<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 12)
FOAMEX INTERNATIONAL INC.
(Name of Issuer)
Common Stock, $0.01 Par Value
(Title of Class of Securities)
344123-10-4
(CUSIP Number)
Philip N. Smith, Jr., Esq.
Trace International Holdings, Inc.
375 Park Avenue
11th Floor
New York, New York 10152
(212) 230-0400
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
November 6, 1998
(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is filing
this schedule because of Rule 13d-1(b)(3) or (4), check the following box |_|.
<PAGE>
SCHEDULE 13D
CUSIP No. 344123-10-4
1 Name of Reporting Person
I.R.S. Identification Nos. of Above Persons (entities only)
Trace International Holdings, Inc.
58-1080969
2 Check the Appropriate Box If a Member of a Group
a. |_|
b. |X|
3 SEC Use Only
4 Source of Funds (See Instructions)
BK, 00
5 Check Box If Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e) |_|
6 Citizenship or Place of Organization
Delaware
7 Sole Voting Power
Number of 4,474,753
Shares
Beneficially 8 Shared Voting Power
Owned By 7,050,247
Each
Reporting 9 Sole Dispositive Power
Person 4,474,753
With
10 Shared Dispositive Power
7,050,247
11 Aggregate Amount Beneficially Owned by Each Reporting Person
11,525,000
12 Check Box If the Aggregate Amount in Row (11) Excludes Certain Shares
(See Instructions) |_|
13 Percent of Class Represented By Amount in Row (11)
46.1%
14 Type of Reporting Person (See Instructions)
CO
<PAGE>
SCHEDULE 13D
CUSIP No. 344123-10-4
1 Name of Reporting Person
I.R.S. Identification Nos. of Above Persons (entities only)
Trace Foam Sub, Inc.
13-3808758
2 Check the Appropriate Box If a Member of a Group
a. |_|
b. |X|
3 SEC Use Only
4 Source of Funds (See Instructions)
00
5 Check Box If Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e) |_|
6 Citizenship or Place of Organization
Delaware
7 Sole Voting Power
Number of 0
Shares
Beneficially 8 Shared Voting Power
Owned By 7,000,247
Each
Reporting 9 Sole Dispositive Power
Person 0
With
10 Shared Dispositive Power
7,000,247
11 Aggregate Amount Beneficially Owned by Each Reporting Person
7,000,247
12 Check Box If the Aggregate Amount in Row (11) Excludes Certain Shares
(See Instructions) |_|
13 Percent of Class Represented By Amount in Row (11)
28.0%
14 Type of Reporting Person (See Instructions)
CO
<PAGE>
SCHEDULE 13D
CUSIP No. 344123-10-4
1 Name of Reporting Person
I.R.S. Identification Nos. of Above Persons (entities only)
Marshall S. Cogan
2 Check the Appropriate Box If a Member of a Group*
a. |_|
b. |X|
3 SEC Use Only
4 Source of Funds (See Instructions)
PF
5 Check Box If Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e) |_|
6 Citizenship or Place of Organization
United States of America
7 Sole Voting Power
Number of 703,334
Shares
Beneficially 8 Shared Voting Power
Owned By 0
Each Reporting 9 Sole Dispositive Power
Person 703,334
With
10 Shared Dispositive Power
0
11 Aggregate Amount Beneficially Owned by Each Reporting Person
703,334
12 Check Box If the Aggregate Amount in Row (11) Excludes Certain Shares
(See Instructions)
13 Percent of Class Represented By Amount in Row (11)
2.8%
14 Type of Reporting Person (See Instructions)
IN
<PAGE>
This Amendment No. 12 to Schedule 13D is filed on behalf of Trace
International Holdings, Inc. ("Trace Holdings"), Trace Foam Sub, Inc. ("Trace
Foam Sub"), and Marshall S. Cogan, and amends and supplements the Schedule 13D,
dated December 14, 1993 (as amended, the "Schedule 13D"), as amended by
Amendment No. 1 thereto filed on December 23, 1994, Amendment No. 2 thereto
filed on March 6, 1995, Amendment No. 3 thereto filed on April 28, 1995,
Amendment No. 4 thereto filed on August 28, 1997, Amendment No. 5 thereto filed
on December 24, 1997, Amendment No. 6 thereto filed on March 16, 1998, Amendment
No. 7 thereto filed on June 26, 1998, Amendment No. 8 thereto filed on July 21,
1998, Amendment No. 9 thereto filed on October 19, 1998, Amendment No. 10
thereto filed on November 6, 1998, and Amendment No. 11 thereto filed on
November 23, 1998 and is being filed pursuant to Rule 13d-2 of the General Rules
and Regulations under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"). This Amendment No. 12 is being filed to report the extension of
the exercise period for a put option whereby Trace Holdings may be obligated
to purchase 308,813 shares of Common Stock of the Issuer.
