - Trace Foam Management Agreement between Foamex L.P. and Trace
Foam, dated as of October 13, 1992.
10.20(i) - Affirmation Agreement re: Management Agreement, dated as of
December 14, 1993 between Foamex L.P. and Trace Foam.
10.21(d) - Agreement and Plan of Merger, dated as of March 11, 1993,
among Foamex L.P., GFI Acquisition, Inc. and General Felt.
10.22(c) - Agreement and Plan of Merger, dated as of March 1, 1993,
among Great Western, Rallis, Foamex L.P. and Kyoto Merger, Inc.
10.23(e) - Salaried Incentive Plan of Foamex L.P. and Subsidiaries.
10.24(e) - Trace Holdings 1987 Nonqualified Stock Option Plan.
10.25(e) - Equity Growth Participation Program.
10.26(e) - Foamex L.P. Salaried Retirement Plan (formerly known as the
Foamex L.P. Products, Inc. Salaried Employee Retirement Plan),
as amended, effective July 1, 1984.
10.27(m) - General Felt Industries, Inc. Retirement Plan for Salaried
Employees, effective as of January 1, 1995.
10.28(e) - Foamex L.P. 401(k) Savings Plan dated January 1, 1989.
10.29(o) - Foamex/GFI 401(k) Savings Plan dated July 1, 1995.
10.30(a) - Foamex International's 1993 Stock Option Plan.
10.31(a) - Foamex International's Non-Employee Director Compensation Plan.
10.32(a) - Employment Agreement, dated as of May 6, 1993, by and between
Foamex L.P. and Rallis.
10.33(f) - Employment Agreement, dated as of February 1, 1994, by and
between Foamex L.P. and William H. Bundy.
10.34(p) - Employment Agreement, dated as of July 26, 1995, by and between
Foamex L.P. and Salvatore J. Bonanno.
10.35(a) - Stock Exchange Agreement, dated as of October 25, 1993, among
Perfect Fit, the stockholders which are parties thereto, Foamex
International and Foamex L.P. (the "Perfect Fit Stock Exchange
Agreement").
10.36(a) - Amendment No. 1 to the Perfect Fit Stock Exchange Agreement,
dated November 18, 1993.
10.37(a) - 1993 Recticel Master Agreement, dated as of November 4, 1993,
by and among Trace Holdings, Trace Foam, RFC, Foamex
International, Recticel s.a., MGM, FCD Sub and Foamex L.P.
10.38(a) - Exchange Agreement, dated as of December 14, 1993, by and
between Foamex International and RFC.
10.39(a) - Withdrawal Agreement, dated as of December 14, 1993, by and
between Foamex L.P. and RFC.
10.40(a) - 1993 Agreement of Terms, dated as of November 4, 1993, by and
among Trace Holdings, Trace Foam, Foamex L.P., Foamex
International, and GBNY.
10.41(a) - 1993 Marely Master Agreement, dated as of November 4, 1993,
by and among Foamex International, Trace Holdings, Trace Foam,
Foamex L.P., and Marely.
10.42(a) - Exchange Agreement, dated as of December 14, 1993, by and
between Foamex International and Marely.
10.43(a) - Warrant Exchange Agreement, dated as of December 14, 1993, by
and between Foamex International and Marely.
10.44(a) - Redemption and Withdrawal Agreement, dated as of December 14,
1993, by and between Foamex L.P. and Marely.
10.45(a) - 1993 DLJ Master Agreement, dated as of November 4, 1993, by
and among Foamex International, Trace Holdings, Trace Foam, DLJ
Funding, and Foamex L.P.
10.46(a) - Exchange Agreement, dated as of December 14, 1993, by and
between Foamex International and DLJ Funding.
10.47(a) - Warrant Exchange Agreement, dated as of December 14, 1993, by
and between Foamex International and DLJ Funding.
10.48(a) - Redemption and Withdrawal Agreement, dated as of December 14,
1993, by and between Foamex L.P. and DLJ Funding.
21
<PAGE>
10.49(a) - 1993 Rallis Master Agreement, dated as of November 4, 1993,
by and among Foamex International, Trace Holdings, Trace Foam,
Rallis, and Foamex L.P.
10.50(a) - Exchange Agreement, dated as of December 14, 1993, by and
between Foamex International and Rallis.
10.51(a) - Partial Redemption Agreement, dated as of December 14, 1993,
by and between Foamex L.P. and Rallis.
10.52(c) - Exchange Agreement Regarding Admission of Limited Partner and
Put Option, dated as of May 1, 1993, among Rallis, Pegasus
Properties, Foamex L.P., and Trace Holdings.
10.53(a) - Amended and Restated Put Option Agreement, dated as of
December 14, 1993, by and between Trace Holdings and Rallis.
