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

                                   ----------

                                    FORM 10-Q

             [X] Quarterly Report Pursuant to Section 13 or 15(d) of
                       the Securities Exchange Act of 1934

                       For the period ended March 31, 2000

                                       OR

            [ ] Transition Report Pursuant to Section 13 or 15(d) of
                       the Securities Exchange Act of 1934

            For the transition period from ___________ to ___________



                          Commission File No. 1-000052

                               SUNBEAM CORPORATION
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

         DELAWARE                                     25-1638266
(STATE OR OTHER JURISDICTION OF         (I.R.S. EMPLOYER IDENTIFICATION NUMBER)
INCORPORATION OR ORGANIZATION)

     2381 EXECUTIVE CENTER DRIVE                              33431
           BOCA RATON, FL                                   (ZIP CODE)
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

                                 (561) 912-4100
              (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)

                                 NOT APPLICABLE
              (FORMER NAME, FORMER ADDRESS AND FORMER FISCAL YEAR,
                         IF CHANGED SINCE LAST REPORT)

     Indicate by check mark whether the 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 [ ]

On May 11, 2000 there were 107,558,065 shares of the registrant's Common Stock
($.01 par value) outstanding.

<PAGE>


                      SUNBEAM CORPORATION AND SUBSIDIARIES

                                QUARTERLY REPORT
                                  ON FORM 10-Q

                                TABLE OF CONTENTS

     PART I.    FINANCIAL INFORMATION
<TABLE>
<CAPTION>

                                                                                                          PAGE
                                                                                                          ----
                <S>                                                                                       <C>
                Item 1.  Financial Statements

                         Condensed Consolidated Statements of Operations (Unaudited)
                         for the three months ended March 31, 2000 and March 31, 1999.....................   2

                         Condensed Consolidated Balance Sheets (Unaudited)
                         as of March 31, 2000 and December 31, 1999.......................................   3

                         Condensed Consolidated Statements of Cash Flows (Unaudited)
                         for the three months ended March 31, 2000 and March 31, 1999.....................   4

                         Notes to Condensed Consolidated Financial Statements (Unaudited).................   5

                Item 2.  Management's Discussion and Analysis of Financial Condition
                         and Results of Operations........................................................  20


     PART II.   OTHER INFORMATION

                Item 1.  Litigation.......................................................................  31

                Item 6.  Exhibits and Reports on Form 8-K.................................................  34

     SIGNATURE  ..........................................................................................  35
</TABLE>

                                      -1-
<PAGE>


PART I.    FINANCIAL INFORMATION

ITEM 1.    FINANCIAL STATEMENTS

                      SUNBEAM CORPORATION AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
                (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

                                                     THREE MONTHS ENDED
                                                   ------------------------
                                                   MARCH 31,      MARCH 31,
                                                     2000           1999
                                                   ---------      ---------


Net sales                                          $ 539,053      $ 523,946
Cost of goods sold                                   405,764        397,491
Selling, general and administrative expense          135,833        141,249
                                                   ---------      ---------
Operating loss                                        (2,544)       (14,794)
Interest expense, net                                 52,487         42,841
Other expense (income), net                            2,611           (127)
                                                   ---------      ---------
Loss before income taxes and minority interest       (57,642)       (57,508)

Income tax provision (benefit):
       Current                                         1,740           (151)
       Deferred                                          (73)         1,893
                                                   ---------      ---------
                                                       1,667          1,742
                                                   ---------      ---------

Minority interest                                         91          1,489
                                                   ---------      ---------
Net loss                                           $ (59,400)     $ (60,739)
                                                   =========      =========
Basic and diluted loss per share:
       Net loss                                    $   (0.55)     $   (0.60)
                                                   =========      =========
Weighted average common shares outstanding           107,056        100,740




            See Notes to Condensed Consolidated Financial Statements.

                                      -2-
<PAGE>

                      SUNBEAM CORPORATION AND SUBSIDIARIES
                CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
                             (AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>

                                                                              MARCH 31,      DECEMBER 31,
                                                                               2000             1999
                                                                            -----------      -----------
<S>                                                                         <C>              <C>
ASSETS
Current assets:
     Cash and cash equivalents                                              $    23,098      $    40,799
     Receivables, net                                                           361,130          364,338
     Inventories                                                                539,544          460,680
     Prepaid expenses, deferred income taxes and other current assets            68,205           72,130
                                                                            -----------      -----------
         Total current assets                                                   991,977          937,947
Property, plant and equipment, net                                              452,603          447,116
Trademarks, tradenames, goodwill and other, net                               1,795,360        1,747,286
                                                                            -----------      -----------
                                                                            $ 3,239,940      $ 3,132,349
                                                                            ===========      ===========

LIABILITIES AND SHAREHOLDERS' DEFICIENCY
Current liabilities:
     Short-term debt and current portion of long-term debt                  $   141,325      $   139,806
     Accounts payable                                                           217,940          185,610
     Other current liabilities                                                  290,606          300,809
                                                                            -----------      -----------
         Total current liabilities                                              649,871          626,225
Long-term debt, less current portion                                          2,308,592        2,164,002
Other long-term liabilities                                                     237,224          241,264
Deferred income taxes                                                           111,235           93,288
Minority interest                                                                 1,105           66,910

Commitments and contingencies (Notes 3 and 9)

Shareholders' deficiency:
     Preferred stock (2,000,000 shares authorized, none outstanding)                 --               --
     Common stock (107,422,500 and 100,746,400 shares issued)                     1,074            1,007
     Additional paid-in capital                                               1,179,630        1,122,455
     Accumulated deficit                                                     (1,168,916)      (1,109,516)
     Accumulated other comprehensive loss                                       (79,875)         (73,286)
                                                                            -----------      -----------
         Total shareholders' deficiency                                         (68,087)         (59,340)
                                                                            -----------      -----------
                                                                            $ 3,239,940      $ 3,132,349
                                                                            ===========      ===========
</TABLE>
            See Notes to Condensed Consolidated Financial Statements.

                                      -3-
<PAGE>
                      SUNBEAM CORPORATION AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                             (AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>

                                                                          THREE MONTHS ENDED
                                                                       ------------------------
                                                                       MARCH 31,      MARCH 31,
                                                                         2000           1999
                                                                       ---------      ---------
<S>                                                                    <C>            <C>
OPERATING ACTIVITIES:
     Net loss                                                          $ (59,400)     $ (60,739)
     Adjustments to reconcile net loss to net cash
       used in operating activities:
         Depreciation and amortization                                    32,492         32,394
         Bond accretion and non-cash interest charges                     11,342         11,271
         Deferred income taxes (benefit) provision                           (73)         1,893
         Minority interest                                                    91          1,489
         Gain on the sale of property, plant and equipment                   (23)          (568)
         Changes in working capital and other, net of acquisitions       (42,985)       (43,224)
                                                                       ---------      ---------
             Net cash used in operating activities                       (58,556)       (57,484)
                                                                       ---------      ---------

INVESTING ACTIVITIES:
     Capital expenditures, net                                           (16,070)       (17,098)
     Proceeds from asset sales                                             6,013            810
     Acquisition of Coleman, including acquisition costs                 (83,445)            --
     Other, net                                                             (467)          (165)
                                                                       ---------      ---------
             Net cash used in investing activities                       (93,969)       (16,453)
                                                                       ---------      ---------
FINANCING ACTIVITIES:
     Net borrowings under revolving credit facilities                    136,212         61,468
     Payments of debt obligations, including prepayment penalties             --         (2,500)
     Other debt financing fees                                            (1,179)          (234)
     Other, net                                                             (209)           (66)
                                                                       ---------      ---------
             Net cash provided by financing activities                   134,824         58,668
                                                                       ---------      ---------

Net decrease in cash and cash equivalents                                (17,701)       (15,269)
Cash and cash equivalents at beginning of period                          40,799         61,432
                                                                       ---------      ---------
Cash and cash equivalents at end of period                             $  23,098      $  46,163
                                                                       =========      =========
</TABLE>
            See Notes to Condensed Consolidated Financial Statements

                                      -4-
<PAGE>
                      SUNBEAM CORPORATION AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

1.   OPERATIONS AND BASIS OF PRESENTATION

ORGANIZATION

Sunbeam Corporation and all of its majority-owned subsidiaries ("Sunbeam" or the
"Company") is a leading designer, manufacturer and marketer of branded consumer
products. The Company's primary business is the manufacturing, marketing and
distribution of durable household and outdoor leisure consumer products through
mass market and other distribution channels in the United States and
internationally. The Company also sells its products to professional and
commercial end users such as small businesses, health care providers, hotels and
other institutions. The Company's principal products include household kitchen
appliances; health monitoring and care products for home use; scales for
consumer and professional use for weight management and business uses; electric
blankets and throws; clippers and trimmers for consumer, professional and animal
uses; smoke and carbon monoxide detectors; outdoor barbecue grills; camping
equipment such as tents, lanterns, sleeping bags and stoves; coolers; backpacks
and book bags; and portable generators and compressors. The Company, through its
Thalia Products Inc. ("Thalia") subsidiary, is developing Home Linking
Technology (TM), or HLT (TM), which is designed to allow products to communicate
with each other.

See Note 3 for information relevant to management's plan to fund its capital and
debt service requirements.

BASIS OF PRESENTATION

The Condensed Consolidated Balance Sheet of the Company as of March 31, 2000 and
the Condensed Consolidated Statements of Operations and Cash Flows for the three
months ended March 31, 2000 and 1999 are unaudited. The unaudited condensed
consolidated financial statements have been prepared in accordance with
generally accepted accounting principles for interim financial information and
with the instructions of Form 10-Q and Rule 10-01 of Regulation S-X. The
December 31, 1999 Condensed Consolidated Balance Sheet was derived from the
consolidated financial statements contained in the Company's Annual Report on
Form 10-K for the year ended December 31, 1999. The condensed consolidated
financial statements contained herein should be read in conjunction with the
consolidated financial statements and related notes contained in the Company's
1999 Annual Report on Form 10-K. In the opinion of management, the unaudited
condensed consolidated financial statements contained herein include all
adjustments (consisting of only recurring adjustments) necessary for a fair
presentation of the results of operations for the interim periods presented.
These interim results of operations are not necessarily indicative of results
for future periods.

BASIC AND DILUTED LOSS PER SHARE OF COMMON STOCK

Basic loss per common share calculations are determined by dividing loss
available to common shareholders by the weighted average number of shares of
common stock outstanding. Diluted loss per share is determined by dividing loss
available to common shareholders by the weighted average number of shares of
common stock and dilutive common stock equivalents outstanding (all related to
outstanding stock options, restricted stock, warrants and the Zero Coupon
Convertible Senior Subordinated Debentures).

For the three months ended March 31, 2000 and 1999, respectively, 120,317 and
25,458 shares related to stock options were not included in diluted average
common shares outstanding because their effect would be antidilutive. Stock
options to purchase 21,341,214 and 18,961,063 common shares were excluded from
potential common shares at March 31, 2000 and 1999, respectively, as the option
exercise prices were greater than the average market price of the Company's
common stock during the year. Diluted average common shares outstanding as of
March 31, 2000 and 1999 excludes 13,242,050 shares related to the conversion
feature of the Zero Coupon Convertible Senior Subordinated Debentures and
27,480,549 and 23,000,000 shares issuable on the exercise of warrants as of
March 31, 2000 and March 31,1999, respectively, due to antidilution.