The Schedule 13D is hereby amended as follows:
ITEM 3. Sources and Amounts of Funds or Other Consideration.
The second paragraph of Item 3 is hereby deleted in its entirety.
ITEM 5. Interests in Securities of the Issuer.
The fourth paragraph of Subclause (iii) of Item 5 (a and b) of Schedule 13D
is hereby amended and restated in its entirety as follows:
As a result of the foregoing, Trace Holdings may be deemed to own
beneficially (as such term is defined in Rule 13d-3) a total of 11,525,000
shares of Common Stock, which represents 46.1% of the outstanding Common Stock.
The penultimate sentence of the second paragraph of Subclause (iv) of Item
5 (a and b) of Schedule 13D is hereby amended and restated as follows:
Mr. Cogan, by virtue of his control positions at Trace Foam
Sub and Trace Holdings, may be deemed to own beneficially (as the term is
defined in Rule 13d-3) the 11,525,000 shares of Common Stock beneficially owned,
directly and indirectly, by Trace Foam Sub and Trace Holdings.
<PAGE>
ITEM 6. Contracts, Arrangements, Understandings or Relationships with respect to
Securities of the Issuer.
The following is added to Item 6:
In connection with the Issuer's acquisition of Great Western, Trace
Holdings entered into a put option agreement (the "Put Option") with John
Rallis, a former President of the Issuer and the former owner of Great Western
Foam Products Corporation. Pursuant to the Put Option, Mr. Rallis has the right
and option to sell to Trace Holdings 308,813 shares of Common Stock for
approximately $7.5 million, or $24.29 per share, at any time during the period
commencing May 6, 1998, which expiration date was initially extended to November
6, 1998. On November 6, 1998, Mr. Rallis exercised the Put Option, which Trace
Holdings was unable to satisfy; subsequently, Mr. Rallis agreed to rescind the
exercise of the Put Option in exchange for the extension of the expiration date
of the Put Option to March 31, 1999. A copy of the letter agreement between
Trace Holdings and Mr. Rallis, dated November 6, 1998, extending the exercise
date of the Put Option is filed as Exhibit T to this Schedule 13D. It is
anticipated that in connection with the consummation of the Merger, Trace
Holdings will pay to Mr. Rallis the difference between the amount payable to Mr.
Rallis upon exercise of the Put Option and the Merger Consideration with respect
to the underlying shares of Common Stock.
<PAGE>
ITEM 7. Exhibits to be Filed.
The following is added to Item 7:
EXHIBIT T Letter Agreement between Trace International Holdings, Inc. and
John Rallis, dated November 6, 1998.
EXHIBIT U Letter Agreement between Trace International Holdings, Inc. and
John Rallis, dated September 30, 1998.
EXHIBIT V Letter Agreement between Trace International Holdings, Inc. and
John Rallis, dated July 21, 1998.
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
TRACE INTERNATIONAL HOLDINGS, INC.
By: /s/ Marshall S. Cogan
-----------------------
Name: Marshall S. Cogan
Title: Chairman of the Board
and Chief Executive Officer
Date: December 15, 1998
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
TRACE FOAM SUB, INC.
By: /s/ Marshall S. Cogan
-----------------------
Name: Marshall S. Cogan
Title: Chairman of the Board
and President
Date: December 15, 1998
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
/s/ Marshall S. Cogan
---------------------
Marshall S. Cogan
Date: December 15, 1998
<PAGE>
EXHIBIT INDEX
Exhibit Number Title
- -------------- -----
99.1 Exhibit T - Letter Agreement between Trace
International Holdings, Inc. and John Rallis, dated
November 6, 1998.
