UNITED STATES                                 
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 10-K


ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934

For the fiscal year ended    September 30, 1996

Commission File Number           0-21548



                            SYNTHETIC INDUSTRIES L.P.
------------------------------------------------------------------------------
             (Exact name of Registrant as specified in its charter)

Delaware                                                             13-3397585
--------- --------------------------------------------------- ------------------
(State or other jurisdiction                                   (I.R.S. Employer
of incorporation or organization)                           Identification No.)

309 LaFayette Road, Chickamauga, Georgia                             30707 
-------------------------------------------------------------------------------
(Address of principal executive offices)                           (Zip Code)

                                 (706) 375-3121
----------------------------------------------------------------------------
              (Registrant's telephone number, including area code)


         Securities registered pursuant to Section 12(b) of the Act:  None.

         Securities registered pursuant to Section 12(g) of the Act:  Units of
                                                  Limited Partnership Interest.


         Indicate  by check mark  whether  registrant  (1) has 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) has been subject to such
filing requirements for the past 90 days.
                                                          Yes   X   No ____








<PAGE>


                       Documents Incorporated By Reference

         Portions  of the annual  report on Form 10-K for the fiscal  year ended
September 30, 1996 of Synthetic Industries,  Inc., a Delaware  corporation,  are
incorporated by reference herein.

                                     PART I

ITEM 1.  BUSINESS

General

         Synthetic Industries, L.P. (the "Partnership") is a limited partnership
organized  under  the laws of the  State of  Delaware.  In  December  1986,  the
Partnership  acquired  (the  "Acquisition")  all of the issued  and  outstanding
shares (the  "Shares")  of the capital  stock of Synthetic  Industries,  Inc., a
Delaware  corporation  (the "Company").  The Company  manufactures and markets a
wide  range of  polypropylene-based  fabric  and  fiber  products  designed  for
industrial applications.  The information set forth under the heading "Business"
in the Form 10-K of the  Company for the fiscal  year ended  September  30, 1996
(the "Form 10-K") is incorporated herein by reference.

         Since its  organization  in 1986,  the  Partnership  has  conducted  no
business  except (I) engaging in the  transactions  described in a  confidential
offering  memorandum  dated January 16, 1987, as  supplemented,  relating to the
offering and sale of units of limited  partnership  interest in the  Partnership
(the  "Units");  and (II)  owning  and  voting  the  Shares.  The  Partnership's
principal  executive  offices are located at 309  LaFayette  Road,  Chickamauga,
Georgia 30707, and its telephone number is (706) 375-3121.

     The sole  general  partner of the  partnership  is SI  Management  L.P.,  a
Delaware limited  partnership  ("Management  L.P."). The sole general partner of
Management L.P. is Synthetic Management G.P. ("Synthetic G.P.").  Synthetic G.P.
is a Georgia  general  partnership  whose  partners  are  controlled  by certain
members  of the  Company's  senior  management.  See  "Directors  and  Executive
Officers--Partners  of  Synthetic  G.P."  Since  the  respective  dates  of  the
formation,  neither  Synthetic  G.P.  nor  Management  L.P.  has  engaged in any
business,  other than Synthetic G.P. acting as the general partner of Management
L.P. and Management L.P. acting as the general partner of Synthetic L.P.

ITEM 2.  PROPERTIES

    The Partnership does not own or lease any physical properties.

    The information set forth under the heading "Properties" in the Form 10-K is
incorporated herein by reference.


ITEM 3.  CLAIMS AND LEGAL PROCEEDINGS

    The  Partnership  is not party to  litigation  arising  out of its  business
operations.

    The information  set forth under the heading "Claims and Legal  Proceedings"
in the Form 10-K is incorporated herein by reference.


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

    No matters  were  submitted  to a vote of the  holders  of the units  during
fiscal 1996.


<PAGE>


                                     PART II


ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY
           AND RELATED STOCKHOLDER MATTERS

       There is no established  trading market for the Units.  In addition,  the
limited  partnership  agreement of the  Partnership  (the  "Limited  Partnership
Agreement") places  restrictions on the  transferability of Units. No transferee
of all or any part of a Unit may be  admitted  to the  Partnership  as a limited
partner  ("Limited  Partner")  without the written  consent of Management  L.P.,
which consent may be withheld in the absolute  discretion of Management L.P. The
Limited  Partnership  Agreement  also provides that the transfer of the whole or
any  portion  of a Unit shall not be  effective  to entitle  the  transferee  to
receive distributions of cash of other property from the Partnership  applicable
to the Unit acquired by reason of such transfer, unless Management L.P. consents
in writing to such transfer.

    The Partnership has made no distributions of any kind since its organization
in 1986.  The Company is currently  restricted  under a loan  agreement with its
senior lenders and an indenture  relating to the Company's  senior  subordinated
debentures  due 2002 from  paying cash  dividends,  or making  certain  types of
capital distributions.

ITEM 6.  SELECTED FINANCIAL DATA
<TABLE>


                                                    Fiscal Year Ended September 30,
                                                    -------------------------------
<S>                                   <C>            <C>            <C>            <C>           <C> 
                                      1996           1995           1994           1993          1992
                                    ------         ------         ------          -----        ------
                                        (thousands of dollars, except limited partnership units outstanding)
Summary of Operations Data:
<S>                                 <C>            <C>            <C>           <C>            <C>     
Net sales                           $299,532       $271,427       $234,977      $210,516       $195,739
Gross profit                          91,211         76,721         82,672        68,335         62,049
Operating income                      37,813         28,687         41,007        29,921         27,656
Income from continuing operations
  before provision for income taxes   14,341          5,436         20,257         8,134          8,155
Income from continuing operations      7,441          1,936         11,657         3,662          3,595
Income from continuing operations
   attributable to limited partners    7,367          1,917         11,540         3,625          3,559
Income (loss) from discontinued
 operations                                -              -             -          1,420         (7,567)
Extraordinary item - loss from early
  extinguishment of debt                   -              -              -        (8,892)            -
Cumulative effect of accounting change     -              -              -        (8,500)            -
Net income (loss)                      7,441          1,936         11,657       (12,310)        (3,972)

Income from continuing operations
    per limited partnership unit         9.21          2.40           14.43          4.53         4.45


Other Financial Data:
Limited partnership units outstanding    800            800            800           800            800

                                                                               As of September 30,
                                        1996           1995           1994          1993           1992
                                       -----         ------         ------        ------         ------

Balance Sheet Data:
Working Capital                      $63,418        $69,041        $44,116       $42,057        $33,982
Total assets                         323,756        312,302        287,935       260,374        254,583
Long-term debt                       194,353        192,048        172,490       164,723        158,638
Partners' Capital                     65,185         57,758         55,819        44,425         56,702
</TABLE>



<PAGE>



ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
              CONDITION AND RESULTS OF OPERATIONS (in 000's)


As previously discussed, since its organization in 1986 and subsequent admission
of Limited Partners, the Partnership has conducted no business except owning and
voting  the  Shares.  As a result of its  public  offering  of  Common  Stock in
November  1996,  the Company  currently  has  8,656,250  shares of Common  Stock
outstanding,  of which  approximately  67% are owned by the Partnership.  As the
Partnership has no independent operations or assets other than its investment in
the Company, the Partnership's  financial statements are substantially identical
to those of the Company, with the exception of the minority interest and certain
expenses recognized by the Partnership  associated with a withdrawn common stock
offering.  As a result,  the discussion and analysis of financial  condition and
results of operations  presented below relates to the operations of the Company,
except as  disclosed.  Accordingly,  all  references to fiscal year refer to the
Company's fiscal year which ends on September 30th.


Results of Operations

The  following  table sets forth the  percentage  relationships  to net sales of
certain income statement  items.  See "Selected  Financial Data", as well as the
Consolidated  Financial  Statements  and the  notes  thereto  for more  detailed
financial information.

                   
                                             Fiscal Year ended September 30,    
                                              1996       1995       1994        
                                                                                
Net sales...........................        100.0%      100.0%     100.0%       
Cost of sales.......................         69.5        71.7       64.8        
                                             ----        ----       ----        
   Gross profit.....................         30.5        28.3       35.2        
Selling expenses....................          9.2         9.0        9.3        
General and administrative                                                      
        expenses....................          7.8         7.8        7.5        
Amortization of intangibles.........          0.9         0.9        1.0        
                                              ---         ---        ---        
  Operating income..................         12.6        10.6       17.4        
Interest expense....................          7.6         8.3        8.5        
Amortization of deferred                                                        
         financing costs............          0.2         0.3        0.3        
                                              ---         ---        ---        
  Income before provision for taxes.4.8       2.0         8.6                   
Provision for income taxes..........          2.3         1.3        3.7        
                                              ---         ---        ---        
  Net income........................          2.5%        0.7%       4.9%       
                                              ====        ====       ====       
                                                                                
Fiscal 1996 Compared to Fiscal 1995                                

     Net sales for the year ended  September 30, 1996 were $299,532  compared to
$271,427 for the same period of fiscal 1995,  an increase of $28,105,  or 10.4%.
This  increase  was  primarily  due to  increased  sales of carpet  backing  and
construction and civil engineering  products.  Carpet backing sales for the year
ended September 30, 1996 were $146,491  compared to $133,025 for the same period
of fiscal 1995, an increase of $13,466,  or 10.1%.  This increase was the result
of higher unit volume in primary and secondary carpet backing,  partially offset
by lower average  selling prices.  Construction  and civil  engineering  product
sales for the year ended September 30, 1996 were $97,043 compared to $82,933 for
the same period of fiscal 1995, an increase of $14,110,  or 17.0%. This increase
was due to an increase in sales of  geotextile  and erosion  control  fabrics of
$13,018,  or 30.7%,  resulting primarily from nonwoven sales in the landfill and
roadway and building site markets.  Technical  textiles sales for the year ended
September 30, 1996 were $55,998  compared to $55,469 for fiscal 1995, a increase
of $529, or 1.0%.