                                      -5-
<PAGE>
                      SUNBEAM CORPORATION AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                                   (UNAUDITED)

1.   OPERATIONS AND BASIS OF PRESENTATION - (CONTINUED)

NEW ACCOUNTING STANDARDS

In June 1999, the FASB issued SFAS No. 137, ACCOUNTING FOR DERIVATIVE
INSTRUMENTS AND HEDGING ACTIVITIES-DEFERRAL OF THE EFFECTIVE DATE OF STATEMENT
NO. 133, which delays the effective date of Statement No. 133 to fiscal years
beginning after June 15, 2000. SFAS No. 133 requires the recognition of all
derivatives in the Consolidated Balance Sheets as either assets or liabilities
measured at fair value. The Company will adopt SFAS No. 133 for the 2001 fiscal
year. The Company has not yet determined the impact SFAS No. 133 will have on
its consolidated financial position, results of operations or cash flows.

RECLASSIFICATIONS

Certain prior year amounts have been reclassified to conform with the 2000
presentation.

2.   ACQUISITIONS

On March 30, 1998, pursuant to a merger agreement dated as of February 27, 1998,
the Company, through a wholly-owned subsidiary, acquired approximately 81% of
the total number of then outstanding shares of common stock of The Coleman
Company, Inc. ("Coleman") from an affiliate of MacAndrews & Forbes Holdings,
Inc. ("M&F"), in exchange for 14,099,749 shares of the Company's common stock
and approximately $160 million in cash. In addition, the Company assumed
approximately $1,016 million in debt. Immediately thereafter, as a result of the
exercise of employee stock options, the Company's indirect beneficial ownership
of Coleman decreased to approximately 79% of the total number of the outstanding
shares of Coleman common stock.

In January 2000, pursuant to a merger agreement dated as of February 27, 1998,
the Company acquired the remaining publicly held Coleman shares pursuant to a
merger transaction pursuant to which the remaining Coleman stockholders (other
than stockholders who are seeking appraisal rights under Delaware law) received
0.5677 of a share of the Company's common stock and $6.44 in cash for each share
of Coleman common stock they owned, aggregating approximately 6.7 million shares
of the Company's common stock and $87 million in cash. The approximate $87
million aggregate cash payment included $4.8 million related to the cash out of
remaining Coleman employee options, in accordance with the merger agreement,
which occurred in December 1999. In addition, pursuant to a court approved
settlement of claims by Coleman public stockholders the Company issued to such
Coleman public stockholders (other than such stockholders who are seeking
appraisal rights under Delaware law), warrants expiring August 24, 2003 to
purchase 4.98 million shares of the Company's common stock at $7.00 per share
less approximately 498,000 warrants issued to the plaintiffs' attorneys for
their fees and expenses. These warrants, which generally have the same terms as
the warrants previously issued to M&F's subsidiary (see Note 9) were issued when
the consideration was paid for the Coleman merger. The total consideration given
for the purchase of the remaining publicly held Coleman shares was valued at
$146 million.

The acquisition of Coleman was accounted for using the purchase method of
accounting, and accordingly, the financial position and results of operations of
Coleman are included in the accompanying Condensed Consolidated Statements of
Operations from the respective dates of acquisition. Prior to the completion of
the merger on January 6, 2000, approximately 20% of Coleman's results of
operations and net equity allocable to the public shareholders was reported as
minority interest.

                                      -6-
<PAGE>
                      SUNBEAM CORPORATION AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                                   (UNAUDITED)

2.   ACQUISITIONS - (CONTINUED)

The purchase price paid for the publicly held Coleman shares has been allocated
based on the estimated fair value of tangible and identified intangible assets
acquired and liabilities assumed as follows (in millions):
<TABLE>
         <S>                                                                      <C>
         Value of common stock issued......................................       $   44
         Value of warrants issued..........................................           14
         Cash paid including expenses and mandatory redemption of debt,
             net of cash acquired..........................................           88
                                                                                  ------

         Net cash paid and equity issued...................................          146
         Fair value of total liabilities assumed, including debt...........           19
                                                                                  ------

                                                                                     165

         Fair value of assets acquired.....................................          157
                                                                                  ------

         Excess of purchase price over fair value of net assets acquired...       $    8
                                                                                  ======
</TABLE>

The excess of purchase price over the fair value of net assets acquired has been
classified as goodwill. Goodwill related to the Coleman acquisition is being
amortized on a straight-line basis over 40 years. Approximately $1.1 billion of
goodwill was recorded by the Company in connection with the acquisition of
Coleman. Goodwill has been allocated to the various operating businesses of
Coleman based on the estimated fair value of Coleman's component businesses.

As of the date of the acquisition of approximately 80% of Coleman, in March
1998, the then management of the Company determined that approximately 117
employees of Coleman would need to be involuntarily terminated in order to
eliminate duplicate activities and functions and fully integrate Coleman into
the Company's operations. The Company recognized a liability of approximately $8
million representing severance and benefit costs related to the 117 employees
pursuant to the termination plan. This liability was included in the allocation
of purchase price. As of March 31, 2000, the Company had paid severance benefits
of approximately $7.7 million and 3 employees have not yet been terminated.
Remaining termination costs are expected to be paid by December 31, 2000 and no
additional charges are anticipated in future periods related to this matter.

The following unaudited pro forma financial information for the Company gives
effect to the purchase of the publicly held shares of Coleman common stock as if
the transaction had occurred at the beginning of the period presented. No pro
forma information has been presented for the period ending March 31, 2000
because the transaction occurred at the beginning of the period. The pro forma
results for the period ending March 31, 1999 have been prepared for
informational purposes only and do not purport to be indicative of the results
of operations that actually would have occurred had the acquisition been
consummated on the date indicated, or which may result in the future. The
unaudited pro forma results follow (in millions, except per share data):
<TABLE>
<CAPTION>
                                                                        THREE MONTHS ENDED
                                                                          MARCH 31, 1999
                                                                        -------------------
         <S>                                                                   <C>
         Net sales......................................................       $523.9
         Net loss.......................................................        (62.3)
         Basic and diluted loss per share from continuing operations....        (0.58)
</TABLE>

3.   DEBT

In March 1998, the Company replaced its $250 million syndicated unsecured
five-year revolving credit facility with a revolving and term credit facility
(the "Credit Facility"). The Credit Facility provided for aggregate borrowings
of up to $1.7 billion and in addition to other customary covenants, required the
Company to maintain specified consolidated leverage, interest coverage and fixed
charge coverage ratios as of the end of each fiscal quarter occurring after
March 31, 1998 and on or prior to the latest stated maturity date for any of the
borrowings under the Credit Facility.

                                      -7-
<PAGE>
                      SUNBEAM CORPORATION AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                                   (UNAUDITED)

3.   DEBT - (CONTINUED)

As a result of, among other things, its operating losses incurred during the
first half of 1998, the Company did not achieve the specified financial ratios
for June 30, 1998 and it appeared unlikely that the Company would achieve the
specified financial ratios for September 30, 1998. Consequently, the Company and
its lenders entered into an agreement dated as of June 30, 1998 that waived
through December 31, 1998 all defaults arising from the failure of the Company
to satisfy the specified financial ratios for June 30, 1998 and September 30,
1998. Pursuant to an agreement with the Company dated as of October 19, 1998,
the Company's lenders extended all of the waivers under the June 30, 1998
agreement through April 10, 1999 and also waived through such date all defaults
arising from any failure by the Company to satisfy the specified financial
ratios for December 31, 1998. In April 1999, such waivers were extended through
April 10, 2000 and on April 10, 2000 such waivers were extended through April
14, 2000.

On April 14, 2000, the Company and its lenders entered into an amendment to the
Credit Facility that, among other things, waived until April 10, 2001 all
defaults arising from any failure by the Company to satisfy certain financial
ratios for any fiscal quarter end occurring through March 31, 2001. As part of
the April 14, 2000 amendment, the Company agreed to a minimum cumulative
earnings before interest, taxes, depreciation and amortization ("EBITDA")
covenant that is based on consolidated EBITDA and is tested at the end of each
month occurring on or prior to March 31, 2001. The minimum cumulative EBITDA is
initially $35.8 million for the period from January 1, 2000 through April 30,
2000 and generally increases on a monthly basis until it reaches $213.6 million
for the period from January 1, 2000 through March 31, 2001. The following
description of the Credit Facility reflects the significant terms of the Credit
Facility as amended to date.

The Credit Facility provides for aggregate borrowings of up to $1.7 billion
pursuant to: (i) a revolving credit facility in an aggregate principal amount of
up to $400 million maturing March 30, 2005 ($52.5 million of which was used to
complete the Coleman merger which occurred on January 6, 2000); (ii) up to
$800.0 million in term loans maturing on March 30, 2005 (of which $35.0 million
was used to complete the Coleman merger which occurred on January 6, 2000) and
(iii) a $500.0 million term loan maturing September 30, 2006 (of which $5.0
million has been repaid). As of March 31, 2000, of the $1.7 billion, $1.572
billion was outstanding under the Credit Facility and approximately $48 million
was available for borrowing. The remaining $80.2 million of the $1.7 billion
Credit Facility was committed for outstanding letters of credit.

Pursuant to the Credit Facility, interest accrues, at the Company's option: (i)
at the London Interbank Offered Rate ("LIBOR"), or (ii) at the base rate of the
administrative agent which is generally the higher of the prime commercial
lending rate of the administrative agent or the Federal Funds Rate plus 0.50%,
in each case plus an interest margin which was 3.00% for LIBOR borrowings and
1.75% for base rate borrowings at March 31, 2000. The applicable interest
margins are subject to further downward adjustment upon the reduction of the
aggregate borrowings under the Credit Facility. Borrowings under the Credit
Facility are secured by a pledge of the stock of the Company's material
subsidiaries and by a security interest in substantially all of the assets of
the Company and its material domestic subsidiaries. In addition, borrowings
under the Credit Facility are guaranteed by a number of the Company's
wholly-owned material domestic subsidiaries and these subsidiary guarantees are
secured by substantially all of the material domestic subsidiaries' assets. To
the extent extensions of credit are made to any subsidiaries of the Company, the
obligations of such subsidiaries are guaranteed by the Company.

Under terms of the April 14, 2000 amendment to the Credit Facility, the Company
is obligated to pay the bank lenders an amendment fee for the April 14, 2000
amendment of 0.50% of the commitments under the Credit Facility as of April 14,
2000, totaling $8.5 million. This fee is payable on the earlier of June 30, 2000
or the closing of the sale of the Company's Eastpak business ("Eastpak"). (See
Note 7.) On November 30, 2000, the Company also must pay an amendment fee
previously agreed to for the April 15, 1999 amendment equal to 0.50% of the
commitments under the Credit Facility as of April 15, 1999, totaling $8.5
million. An additional amendment fee relating to the April 15, 1999 amendment
equal to $8.5 million will be payable to the bank lenders if the aggregate loan
and commitment exposure under the Credit Facility is equal to or more than $1.2
billion on November 30, 2000, with such fee being payable on June 30, 2001. The
$17 million amendment fee associated with the April 15, 1999 amendment was
amortized to interest expense using the straight-line method over the one-year
term of the amendment. The $8.5 million amendment fee associated with the April
14, 2000 amendment will be amortized to interest expense using the straight-line
method over the one year term of that amendment.