99.2 Exhibit U - Letter Agreement between Trace
International Holdings, Inc. and John Rallis, dated
September 30, 1998.
99.3 Exhibit V - Letter Agreement between Trace
International Holdings, Inc. and John Rallis, dated
July 21, 1998.
<PAGE>
Exhibit T
---------
November 6, 1998
Mr. John Rallis
3501 Jamboree Road, Suite 4000
Newport Beach, CA 92660
Dear Mr. Rallis:
As you know, you, John Rallis ("Rallis"), and I, Philip N. Smith, Jr.,
Senior Vice President and Secretary of Trace International Holdings, Inc.
(formerly known as '21' International Holdings, Inc.) ("Trace"), have had
discussions and reached an understanding and agreement concerning the amendment
and modification of the letter agreements between Rallis and Trace dated July
21, 1998 (the "July 1998 Letter Agreement") and September 30, 1998 (the
September 1998 Letter Agreement"), which amended and modified certain provisions
of the Amended and Restated Put Option Agreement by and between Rallis and Trace
dated as of December 14, 1993 (the "Put Option Agreement"), to (a) extend the
Exercise Period under the Put Option Agreement (to March 31, 1999) and (b)
extend the last date for (i) the consummation of the Merger Transaction and (ii)
the Trace purchase from Rallis, and the Rallis sale to Trace, of all of the
Rallis right, title and interest in the Put Option Agreement under certain
circumstances (to March 24, 1999). This letter is intended to set forth the
understanding and agreement between Rallis and Trace respecting the foregoing,
viz:
Rallis and Trace agree:
1. The Exercise Period under the Put Option Agreement shall
be extended through March 31, 1999. That is paragraph 1 of the July
1998 Letter Agreement shall be amended to read in its entirety as
follows:
"1. Effective as of November 6, 1998, the Put Option
Agreement shall be amended and modified (and the Exercise Period shall
be extended) so that the Exercise Period (provided for in subsection
[b] of Section 1) shall be "at any time during the period commencing
on May 6, 1998 and ending March 31, 1999." That is, the Put Option may
be exercised, in whole or in part, by Rallis (and/or any permitted
assignee) at any time during the period commencing on May 6, 1998 and
ending March 31, 1999."
<PAGE>
Mr. John Rallis
November 6, 1998
Page 2
2. Paragraph 2 of the July 1998 Letter Agreement shall be
amended to read in its entirety as follows:
"2. Recently, (a) Trace advised Rallis of the execution and
delivery by Trace and Foamex International Inc. ("Foamex") of a new
definitive merger agreement whereby (i) Foamex shall be merged into a
wholly-owned subsidiary of Trace (the "Trace Merger Subsidiary"), (ii)
all shareholders of Foamex (other than Trace and its subsidiaries)
shall receive twelve dollars ($12) per share for their shares of
Foamex, and (iii) Foamex shall become a wholly-owned subsidiary of
Trace ("the Merger Transaction"), (b) Trace requested that Rallis (and
The Rallis Foundation) vote in favor of the Merger Transaction and
agree to accept twelve dollars ($12) per share for their shares of
Foamex in accordance with the terms of the Merger Transaction, and (c)
Trace requested that Rallis not exercise to Put Option."
3. The last date for (a) the consummation of the Merger
Transaction and (b) the Trace purchase from Rallis, and the Rallis
sale to Trace, of all of the right, title and interest of Rallis in
the Put Option Agreement under certain circumstances shall be extended
through March 24, 1999. That is, paragraph 3 of the July 1998 Letter
Agreement shall be amended to read in its entirety as follows:
"3. Therefore, in the event during the Exercise Period (a)
Rallis does not exercise the Put Option, (b) Rallis (and The Rallis
Foundation) tender the Rallis (and The Rallis Foundation) shares of
Foamex to the Trace Merger Subsidiary (in consideration for a payment
by the Trace Merger Subsidiary to Rallis [and The Rallis Foundation]
of twelve dollars [$12] per share for the Rallis [and The Rallis
Foundation] shares of Foamex), and (c) the Merger Transaction is
consummated on or before March 24, 1999, concurrently with the
consummation of the Merger Transaction, Rallis shall sell to Trace,
and Trace shall purchase from Rallis, all right, title and interest of
Rallis in the Put Option Agreement (and all rights of Rallis as to the
Put Option) for the payment by Trace to Rallis of the sum of three
million seven hundred ninety-five thousand three hundred eleven
dollars and seventy cents ($3,795,311.70). The Trace payment to Rallis
in this regard shall be made within two (2) business days of the
consummation of the Merger Transaction or on March 24, 1999, whichever
shall first occur."