     While the  Company's  sales have grown in each year,  the  Company's  gross
profit has fluctuated due to a variety of factors,  primarily related to changes
in the price of  polypropylene.  Polypropylene is the basic raw material used in
the manufacture of substantially all of the Company's  products,  accounting for
approximately 50% of the Company's cost of goods sold. The Company believes that
the selling prices of its products have adjusted over time to reflect changes in
polypropylene  prices,  although such price  changes  favorably  affected  gross
profit for fiscal 1994 and adversely  affected  gross profit for fiscal 1995. In
fiscal 1996,  polypropylene  prices  decreased an average of 8% from fiscal 1995
levels.  The benefit of this average cost decrease was only partially  offset by
reduced  average  selling  prices,  which,  coupled  with higher  sales  volume,
resulted in a gross profit  improvement  of $14,490,  or 18.9%,  from $76,721 in
fiscal 1995 to $91,211 in fiscal 1996.  As a percentage  of sales,  gross profit
increased to 30.5% from 28.3%.

     The Company believes that average  polypropylene prices will decline in the
first quarter of fiscal 1997 as a result of continued expansion of polypropylene
capacity.  According  to a  September  1996  report  by  Chem  Data,  a  monthly
petrochemical  and plastics  analysis  publication,  current annual  capacity in
North  America  will rise 11% to 14.0 billion  pounds per year in calendar  1997
from a projected 12.6 billion  pounds per year at December  1996.  Historically,
the  creation of  additional  capacity  has helped to relieve  supply  pressures
although there can be no assurance that this will continue to be the case.

     Selling  expenses  for the year  ended  September  30,  1996  were  $27,488
compared to $24,273 for the same period of fiscal  1995,  an increase of $3,215,
or 13.2%. This increase was primarily due to increased  expenditures  associated
with higher sales volume as well as increased marketing expenses. These expenses
are related to the Company's  expectation of higher sales in 1997 resulting from
the completion of the 1996 capacity expansion program. As a percentage of sales,
selling expenses increased from 9.0% to 9.2%.

     General and  administrative  expenses for the year ended September 30, 1996
for the Company were  $22,657  compared to $21,195 for the same period of fiscal
1995,  an increase of $1,462,  or 6.9%.  As a percentage  of sales,  general and
administrative expenses decreased from 7.8% to 7.6%. In fiscal 1995, general and
administrative  expenses  included  a pre-tax  charge of  $2,852  related  to an
increase in the allowance for doubtful accounts taken to establish a reserve for
a carpet backing customer who experienced severe financial difficulties. Without
this charge, fiscal 1995 general and administrative  expenses as a percentage of
sales would have been 6.8% The increase in general and  administrative  expenses
was primarily due to  infrastructure  expenditures,  which included an increased
investment in the Company's  Management  Information  System, to support company
growth.  Included in general and administrative  expenses for the Partnership is
$661 related to a withdrawn common stock offering,  such amount being due to the
Company.

     Operating income for the Company for fiscal 1996 was $38,474 as compared to
$28,687 for fiscal 1995,  an increase of $9,787,  or 34.1%.  As a percentage  of
sales,  operating  income increased to 12.8% in fiscal 1996 from 10.6% in fiscal
1995. This was primarily due to factors  discussed  above.  Operating income for
the  Partnership  for fiscal 1996 was $37,813,  which  includes  the  additional
general and administrative expenses related to a withdrawn common stock offering
discussed above.

     Total interest  expense for fiscal 1996 was $22,773 compared to $22,514 for
fiscal 1995,  an increase of $259,  or 1.2%,  due to higher  average  total debt
outstanding.

     The  effective  income  tax rate was 46% and 64% in  fiscal  1996 and 1995,
respectively.  The decrease  was  primarily  due to the effect of  nondeductible
expenses,  including the  amortization of goodwill,  on higher taxable income in
fiscal 1996.

     Net income for  fiscal  1996 for the  Company  was $8,102  compared  to net
income of $1,936  for fiscal  1995,  an  increase  of  $6,166,  or  318.5%.  The
Company's  earnings  before  interest,   taxes,  depreciation  and  amortization
("EBITDA")  for fiscal 1996 was $54,074  compared to $42,887 for fiscal 1995, an
increase of $11,187,  or 26.1%.  The increase in net income,  as well as EBITDA,
was  primarily  due to higher sales  volumes and lower average raw material cost
offset by slightly lower average  selling  prices,  higher  manufacturing  costs
associated with plant shutdowns as a result of the winter ice storms in 1996 and
increased  selling and general and  administrative  costs. Net income for fiscal
1996  for  the   Partnership   was  $7,441,   which  includes  the  general  and
administrative  expenses related to a withdrawn common stock offering  discussed
above.



Fiscal 1995 Compared to Fiscal 1994

         Net sales for fiscal 1995 were $271,427 compared to $234,977 for fiscal
1994, an increase of $36,450,  or 15.5%. This increase was primarily due to unit
volume growth in certain product lines and higher average selling prices. Carpet
backing  sales for fiscal 1995 were  $133,025  compared  to $117,791  for fiscal
1994,  an increase of $15,234,  or 12.9%.  This  increase was  primarily  due to
higher unit volume due in part to  increased  market  share in both  primary and
secondary  carpet backing as well as higher selling prices as compared to fiscal
1994.  Construction  and civil  engineering  product  sales for fiscal 1995 were
$82,933  compared to $68,706 for fiscal 1994, an increase of $14,227,  or 20.7%.
This increase was primarily due to a significant growth in sales of geosynthetic
products as well as an increase in sales of  Fibermesh (R)  fibers.  Technical
textiles sales for fiscal 1995 were $55,469 compared to $48,480 for fiscal 1994,
an increase of $6,989,  or 14.4%. This increase was primarily due to unit volume
growth in the furniture and bedding markets.

         Gross profit for fiscal 1995 was $76,721 compared to $82,672 for fiscal
1994,  a decrease of $5,951,  or 7.2%.  As a percentage  of sales,  gross profit
decreased  to 28.3%  from  35.2%.  This  decrease  was  primarily  due to higher
polypropylene  costs,  offset  partially by higher average selling  prices.  The
average market price of polypropylene  increased  approximately 50% per pound in
fiscal 1995 over fiscal 1994.

         Selling  expenses for fiscal 1995 were $24,273  compared to $21,815 for
fiscal 1994, an increase of $2,458, or 11.3%. This increase was primarily due to
increased  marketing efforts in the construction and civil engineering  products
lines as a direct result of increased sales.  However, as a percentage of sales,
selling expenses decreased from 9.3% to 8.9%.

         General  and  administrative  expenses  for  fiscal  1995 were  $21,195
compared to $17,588 for fiscal  1994,  an  increase  of $3,607,  or 20.5%.  As a
percentage of sales, general and administrative  expenses increased from 7.5% to
7.8%.  This  increase  was  primarily  due to a charge of $2,852  related  to an
increase in the allowance  for doubtful  accounts  during the fourth  quarter of
fiscal 1995. The charge was taken to establish a reserve for accounts receivable
for a carpet backing customer who experienced severe financial difficulties.

         Operating  income for fiscal 1995 was  $28,687  compared to $40,770 for
fiscal  1994,  a  decrease  of  $12,083,  or 29.6%.  As a  percentage  of sales,
operating income decreased to 10.6% from 17.4%.  This decrease was primarily due
to the change in gross profit associated with higher raw material costs.

         Total interest  expense for fiscal 1995 was $22,514 compared to $20,011
for  fiscal  1994.  This  increase  was  due  to a  higher  average  total  debt
outstanding and a higher base rate for the Credit Facility.

         The effective income tax rate for fiscal 1995 was 64.3% compared to 43%
for fiscal 1994.  The increase was primarily due to the effect of  nondeductible
expenses,  including the  amortization  of goodwill,  on lower taxable income in
fiscal 1995.

         Net income for fiscal  1995 was $1,936  compared  to $11,420 for fiscal
1994, a decrease of $9,484, or 83%. This decrease was primarily due to increased
raw material and interest costs.


Liquidity and Capital Resources

     To finance its capital expenditures program and fund its operational needs,
the  Company  has relied  upon cash  provided  by  operations,  supplemented  as
necessary by bank lines of credit and long-term  indebtedness.  Cash provided by
(used in) operating activities was $31,421, (35), and 23,962 for the years ended
September 30, 1996, 1995 and 1994, respectively.