                                      -8-
<PAGE>
                      SUNBEAM CORPORATION AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                                   (UNAUDITED)

3.   DEBT - (CONTINUED)

In addition to the above described ratios and tests, the Credit Facility
contains covenants customary for credit facilities of a similar nature,
including limitations on the ability of the Company and its subsidiaries,
including Coleman, to, among other things, (i) declare dividends or repurchase
stock, (ii) prepay, redeem or repurchase debt, incur liens and engage in
sale-leaseback transactions, (iii) make loans and investments, (iv) incur
additional debt, (v) amend or otherwise alter material agreements or enter into
restrictive agreements, (vi) make capital expenditures, (vii) fail to maintain
its trade receivable securitization programs, (viii) engage in mergers,
acquisitions and asset sales, (ix) engage in certain transactions with
affiliates, (x) settle certain litigation, (xi) alter its cash management system
and (xii) alter the businesses they conduct. The Credit Facility provides for
events of default customary for transactions of this type, including nonpayment,
misrepresentation, breach of covenant, cross-defaults, bankruptcy, material
adverse change arising from compliance with ERISA, material adverse judgments,
entering into guarantees and change of ownership and control. Furthermore, the
Credit Facility requires the Company to prepay loans under the Credit Facility
on December 31, 2000 to the extent that cash on hand in the Company's
concentration accounts plus the aggregate amount of unused revolving loan
commitments on that date exceed $185.0 million.

Unless waived by the bank lenders, the failure of the Company to satisfy any of
the financial ratios and tests contained in the Credit Facility or the
occurrence of any other event of default under the Credit Facility would entitle
the bank lenders to (a) receive a 2.00% increase in the interest rate applicable
to outstanding loans and increase the trade letter of credit fees to 1.00% and
(b) declare the outstanding borrowings under the Credit Facility immediately due
and payable and exercise all or any of their other rights and remedies. Any such
acceleration or other exercise of rights and remedies would likely have a
material adverse effect on the Company.

Pursuant to the April 14, 2000 amendment, term loan payments originally
scheduled for September 30, 1999 and March 31, 2000 in the amount of $69.3
million on each date are to be made as follows: (i) $69.3 million on the earlier
of the sale of Eastpak or August 15, 2000, (ii) $30.8 million on November 30,
2000 and (iii) $38.5 million on April 10, 2001. In addition, the April 14, 2000
amendment provides that the payment dates for the $69.3 million term loan
payments originally scheduled for each of September 30, 2000 and March 31, 2001
are deferred until April 10, 2001.

In March 1998, the Company completed an offering of Zero Coupon Convertible
Senior Subordinated Debentures due 2018 (the "Debentures") at a yield to
maturity of 5.0% (approximately $2,014 million principal amount at maturity)
which resulted in approximately $730 million of net proceeds. The Debentures are
exchangeable for shares of the Company's common stock at an initial conversion
rate of 6.575 shares for each $1,000 principal amount at maturity of the
Debentures, subject to adjustment upon occurrence of certain events. The
Debentures are subordinated in right of payment to all existing and future
senior indebtedness of the Company. The Debentures are not redeemable by the
Company prior to March 25, 2003. On or after such date, the Debentures are
redeemable for cash with at least 30 days notice, at the option of the Company.
The Company is required to purchase Debentures at the option of the holder as of
March 25, 2003, March 25, 2008 and March 25, 2013, at purchase prices equal to
the issue price plus accrued original discount to such dates. The Company may,
at its option, elect to pay any such purchase price in cash or common stock, or
any combination thereof. However, the Credit Facility prohibits the Company from
redeeming or repurchasing debentures for cash.

The Company believes its borrowing capacity under the Credit Facility, foreign
working capital lines, cash flow from the operations of the Company, existing
cash and cash equivalent balances, proceeds from its receivable securitization
programs, the sale of Eastpak (see Note 7) and sales of non-core assets will be
sufficient to support planned working capital needs, planned capital
expenditures and scheduled debt service to April 10, 2001. Although management
believes they will be successful in accomplishing the above, there can be no
assurance that the aforementioned sources of funds will be sufficient to meet
the Company's cash requirements on a consolidated basis. If the Company is
unable to satisfy such cash requirements, the Company could be required to adopt
one or more alternatives, such as reducing or delaying capital expenditures,
restructuring indebtedness, selling other assets or operations or issuing
additional shares of capital stock in the Company, and some of such actions
would require the consent of the lenders. There can be no assurance that any of
such actions could be effected, or if so, on terms favorable to the Company,
that such actions would enable the Company to continue to satisfy its cash
requirements or that such actions would be permitted under the terms of the
Credit Facility. In anticipation of the expiration of the current waiver on
April 10, 2001, the Company intends to negotiate with its lenders regarding a
further amendment to the Credit Facility, further waiver of the covenants and
other terms, or refinancing of the

                                      -9-
<PAGE>
                      SUNBEAM CORPORATION AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                                   (UNAUDITED)

3.   DEBT - (CONTINUED)

Credit Facility. Any decisions with respect to such amendment, waiver, or
refinancing will be made based on a review from time to time of the advisability
of particular transactions. There can be no assurance that an amendment, further
waiver of existing covenants and other terms, or refinancing will be entered
into by April 10, 2001. The failure to obtain such an amendment, further waiver
or debt refinancing would likely result in violation of existing covenants and
compliance with other terms, which would permit the bank lenders to accelerate
the maturity of all outstanding borrowings under the Credit Facility, which
would likely have a material adverse effect on the Company.

4.   ACCOUNTS RECEIVABLE SECURITIZATION

The Company has entered into a receivable securitization program, which expires
March 2001, to sell without recourse, through a wholly-owned subsidiary, certain
trade accounts receivable. In March 2000, the Company entered into an amendment
to such receivables program to increase this program to $100 million from $70
million. During the first quarters of 2000 and 1999, the Company received
approximately $125.4 million and $60.1 million, respectively, under this
arrangement. At March 31, 2000 and 1999, the Company had reduced accounts
receivable by approximately $67.9 million and $29.5 million, respectively, for
receivables sold under this program. Costs of the program, which primarily
consist of the purchaser's financing cost of issuing commercial paper backed by
the receivables, totaled $1.0 million and $0.4 million during the first quarter
of 2000 and 1999, respectively, and have been classified as interest expense in
the accompanying Condensed Consolidated Statements of Operations. The Company,
through a wholly-owned subsidiary, retains collection and administrative
responsibilities for the purchased receivables. In April 2000, the Company's
Coleman and Powermate subsidiaries entered into an additional revolving trade
accounts receivable securitization program to sell, without recourse, through a
wholly-owned subsidiary of Coleman, up to a maximum of $95 million in trade
accounts receivables. These trade accounts receivable programs contain
cross-default provisions that provide the purchaser of the receivables an option
to cease purchasing receivables from the Company if the Company is in default
under the Credit Facility. In addition, these agreements contain various other
covenants customary for these types of programs, including financial covenants.

5.   COMPREHENSIVE LOSS

The components of the Company's comprehensive loss are as follows (in
thousands):
<TABLE>
<CAPTION>
                                                                      THREE MONTHS ENDED
                                                                   ---------------------------
                                                                    March 31,        March 31,
                                                                      2000             1999
                                                                   ---------         ---------
    <S>                                                            <C>               <C>
    Net loss..................................................     $ (59,400)        $ (60,739)
    Foreign currency translation adjustment, net of taxes.....        (6,589)           (9,427)
                                                                   ---------         ---------
    Comprehensive loss........................................     $ (65,989)        $ (70,166)
                                                                   =========        =========
</TABLE>

As of March 31, 2000 and December 31, 1999, "Accumulated other comprehensive
loss," as reflected in the Condensed Consolidated Balance Sheets is comprised of
the following:
<TABLE>
<CAPTION>
                                           CURRENCY           MINIMUM
                                          TRANSLATION         PENSION
                                          ADJUSTMENTS        LIABILITY             TOTAL
                                          -----------        ---------           ---------
    <S>                                   <C>               <C>                  <C>

    Balance at March 31, 2000.........    $ (31,834)        $  (48,041)          $ (79,875)
    Balance at December 31, 1999......      (25,245)           (48,041)            (73,286)
</TABLE>






                                      -10-
<PAGE>
                      SUNBEAM CORPORATION AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                                   (UNAUDITED)

6.   SUPPLEMENTARY FINANCIAL STATEMENT DATA

Supplementary Balance Sheet data at the end of each period is as follows (in
thousands):
<TABLE>
<CAPTION>
                                                         MARCH 31,        DECEMBER 31,
                                                           2000              1999
                                                        ----------        ------------
              <S>                                       <C>               <C>
              Receivables:
               Trade.................................   $  400,143        $  404,905
               Sundry................................        4,732             3,777
                                                        ----------        ----------
                                                           404,875           408,682
               Valuation allowance...................      (43,745)          (44,344)
                                                        ----------        ----------
                                                        $  361,130        $  364,338
                                                        ==========        ==========
              Inventories:
               Finished goods........................   $  388,109        $  330,179
               Work in process.......................       50,236            30,691
               Raw materials and supplies............      101,199            99,810
                                                        ----------        ----------
                                                        $  539,544        $  460,680
                                                        ==========        ==========
</TABLE>

Supplementary Statement of Cash Flows data is as follows (in thousands):
<TABLE>
<CAPTION>

                                                             THREE MONTHS ENDED
                                                        -----------------------
                                                         MARCH 31,        MARCH 31,
                                                           2000             1999
                                                        ----------        ---------
     <S>                                                <C>               <C>
     Cash paid (received) during the period for:

               Interest..............................   $   18,233        $    30,092
                                                        ==========        ===========
               Income taxes, net of refunds             $     (923)       $       184
                                                        ==========        ===========
</TABLE>

7.   ASSET IMPAIRMENT AND OTHER CHARGES

In March 2000, the Company announced that it intends to shut down operations at
its Glenwillow facility, which manufactures and distributes Mr. Coffee brand
coffee makers and coffee filters. These operations will be consolidated into
other existing facilities. As a result of this decision, the Company recorded a
charge of $3.3 million in the first quarter, primarily related to the write-off
of leasehold improvements, severance costs and contract and lease termination
fees. This charge was recorded in selling, general and administrative expense
("SG&A") ($0.6 million) and Cost of Goods Sold ($2.7 million). The Glenwillow
facility is expected to be closed by the end of the second quarter of 2000 and
will result in the elimination of approximately 300 positions. The Company
anticipates incurring additional incremental costs during the second quarter of
2000, primarily relating to relocation of certain manufacturing equipment and
machinery to other Company manufacturing locations and as a result of duplicate
warehousing costs as inventory levels are built in order to avoid customer
supply issues during the plant shut-down.

In the first quarter of 2000, in connection with the Company's on-going
strategic planning process, the decision was made to close the remaining Sunbeam
retail stores. As a result of this decision, a charge of $2.5 million, primarily
related to the write-off of leasehold improvements, severance and lease
termination fees was recorded in the first quarter of 2000. This charge was
recorded in SG&A ($2.2 million) and Cost of Goods Sold ($0.3 million). The
Company expects that the majority of these stores will be closed by the end of
the second quarter of 2000 and will result in the elimination of approximately
60 positions.