<PAGE>
Mr. John Rallis
November 6, 1998
Page 3
4. Paragraph 4 of the July 1998 Letter Agreement shall be
amended to read in its entirety as follows:
"4. In the event (a) the payment by the Trace Merger
Subsidiary to Rallis (and The Rallis Foundation) is less than twelve
dollars ($12) per share for the Rallis (and The Rallis Foundation)
shares of Foamex (the "Shortfall"), the amount of the Shortfall shall
be added to the amount of the payment by Trace to Rallis for all
right, title and interest of Rallis in the Put Option provided for in
paragraph 3, above (viz, $3,795,311.70) and (b) the payment by the
Trace Merger Subsidiary to Rallis (and The Rallis Foundation) is more
than twelve dollars ($12) per share for the Rallis (and The Rallis
Foundation) shares of Foamex (the "Excess"), the amount of the Excess
shall be subtracted from the amount of the payment by Trace to Rallis
for all right, title and interest of Rallis in the Put Option provided
for in paragraph 3, above (viz, $3,795,311.70)."
5. In all other respects, the terms and provisions of the
July 1998 Letter Agreement and the September 1998 Letter Agreement
remain as is, unamended and unmodified.
If the foregoing correctly sets forth the understanding and agreement
between Rallis and Trace in this regard, kindly sign the enclosed copy of this
letter and return the enclosed copy of this letter to the undersigned, whereupon
this letter shall evidence and constitute our agreement.
Very truly yours,
Trace International Holdings, Inc.
By: /s/ Philip N. Smith, Jr.
-------------------------------
Philip N. Smith, Jr.
Senior Vice President and
Secretary
Agreed and Accepted:
November 6, 1998
/s/ John Rallis
- --------------------
John Rallis
<PAGE>
Exhibit U
---------
September 30, 1998
Mr. John Rallis
3501 Jamboree Road, Suite 4000
Newport Beach, CA 92660
Dear Mr. Rallis:
As you know, you, John Rallis ("Rallis"), and I Philip N. Smith, Jr.,
Senior Vice President and Secretary of Trace International Holdings, Inc.
(formerly known as '21' International Holdings, Inc.) ("Trace"), have had
discussions and reached an understanding and agreement concerning the amendment
and modification of the letter agreement between Rallis and Trace dated July 21,
1998 (the "July 1998 Letter Agreement"), which amended and modified certain
provisions of the Amended and Restated Put Option Agreement by and between
Rallis and Trace dated as of December 14, 1993 ("the Put Option Agreement"), to
(a) extend the Exercise Period under the Put Option Agreement (to November 6,
1998) and (b) extend the last date for (i) the consummation of the Merger
Transaction and (ii) the Trace purchase from Rallis, and the Rallis sale to
Trace, of all of the Rallis right, title and interest in the Put Option
Agreement under certain circumstances (to October 30, 1998). This letter is
intended to set forth the understanding and agreement between Rallis and Trace
respecting the foregoing, vis:
Rallis and Trace agree:
1. The Exercise Period under the Put Option Agreement shall
be extended through November 6, 1998. That is, paragraph 1 of the July
1988 Letter Agreement shall be amended to read in its entirety as
follows:
"1. Effective as of September 30, 1998, the Put Option
Agreement shall be amended and modified (and the Exercise Period shall
be extended) so that the Exercise Period (provided for in subsection
[b] of Section 1) shall be "at any time during the period commencing
on May 6, 1998 and ending November 6, 1998." That is, the Put Option
may be exercised, in whole or in part, by Rallis (and/or any permitted
assignee) at any time during the period commencing on May 6, 1998 and
ending November 6, 1998."