     Cash  provided by (used in) operating  activities in fiscal 1996,  1995 and
1994  resulted  primarily  from  net  income  of  $8,102,  $1,936  and  $11,420,
respectively,  after deducting non-cash charges of $20,723,  $17,945 and $16,703
and net working capital changes of approximately $2,596, ($19,916) and ($4,161),
for  each  respective  period.  The  increase  in  cash  provided  by  operating
activities  for fiscal 1996 as compared  to fiscal 1995 was  principally  due to
fluctuations in net income and the Company's working capital  requirements.  The
changes  included  reduced  inventory  and  accounts  payable  balances  in 1996
resulting  primarily from lower  inventory  quantities  and lower  polypropylene
costs.  The decrease in cash provided by operating  activities in fiscal 1995 as
compared to fiscal 1994 was principally due to lower net income and fluctuations
in  working  capital  requirements.   Working  capital  requirements   increased
primarily  due to  increases  in accounts  receivable,  inventory  and  accounts
payable.  The increase in accounts receivable resulted from increased sales over
the prior year  particularly in certain seasonal product lines. The increases in
inventory and accounts payable resulted from the effects of higher polypropylene
costs, as well as increased  units in finished goods and raw materials.  Working
capital amounted to $64,077, $69,039 and $44,114 at September 30, 1996, 1995 and
1994, respectively.

     Capital  expenditures  in fiscal  1996,  1995 and 1994  were  approximately
$34,200, $13,300 and $31,900, respectively.  Capital expenditures in fiscal 1996
and 1995 were primarily to increase woven manufacturing  capacity at its largest
facility.  In fiscal 1994, the Company expanded its secondary carpet backing and
nonwoven  facilities.  The  Company  expects to incur  approximately  $40,000 of
additional  capital  expenditures in each of fiscal 1997 and 1998,  primarily to
expand capacity and to continue to reduce  manufacturing  costs, subject in each
case to prevailing market conditions.

     The Credit  Facility  provides for  potential  borrowing  capacity of up to
$85,000 and is comprised of term loan borrowings of $45,000 (of which $10,000 is
payable in 1999 and $17,500 is payable in each of 2000 and 2001) and a revolving
credit loan portion (the "Revolver") of up to $40,000. The Revolver provides for
availability based on a borrowing formula consisting of 85% of eligible accounts
receivable and 50% of eligible inventory,  subject to certain  limitations.  The
Credit Facility expires on October 1, 2001.

     On December 14, 1992, the Company issued $140,000 of the Debentures,  which
represent unsecured obligations of the Company. The Debentures are redeemable at
the  option of the  Company  at any time on or after  December  1,  1997,  at an
initial  redemption  price of 106.375% of their  principal  amount together with
accrued interest,  with declining redemption prices thereafter.  Interest on the
Debentures is payable semi-annually on June 1 and December 1.

     On November 1, 1996, the Company sold  2,875,000  shares of common stock in
an underwritten  public offering.  The net proceeds to the Company from the sale
(after  payment of  underwriting  discounts and  commissions  and expenses) were
$34,020, which will be used to repay certain outstanding indebtedness.

     Based on current levels of operations and anticipated growth, the Company's
management  expects  cash from  operations  to provide  sufficient  cash flow to
satisfy  the  debt  service   requirements  of  the  Company's   long-term  debt
obligations,   including  the  Credit  Facility  and  lease  agreements,  permit
anticipated  capital   expenditures  and  fund  the  Company's  working  capital
requirements for the next twelve months.





Inflation and Seasonality

     The  Company  does not believe  that its  operations  have been  materially
affected by  inflation  during the three most  recent  fiscal  years.  While the
Company  does not  expect  that  inflation  will  have a  material  impact  upon
operating results,  there is no assurance that its business will not be affected
by inflation in the future.

     The Company's sales and income from continuing operations have historically
been higher in the third and fourth quarters of its fiscal year. While sales and
operating  income in the carpet backing and technical  textile product lines are
not  greatly  affected  by  seasonal  trends,  sales of  construction  and civil
engineering  products  are lower in the first and second  quarters  of any given
fiscal year due to the impact of adverse weather  conditions on the construction
and civil  engineering  markets.  Consequently,  as sales from  construction and
civil engineering products continue to increase as a percentage of the Company's
total sales, the seasonality of these products' sales will affect total sales of
the Company to a greater degree.


Forward Looking Statements

     The  discussion  of the  Company's  business and  operations in this report
includes in several instances forward-looking  statements,  which are based upon
management's  good  faith  assumptions   relating  to  the  financial,   market,
operating,  and other  relevant  environments  that will  exist and  affect  the
Company's  business and operations in the future.  No assurance can be made that
the assumptions upon which management based its forward-looking  statements will
prove to be correct,  or that the Company's  business and operations will not be
affected in any substantial manner by other factors not currently foreseeable by
management  or beyond the  Company's  control.  All  forward-looking  statements
involve risk and uncertainty, including those described in this report, and such
statements shall be deemed in the future to be modified in their entirety by the
Company's public pronouncements, including those contained in all future reports
and other  documents  filed by the  Company  with the  Securities  and  Exchange
Commission.


Accounting Changes

     In March 1995, the Financial  Accounting  Standards  Board ("FASB")  issued
Statement of Financial  Accounting  Standards ("SFAS") No. 121,  "Accounting for
the  Impairment of Long-Lived  Assets and for  Long-Lived  Assets to be Disposed
Of," which requires  impairment  losses to be recorded on long-lived assets used
in operations  when  indicators of impairment  are present and the  undiscounted
cash flows  estimated  to be generated by those assets are less than the assets'
carrying  amount.  SFAS No. 121 also  addresses the  accounting  for  long-lived
assets  that are  expected  to be disposed  of.  SFAS No. 121 is  effective  for
financial  statements  for fiscal  years  beginning  after  December  15,  1995.
Management  believes  that the adoption of this  standard will have no effect on
the consolidated financial position or results of operations.

     In October 1995, the FASB issued SFAS No. 123,  "Accounting for Stock-Based
Compensation" which is effective for the Company as of October 1, 1996. SFAS No.
123  establishes  financial  accounting and reporting  standards for stock-based
employee   compensation   plans.   The  Company  will  account  for  stock-based
compensation awards under the provisions of Accounting  Principles Board Opinion
No. 25, as permitted by SFAS No. 123. In accordance with SFAS No. 123, beginning
in the fiscal year ended  September  30,  1997,  the Company will make pro forma
disclosures  relative to stock-based  compensation  as part of the  accompanying
footnotes to the consolidated financial statements.


ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     See the financial  statements,  together with the auditors' report thereon,
appearing immediately after Part IV, Item 14 hereof.


ITEM 9.  DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

         None.


<PAGE>


                                    PART III

ITEM 10. EXECUTIVE OFFICERS AND DIRECTORS OF THE COMPANY


Directors of Synthetic G.P.

     Synthetic G.P. is the sole general partner of Management L.P., which is the
sole  general  partner  of the  Partnership.  By virtue of these  relationships,
Synthetic G.P. controls the management and affairs of the Partnership.

     The  general  partners  of  Synthetic  G.P.  are  the  following   Delaware
corporations:   Chill  Investments,   Inc.,  Beckman  Investments,  Inc.,  Freed
Investments,  Inc., Kenner Investments,  Inc., and Wright Investments, Inc. Each
of Leonard Chill, Jon P. Beckman, W. Wayne Freed, Ralph A. Kenner and W. Gardner
Wright,  Jr. is the sole  director  and the  controlling  stockholder  of one of
Synthetic  G.P.'s  general  partners,  and an executive  officer of the Company.
Messrs. Chill and Beckman also serve as directors of the Company.

     The  information  set forth  under the  heading  "Directors  and  Executive
Officers" in the Form 10-K is incorporated herein by reference.


ITEM 11.  RENUMERATION OF DIRECTORS AND OFFICERS

         The information set forth under the heading  "Remuneration of Directors
and Officers" in the Form 10-K is incorporated herein by reference.


 ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         As at December 1, 1996, no person or group is known to the  Partnership
to be the  beneficial  owner of more than five  percent  (5%) of the Units.  The
general partners of Synthetic G.P. and their respective  stockholders do not own
any Units.


ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         The General  Partner is the sole  general  partner of the  Partnership.
Synthetic  Management  G.P. is the sole general partner of SI Management L.P. By
virtue of these relationships, Synthetic Management G.P. controls the management
and affairs of the Partnership and, therefore, the Company. The Partnership owns
5,781,250  shares  of Common  Stock,  or  approximately  67% of the  issued  and
outstanding  shares of Common  Stock,  and  therefore  holds the voting power to
determine the outcome of all matters upon which stockholders vote.

     The general  partners of Synthetic  Management  G.P. are the following five
Delaware corporations: Chill Investments, Inc., Beckman Investments, Inc., Freed
Investments,  Inc., Kenner Investments,  Inc., and W.G. Wright Investments, Inc.
Each of Messrs.  Chill,  Beckman,  Freed, Kenner and Wright is the sole director
and the sole stockholder of one of Synthetic Management G.P.'s general partners.
For further information  concerning Messrs.  Chill,  Beckman,  Freed, Kenner and
Wright,  see  "Management--Executive  Officers and Directors of the Company" and
"--Executive Compensation".