During the fourth quarter of 1999, the Company announced its intent to sell
Eastpak. In March 2000, the Company entered into the an agreement with VF
Corporation which provides for the sale of Eastpak (the "Eastpak Sale
Agreement"). The final purchase price is subject to certain post closing
adjustments and retention of certain liabilities. Eastpak, a wholly-owned
subsidiary of Coleman, was acquired by the Company in March 1998. Net sales from
Eastpak were approximately 5% of consolidated net sales in both the first
quarters of 2000 and 1999. Operating income in the first quarter of 2000 and
1999 was not significant. In the fourth quarter of 1999, as a result of the
Company's change in business strategy for Eastpak, an evaluation for impairment
of Eastpak's long-lived assets was performed pursuant to SFAS No. 121. Based
upon this analysis, the Company determined that the fair market value of
Eastpak's long-lived

                                      -11-
<PAGE>
                      SUNBEAM CORPORATION AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                                   (UNAUDITED)

7.   ASSET IMPAIRMENT AND OTHER CHARGES - (CONTINUED)

assets including intangibles, was less than the carrying value. Accordingly,
during the fourth quarter of 1999, the Company adjusted the carrying value of
Eastpak's net assets to its estimated fair value (less estimated costs of sale)
resulting in a non-cash impairment charge of $52 million. This charge reduced
the goodwill associated with Eastpak. The fair market value of Eastpak was
determined based upon the purchase price in the Eastpak Sale Agreement. This
charge is reflected in SG&A in the fourth quarter of 1999 Consolidated
Statements of Operations. Eastpak is included in the Company's Outdoor Leisure
business group.

In the fourth quarter of 1999, in connection with the completion of the
Company's 2000 strategic planning process, the decision was made to discontinue
a number of products, primarily scales, humidifiers and certain camping stoves,
lights and air mattresses, previously made by the Company, resulting in
equipment and tooling that will no longer be utilized by the Company and
inventory levels in excess of anticipated sales volume. In addition, as a result
of the Company's business planning process, which was completed in the fourth
quarter of 1999, the Company identified certain other assets that would no
longer be required for ongoing operations. Accordingly, a charge of $8.0 million
was recorded in the fourth quarter of 1999 in Cost of Goods Sold to write
certain of these fixed assets down to their estimated fair market values.
Substantially all of this charge related to machinery, equipment and tooling at
the Company's Hattiesburg, Mississippi manufacturing facility. These assets were
taken out of service at the time of the write-down and were not depreciated
further after the write-down. These assets had either a nominal salvage value or
no significant remaining carrying value as of December 31, 1999 and are expected
to be disposed by September 30, 2000. Depreciation expense associated with these
assets approximated $0.9 million for the year ended 1999. During the fourth
quarter of 1999 the Company also decided to discontinue certain grill and grill
accessory stock keeping units ("SKUs"). As a result of this decision, the
Company reduced the economic useful life associated with the machinery,
equipment and tooling used for these SKUs. Approximately $3 million of
additional depreciation expense was recorded over the fourth quarter of 1999
from the time the decision was made to exit the product line until production
ceased at December 31, 1999 and resulted in the affected assets being fully
depreciated. Depreciation expense associated with these assets was $4.6 million
for the year ended 1999. These assets are expected to be disposed of during the
first half of 2000, and the Company does not expect to generate significant
proceeds as a result of the disposals. Additionally, as a result of the
Company's decision to discontinue certain camping stoves, lights, air
mattresses, scales and humidifiers, a $3.0 million charge was recorded during
the fourth quarter of 1999 to properly state this inventory at the
lower-of-cost-or-market. The Company also recognized approximately $0.8 million
related to certain other product lines to properly state the inventory at the
lower-of-cost-or-market. These charges for excess inventories were based upon
management's best estimate of net realizable value.

At March 31, 2000 and December 31, 1999, the Company had $0.9 million of
restructuring accruals relating to its 1996 restructuring plan. This $0.9
million was comprised of $0.6 million relating to lease payments and termination
fees and $0.3 million relating to discontinued operations. It is anticipated
that the remaining restructuring accrual of $0.9 million will be paid through
2006.

                                      -12-
<PAGE>
                      SUNBEAM CORPORATION AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                                   (UNAUDITED)

8.   SEGMENT, CUSTOMER AND GEOGRAPHIC DATA

The following tables include selected financial information with respect to
Sunbeam's four operating segments. Corporate expenses include, among other
items, expenses for services which are provided in varying levels to the three
operating groups and for Year 2000 efforts.
<TABLE>
<CAPTION>
                                                                  OUTDOOR
                                                  HOUSEHOLD       LEISURE      INTERNATIONAL    CORPORATE        TOTAL
                                                ------------    ------------   -------------   ------------   -----------
<S>                                             <C>             <C>             <C>            <C>            <C>
THREE MONTHS ENDED MARCH 31, 2000

    Net sales to unaffiliated customers......   $    164,806    $    228,822    $    144,088   $      1,337   $   539,053
    Intersegment net sales...................         20,990          44,471             935             --        66,396
    Segment earnings (loss)..................          6,345          13,943          12,937        (22,305)       10,920
    Segment depreciation expense.............          6,133           9,043           1,507          2,426        19,109

THREE MONTHS ENDED MARCH 31, 1999

    Net sales to unaffiliated customers...      $    164,078    $    218,733    $    139,557   $      1,578   $   523,946
    Intersegment net sales................            19,192          42,664           4,750             --        66,606
    Segment earnings (loss)...............             7,264          11,867          11,438        (22,313)        8,256
    Segment depreciation expense..........             6,545           9,259           1,297          1,482        18,583

SEGMENT ASSETS

    March 31, 2000...........................   $    655,364    $  1,851,480    $    406,359   $    326,737   $ 3,239,940
    December 31, 1999........................        707,436       1,707,559         385,200        332,154     3,132,349
</TABLE>

Reconciliation of selected segment information to Sunbeam's consolidated totals:
<TABLE>
<CAPTION>
                                                                                        THREE MONTHS ENDED
                                                                             --------------------------------------

                                                                             MARCH 31, 2000             MARCH 31, 1999
                                                                             --------------             --------------
<S>                                                                          <C>                        <C>
Net sales:
Net sales for reportable segments.................................           $   605,449                $   590,552
Elimination of intersegment net sales.............................               (66,396)                   (66,606)
                                                                             -----------                -----------
     Consolidated net sales.......................................           $   539,053                $   523,946
                                                                             ===========                ===========

Segment loss:
Total earnings for reportable segments............................           $    10,920                $     8,256
Unallocated amounts:
     Interest expense.............................................               (52,487)                   (42,841)
     Other (expense) income, net..................................                (2,611)                       127
     Glenwillow plant closing ....................................                (3,257)                        --
     Retail store closing ........................................                (2,544)                        --
     Purchase accounting..........................................                (4,280)                        --
     Insurance recovery...........................................                10,000                         --
     Year 2000 and system initiative expenses.....................                    --                     (8,118)
     Contract termination and other...............................                    --                     (1,121)
     Amortization of intangible assets............................               (13,383)                   (13,811)
                                                                             -----------                -----------
                                                                                 (68,562)                   (65,764)
                                                                             -----------                -----------
      Consolidated loss before income taxes and minority interest.           $   (57,642)               $   (57,508)
                                                                             ===========                ===========
</TABLE>

                                      -13-
<PAGE>
                      SUNBEAM CORPORATION AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                                   (UNAUDITED)

9.   COMMITMENTS AND CONTINGENCIES

LITIGATION

On April 23, 1998, two class action lawsuits were filed on behalf of purchasers
of the Company's common stock in the U.S. District Court for the Southern
District of Florida against the Company and some of its present and former
directors and former officers alleging violations of the federal securities laws
as discussed below. After that date, approximately fifteen similar class actions
were filed in the same court. One of the lawsuits also named as defendant Arthur
Andersen LLP ("Arthur Andersen"), the Company's independent accountants for the
period covered by the lawsuit.

On June 16, 1998, the court entered an order consolidating all these suits and
all similar class actions subsequently filed (collectively, the "Consolidated
Federal Actions"). On January 6, 1999, plaintiffs filed a consolidated amended
class action complaint against the Company, some of its present and former
directors and former officers, and Arthur Andersen. The consolidated amended
class action complaint alleges, among other things, that defendants made
material misrepresentations and omissions regarding the Company's business
operations and future prospects in an effort to artificially inflate the price
of the Company's common stock and call options, and that, in violation of
section 20(a) of the Exchange Act, the individual defendants exercised influence
and control over the Company, causing the Company to make material
misrepresentations and omissions. The consolidated amended complaint seeks an
unspecified award of money damages. In February 1999, plaintiffs moved for an
order certifying a class consisting of all persons and entities who purchased
the Company's common stock or who purchased call options or sold put options
with respect to the Company's common stock during the period April 23, 1997
through June 30, 1998, excluding the defendants, their affiliates, and employees
of the Company. Defendants have opposed that motion. In March 1999, all
defendants who had been served with the consolidated amended class action
complaint moved to dismiss it and the court granted the motion only as to
certain non-employee current and former directors and a former officer, and
denied it as to the other defendants. Arthur Andersen has filed counterclaims
against the Company, and a third-party complaint against a director of the
Company and against unnamed third party corporations.

On April 7, 1998, a purported derivative action was filed in the Circuit Court
for the Fifteenth Judicial Circuit in and for Palm Beach County, Florida against
the Company and some of its present and former directors and former officers.
The action alleged that the individual defendants breached their fiduciary
duties and wasted corporate assets when the Company granted stock options in
February 1998 to three of its now former officers and directors. In June 1998,
all defendants filed a motion to dismiss the complaint for failure to make a
pre-suit demand on the Company's board of directors. In February 1999,
plaintiffs filed an amended derivative complaint nominally on behalf of the
Company against some of its present and former directors and former officers and
Arthur Andersen. This amended complaint alleges, among other things, that
Messrs. Dunlap and Kersh, the Company's former Chairman and Chief Executive
Officer and former Chief Financial Officer, respectively, caused the Company to
employ fraudulent accounting procedures in order to enable them to secure new
employment contracts, and seeks a declaration that the individual defendants
have violated fiduciary duties, an injunction against the payment of
compensation to Messrs. Dunlap and Kersh or the imposition of a constructive
trust on such payments, and unspecified money damages. The defendants have each
moved to dismiss the amended complaint in whole or in part.

During 1998, purported class action and derivative lawsuits were filed in the
Court of Chancery of the State of Delaware in New Castle County and in the U.S.
District Court for the Southern District of Florida by stockholders of the
Company against the Company, MacAndrews & Forbes and some of the Company's
present and former directors. These complaints allege, among other things, that
the defendants breached their fiduciary duties when the Company entered into a
settlement agreement with the MacAndrews & Forbes subsidiary that sold the
Company a controlling interest in Coleman. In such settlement agreement, the
MacAndrews & Forbes subsidiary released the Company from threatened claims
arising out of the Company's acquisition of its interest in Coleman, and
MacAndrews & Forbes agreed to provide management support to the Company. Under
the settlement agreement, the MacAndrews & Forbes subsidiary was granted a
warrant expiring August 24, 2003 to purchase up to an additional 23 million
shares of the Company's common stock at an exercise price of $7 per share,
subject to anti-dilution provisions. The derivative actions filed in the
Delaware Court of Chancery were consolidated. The plaintiffs voluntarily
dismissed this action. The action filed in the U.S. District Court for the
Southern District of Florida has been dismissed. In April 2000, a complaint was
filed in the U.S. District Court for the Southern District of Florida against
the Company, certain current and former directors, Messrs. Dunlap and Kersh and
MacAndrews & Forbes alleging, among other things, that certain of the defendants
breached their fiduciary duty when the Company entered into a settlement
agreement with MacAndrews & Forbes, and certain of the defendants breached their
fiduciary duty and wasted corporate assets by, among other things, issuing

                                      -14-
<PAGE>
                      SUNBEAM CORPORATION AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                                   (UNAUDITED)

9.   COMMITMENTS AND CONTINGENCIES - (CONTINUED)

materially false and misleading statements regarding the Company's financial
condition. The plaintiff in this action seeks, among other things, recission of
the warrants issued to MacAndrews & Forbes and an injunction preventing the
issuance of warrants and damages.