10.54(a) - Exchange Agreement, dated as of December 14, 1993, by and
between Foamex International and Trace Holdings.
10.55(a) - Redemption and Withdrawal Agreement, dated as of December 14,
1993, by and between Foamex L.P. and Trace Holdings.
10.56(a) - Exchange Agreement, dated as of December 14, 1993, by and
between Foamex International and Trace Foam.
10.57(a) - Withdrawal Agreement, dated as of December 14, 1993, by and
between Foamex L.P. and Trace Foam.
10.58(a) - Exchange Agreement, dated as of December 14, 1993, by and
between Foamex International and FCD Sub.
10.59(a) - Redemption and Withdrawal Agreement, dated as of December 14,
1993, by and between Foamex L.P. and FCD Sub.
10.60(a) - Release and Termination Agreement, dated as of December 14,
1993, by and among Trace Holdings, Trace Foam, Foamex L.P.,
RFC, Marely, DLJ, MGM, FCD Sub, Recticel s.a., SGB, GBNY, and
Wilmington Trust Company.
10.61(f) - Stock Purchase Agreement, dated as of December 23, 1993, by
and among Transformacion de Espumas y Fieltros, S. A., the
stockholders which are parties thereto, and Foamex L.P.
- -------------
(a) Incorporated herein by reference to the Exhibit to Foamex
International's Registration Statement on Form S-1, Registration
No. 33-69606.
(b) Incorporated herein by reference to the Exhibit to the
Registration Statement of Foamex L.P. and FCC on Form S-4,
Registration No. 33-65158.
(c) Incorporated herein by reference to the Exhibit to the
Registration Statement of Foamex L.P., FCC and General Felt on
Form S-1, Registration Nos. 33-60888, 33-60888-01, and
33-60888-02.
(d) Incorporated herein by reference to the Exhibit to the Form 10-K
Statement of Foamex L.P. and FCC for fiscal 1992.
(e) Incorporated herein by reference to the Exhibit to the
Registration Statement of Foamex L.P. and FCC on Form S-1,
Registration Nos. 33-49976 and 33-49976-01.
(f) Incorporated herein by reference to the Exhibit to the Form 10-K
of Foamex International for fiscal 1993.
(g) Incorporated herein by reference to the Exhibit to JPS Automotive
L.P.'s Registration Statement on Form S-1, Registration No.
33-75510.
(h) Incorporated by reference to the Exhibit to the Form 10-Q of
Foamex International for the quarterly period ended July 3, 1994.
22
<PAGE>
(i) Incorporated herein by reference to the Exhibit to the
Registration Statement of FJPS, FJCC and Foamex International on
Form S-4, Registration No. 33-82028.
(j) Incorporated herein by reference to the Exhibit to the quarterly
report on Form 10-Q of JPS Automotive L.P. and JPS Automotive
Products Corp. for the fiscal quarter ended October 2, 1994.
(k) Incorporated herein by reference to the Exhibit to the quarterly
report on Form 10-Q of Foamex L.P. and Foamex L.P. Capital
Corporation, and General Felt Industries, Inc. for the fiscal
quarter ended October 2, 1994.
(l) Incorporated herein by reference to the Exhibit to the
Registration Statement on Form S-1 of Foamex International,
Registration No. 33-85488.
(m) Incorporated herein by reference to the Exhibit to the Form 10-K
of Foamex International for fiscal 1994.
(n) Incorporated herein by reference to the Exhibit to the Form 10-K
of Foamex L.P. for fiscal 1994.
(o) Incorporated herein by reference to the Exhibit to the Form 10-Q
of Foamex L.P. for the quarterly period ended July 2, 1995.
(p) Incorporated herein by reference to the Exhibit to the Form 10-K
of Foamex L.P. for fiscal 1995.
Certain instruments defining the rights of security holders have
been excluded herefrom in accordance with Item 601(b)(4)(iii) of Regulation S-K.
The registrant hereby agrees to furnish a copy of any such instrument to the
Commission upon request.
(b) Foamex L.P. filed the following Current Reports on Form 8-K:
None.
23
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrants have duly caused this report to be signed on their behalf by the
undersigned thereunto duly authorized.
FOAMEX L.P.
By: FMXI, INC.
General Partner
Date: May 9, 1996 By: /s/ Kenneth R. Fuette
----------------------
Kenneth R. Fuette
Chief Financial Officer and
Chief Accounting Officer
FOAMEX CAPITAL CORPORATION
Date: May 9, 1996 By: /s/ Kenneth R. Fuette
----------------------
Kenneth R. Fuette
Chief Financial Officer and
Chief Accounting Officer
24
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