         Jon P.  Beckman,  a former  executive  officer  of the  Company  and an
affiliate  of the General  partner,  is being  retained as a  consultant  to the
Company. Pursuant to his consulting agreement with the Company, Mr. Beckman will
receive,  until January 31, 2000, or upon earlier  termination of his consulting
agreement,  $125,000  per  year and  various  insurance  coverages,  and will be
authorized to exercise all stock options  awarded to him,  subject to applicable
vesting provisions. Under this agreement, Mr. Beckman is required to provide the
Company with 20 hours of consultation  per month,  has released the Company from
any liability  resulting  from his employment and has also agreed not to compete
against the Company.

         The Company  leases  office space under a five-year  lease with William
Gardner Wright, Jr., one of the Company's  executive  officers.  The term of the
lease  expires on September  30, 1998 and the rent is  approximately  $4,000 per
month, which the Company believes is within prevailing market rates.

         Pursuant to a licensing  agreement with the Company, W. Wayne Freed, an
executive officer of the Company,  receives royalties related to the manufacture
and sale of a certain  product for which Mr. Freed owns all the U.S. and foreign
patents.  Under this  agreement,  Mr.  Freed  received  royalties  of $3,079 and
$12,269 in fiscal 1995 and 1996, respectively, and will continue to receive such
royalties until 2012 or the earlier termination of the license agreement.


<PAGE>


                                     PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES,
            AND REPORTS ON FORM 8-K


(a)  Index to Consolidated Financial Statements:

                                                                   Page No. of
                                                             Financial Statement
      (1)   Financial Statements:

            Independent Auditors' Report                                F-1
            Consolidated Balance Sheets                                 F-2
            Consolidated Statements of Operations                       F-3
            Consolidated Statements of Changes in
               Stockholder's Equity                                     F-4
            Consolidated Statements of Cash Flows                       F-5
            Notes to Consolidated Financial Statements                  F-6


(b)   No reports on Form 8-K were filed during the last quarter of the
Partnership's fiscal year ended September 30, 1996.

(c) Exhibits: See exhibit index immediately following Item 14.

(d) No additional financial statements are required to be filed.


Supplemental  Information to be Furnished With Reports Filed Pursuant to Section
15(d) of the Securities  Exchange Act of 1934, as amended,  by Registrants Which
Have Not Registered Securities Pursuant to Section 12 thereunder.

No annual reports or proxy  materials have been sent to the sole  stockholder of
the Partnership or the holders of the units.

<PAGE>


                                  EXHIBIT INDEX


Location in
Sequential
Page Numbering
System

                      The following are the Exhibits as required by Item 14 (c).

     1    2.1 Acquisition  Agreement  dated November 21, 1986 between  Synthetic
          Industries, Inc., Synthetic Industries Limited, Polyweave Corporation,
          the shareholders of Synthetic  Industries,  Inc., Synthetic Industries
          Limited and SI Holding Inc. including exhibits thereto. 1 2.2 Plan and
          Agreement of Merger dated December 4, 1986.

     2    2.3 Asset Purchase  Agreement dated October 12, 1990 between Synthetic
          Industries, Inc. and Chicopee.

     10   3.1  Certificate  of  Incorporation  of  Synthetic  Industries,   Inc.
          (including  all  amendments  to date) filed with the  Secretary of the
          State of Delaware.

     10   3.2  Amended  and  Restated  By-Laws  of  Synthetic  Industries,  Inc.
          (including all amendments to date).

     4    4.1 Form of Indenture  between Synthetic  Industries,  Inc. and United
          States Trust Company of New York,  Trustee,  in respect to the 12-3/4%
          Senior Subordinated Debentures due 2002.

     9    4.2 Supplemental Form of Indenture between Synthetic Industries,  Inc.
          and United  States Trust Company of New York,  Trustee,  in respect to
          the 12-3/4% Senior Subordinated Debentures due 2002.

     9    10.1  Fourth  Amended  and  Restated  Revolving  Credit  and  Security
          Agreement  dated as of October  20, 1995 among  Synthetic  Industries,
          Inc.,  The First  National Bank of Boston and other Lenders  listed on
          Schedule I thereto, and The First National Bank of Boston, as agent on
          behalf of the Lenders.

     9    10.2  Amendment  No. 1 to the Fourth  Amended and  Restated  Revolving
          Credit and Security Agreement dated as of December 1, 1995

     11   10.3  Amendment  No. 2 to the Fourth  Amended and  Restated  Revolving
          Credit and Security Agreement dated as of December 1, 1995

     9    10.4  Amendment  No. 3 to the Fourth  Amended and  Restated  Revolving
          Credit and Security Agreement dated as of December 1, 1995

     2    10.5 US  Patent  No.  4,867,614,  Reinforced  Soil  and  Method  (Exp.
          December 13, 2003).

     2    10.6 US Patent No.  4,790,691,  Fiber Reinforced Soil and Method (Exp.
          December 13, 2003).

     2    10.7 US Patent No.  5,007,766,  Shaped Barrier for Erosion Control and
          Sediment Collection (Exp. April 16, 2008).

     1    10.8 Lease  agreement dated November 22, 1971 between Murray Sobel and
          Synthetic Industries, Inc. (including all amendments to date).

     1    10.9 Lease agreement dated February 13, 1969, between Murray Sobel and
          wife, Marcela S. Sobel, and Joseph F. Decosimo,  Frank M. Thompson and
          Murray Sobel, Trustees and Synthetic  Industries,  Inc. (including all
          amendments to date).

     2    10.10 Lease  agreement  dated  December 17, 1990 between  Chicopee and
          Synthetic Industries, Inc.

     2    10.11  Lease  agreement  dated  January 17,  1991  between  Herchel L.
          Webster and Allie Ree  Webster and  Synthetic  Industries,  Inc.  (the
          "Lumite Lease").

     6    10.12 Amendment to the Lumite Lease dated October 1, 1992.

     2    10.13 Consulting Agreement dated July 23, 1991 between Texpro Limitada
          y Cia S.C.A. and Synthetic Industries, Limited.

     7    10.14 Supply Contract  between  Eastman  Chemical  Products,  Inc. and
          Synthetic Industries, Inc. dated December 13, 1991.

     13   10.15  Agreement  dated  September 6, 1996 between  Leonard  Chill and
          Synthetic Industries, Inc.

     13   10.16  Agreement  dated  September  6, 1996 between W. Wayne Freed and
          Synthetic Industries, Inc.

     13   10.17  Agreement  dated  September 6, 1996 between Ralph A. Kenner and
          Synthetic Industries, Inc.

     13   10.18 Agreement  dated  September 6, 1996 between Gardner Wright,  Jr.
          and Synthetic Industries, Inc.

     13   10.19  Agreement  dated  September  6, 1996  between  John M. Long and
          Synthetic Industries, Inc.

     13   10.20 Agreement dated September 6, 1996 between Charles T. Koerner and
          Synthetic Industries, Inc.

     2    10.21 Agreement dated September 6, 1996 between Robert J. Breyley, Sr.
          and Fibermesh Company.

     13   10.22 Agreement  dated September 6, 1996 between Joseph  Sinicropi and
          Synthetic Industries, Inc.

     13   10.23 Agreement  dated September 6, 1996 between W.O.  Falkenberry and
          Synthetic Industries, Inc.

     13   10.24  Agreement  dated  September 6, 1996 between Bobby  Callahan and
          Synthetic Industries, Inc.

     8    10.25 1994 Stock Option Plan for Non-Employee Directors

     8    10.26 1994 Stock Option Plan

     11   10.27 1996 Stock Option Plan

     11   10.28 Incentive Compensation Plan Fiscal Year 1994/1995

     11   10.29 Incentive Compensation Plan Fiscal Year 1995/1996

     12   10.30  Form  of  Registration   Rights  Agreement   between  Synthetic
          Industries,  L.P. and Synthetic  Industries,  Inc. dated as of October
          31, 1996.

     13   10.31  Amendment  No. 4 to the Fourth  Amended and Restated  Revolving
          Credit and Security Agreement dated as of September 27, 1996.

     14   10.32  Amendment  No. 5 to the Fourth  Amended and Restated  Revolving
          Credit and Security Agreement dated as of October 28, 1996

     2    21. List of Subsidiaries of Synthetic Industries, Inc.

          27.  Financial Data Schedule

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

     1    Filed as an exhibit to the  Company's  Registration  Statement on Form
          S-1 (33-11479) as filed with the Securities and Exchange Commission on
          January 23, 1987 and incorporated herein by reference.

     2    Filed as an exhibit to the  Company's  Registration  Statement on Form
          S-1 (33-51206) as filed with the Securities and Exchange Commission on
          August 24, 1992 and incorporated herein by reference.

     3    Filed as an exhibit to the  Company's  Annual  Report on Form 10-K for
          the fiscal year ended  September 30, 1993 and  incorporated  herein by
          reference.

     4    Filed  as  an  exhibit  to  the  Company's  Amendment  No.  3  to  the
          Registration  on Form S-1  (33-51206) as filed with the Securities and
          Exchange  Commission  on December 4, 1992 and  incorporated  herein by
          reference.

     5    Filed as an exhibit to the  Partnership's  Registration  Statement  on
          Form 10 (0-21548) as filed with the Securities and Exchange Commission
          on April 16, 1993 and incorporated herein by reference.