2. The last date for (a) the consummation of the Merger
Transaction and (b) the Trace purchase from Rallis,
<PAGE>
Mr. John Rallis
September 30, 1998
Page 2
and the Rallis sale to Trace, of all of the right, title and interest
of Rallis in the Put Option Agreement under certain circumstances
shall be extended through October 30, 1998. That is, paragraph 3 of
the July 1998 Letter Agreement shall be amended to read in its
entirety as follows:
"3. Therefore, in the event during the Exercise Period (a)
Rallis does not exercise the Put Option, (b) Rallis (and The Rallis
Foundation) tender the Rallis (and The Rallis Foundation) shares of
Foamex to the Trace Merger Subsidiary (in consideration for a payment
by the Trace Merger Subsidiary to Rallis [and The Rallis Foundation]
of eighteen dollars and seventy-five cents [$18.75] per share for the
Rallis [and The Rallis Foundation] shares of Foamex), and (c) the
Merger Transaction is consummated on or before October 30, 1998,
concurrently with the consummation of the Merger Transaction. Rallis
shall sell to Trace, and Trace shall purchase from Rallis, all right,
title and interest of Rallis in the Put Option Agreement (and all
rights of Rallis as to the Put Option) for the payment by Trace to
Rallis of the sum of one million seven hundred ten thousand eight
hundred twenty-four dollars ($1,710,824). The Trace payment to Rallis
in this regard shall be made within two (2) business days of the
consummation of the Merger Transaction or on October 30, 1998,
whichever shall first occur."
3. In all other respects, the terms and provisions of the
July 1998 Letter Agreement remain as is, unamended and unmodified.
If the foregoing currently sets forth the understanding and agreement
between Rallis and Trace in this regard, kindly sign the enclosed copy of this
letter and return the enclosed
<PAGE>
Mr. John Rallis
September 30, 1998
Page 3
copy of this letter to the undersigned, whereupon this letter shall evidence and
constitute our agreement.
Very truly yours,
Trace International Holdings, Inc.
By:/s/Philip N. Smith, Jr.
------------------------------
Philip N. Smith, Jr.
Senior Vice President and
Secretary
Agreed and Accepted:
September 30, 1998
/s/John Rallis
- -------------------------
John Rallis
<PAGE>
Exhibit V
---------
[LETTERHEAD OF UNITED AUTO GROUP, INC.]
VIA FEDERAL EXPRESS
- -------------------
July 21, 1998
Mr. John Rallis
3501 Jamboree Road
Suite 4000
Newport Beach, CA 92660
Dear Mr. Rallis:
As you know, you, John Rallis ("Rallis"), and I, Philip N. Smith, Jr.,
Senior Vice President and General Counsel of Trace International Holdings, Inc.
(formerly known as '21' International Holdings, Inc.) ("Trace"), have had
discussions and reached an understanding and agreement concerning (a) the
amendment and modification of the Amended and Restated Put Option Agreement by
and between Rallis and Trace dated as of December 14, 1993 (the "Put Option
Agreement") to extend the Exercise Period under the Put Option Agreement and (b)
the obligation of Trace to purchase from Rallis, and the obligation of Rallis to
sell to Trace, all of the Rallis right, title and interest in the Put Option
Agreement under certain circumstances. This letter is intended to set forth the
understanding and agreement between Rallis and Trace respecting the foregoing,
viz:
Rallis and Trace agree:
1. Effective as of July 21, 1998, the Put Option Agreement
shall be amended and modified (and the Exercise Period shall
be extended) so that the Exercise Period (provided for in
subsection [b] of Section 1) shall be "at any time during
the period commencing on May 6, 1998 and ending October 7,
1998." That is, the Put Option may be exercised, in whole or
in part, by Rallis (and/or any permitted assignee) at any
time during the period commencing on May 6, 1998 and ending
October 7, 1998.
2. Recently, (a) Trace advised Rallis of the execution and
delivery by Trace and Foamex International Inc. ("Foamex")
of a definitive merger agreement whereby (i) Foamex shall be
merged into a wholly-owned subsidiary of Trace (the "Trace
Merger Subsidiary"), (ii) all shareholders of Foamex (other
than Trace and its subsidiaries) shall receive eighteen
dollars and seventy-five cents ($18.75) per share for their
shares of Foamex, and (iii) Foamex shall become a
wholly-owned subsidiary of Trace (the "Merger Transaction"),
(b) Trace requested that Rallis (and The Rallis Foundation)
<PAGE>
Mr. John Rallis
July 21, 1998
Page 2
vote in favor of the Merger Transaction and agreed to accept
eighteen dollars and seventy five cents ($18.75) per share
for their shares of Foamex in accordance with the terms of
the Merger Transaction, and (c) Trace requested that Rallis
not exercise the Put Option.