In September 1998, an action was filed in the 56th Judicial District Court of
Galveston County, Texas alleging various claims in violation of the Texas
Securities Act and Texas Business & Commercial Code as well as common law fraud
as a result of the Company's alleged misstatements and omissions regarding the
Company's financial condition and prospects during a period beginning May 1,
1998 and ending June 16, 1998, in which the U.S. National Bank of Galveston,
Kempner Capital Management, Inc. and Legacy Trust Company engaged in
transactions in the Company's common stock on their own behalf and on behalf of
their respective clients. The Company is the only named defendant in this
action. The complaint requests recovery of compensatory damages, punitive
damages and expenses in an unspecified amount. This action was subsequently
transferred to the U.S. District Court for the Southern District of Florida and
consolidated with the Consolidated Federal Actions.

In October 1998, a class action lawsuit was filed in the U.S. District Court for
the Southern District of Florida on behalf of certain purchasers of the
debentures against the Company and certain of the Company's former officers and
directors. In April 1999, a class action lawsuit was filed in the U.S. District
Court for the Southern District of Florida on behalf of persons who purchased
debentures during the period of March 20, 1998 through June 30, 1998, inclusive,
but after the initial offering of such debentures against the Company, Arthur
Andersen, the Company's former auditor, and certain former officers and
directors. The court consolidated the two cases and the plaintiffs have filed a
consolidated class action on behalf of persons who purchased debentures in the
initial offering and in the market during the period March 20, 1998 through June
30, 1998. The amended complaint alleges, among other things, violations of the
federal and state securities laws and common law fraud. The plaintiffs seek,
among other things, either unspecified monetary damages or rescission of their
purchase of the debentures. This action is coordinated with the Consolidated
Federal Actions.

The Company has been named as a defendant in an action filed in the District
Court of Tarrant County, Texas, 48th Judicial District, on November 20, 1998.
The plaintiffs in this action are purchasers of the debentures. The plaintiffs
allege that the Company violated the Texas Securities Act and the Texas Business
& Commercial Code and committed state common law fraud by materially misstating
the financial position of the Company in connection with the offering and sale
of the debentures. The complaint seeks rescission, as well as compensatory and
exemplary damages in an unspecified amount. The Company specially appeared to
assert an objection to the Texas court's exercise of personal jurisdiction over
the Company, and a hearing on this objection took place in April 1999. Following
the hearing, the court entered an order granting the Company's special
appearance and dismissing the case without prejudice. The plaintiffs appealed,
which appeal was denied.

On February 9, 1999, Messrs. Dunlap and Kersh filed with the American
Arbitration Association demands for arbitration of claims under their respective
employment agreements with the Company. Messrs. Dunlap and Kersh are requesting
a finding by the arbitrator that the Company terminated their employment without
cause and that they should be awarded certain benefits based upon their
respective employment agreements. The Company has answered the arbitration
demands of Messrs. Dunlap and Kersh and has filed counterclaims seeking, among
other things, the return of all consideration paid, or to be paid, under the
February 1998 Employment Agreements between the Company and Messrs. Dunlap and
Kersh. An answer was filed by Messrs. Dunlap and Kersh generally denying the
Company's counterclaim. Discovery is pending.

On September 13, 1999, an action naming the Company and Arthur Andersen as
defendants was filed in the Circuit Court for Montgomery County, Alabama. The
plaintiffs in this action are purchasers of the Company's common stock during
the period March 19, 1998 through May 6, 1998. The plaintiffs allege, among
other things, that the defendants violated the Alabama Securities Laws. The
plaintiffs seek compensatory and punitive damages in an unspecified amount.
Arthur Andersen has filed a cross claim against the Company for contribution and
indemnity. The Company has filed a motion to dismiss. In May 2000, the
plaintiffs in this action filed an amended complaint, which added allegations of
violations of the federal securities laws.

The Company intends to vigorously defend each of the foregoing lawsuits, but
cannot predict the outcome and is not currently able to evaluate the likelihood
of the Company's success in each case or the range of potential loss, if any.
However, if the Company were to lose one or more of these lawsuits, judgments
would likely have a material adverse effect on the Company's consolidated
financial position, results of operations or cash flows.

                                      -15-
<PAGE>
                      SUNBEAM CORPORATION AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                                   (UNAUDITED)

9.   COMMITMENTS AND CONTINGENCIES - (CONTINUED)

In July 1998, the American Alliance Insurance Company ("American Alliance")
filed suit against the Company in the U.S. District Court for the Southern
District of New York requesting a declaratory judgment of the court that the
directors' and officers' liability insurance policy for excess coverage issued
by American Alliance was invalid and/or had been properly canceled by American
Alliance. As a result of a motion made by the Company, this case has been
transferred to the U.S. District Court for the Southern District of Florida for
coordination and consolidation of pre-trial proceedings with the various actions
pending in that court. In October 1998, an action was filed by Federal Insurance
Company ("Federal Insurance") in the U.S. District Court for the Middle District
of Florida requesting the same relief as that requested by American Alliance in
the previously filed action as to additional coverage levels under the Company's
directors' and officers' liability insurance policy. This action has been
transferred to the U.S. District Court for the Southern District of Florida.
Discovery in the cases brought by American Alliance and Federal Insurance is
underway and coordinated with the discovery in the Consolidated Federal Actions.
In December 1998, an action was filed by Executive Risk Indemnity, Inc. in the
Circuit Court of the Seventeenth Judicial Circuit in and for Broward County,
Florida requesting the same relief as that requested by American Alliance and
Federal Insurance in their previously filed actions as to additional coverage
levels under the Company's directors' and officers' liability insurance policy.
In April 1999, the Company filed an action in the U.S. District Court for the
Southern District of Florida against National Union Fire Insurance Company of
Pittsburgh, PA ("National Union"), Gulf Insurance Company ("Gulf") and St. Paul
Mercury Insurance Company ("St. Paul") requesting, among other things, a
declaratory judgment that National Union is not entitled to rescind its
directors' and officers' liability insurance policies to the Company and a
declaratory judgment that the Company is entitled to coverage from these
insurance companies for the various lawsuits described herein under directors'
and officers' liability insurance policies issued by each of the defendants. The
Company has settled its litigation with National Union. In response to the
Company's complaint, defendants St. Paul and Gulf have answered and asserted
counterclaims seeking rescission and declaratory relief that no coverage is
available to the Company. The Company intends to pursue recovery from all of its
insurers if damages are awarded against the Company or its indemnified officers
and/or directors under any of the foregoing actions and to recover attorneys'
fees covered under those policies. The Company's failure to obtain such
insurance recoveries following an adverse judgment in any of the actions
described above could have a material adverse effect on the Company's financial
position, results of operations or cash flows.

By letter dated June 17, 1998, the staff of the Division of Enforcement of the
SEC advised the Company that it was conducting an informal inquiry into the
Company's accounting policies and procedures and requested that the Company
produce certain documents. In July 1998, the SEC issued a Formal Order of
Private Investigation, designating SEC officers to take testimony and pursuant
to which a subpoena was served on the Company requiring the production of
certain documents. In November 1998, another SEC subpoena requiring the
production of additional documents was received by the Company. The Company has
provided numerous documents to the SEC staff and continues to cooperate with the
SEC staff. The Company has, however, declined to provide the SEC with material
that the Company believes is subject to the attorney-client privilege and the
work product immunity. The SEC has not commenced any civil or administrative
proceedings as a result of its investigation, and the Company cannot predict at
this time whether the SEC will seek to impose any monetary or other penalties
against the Company. Under these circumstances, the Company cannot estimate the
duration of the investigation or its outcome.

The Company and its subsidiaries are also involved in various other lawsuits
arising from time to time which the Company considers to be ordinary routine
litigation incidental to its business. In the opinion of the Company, the
resolution of these routine matters, and of certain matters relating to prior
operations, individually or in the aggregate, will not have a material adverse
effect upon the financial position, results of operations or cash flows of the
Company.

                                      -16-
<PAGE>
                      SUNBEAM CORPORATION AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                                   (UNAUDITED)

9.   COMMITMENTS AND CONTINGENCIES - (CONTINUED)

Amounts accrued for litigation matters represent the anticipated costs (damages
and/or settlement amounts) in connection with pending litigation and claims and
related anticipated legal fees for defending such actions. The costs are accrued
when it is both probable that an asset has been impaired or a liability has been
incurred and the amount can be reasonably estimated. The accruals are based upon
the Company's assessment, after consultation with counsel, of probable loss
based on the facts and circumstances of each case, the legal issues involved,
the nature of the claim made, the nature of the damages sought and any relevant
information about the plaintiffs and other significant factors which vary by
case. When it is not possible to estimate a specific expected cost to be
incurred, the Company evaluates the range of probable loss and records the
minimum end of the range. As of March 31, 2000, the Company had established
accruals for litigation matters of $22.3 million (representing $9.6 million and
$12.7 million for estimated damages or settlement amounts and legal fees,
respectively) and $24.3 million as of December 31, 1999 (representing $9.6
million and $14.7 million for estimated damages or settlement amounts and legal
fees, respectively). It is anticipated that the $22.3 million accrual at March
31, 2000 will be paid as follows: $19.5 million in 2000, $2.7 million in 2001
and $0.1 million in 2002. The Company believes, based on information available
on March 31, 2000, that anticipated probable costs of litigation matters
existing as of March 31, 2000 have been adequately reserved to the extent
determinable.

ENVIRONMENTAL MATTERS

The Company's operations, like those of comparable businesses, are subject to
certain federal, state, local and foreign environmental laws and regulations in
addition to laws and regulations regarding labeling and packaging of products
and the sales of products containing certain environmentally sensitive
materials. The Company believes it is in substantial compliance with all
environmental laws and regulations which are applicable to its operations.
Compliance with environmental laws and regulations involves certain continuing
costs; however, such costs of ongoing compliance have not resulted, and are not
anticipated to result, in a material increase in the Company's capital
expenditures or to have a material adverse effect on the Company's competitive
position, results of operations, financial condition or cash flows.

In addition to ongoing environmental compliance at its operations, the Company
also is actively engaged in environmental remediation activities, many of which
relate to divested operations. As of March 31, 2000, the Company has been
identified by the United States Environmental Protection Agency ("EPA") or a
state environmental agency as a potentially responsible party ("PRP") in
connection with seven sites subject to the federal Superfund Act and five sites
subject to state Superfund laws comparable to the federal law (collectively the
"Environmental Sites"), exclusive of sites at which the Company has been
designated (or expects to be designated) as a de minimis (less than 1%)
participant.