     6    Filed  as an  exhibit  to the  Partnership's  Amendment  No.  1 to the
          Registration  Statement  on  Form  10  (0-21548)  as  filed  with  the
          Securities and Exchange Commission on August 10, 1993 and incorporated
          herein by reference.

     7    Pursuant  to an order dated  October  19,  1992,  the  Securities  and
          Exchange  Commission  granted  confidential  treatment with respect to
          certain  portions of this exhibit under Rule 406 of the Securities Act
          of 1933, as amended.

     8    Filed as an exhibit to the  Company's  Annual  Report on Form 10-K for
          the fiscal year ended  September 30, 1994 and  incorporated  herein by
          reference.

     9    Filed as an exhibit to the  Company's  Annual  Report on Form 10-K for
          the fiscal year ended  September 30, 1995 and  incorporated  herein by
          reference.

     10   Filed as an exhibit to the  Company's  Registration  Statement on Form
          8-A (0-12357) as filed with the Securities and Exchange  Commission on
          October 24, 1996 and incorporated herein by reference.

     11   Filed as an exhibit to the  Company's  Registration  Statement on Form
          S-1  (333-09377) as filed with the Securities and Exchange  Commission
          on August 1, 1996 and incorporated herein by reference.

     12   Filed as an exhibit to Amendment No. 1 to the  Company's  Registration
          Statement on Form S-1  (333-09377)  as filed with the  Securities  and
          Exchange  Commission on September 13, 1996 and incorporated  herein by
          reference.

     13   Filed as an exhibit to Amendment No. 2 to the  Company's  Registration
          Statement on Form S-1  (333-09377)  as filed with the  Securities  and
          Exchange  Commission  on  October 2, 1996 and  incorporated  herein by
          reference.

     14   Filed as an exhibit to the  Company's  Annual  Report on Form 10-K for
          the fiscal year ended  September 30, 1996 and  incorporated  herein by
          reference.


<PAGE>


F-16


Deloitte and Touche LLP
Two World Financial Center
New York, New York  10281-1414
Telephone:  (212) 436-2000
Facsimile:   (212) 436-5000




INDEPENDENT AUDITORS' REPORT


To the Partners of Synthetic Industries, L.P.
Chickamauga, Georgia


We have  audited  the  accompanying  consolidated  balance  sheets of  Synthetic
Industries,  L.P. and its  subsidiary as of September 30, 1996 and 1995, and the
related consolidated statements of operations,  changes in partners' capital and
cash flows for each of the three years in the period ended  September  30, 1996.
These financial  statements are the responsibility of the Company's  management.
Our responsibility is to express an opinion on these 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
misstatements. 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,  such consolidated  financial  statements present fairly, in all
material  respects,  the financial  position of Synthetic  Industries,  L.P. and
subsidiary at September 30, 1996 and 1995,  and the results of their  operations
and their cash flows for each of the three years in the period  ended  September
30, 1996 in conformity with generally accepted accounting principles.




/S/ Deloitte and Touche LLP


Deloitte & Touche LLP


November 12, 1996




<PAGE>


                            SYNTHETIC INDUSTRIES L.P.
                                 AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS
               (In thousands of dollars, except unit information)

                                                           September 30,
                  ASSETS                                1996           1995
                                                       --------       ------

CURRENT ASSETS:
  Cash..........................................     $     103        $   110
  Accounts receivable, net (Note 4).............        47,861         47,947
  Inventory (Note 5)............................        39,142         45,597
  Other current assets (Note 6).................        14,655         14,708
                                                     ---------       --------

      TOTAL CURRENT ASSETS......................       101,761        108,362

PROPERTY, PLANT AND EQUIPMENT, net (Note 7).....       137,974        116,729

OTHER ASSETS (Note 8)...........................        84,021         87,211
                                                     ---------       --------

                                                      $323,756       $312,302

                  LIABILITIES AND PARTNERS' CAPITAL

CURRENT LIABILITIES:
  Accounts payable..............................       $20,227       $ 24,021
  Accrued expenses and other current liabilities        10,026          7,378
  Income taxes payable (Note 11)................         1,407          1,455
  Interest payable..............................         6,024          6,427
  Current maturities of long-term debt (Note 9).           659             40
                                                      ---------     ----------

         TOTAL CURRENT LIABILITIES...............        38,343         39,321

LONG-TERM DEBT (Note 9)..........................       194,353        192,048

DEFERRED INCOME TAXES (Note 11)..................        25,875         23,175




COMMITMENTS AND CONTINGENCIES (Note 10)

PARTNERS' CAPITAL (Notes 3 and 13)
  General Partner's Capital......................           649            575
  Limited Partners' Capital,
     800 Units issued and outstanding............        64,536         57,183
                                                       --------       --------

      TOTAL PARTNERS' CAPITAL....................        65,185         57,758
                                                       --------       --------

                                                       $323,756       $312,302

                 See notes to consolidated financial statements

<PAGE>

<TABLE>


                            SYNTHETIC INDUSTRIES L.P.
                                 AND SUBSIDIARY
                           CONSOLIDATED STATEMENTS OF
               OPERATIONS (In thousands of dollars, except limited
                         partnership units outstanding)


<CAPTION>

                                                                                       Year ended September 30,
                                                                         1996             1995         1994__
                                                                    --------------   ------------------------

<S>                                                                       <C>               <C>              <C>     
Net sales...............................................................  $ 299,532         $271,427         $234,977
                                                                          ---------         --------         --------
Costs and expenses:
  Cost of sales ........................................................    208,321          194,706          152,305
  Selling expenses......................................................     27,488           24,273           21,815
  General and administrative expenses...................................     23,318           21,195           17,351
  Amortization of excess of purchase price over net
      assets acquired and other intangibles.............................      2,592            2,566            2,499
                                                                           --------         --------         --------

                                                                            261,719          242,740          193,970
                                                                            -------         --------         --------

      Operating income..................................................     37,813           28,687           41,007
                                                                           --------         --------         --------

Other expenses:
  Interest expense, net.................................................     22,773           22,514           20,011
  Amortization of deferred financing costs..............................        699              737              739
                                                                           --------          -------         --------

                                                                             23,472           23,251           20,750
                                                                            -------         --------         --------
Income before
    provision for income taxes..........................................     14,341            5,436           20,257

Provision for income taxes
    (Note 11)...........................................................      6,900            3,500            8,600
                                                                           --------         --------         --------


NET INCOME..............................................................    $ 7,441         $  1,936        $  11,657
                                                                           ========       ==========       ==========

NET INCOME ATTRIBUTABLE TO:
      General partner...................................................$        74      $        19       $      114
      Limited partners..................................................      7,367            1,917           11,543
                                                                          ---------         --------           ------

                                                                           $  7,441       $    1,936         $  11,657
                                                                           ========       ==========         =========

Net income per limited partnership unit.................................  $     9.21      $     2.40        $    14.43
                                                                          ==========      ==========        ==========

Limited partnership units outstanding ..................................        800              800              800
                                                                          =========          =======         ========
</TABLE>





                 See notes to consolidated financial statements                 

<PAGE>



                            SYNTHETIC INDUSTRIES L.P.
                                 AND SUBSIDIARY
                  CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL
                            (In thousands of dollars)




                                                                  Total
                                     General    Limited          Partners'
                                     Partner    Partner          Capital


Balance, September 30, 1993...... $     442     $ 43,746          $44,188

Net income.......................       114       11,543           11,657

Foreign currency translation.......       -          (26)             (26)
                                   --------     ---------         -------

Balance, September 30, 1994......       556       55,263           55,819

Net income.......................        19        1,917            1,936

Foreign currency translation.......       -            3                3
                                    --------     --------         --------

Balance, September 30, 1995.......       575      57,183           57,758

Net income........................        74       7,367            7,441

Foreign currency translation........       -         (14)             (14)
                                     --------    --------       ---------

Balance, September 30, 1996.......  $    649     $ 64,536        $ 65,185
                                     ========    =========       ========





                 See notes to consolidated financial statements

<PAGE>

<TABLE>

                            SYNTHETIC INDUSTRIES L.P.
                                 AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                            (In thousands of dollars)
<CAPTION>
                                                                                   Year ended September 30,
                                                                              1996              1995       1994
                                                                             ------            -----      -----
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                        <C>              <C>             <C>      
  Net income............................................................   $  7,441         $  1,936        $  11,657
  Adjustments to reconcile net income
       to net cash provided by (used in) operations:
  Depreciation and amortization.........................................     16,299           14,937           12,390
  Deferred income taxes.................................................      3,400             (355)           3,830
  Provision for bad debts...............................................      1,024            3,363              217
  Loss on disposal of equipment.........................................          -                -              266
  Change in assets and liabilities:
  Increase in accounts receivable.......................................       (943)         (12,212)          (2,861)
  Decrease (increase) in inventory......................................      6,451          (13,076)          (7,255)
  Increase in other current assets......................................       (647)          (1,469)            (595)
  (Decrease) increase in accounts payable...............................     (3,801)           5,254            5,340
  Increase in accrued expenses and other current liabilities............      2,648              434              533
  (Decrease) increase in income taxes payable...........................        (48)             973              482
  (Decrease) increase in interest payable...............................       (403)             180              224
                                                                          ----------      ----------         --------
     Cash provided by (used in) operating activities....................     31,421              (35)          24,228
                                                                           --------      ------------        --------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Additions to property, plant and equipment............................    (29,253)         (13,313)         (31,866)
                                                                            --------         --------         --------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Borrowings under term loan............................................     19,500           11,000                -
  Repayments under term loan............................................       (500)          (6,000)          (6,000)
  Net (repayment) borrowings under revolving credit line................    (20,734)           8,598           13,802
  Payment of capital lease obligation and other long term debt..........       (342)             (36)            (297)
  Deferred financing costs..............................................       (101)            (221)               -
                                                                            --------       ----------     -----------
       Cash (used in) provided by financing activities..................     (2,177)          13,341            7,503
  Effect of exchange rate changes on cash...............................          2               (2)              (3)
                                                                          ---------       ----------         -------- 
NET DECREASE IN CASH....................................................         (7)              (9)            (136)
CASH AT BEGINNING OF PERIOD.............................................        110              119              255
                                                                           --------          -------         --------
CASH AT END OF PERIOD...................................................   $    103         $    110         $    119
                                                                           ========         ========         ========