3. Therefore, in the event during the Exercise Period (a)
Rallis does not exercise the Put Option, (b) Rallis (and The
Rallis Foundation) tender the Rallis (and The Rallis
Foundation) shares of Foamex to the Trace Merger Subsidiary
in consideration of a payment by the Trace Merger Subsidiary
to Rallis (and The Rallis Foundation) of eighteen dollars
and seventy-five cents ($18.75) per share for the Rallis
(and The Rallis Foundation) shares of Foamex, and (c) the
Merger Transaction is consummated on or before September 30,
1998, concurrently with the consummation of the Merger
Transaction, Rallis shall sell to Trace, and Trace shall
purchase from Rallis, all right, title and interest of
Rallis in the Put Option Agreement (and all rights of Rallis
as to the Put Option) for the payment by Trace to Rallis of
the sum of one million seven hundred ten thousand eight
hundred twenty-four dollars ($1,710,824). The Trace payment
to Rallis in this regard shall be made within two (2)
business days of the consummation of the Merger Transaction
or on September 30, 1998, whichever shall first occur.
4. In the event (a) the payment by the Trace Merger Subsidiary
to Rallis (and The Rallis Foundation) is less than eighteen
dollars and seventy-five cents ($18.75) per share for the
Rallis (and The Rallis Foundation) shares of Foamex (the
"Shortfall"), the amount of the Shortfall shall be added to
the amount of the payment by Trace to Rallis for all right,
title and interest of Rallis in the Put Option provided for
in paragraph 3, above (viz, $1,710,824) and (b) the payment
by the Trace Merger Subsidiary to Rallis (and The Rallis
Foundation) is more than eighteen dollars and seventy-five
cents ($18.75) per share for the Rallis (and The Rallis
Foundation) shares of Foamex (the "Excess"), the amount of
the Excess shall be subtracted from the amount of the
payment by Trace to Rallis for all right, title and interest
of Rallis in the Put Option provided for in paragraph 3,
above (viz, $1,710,824).
5. Rallis and Trace agree to execute and deliver any other
documents, and to perform any further acts, that may be
reasonably necessary to give effect to, and to carry out the
terms and provisions of, this letter agreement.
<PAGE>
Mr. John Rallis
July 21, 1998
Page 3
6. This letter agreement shall inure to the benefit of and
shall be binding upon the heirs, successors and permitted
assigns of Rallis and the successors and assigns of Trace.
7. Any notice under this letter agreement shall be in writing
and shall be deemed to have been duly given on the date of
service if served personally or on the second day after
mailing if mailed by first class mail, registered or
certified, postage pre-paid, and addressed to Rallis at his
business address and to Trace at its business address (which
are presently the addresses which appear below).
8. If any legal action is necessary to enforce the terms of
this letter agreement, the prevailing party shall be
entitled to reasonable attorneys' fees in addition to any
other relief to which it may be entitled.
9. This letter agreement shall be subject to the laws of the
State of California.
10. This letter agreement (when read together with the Put
Option Agreement) (a) contains the entire understanding and
(b) supersedes and takes the place of all prior
understandings and agreements between Rallis and Trace in
this regard, whether written, oral, express or implied, and
(c) is a complete statement of the agreement between Rallis
and Trace in this regard and the terms hereof.
If the foregoing correctly sets forth the understanding and agreement
between Rallis and Trace in this regard, kindly sign the enclosed copy of this
letter and return the enclosed copy of this letter to the undersigned, whereupon
this letter shall evidence and constitute our agreement.
Sincerely yours,
/s/ Philip N. Smith, Jr.
--------------------------
Philip N. Smith, Jr.
PNS:ssc
cc: Ralph Cassady
AGREED AND ACCEPTED:
JULY 23, 1998
/s/ John Rallis
- ----------------------
John Rallis