The Superfund Act, and related state environmental remediation laws, generally
authorize governmental authorities to remediate a Superfund site and to assess
the costs against the PRPs or to order the PRPs to remediate the site at their
expense. Liability under the Superfund Act is joint and several and is imposed
on a strict basis, without regard to degree of negligence or culpability. As a
result, the Company recognizes its responsibility to determine whether other
PRPs at a Superfund site are financially capable of paying their respective
shares of the ultimate cost of remediation of the site. Whenever the Company has
determined that a particular PRP is not financially responsible, it has assumed
for purposes of establishing reserve amounts that such PRP will not pay its
respective share of the costs of remediation. To minimize the Company's
potential liability with respect to the Environmental Sites, the Company has
actively participated in steering committees and other groups of PRPs
established with respect to such sites. The Company currently is engaged in
active remediation activities at thirteen sites, seven of which are among the
Environmental Sites referred to above, and six of which have not been designated
as Superfund sites under federal or state law. The remediation efforts in which
the Company is involved include facility investigations, including soil and
groundwater investigations, corrective measure studies, including feasibility
studies, groundwater monitoring, extraction and treatment and soil sampling,
excavation and treatment relating to environmental clean-ups. In certain
instances, the Company has entered into agreements with governmental authorities
to undertake additional investigatory activities and in other instances has
agreed to implement appropriate remedial actions. The Company has also
established reserve amounts for certain non-compliance matters including those
involving air emissions.

                                      -17-
<PAGE>
                      SUNBEAM CORPORATION AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                                   (UNAUDITED)

9.   COMMITMENTS AND CONTINGENCIES - (CONTINUED)

The Company has established reserves to cover the anticipated probable costs of
investigation and remediation, based upon periodic reviews of all sites for
which the Company has, or may have remediation responsibility. The Company
accrues environmental investigation and remediation costs when it is probable
that a liability has been incurred, the amount of the liability can be
reasonably estimated and the Company's responsibility for the liability is
established. Generally, the timing of these accruals coincides with the earlier
of formal commitment to an investigation plan, completion of a feasibility study
or the Company's commitment to a formal plan of action. As of March 31, 2000 and
December 31, 1999, the Company's environmental reserves were $19.7 million
(representing $18.0 million for the estimated costs of facility investigations,
corrective measure studies, or known remedial measures, and $1.7 million for
estimated legal costs) and $19.9 million (representing $18.2 million for the
estimated costs of facility investigations, corrective measure studies, or known
remedial measures, and $1.7 million for estimated legal costs), respectively. It
is anticipated that the $19.7 million accrual at March 31, 2000 will be paid as
follows: $3.1 million in 2000, $3.2 million in 2001, $2.6 million in 2002, $0.8
million in 2003, $0.6 million in 2004 and $9.4 million thereafter. The Company
has accrued its best estimate of investigation and remediation costs based upon
facts known to the Company at such dates and because of the inherent
difficulties in estimating the ultimate amount of environmental costs, which are
further described below, these estimates may materially change in the future as
a result of the uncertainties described below. Estimated costs, which are based
upon experience with similar sites and technical evaluations, are judgmental in
nature and are recorded at undiscounted amounts without considering the impact
of inflation and are adjusted periodically to reflect changes in applicable laws
or regulations, changes in available technologies and receipt by the Company of
new information. It is difficult to estimate the ultimate level of future
environmental expenditures due to a number of uncertainties surrounding
environmental liabilities. These uncertainties include the applicability of laws
and regulations, changes in environmental remediation requirements, the
enactment of additional regulations, uncertainties surrounding remediation
procedures including the development of new technology, the identification of
new sites for which the Company could be a PRP, information relating to the
exact nature and extent of the contamination at each site and the extent of
required cleanup efforts, the uncertainties with respect to the ultimate outcome
of issues which may be actively contested and the varying costs of alternative
remediation strategies. The Company continues to pursue the recovery of some
environmental remediation costs from certain of its liability insurance
carriers; however, such potential recoveries have not been offset against
potential liabilities and have not been considered in determining the Company's
environmental reserves.

Due to uncertainty over remedial measures to be adopted at some sites, the
possibility of changes in environmental laws and regulations and the fact that
joint and several liability with the right of contribution is possible at
federal and state Superfund sites, the Company's ultimate future liability with
respect to sites at which remediation has not been completed may vary from the
amounts reserved as of March 31, 2000.

The Company believes, based on information available as of March 31, 2000 for
sites where costs are estimable, that the costs of completing environmental
remediation of all sites for which the Company has a remediation responsibility
have been adequately reserved and that the ultimate resolution of these matters
will not have a material adverse effect upon the Company's financial condition,
results of operations or cash flows.

PRODUCT LIABILITY MATTERS

As a consumer goods manufacturer and distributor, the Company and/or its
subsidiaries face the constant risks of product liability and related lawsuits
involving claims for substantial money damages, product recall actions and
higher than anticipated rates of warranty returns or other returns of goods.
These claims could result in liabilities that could have a material adverse
effect on the Company's consolidated financial position, results of operations
or cash flows. Some of the product lines the Company acquired in the 1998
acquisitions have increased its exposure to product liability and related
claims.

                                      -18-
<PAGE>
                      SUNBEAM CORPORATION AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                                   (UNAUDITED)

9.   COMMITMENTS AND CONTINGENCIES - (CONTINUED)

BRK Brands, Inc. and Sunbeam (Canada Limited) are defendants in an alleged class
action lawsuit in Ontario, Canada (the "Canada Action") that claims, among other
things, that the defendants failed to adequately inform consumers of the varying
performance characteristics of smoke detectors utilizing ionization and
photoelectric technology. The alleged class action consists of all consumers in
Ontario, Canada who have purchased ionization detectors manufactured or sold by
the defendants or their predecessors. BRK Brands is also a defendant in two
separate alleged nationwide class action lawsuits in the United States, one in
the United States District Court for the Northern District of Alabama (the
"Alabama Action") and the other in Circuit Court, Twentieth Judicial District,
St. Clair County, Illinois (the "Illinois Action"). The plaintiffs in both the
Alabama Action and the Illinois Action make substantially the same allegations
as in the Canada Action. The defendants and the plaintiffs have entered into a
settlement of the Alabama Action which provides for a nationwide public
information campaign regarding the performance characteristics of ionization and
photoelectric smoke detector technology and also provides for a rebate on the
purchase of dual sensor smoke detectors. The settlement of the Alabama Action is
intended to resolve all similar claims nationwide. The settlement has received
preliminary approval from the U.S. District Court for the Northern District of
Alabama. The defendants intend to vigorously defend the Canada Action and the
Illinois Action, but cannot predict the outcome and is not currently able to
evaluate the likelihood of the defendant's success or the range of potential
loss, if any. However, if the defendants' were to lose one of these lawsuits, it
could have a material adverse effect on the defendants' financial position,
results of operations or cash flows.

The Company is party to various personal injury and property damage lawsuits
relating to its products and incidental to its business. Annually, the Company
sets its product liability insurance program which is an occurrence based
program based on the Company's current and historical claims experience and the
availability and cost of insurance. The Company's program for 2000 is comprised
of a self-insurance retention of $3.5 million per occurrence, and is limited to
$28.0 million in the aggregate.

Cumulative amounts estimated to be payable by the Company with respect to
pending and potential claims for all years in which the Company is liable under
its self-insurance retention have been accrued as liabilities. Such accrued
liabilities are necessarily based on estimates (which include actuarial
determinations made by independent actuarial consultants as to liability
exposure, taking into account prior experience, numbers of claims and other
relevant factors); thus, the Company's ultimate liability may exceed or be less
than the amounts accrued. The methods of making such estimates and establishing
the resulting liability are reviewed on a regular basis and any adjustments
resulting therefrom are reflected in current operating results.

Historically, product liability awards have rarely exceeded the Company's
individual per occurrence self-insured retention. There can be no assurance,
however, that the Company's future product liability experience will be
consistent with its past experience. Based on existing information, the Company
believes that the ultimate conclusion of the various pending product liability
claims and lawsuits of the Company, individually or in the aggregate, will not
have a material adverse effect on the financial position, results of operations
or cash flows of the Company.

                                      -19-
<PAGE>

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the accompanying
condensed consolidated financial statements and the related footnotes included
in this quarterly report on Form 10-Q, as well as the consolidated financial
statements, related footnotes and management's discussion and analysis of
financial condition and results of operations in the Company's Annual Report on
Form 10-K for the year ended December 31, 1999.

ACQUISITIONS

On March 30, 1998, pursuant to a merger agreement dated as of February 27, 1998,
the Company, through a wholly-owned subsidiary, acquired approximately 81% of
the total number of then outstanding shares of common stock of the Coleman
Company, Inc. ("Coleman") from an affiliate of MacAndrews & Forbes ("M&F"), in
exchange for 14,099,749 shares of the Company's common stock and approximately
$160 million in cash. In addition, the Company assumed approximately $1,016
million in debt of Coleman and its parent corporations. Immediately thereafter,
as a result of the exercise of Coleman employee stock options, the Company's
indirect beneficial ownership of Coleman decreased to approximately 79%.

In January 2000, pursuant to a merger agreement dated as of February 27, 1998,
the Company acquired the remaining publicly held Coleman shares pursuant to a
merger transaction pursuant to which the remaining Coleman stockholders (other
than stockholders who are seeking appraisal rights under Delaware law) received
0.5677 of a share of the Company's common stock and $6.44 in cash for each share
of Coleman common stock they owned, aggregating approximately 6.7 million shares
of the Company's common stock and $87 million in cash. The approximate $87
million aggregate cash payment included $4.8 million related to the cash out of
remaining Coleman employee options, in accordance with the merger agreement,
which occurred in December 1999. In addition, pursuant to a court approved
settlement of claims by Coleman public stockholders the Company issued to such
Coleman public stockholders (other than such stockholders who are seeking
appraisal rights under Delaware law), warrants expiring August 24, 2003 to
purchase 4.98 million shares of the Company's common stock at $7.00 per share
less approximately 498,000 warrants issued to the plaintiffs' attorneys for
their fees and expenses. These warrants, which generally have the same terms as
the warrants previously issued to M&F's subsidiary (see Note 9 to the Condensed
Consolidated Financial Statements) were issued when the consideration was paid
for the Coleman merger. The total consideration given for the purchase of the
remaining publicly held Coleman shares was valued at $146 million.

The acquisition of Coleman was accounted for using the purchase method of
accounting, and accordingly, the financial position and results of operations of
Coleman are included in the accompanying Condensed Consolidated Statements of
Operations from the respective dates of acquisition. Prior to the completion of
the merger on January 6, 2000, the approximate 20% of Coleman's results of
operations and net equity allocable to the public shareholders was reported as
minority interest.

DIVESTITURES

During the fourth quarter of 1999, the Company announced its intent to sell its
Eastpak business ("Eastpak"). In March 2000, the Company entered into the
Eastpak Sale Agreement with VF Corporation which provides for the sale of
Eastpak. The final purchase price is subject to certain post-closing adjustments
and retention of certain liabilities. Eastpak, a wholly-owned subsidiary of
Coleman, was acquired by the Company in March 1998. Net sales from Eastpak were
approximately 5% of consolidated net sales in both the first quarter of 2000 and
1999. Operating income in the first quarter of 2000 and 1999 was not
significant. In the fourth quarter of 1999, as a result of the Company's change
in business strategy for Eastpak, an evaluation for impairment of Eastpak's
long-lived assets was performed pursuant to SFAS No. 121. Based upon this
analysis, the Company determined that the fair market value of Eastpak's
long-lived assets, including intangibles, was less than the carrying value.
Accordingly, during the fourth quarter of 1999, the Company adjusted the
carrying value of Eastpak's net assets to its estimated fair value (less
estimated costs of sale) resulting in a non-cash impairment charge of $52
million. This charge reduced the goodwill associated with Eastpak. The fair
market value of Eastpak was determined based upon the purchase price in the
Eastpak Sale Agreement. This charge is reflected in SG&A in the fourth quarter
of 1999 Consolidated Statements of Operations. Eastpak is included in the
Company's Outdoor Leisure business group.