SUPPLEMENTAL SCHEDULE OF CASH FLOW INFORMATION Cash paid during the year for:
  Interest .............................................................   $ 23,176         $ 22,334         $ 19,787
  Income taxes..........................................................      3,548            2,882            3,901

SUPPLEMENTAL SCHEDULE OF NONCASH ACTIVITY
Capital lease obligation incurred for purchase of equipment.............   $  5,000      $       -         $        -


                 See notes to consolidated financial statements                  
</TABLE>

<PAGE>






                            SYNTHETIC INDUSTRIES L.P.
                                 AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
               (In thousands of dollars, except share information)


1.   ORGANIZATION

     Synthetic  Industries,  L.P. (the  "Partnership") is a limited  partnership
     organized  under the laws of Delaware.  In December 1986,  the  Partnership
     acquired all of the issued and outstanding shares of Synthetic  Industries,
     Inc. (the "Company").  The Company manufactures and markets a wide range of
     polypropylene-based  fabric  and fiber  products  designed  for  industrial
     applications.  The  Company's  diverse mix of products  are marketed to the
     floor covering, construction and technical textile markets for such end-use
     applications  as carpet backing,  geotextiles,  erosion  control,  concrete
     reinforcement and furniture construction fabrics.

     Since its  organization  in 1986, the Partnership has conducted no business
     except  (I)  engaging  in  the  transactions  described  in a  confidential
     offering  memorandum dated January 16, 1987, as  supplemented,  relating to
     the  offering  and sale of units of  limited  partnership  interest  in the
     Partnership (the "Units"); and (II) owning and voting the Shares.


2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Principles of consolidation

     The  consolidated   financial   statements  include  the  accounts  of  the
     Partnership and the Company. All significant intercompany  transactions and
     balances have been eliminated.

     Revenue Recognition

     Revenue from product sales is recognized at the time of shipment.

     Foreign currency translation

     The assets and  liabilities of foreign  subsidiaries  are translated at the
     fiscal  year-end  rates of  exchange,  and the  results of  operations  are
     translated at the average rates of exchange for the years presented.  Gains
     or losses resulting from translating foreign currency financial  statements
     are accumulated in the cumulative  translation  adjustments  account in the
     stockholder's  equity  section  of the  accompanying  consolidated  balance
     sheets.  Foreign  currency  transaction  gains and losses are  included  in
     results of operations.  Foreign currency  realized and unrealized gains and
     losses for the years presented were not material.




     Inventory

     Inventory is stated at the lower of cost,  determined  using the  first-in,
     first-out method, or market.
    

      Property, plant and equipment

     Property,   plant  and  equipment  is  stated  at  cost  less   accumulated
     depreciation   and   amortization.   Depreciation   is   provided   on  the
     straight-line method based on estimated useful lives, as follows:

      Building and improvements                                   25 years
      Machinery and equipment                                     14 years

     Leasehold improvements are amortized over the shorter of the useful life of
     the asset or the term of the lease.  Expenses for repairs,  maintenance and
     renewals are charged to operations as incurred.  Expenditures which improve
     an asset or extend its useful life are  capitalized.  When  properties  are
     retired  or  otherwise  disposed  of,  the  related  cost  and  accumulated
     depreciation and amortization are removed from the accounts and any gain or
     loss is included in the results of operations.

     Capitalized  interest is charged to machinery  and  equipment and amortized
     over the lives of the related assets.  Interest  capitalized  during fiscal
     1996, 1995 and 1994 was $392, $729 and $283, respectively.

     Income taxes

     The Company accounts for income taxes using an asset and liability approach
     in  accordance  with  Statement of Financial  Accounting  Standards No. 109
     ("SFAS 109").  Under SFAS 109, deferred income taxes are recognized for the
     tax consequences of temporary differences by applying enacted statutory tax
     rates  applicable  to future  years to  differences  between the  financial
     statement  carrying  amounts  and the tax  bases  of  existing  assets  and
     liabilities.  The  effect  on  deferred  taxes of a change  in tax rates is
     recognized in the statement of operations  for the period that includes the
     enactment date.

     Excess of purchase price over net assets acquired

     The excess of purchase  price over net assets  acquired is  amortized  on a
     straight-line  basis over a period of 40 years.  Excess of  purchase  price
     over net assets acquired is assessed for recoverability on a regular basis.
     In evaluating the value and future benefits of goodwill, its carrying value
     would be reduced by the excess,  if any, of the balance  over  management's
     best estimate of undiscounted  future operating income before  amortization
     of the related intangible assets over the remaining amortization period.

     Deferred financing and Intangible assets

     Deferred  financing  costs are  amortized  over periods from 5 to 12 years.
     Intangible  assets  consist  primarily of a  Fibermesh (r)  trademark and
     patents  on  civil   engineering   products,   which  are  amortized  on  a
     straight-line basis over 40 and 15 years, respectively.

     Net income per limited partnership unit

     Net income per limited  partnership unit is based upon the weighted average
     number of units  outstanding  during each  respective  year.  Net income is
     allocated to the General  Partner and the Limited  Partners  based on their
     respective ownership percentages.

     Use of estimates

     The  preparation  of financial  statements  in  conformity  with  generally
     accepted  accounting  principles  requires management to make estimates and
     assumptions  that affect the reported amounts of assets and liabilities and
     disclosure  of  contingent  assets  and  liabilities  at  the  date  of the
     financial  statements  and the  reported  amounts of revenues  and expenses
     during  the  reporting  period.  Actual  results  could  differ  from those
     estimates.

     Impairment of long-lived assets and long-lived assets to be disposed of

     In March 1995, the Financial  Accounting  Standards  Board ("FASB")  issued
     Statement of Financial  Accounting  Standards ("SFAS") No. 121, "Accounting
     for the  Impairment of Long-Lived  Assets and for  Long-Lived  Assets to be
     Disposed Of," which requires impairment losses to be recorded on long-lived
     assets used in operations when indicators of impairment are present and the
     undiscounted  cash flows estimated to be generated by those assets are less
     than  the  assets'  carrying  amount.  SFAS  No.  121  also  addresses  the
     accounting for long-lived  assets that are expected to be disposed of. SFAS
     No. 121 is effective for financial  statements  for fiscal years  beginning
     after  December 15,  1995.  Management  believes  that the adoption of this
     standard will have no effect on consolidated  financial position or results
     of operations.

     Stock based compensation

     In October 1995, the FASB issued SFAS No. 123,  "Accounting for Stock-Based
     Compensation"  which will be effective for the Company beginning October 1,
     1996. SFAS No. 123 establishes financial accounting and reporting standards
     for stock-based  employee  compensation plans. The company will account for
     stock-based   compensation   awards  under  the  provisions  of  Accounting
     Principles  Board  Opinion  No.  25,  as  permitted  by SFAS  No.  123.  In
     accordance with SFAS No. 123,  beginning in the fiscal year ended September
     30,  1997,  the  Company  will  make  pro  forma  disclosures  relative  to
     stock-based  compensation  as part  of the  accompanying  footnotes  to the
     consolidated financial statements.

     Reclassification of prior financial statements

     Certain  reclassifications  have been  made to  previous  years'  financial
     statements to conform with 1996 classifications.


3.   RECAPITALIZATION AND INITIAL PUBLIC OFFERING

      On July 31,  1996,  the board of  directors  (the  "Board"),  approved  an
      amendment  to the  Company's  Certificate  of  Incorporation  to  effect a
      recapitalization  of the  Company's  Common  Stock,  pursuant to which the
      number of authorized shares of the Company's Common Stock was increased to
      25,000,000   shares   (the    "Recapitalization").    As   part   of   the
      Recapitalization, the Board approved a 115,740.74-for-1 stock split of the
      issued  and  outstanding  shares of Common  Stock.  The  Recapitalization,
      including  the stock  split,  became  effective  immediately  prior to the
      initial public offering.

      On November 1, 1996, the Company sold 2,875,000  shares of common stock in
      an underwritten public offering.  The net proceeds to the Company from the
      sale  (after  payment  of  underwriting   discounts  and  commissions  and
      expenses) were approximately $34,020. The net proceeds to the Company will
      be used to repay certain outstanding indebtedness.