                                      -20-
<PAGE>

SIGNIFICANT AND UNUSUAL CHARGES

Consolidated operating results for 2000 and 1999 were impacted by a number of
significant and unusual charges. Operating loss, adjusted for these items, is
summarized in the following table and succeeding narrative.

                                                MARCH 31,    MARCH 31,
                                                  2000         1999
                                                --------     --------
(Amounts in millions)
Net sales--As reported ....................     $  539.1     $  523.9

Gross margin--As reported .................        133.3        126.5
Non-recurring items:
  Glenwillow plant closure ................          2.7         --
  Retail store closings ...................          0.3         --
  Purchase accounting .....................          4.3         --
                                                --------     --------
    Adjusted gross margin .................        140.6        126.5
      ADJUSTED GROSS MARGIN PERCENTAGE ....         26.1%        24.1%

Selling, general and administrative
  expense ("SG&A")--As reported ...........        135.8        141.2
Non-recurring items:
  Glenwillow plant closure ................         (0.6)        --
  Retail store closings ...................         (2.2)        --
  Insurance recovery ......................         10.0         --
  Year 2000 and system initiatives expenses         --           (8.1)
  Contract termination and other ..........         --           (1.1)
                                                --------     --------
    Adjusted SG&A expense .................        143.0        132.0
                                                --------     --------
Adjusted operating loss ...................     $   (2.4)    $   (5.5)
                                                ========     ========


GLENWILLOW PLANT CLOSURE

In March 2000, the Company announced that it intends to shut down operations at
its Glenwillow facility, which manufactures and distributes Mr. Coffee brand
coffee makers and coffee filters. These operations will be consolidated into
other existing facilities. As a result of this decision, the Company recorded a
charge of $3.3 million in the first quarter, primarily related to the write-off
of leasehold improvements, severance costs and contract and lease termination
fees. This charge was recorded in SG&A ($0.6 million) and Cost of Goods Sold
($2.7 million). The Glenwillow facility is expected to be closed by the end of
the second quarter of 2000 and will result in the elimination of approximately
300 positions. The Company anticipates incurring additional incremental costs
during the second quarter of 2000, primarily related to relocation of certain
manufacturing equipment and machinery to other Company manufacturing locations
and as a result of duplicate warehousing costs as inventory levels are built in
order to avoid customer supply issues during the plant shut-down.

RETAIL STORE CLOSINGS

In the first quarter of 2000, in connection with the Company's on-going
strategic planning process, the decision was made to close the remaining Sunbeam
retail stores. As a result of this decision, a charge of $2.5 million, primarily
related to the write-off of leasehold improvements, severance and lease
termination fees was recorded in the first quarter of 2000. This charge was
recorded in SG&A ($2.2 million) and Cost of Goods Sold ($0.3 million). The
Company expects that the majority of these stores will be closed by the end of
the second quarter of 2000 and will result in the elimination of approximately
60 positions.

PURCHASE ACCOUNTING

The Company recorded the Coleman acquisition using the purchase method of
accounting. In accordance with this accounting method, inventory pertaining to
the acquisition of the remaining approximately 20% interest in Coleman was
recorded at fair value. The fair value of the inventory exceeded the book value
reflected on the balance sheet of the acquired company as of the acquisition
date. The excess of the fair value of inventory over its pre-acquisition book
value was recorded in cost of sales as the inventory was sold. The non-recurring
impact of this purchase accounting adjustment was $4.3 million in the first
quarter of 2000.

                                      -21-
<PAGE>

INSURANCE RECOVERY

In the first quarter of 2000, the Company settled one of its claims related to
its directors' and officers' liability insurance policies pursuant to which,
among other things, the insurer reimbursed the Company for $10 million of
defense costs, which was the limit of the policy at issue. This reimbursement is
included in SG&A in the first quarter of 2000.

YEAR 2000 AND SYSTEMS INITIATIVES EXPENSES

See "Year 2000 Disclosure" within this Item II - "Management's Discussion and
Analysis of Financial Condition and Results of Operations".

CONTRACT TERMINATION AND OTHER

In the first quarter of 1999, the Company recorded a charge of $0.8 million
relating to the renegotiations of a contract with one of the Company's
licensees. In addition, approximately $0.3 million was recorded during the first
quarter of 1999 as a result of management's strategic decision to close a
warehouse in Mexico.

THREE MONTHS ENDED MARCH 31, 2000 COMPARED TO THREE MONTHS ENDED MARCH 31, 1999

Consolidated net sales for the three months ended March 31, 2000 and 1999 were
$539.1 million and $523.9 million respectively, an increase of $15.2 million or
approximately 3%. This increase was driven by the Outdoor Leisure group, where
net sales increased approximately $10 million to $228.8 million in the first
quarter of 2000 as compared to the same period in 1999. The increase in Outdoor
Leisure net sales was primarily driven by strong retail replenishment demand of
outdoor recreation products and by sales of Outdoor Cooking products. The
increase in net sales of Outdoor Cooking products is largely attributable to the
introduction of Coleman(R) branded gas grills and grill accessories. These
increases are partially offset by a decrease in revenue from Powermate(R)
generators as a result of a combination of factors that impacted the entire
portable generator category, including weather conditions and the effect of Year
2000 related sales in the second half of 1999 period. Sales of Powermate
generators are expected to continue to be adversely effected during the second
and third quarters of this year while trade inventories rebalance from the
effect of Year 2000 related sales in the second half of 1999. International net
sales increased $4.5 million to $144.1 million in the first quarter of 2000 as
compared to the same period in 1999. The increase in International net sales in
the first quarter of 2000 is primarily attributable to increases in net sales in
Japan resulting from increased sales of outdoor recreation products and improved
economic conditions in this region. Increased net sales in Latin America driven
by sales of appliances, partially offset by decreases in net sales in Canada as
a result of lower levels of sales of Powermate generators, account for the
remainder of the International sales increase. Household net sales increased
approximately $1 million to $164.8 million in 2000, due to an increase in net
sales of appliances and personal care products largely offset by slight
decreases in sales of postal scales and decreases of First Alert product sales.

Gross margin for the first quarter in 2000 was $133.3 million or $6.8 million
higher than the comparable period in 1999. Excluding the effects of significant
and unusual items, as summarized above under "Significant and unusual charges",
gross margin was $140.6 million in the first quarter of 2000 or $14.1 million
higher than the comparable period in 1999. As a percentage of net sales, gross
margin improved to approximately 26% in the first quarter of 2000 as compared to
the first quarter 1999 gross margin of approximately 24%. The $14.1 million
improvement in gross margin, as adjusted for unusual charges, is reflective of
numerous improvements over the same period in the prior year, including
additional utilization of the Company's factories in 2000 and decreases in
customer returns and allowances, which are deductions from gross sales to arrive
at net sales. These improvements account for approximately $11 million of the
increase in gross margin in the first quarter of 2000 as compared to the same
period in 1999. The balance of the increase in gross margin was driven by the
increase in net sales in the first quarter of 2000, as compared to the first
quarter of 1999.

SG&A expense in the first quarter of 2000 was $135.8 million, representing a 4%
decrease over the same period in the prior year. Excluding the effects of
significant and unusual items, as summarized above under "Significant and
Unusual Charges", SG&A expense for 2000 was approximately $11 million, or 8%
higher than the same period in 1999. This increase is largely attributable to
increased spending related to research and development ("R&D") costs and
advertising and marketing, which increased $3.0 million and $4.5 million,
respectively, in the first quarter of 2000 as compared to the same period in the
prior year. The higher levels of R&D costs relate to new product development,
including "Smart Products", which


                                      -22-
<PAGE>

the Company plans to offer through its Thalia subsidiary in 2001. The increases
in advertising and marketing relate to new product introductions, including
"Smart Products", Coleman branded grills and grill accessories and outdoor
recreation products. The remaining increase is primarily due to increased levels
of SG&A in the Outdoor Leisure and International groups driven by increased net
sales.

Consolidated operating results for the first quarters of 2000 and 1999, were
losses of $59.4 million and $60.7 million, respectively. Operating results, as
adjusted, were losses of $2.4 million and $5.5 million in the first quarter of
2000 and 1999, respectively. The adjusted results reflect the factors discussed
above.

Interest expense, net in the first quarter of 2000 was $52.5 million as compared
to $42.8 million in the same period in the prior year. Approximately half of
this increase is attributable to higher levels of borrowings and increased
interest rates in the first quarter of 2000 as compared to the same period in
the prior year. The balance of the increase was driven by the amortization of
the loan amendment fee (approximately $4 million) the Company is obligated to
pay under the terms of the Credit Facility. See Note 3 to the Condensed
Consolidated Financial Statements.

Other expense, net of $2.6 million for the first quarter of 2000 primarily
relates to losses due to foreign exchange rates, primarily from Europe. Other
income, net in the first quarter of 1999 relates to favorable foreign exchange
rates.

The minority interest reported for the first quarter of 1999 primarily relates
to the minority interest held in Coleman by public shareholders.

Tax expense recorded in the first quarter of 2000 totaled $1.7 million, of which
$0.8 million related to Eastpak and the remainder related primarily to taxes on
foreign income. Income taxes in the first quarter of 1999 reflect tax expense on
earnings of foreign operations. No net tax benefit was recorded due to the
Company's U.S. losses in either year as it is management's assessment that the
Company cannot demonstrate that it is more likely than not that deferred tax
assets resulting from these losses would be realized through future taxable
income.

FOREIGN OPERATIONS

Approximately 80% of the Company's business is conducted in U.S. dollars,
including domestic sales, U.S. dollar denominated export sales, primarily to
Latin American markets, Asian sales and the majority of European sales. The
Company's non-U.S. dollar denominated sales are made principally by subsidiaries
in Europe, Canada, Japan, Latin America and Mexico. Translation adjustments
resulting from the Company's non-U.S. denominated subsidiaries have not had a
material impact on the Company's financial condition, results of operations or
cash flows.

On a limited basis, the Company selectively uses derivatives, primarily foreign
exchange option and forward contracts, to manage foreign exchange exposures that
arise in the normal course of business. No derivative contracts are entered into
for trading or speculative purposes. The use of derivatives has not had a
material impact on the Company's financial results.

SEASONALITY

Sunbeam's consolidated sales are not expected to exhibit substantial
seasonality; however, sales are expected to be strongest during the second
quarter of the calendar year and weakest in the first quarter. Furthermore,
sales of a number of products, including warming blankets, vaporizers,
humidifiers, grills, First Alert products, camping and generator products may be
impacted by unseasonable weather conditions.

LIQUIDITY AND CAPITAL RESOURCES

DEBT INSTRUMENTS

In order to finance the 1998 acquisitions of Coleman, First Alert, Inc. ("First
Alert") and Signature Brands USA, Inc. ("Signature Brands") and to refinance
substantially all of the indebtedness of the Company and the three acquired
companies, the Company consummated an offering in March 1998 of zero coupon
debentures due 2018, having a yield to maturity of 5% (approximately $2,014
million principle amount at maturity), which resulted in approximately $730
million of net proceeds and borrowed about $1,325 million under its Credit
Facility.