      The  Partnership  attempted a public offering to sell all of its shares in
      the Company which was withdrawn.  Under an agreement with the Company, the
      Company paid the costs  associated  with the withdrawn  public offering of
      approximately  $660  and  the  Partnership  will  reimburse  the  Company.
      Accordingly,  the  Partnership  has  expensed  the costs,  in general  and
      administrative  expenses,  and recorded a liability to the Company for all
      amounts due.


4.  ACCOUNTS RECEIVABLE

     Accounts receivable are presented net of the doubtful allowances of $3,036,
     $4,053 and $1,201 for fiscal  1996,  1995 and 1994,  respectively.  Amounts
     written off against  established  allowances were $2,041, $511 and $217 for
     the years ended September 30, 1996, 1995 and 1994, respectively.

     The Company grants  uncollateralized trade terms to its customers,  most of
     whom are  located in the state of  Georgia.  As of  September  30, 1996 and
     1995,  $21,916  and  $22,  903,  respectively,  of the  Company's  accounts
     receivable  balances  were  due  from  customers  located  in the  state of
     Georgia.  Net sales to one customer  represented  18% of  consolidated  net
     sales for all three fiscal years presented.


5.   INVENTORY
                                                        September 30,
                                                  1996                1995
                                                  ----                ----

     Finished goods............................$ 22,555            $ 27,867
     Work in process.........................     7,937               5,541
     Raw materials...........................     8,650              12,189
                                               --------            --------

                                              $  39,142            $ 45,597
                                              =========            ========

6.   OTHER CURRENT ASSETS
                                                       September 30,
                                                  1996                1995
                                                 ----                ----

    Prepaid supplies........................  $  8,283            $  7,192
    Deferred tax assets.....................     4,765               5,465
    Other...................................     1,607               2,051
                                               -------             -------
                                               $14,655             $14,708
                                              ========             =======



7.   PROPERTY, PLANT AND EQUIPMENT

                                                      September 30,
                                                1996              1995
                                                ----             -----  

   Land....................................  $  4,458            $  3,511
   Buildings and improvements..............    29,298              23,457
   Machinery and equipment and
     leasehold improvements................   179,386             151,921
                                              -------            --------
                                              213,142             178,889
     Accumulated depreciation................  75,168              62,160
                                               ------             -------

                                              $137,974           $116,729
                                              ========           ========

     Depreciation expense on property,  plant and equipment was $13,008, $11,634
     and $9,152 in fiscal 1996, 1995 and 1994, respectively.

8.   OTHER ASSETS

                                                         September 30,
                                                   1996               1995
                                                   ----               ----

Excess of purchase price
   over net assets acquired...................... $99,818             $99,818
Intangible assets..............................     3,546               3,546
Deferred financing costs........................   12,331              12,230
                                                ---------             -------
                                                  115,695             115,594
Accumulated amortization........................   31,674              28,383
                                                 --------             -------
                                                 $ 84,021            $ 87,211
                                                 ========            ========


The excess of purchase price over net assets acquired arose from the purchase of
the  Company's  Common  Stock.  The Company was acquired by the  Partnership  on
December 4, 1986.  This  acquisition was accounted for using the purchase method
of accounting.  Accordingly,  the purchase price was allocated to the net assets
acquired  based on estimates by independent  appraisals and other  valuations of
fair market value as of December 4, 1986,  and  resulted in a purchase  price in
excess of net assets acquired of $99,818.

Amortization  expense was  $3,291,  $3,303 and $3,238 in fiscal  1996,  1995 and
1994, respectively.


9.   LONG-TERM DEBT

Long-term debt consists of the following at September 30:


                                                         1996         1995
       Secured revolving credit facility (a):
         Secured revolving credit portion             $  3,993        $24,727
         Term loan portion                              45,000         26,000
       12 3/4% senior subordinated debentures (b)      140,000        140,000
       Capital lease obligation (Note 10)                4,698              -
       Other                                             1,321          1,361
                                                     ---------      ---------
                                                       195,012        192,088
       Less current portion                                659             40
                                                     ---------      ---------
       Total long-term portion                       $ 194,353       $192,048
                                                     =========       ========

     a.   The Secured Revolving Credit Facility

          On October 20, 1995, the Company and its lenders entered into a Fourth
          Amended and Restated  Revolving  Credit Agreement (as amended to date,
          the "Credit Facility").  The Company's term loan portion of the Credit
          Facility  was  increased  to  $45,000.   The  Credit  Facility  has  a
          termination  date of October  20,  2001,  and  provides  for term loan
          repayments of $10,000 in 1999 and $17,500 in each of 2000 and 2001.

          The  revolving  credit  loan  portion  of  the  Credit  Facility  (the
          "Revolver")  provides for  availability  based on a borrowing  formula
          consisting of 85% of eligible accounts  receivable and 50% of eligible
          inventory,   subject  to  certain  limitations.   The  maximum  amount
          available  for borrowing  under the  revolving  credit loan portion is
          increased to $40,000,  of which  $34,115 is available at September 30,
          1996.

          The Credit Facility  permits  borrowings  which bear interest,  at the
          Company's option, (i) for domestic  borrowings,  based on the lender's
          base  rate  plus .75% or 1.00%  for  Revolver  or Term Loan  advances,
          respectively  (9.00%  and 9.25% at  September  30,  1996 and 9.50% and
          9.75% at September 30,1995) or (ii) for Eurodollar borrowing, based on
          the Interbank Eurodollar rate at the time of conversion plus 2.50% and
          2.75% for  Revolver  or Term Loan  advances,  respectively  (8.06% and
          8.09% at  September  30, 1996 and 8.50% and 8.625% and  September  30,
          1995).

          The Credit Facility provides for borrowings under letters of credit of
          up to $3,000,  which  borrowings  reduce amounts  available  under the
          Revolver. At September 30, 1996, there was $1,892 in letters of credit
          outstanding under the facility. The Company is required to pay a .375%
          fee on this unused portion of the commitment and an agency fee of $150
          per annum.

          The Credit  Facility is  collateralized  by  substantially  all of the
          Company's assets and contains  covenants related to the maintenance of
          certain operating and working capital levels and limitations as to the
          amount of capital expenditures. The Company's ability to pay dividends
          on its common stock is restricted by both the Credit  Facility and the
          indenture  relating to the Senior  Subordinated  Debentures  discussed
          below.

     b.   Senior Subordinated Debentures

          On December 14, 1992,  the Company  issued  $140,000 of 12-3/4% Senior
          Subordinated  Debentures due 2002 (the "Debentures"),  which represent
          unsecured obligations of the Company. The Debentures are redeemable at
          the option of the  Company at any time on or after  December  1, 1997,
          initially at 106.375% of their principal amount, together with accrued
          interest, with declining redemption prices thereafter. Interest on the
          Debentures is payable semi-annually on June 1 and December 1.

          The fair  value of the  Company's  Debentures  is  estimated  based on
          quoted  market  prices  for  the  Debentures  in the  over-the-counter
          market.  The estimated  fair value of the  Debentures at September 30,
          1996 is 107.0% of their face amount or $149,800.

Approximate  aggregate  minimum  annual  payments  due on long term debt and the
capital lease,  for the subsequent five years are as follows:  1997, $659; 1998,
$718; 1999, $10,783; 2000, $22,347; 2001, $19,470; and thereafter, $141,036.


10.  COMMITMENTS AND CONTINGENCIES

     a.   Lease commitments

          On May 15, 1996,  the Company  entered into a five year capital  lease
          for equipment  which  provides for payments over a five year period at
          an interest rate of 8.42%. The Company also leases certain factory and
          warehouse  buildings and equipment  under long-term  operating  leases
          expiring through 2009.


<PAGE>



          Future minimum lease payments under  noncancellable  lease obligations
at September 30, 1996 are as follows:

                                                     Capital         Operating
                  Year                                leases            leases

                  1997.............................   $  986          $ 3,786
                  1998.............................      986            2,262
                  1999.............................      986            1,622
                  2000.............................      986              991
                  2001.............................    1,993              362
                  Thereafter.......................        -              817
                                                     -------           ------

                  Total minimum lease payments..... $ 5,937          $ 9,840
                                                     =======

                  Less amount representing interest. ...............   1,239
                                                                       -----

                  Present value of net minimum
                     lease payments.................................   4,698

                  Less current maturities of
                     capital lease obligation.......................     614
                                                                      -------

                  Capital lease obligation.......................... $ 4,084

          Total  rental  expense  for  the  above  operating  leases  and  other
          short-term leases for the fiscal years 1996, 1995 and 1994 was $4,499,
          $3,731 and $4,684, respectively.

     b.   Capital Expenditures

          In  fiscal  1997,  the  Company  plans  a  $40,000  expansion  of  its
          manufacturing facilities, primarily to expand capacity and to continue
          to  reduce   manufacturing   costs,   subject  to  prevailing   market
          conditions, of which $7,084 is committed at September 30, 1996.

     c.   Litigation

          The Partnership is not party to litigation arising out of its business
          operations.

          The Company and its subsidiaries are parties to litigation arising out
          of their business operations.  Most of such litigation involves claims
          for personal injury,  property  damage,  breach of contract and claims
          involving employee relations and certain  administrative  proceedings.
          The Company  believes such claims are adequately  covered by insurance
          or do not involve a risk of material loss to the Company.




<PAGE>


11.  INCOME TAXES

     The sources of income  before  provision for incomes taxes are presented as
follows:


                                    Fiscal Years Ended September 30,
                                     1996        1995          1994
                                     ----        ----          ----

  United States...................  $13,422    $  4,546      $ 19,742
  Foreign.........................  $   919    $    890      $    515
                                    -------    ---------     --------
  Earnings before income taxes....  $14,341    $  5,436      $ 20,257
                                    --------    --------     --------



     The provision for income taxes attributable to the amounts shown
    above consists of the following:

                                           Year ended September 30,
                                   1996              1995               1994
                                   ----              ----               ----
          Current:
              Federal.........    $2,600            $3,180           $  3,770
              State...........       600               400              1,000
              Foreign.........       300               275                  -
                                 -------           -------            -------
                                   3,500             3,855              4,770
                                 -------           -------            -------
          Deferred:
              Federal.........     3,200              (218)             3,405
              State...........       200              (137)               425
                                 -------           --------           -------
                                   3,400              (355)             3,830
                                 -------           --------           -------

       Total taxes on income..    $6,900            $3,500            $ 8,600
                                  ======            ======            =======


A reconciliation of US income tax computed at the statutory rate and actual tax
expense is as follows:


                                                  Year ended September 30,
                                                1996     1995       1994
                                                ----     ----       ----

  Amount computed at statutory rate.......    $5,020    $1,900     $7,090

  State and local taxes less applicable
    federal income tax....................       550       270        747

  Amortization of goodwill................       873       873        871

  Other nondeductible expenses............       115       210        348

  Other, net..............................       342       247       (456)
                                              ------    ------     -------
                                              $6,900    $3,500     $8,600
                                              ======    ======     ======

The tax effects of significant  items  comprising the Company's net deferred tax
liability are as follows:

                                                 Year ended September 30,
                                                  1996             1995
                                                  ----             ----

 Property, plant and equipment...............   $24,819          $22,121
 Trademarks and patents......................     1,056            1,054
                                                 ------           ------

 Total deferred tax liabilities..............    25,875           23,175
                                                 ------           ------


 Receivables.................................       996            1,609
 Inventory...................................       626              628
 Accrued expenses............................     1,829            1,581
 AMT credit carryforward
    (no expiration date).....................     1,314            1,647
                                                -------           ------

 Total deferred tax assets...................     4,765            5,465
                                                -------         --------

 Net deferred tax liability..................   $21,110          $17,710
                                             ==========          =======

 The Company's United  States Income Tax returns for fiscal years 1992 and 1993
 have been  examined and settled  without material adjustment.


12.  RETIREMENT PROGRAMS

     For US  employees,  the Company  maintains a trusteed  profit-sharing  plan
     ("Plan") which is qualified  under Section  401(k) of the Internal  Revenue
     Code.  All  full-time  employees  over the age of 21 who have been employed
     continuously  for at least one year are eligible for  participation  in the
     Plan. The Company may, but has not elected to,  contribute a portion of its
     profits to the Plan,  as  determined  by the Board of  Directors.  Employer
     contributions  vest over 1 to 5 years.  The  Company  has  elected to match
     employee  contributions  to the Plan on a 50% basis but not to exceed 3% of
     the  employee's  annual  compensation.  During fiscal years 1996,  1995 and
     1994, the Company contributed $999, $921 and $891,  respectively.  The Plan
     provides for the Company to bear the expense of the  administration  of the
     Plan. Pension expense on the foreign plans is not significant.


13. STOCK OPTIONS

     In August 1994,  the Company  adopted a stock option plan (the  "Director's
     Plan")  pursuant  to which  non-qualified  stock  options  to  purchase  an
     aggregate  of  125,261  shares of Common  Stock  were  granted  to the four
     non-employee  Directors  of the Company at an  exercise  price of $6.83 per
     share which was  determined  by  reference  to the fair market value of the
     Company's  equity at the time such  Directors  joined the Board.  The stock
     options  will be fully  vested by  October  1,  1996 and have a term  which
     expires on August 4, 2004.  The  Director's  Plan does not  provide for any
     further grants or options thereunder.

     In August 1994, the Company  adopted a stock option plan ( the "1994 Plan")
     for its key  employees  which  provides  for the grant of  incentive  stock
     options,  within the meaning of Section 422A of the Internal  Revenue Code,
     and non-qualified stock options.  The maximum aggregate number of shares of
     Common  Stock  that may be  issued  under  the 1994  Plan is  approximately
     491,413 shares.

     In December 1995 and 1994,  stock options for 174,716 and 316,697 shares of
     Common  Stock were granted to various  employees  under the 1994 Plan at an
     exercise  price of $10.72  per  share.  The stock  options  vest and become
     exercisable  at a rate of 25% per year over a  four-year  period and expire
     ten years from the date of grant.  As of September  30, 1996,  79,173 stock
     options were exercisable under the 1994 Plan.

     In May 1996 as amended on July 31, 1996, the Company adopted a stock option
     plan (the "1996  Plan"),  which  provides for the grant of incentive  stock
     options and  nonqualified  stock  options to any full time  employee of the
     Company under terms  substantially  the same as the 1994 Plan.  The maximum
     number of shares of Common  Stock that may be issued under the 1996 Plan is
     289,062 shares. Options to purchase an aggregate of 21,723 shares have been
     granted at an exercise price of $10.72 per share.

     The purchase  price of the shares of Common Stock  subject to options under
     the 1994 and 1996 Plans must be no less than the fair  market  value of the
     Common  Stock at the date of grant,  provided,  however,  that the purchase
     price of shares of Common Stock subject to Initial Stock Offerings  ("ISO")
     granted to any  optionee  who owns shares  possessing  more than 10% of the
     combined voting power of the Company ("Ten Percent  Stockholder")  must not
     be less than 110% of the fair market  value of the Common stock at the date
     of the grant.  The maximum  term of an option may not exceed ten years from
     the date of grant,  except  with  respect to ISOs  granted  to Ten  Percent
     Stockholders which must expire within five years of the date of grant.


14.   RELATED PARTY TRANSACTIONS

      The Partnership  owns 5,781,250  shares of the Company's  Common Stock, or
      approximately  67% of the issued and  outstanding  shares of Common Stock.
      Four of the Company's  executive  officers,  including the chief executive
      officer,   and  a  former  executive  officer  are  sole  stockholders  of
      corporations  which  indirectly  control the sole  general  partner of the
      Partnership.

      The  Company  and  the  Partnership  entered  into a  Registration  Rights
      Agreement  pursuant  to which the Company has agreed that upon the request
      of the  Partnership the Company will register under the Securities Act and
      applicable state securities laws the sale of the Common Stock owned by the
      Partnership and as to which registration has been requested. The Company's
      obligation is subject to certain limitations  relating to a minimum amount
      required for registration,  the timing of a registration and other similar
      matters.  The  Company  is  obligated  to pay  any  registration  expenses
      incidental to such registration,  excluding  underwriter's  commission and
      discounts.  In  connection  with the Common  Stock  Offering,  the Company
      incurred  approximately  $300 in 1996 of  such  registration  expenses  on
      behalf of the Partnership.

      A  former  executive  officer  of  the  Company  and an  affiliate  of the
      Partnership is being retained as a consultant to the Company.  Pursuant to
      a consulting agreement with the Company, the former executive officer will
      receive,  until  January 31,  2000,  or upon earlier  termination  of his
      consulting agreement,  $125 per year and various insurance coverages,  and
      will be authorized to exercise all stock options  awarded to him,  subject
      to  applicable  vesting  provisions.  Under  this  agreement,  the  former
      executive  officer is required  to provide  the  Company  with 20 hours of
      consultation  per month,  has  released  the  Company  from any  liability
      resulting from his  employment and has also agreed not to compete  against
      the Company.

      The Company  leases  office space under a five-year  lease with one of the
      Company's executive  officers.  The term of the lease expires on September
      30,  1998 and the rent is  approximately  $48 per year,  which the Company
      believes is within prevailing market rates.

      Pursuant to a licensing  agreement with the Company,  an executive officer
      of the Company receives royalties related to the manufacture and sale of a
      certain  product for which the  executive  officer  owns all of the United
      States  and  foreign  patents.  Under  the  agreement,  the  Company  paid
      royalties of $3 and $12 to the executive  officer in fiscal 1995 and 1996,
      respectively,  and will continue to pay such  royalties  until 2012 or the
      earlier termination of the license agreement.

      During fiscal 1996 and  1995, the Company paid fees of  approximately $232
      and $135,  respectively,  to a law firm in which a director of the Company
      was a partner.



<PAGE>


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

SYNTHETIC INDUSTRIES L.P.

By:  SI MANAGEMENT L.P.
        General Partner
By:  SYNTHETIC MANAGEMENT G.P.
        General Partner
By:  CHILL INVESTMENTS, INC.
        Managing General Partner



By:  /s/ Leonard Chill
            Leonard Chill
            President


Dated:  December 20, 1996