                                      -23-
<PAGE>

The debentures are exchangeable for shares of the Company 's common stock at an
initial conversion rate of 6.575 shares for each $1,000 principal amount at
maturity of the debentures, subject to adjustments upon occurrence of specified
events. The debentures are subordinated in right of payment to all existing and
future senior indebtedness of the Company. The debentures are not redeemable by
the Company prior to March 25, 2003. On or after such date, the debentures are
redeemable for cash with at least 30 days notice, at the option of the Company.
The Company is required to purchase debentures at the option of the holder as of
March 25, 2003, March 25, 2008 and March 25, 2013, at purchase prices equal to
the issue price plus accrued original discount to such dates. The Company may,
at its option, elect to pay any such purchase price in cash or common stock or
any combination thereof. However, the Credit Facility prohibits the Company from
redeeming or repurchasing debentures for cash.

Concurrent with the 1998 acquisitions, the Company replaced its $250 million
syndicated unsecured five-year revolving credit facility with the Credit
Facility. The Credit Facility provided for aggregate borrowings of up to $1.7
billion and in addition to other customary covenants, required the Company to
maintain specified consolidated leverage, interest coverage and fixed charge
coverage ratios as of the end of each fiscal quarter occurring after March 31,
1998 and on or prior to the latest stated maturity date for any of the
borrowings under the Credit Facility.

As a result of, among other things, its operating losses incurred during the
first half of 1998, the Company did not achieve the specified financial ratios
for June 30, 1998 and it appeared unlikely that the Company would achieve the
specified financial ratios for September 30, 1998. Consequently, the Company and
its lenders entered into an agreement dated as of June 30, 1998 that waived
through December 31, 1998 all defaults arising from the failure of the Company
to satisfy the specified financial ratios for June 30, 1998 and September 30,
1998. Pursuant to an agreement with the Company dated as of October 19, 1998,
the Company's lenders extended all of the waivers through April 10, 1999 and
also waived through such date all defaults arising from any failure by the
Company to satisfy the specified financial ratios for December 31, 1998. In
April 1999, such waivers were extended through April 10, 2000 and on April 10,
2000 such waivers were extended through April 14, 2000.

On April 14, 2000, the Company and its lenders entered into an amendment to the
Credit Facility that, among other things, waived until April 10, 2001 all
defaults arising from any failure by the Company to satisfy certain financial
ratios for any fiscal quarter end occurring through March 31, 2001. As part of
the April 14, 2000 amendment, the Company agreed to a minimum cumulative
earnings before interest, taxes, depreciation and amortization ("EBITDA")
covenant that is based on consolidated EBITDA and is tested at the end of each
month occurring on or prior to March 31, 2001. The minimum cumulative EBITDA is
initially $35.8 million for the period from January 1, 2000 through April 30,
2000 and generally increases on a monthly basis until it reaches $213.6 million
for the period from January 1, 2000 through March 31, 2001. The following
description of the Credit Facility reflects the significant terms of the Credit
Facility as amended to date.

The Credit Facility provides for aggregate borrowings of up to $1.7 billion
pursuant to: (i) a revolving credit facility in an aggregate principal amount of
up to $400 million maturing March 30, 2005 ($52.5 million of which was used to
complete the Coleman merger which occurred on January 6, 2000); (ii) up to
$800.0 million in term loans maturing on March 30, 2005 (of which $35.0 million
was used to complete the Coleman merger which occurred on January 6, 2000) and
(iii) a $500.0 million term loan maturing September 30, 2006 (of which $5.0
million has been repaid). As of March 31, 2000, of the $1.7 billion, $1.572
billion was outstanding and approximately $48 million was available for
borrowing. The remaining $80.2 million of the $1.7 billion Credit Facility was
committed for outstanding letters of credit.

Pursuant to the Credit Facility, interest accrues, at the Company's option: (i)
at the London Interbank Offered Rate ("LIBOR"), or (ii) at the base rate of the
administrative agent which is generally the higher of the prime commercial
lending rate of the administrative agent or the Federal Funds Rate plus 0.50%,
in each case plus an interest margin which was 3.00% for LIBOR borrowings and
1.75% for base rate borrowings at March 31, 2000. The applicable interest
margins are subject to further downward adjustment upon the reduction of the
aggregate borrowings under the Credit Facility. Borrowings under the Credit
Facility are secured by a pledge of the stock of the Company's material
subsidiaries and by a security interest in substantially all of the assets of
the Company and its material domestic subsidiaries. In addition, borrowings
under the Credit Facility are guaranteed by a number of the Company's
wholly-owned material domestic subsidiaries and these subsidiary guarantees are
secured by substantially all of the material domestic subsidiaries' assets. To
the extent extensions of credit are made to any subsidiaries of the Company, the
obligations of such subsidiaries are guaranteed by the Company.

Under terms of the April 14, 2000 amendment to the Credit Facility, the Company
is obligated to pay the bank lenders an amendment fee for the April 14, 2000
amendment of 0.50% of the commitments under the Credit Facility as of April 14,
2000, totaling $8.5 million. This fee is payable on the earlier of June 30, 2000
or the closing of the Eastpak sale.


                                      -24-
<PAGE>

On November 30, 2000, the Company also must pay an amendment fee previously
agreed to for the April 15, 1999 amendment equal to 0.50% of the commitments
under the Credit Facility as of April 15, 1999, totaling $8.5 million. An
additional amendment fee relating to the April 15, 1999 amendment equal to $8.5
million will be payable to the bank lenders if the aggregate loan and commitment
exposure under the Credit Facility is equal to or more than $1.2 billion on
November 30, 2000, with such fee being payable on June 30, 2001. The $17 million
amendment fee associated with the April 15, 1999 amendment was amortized to
interest expense using the straight-line method over the one-year term of the
amendment. The $8.5 million amendment fee associated with the April 14, 2000
amendment will be amortized to interest expense using the straight-line method
over the one year term of that amendment.

In addition to the above described ratios and tests, the Credit Facility
contains covenants customary for credit facilities of a similar nature,
including limitations on the ability of the Company and its subsidiaries,
including Coleman, to, among other things, (i) declare dividends or repurchase
stock, (ii) prepay, redeem or repurchase debt, incur liens and engage in
sale-leaseback transactions, (iii) make loans and investments, (iv) incur
additional debt, (v) amend or otherwise alter material agreements or enter into
restrictive agreements, (vi) make capital expenditures, (vii) fail to maintain
its trade receivable securitization programs, (viii) engage in mergers,
acquisitions and asset sales, (ix) engage in certain transactions with
affiliates, (x) settle certain litigation, (xi) alter its cash management system
and (xii) alter the businesses they conduct. The Credit Facility provides for
events of default customary for transactions of this type, including nonpayment,
misrepresentation, breach of covenant, cross-defaults, bankruptcy, material
adverse change arising from compliance with ERISA, material adverse judgments,
entering into guarantees and change of ownership and control. Furthermore, the
Credit Facility requires the Company to prepay loans under the Credit Facility
on December 31, 2000 to the extent that the cash on hand in the Company's
concentration accounts plus the aggregate amount of unused revolving loan
commitments on that date exceed $185.0 million.

Unless waived by the bank lenders, the failure of the Company to satisfy any of
the financial ratios and tests contained in the Credit Facility or the
occurrence of any other event of default under the Credit Facility would entitle
the bank lenders to (a) receive a 2.00% increase in the interest rate applicable
to outstanding loans and increase the trade letter of credit fees to 1.00% and
(b) declare the outstanding borrowings under the Credit Facility immediately due
and payable and exercise all or any of their other rights and remedies. Any such
acceleration or other exercise of rights and remedies would likely have a
material adverse effect on the Company.

Pursuant to the April 14, 2000 amendment, term loan payments originally
scheduled for September 30, 1999 and March 31, 2000 in the amount of $69.3
million on each date are to be made as follows: (i) $69.3 million on the earlier
of the sale of Eastpak or August 15, 2000, (ii) $30.8 million on November 30,
2000 and (iii) $38.5 million on April 10, 2001. In addition, the April 14, 2000
amendment provides that the payment dates for the $69.3 million term loan
payments originally scheduled for each of September 30, 2000 and March 31, 2001
are deferred until April 10, 2001. (See Note 3 to the Condensed Consolidated
Financial Statements.)

CASH FLOWS

As of March 31, 2000, the Company had cash and cash equivalents of $23.1 million
and total debt of $2.4 billion. Cash used in operating activities during the
first three months of 2000 was $58.6 million, consistent with the $57.5 million
used in the first three months of 1999. During the first quarter of 2000,
inventory levels increased approximately $75 million, largely due to the
seasonal inventory build in the Company's Outdoor Leisure group. Accounts
receivable decreased approximately $3 million from December 31, 1999 and
approximately $36 million from the same period in the prior year, as a result of
the impact of the accounts receivable securitization program and as a result of
the Company's management of receivables. (See Note 4 to the Condensed
Consolidated Financial Statements.) Accounts payable increased during the first
quarter of 2000 by approximately $32 million as a result of the aforementioned
inventory build.

Cash used in investing activities in the first quarter of 2000 reflects $83.4
million for the purchase of the remaining approximate 20% interest in Coleman.
Capital spending for the first quarter of 2000 totaled $16.1 million, primarily
for equipment and tooling for new products and the expansion of the Company's
Neosho, Missouri warehouse. Investing activities for the 2000 period also
includes approximately $6 million from the sale of assets, including the sale of
the former Coleman headquarters building ($5 million). Capital spending in the
comparable 1999 period was $17.1 million and was primarily for information
systems and equipment and tooling for new products. The Company anticipates 2000
capital spending to be less than 5% of net sales. Capital expenditures in the
current year are expected to primarily relate to manufacturing equipment
replacement, new product introductions and capacity additions, including the
Neosho warehouse expansion.

                                      -25-
<PAGE>

Cash provided by financing activities totaled $134.8 million in the first three
months of 2000 and reflected net borrowings under the Company's Credit Facility.
Approximately $83 million of the borrowings under the Credit Facility resulted
from the Company's purchase of the remaining 20% interest in Coleman and the
balance was used to fund the Company's working capital requirements. Cash
provided by financing activities totaled $58.7 million in the first quarter of
1999 and reflects net borrowings under the Company's Credit Facility. See Note 3
to the Condensed Consolidated Financial Statements.

At March 31, 2000, standby and commercial letters of credit aggregated $80.2
million and were predominately for insurance policies, workers' compensation,
and international trade activities. In addition, as of March 31, 2000, surety
bonds with a contract value of $78.4 million were outstanding largely for the
Company's pension plans and as a result of environmental issues and litigation
judgments that are currently under appeal.

In January 2000, pursuant to a merger agreement dated as of February 27, 1998,
the Company acquired the remaining publicly held Coleman shares pursuant to a
merger transaction pursuant to which the remaining Coleman stockholders (other
than stockholders who are seeking appraisal rights under Delaware law) received
0.5677 of a share of the Company's common stock and $6.44 in cash for each share
of Coleman common stock they owned, aggregating approximately 6.7 million shares
of the Company's common stock and $87 million in cash. The approximate $87
million aggregate cash payment included $4.8 million related to the cash out of
remaining Coleman employee options, in accordance with the merger agreement,
which occurred in December 1999. In addition, pursuant to a court approved
settlement of claims by Coleman public stockholders the Company issued to such
stockholders (other than such stockholders who are seeking appraisal rights
under Delaware law), warrants expiring August 24, 2003 to purchase 4.98 million
shares of the Company's common stock at $7.00 per share less approximately
498,000 warrants issued to the plaintiffs' attorneys for their fees and
expenses. These warrants, which generally have the same terms as the warrants
previously issued to M&F's subsidiary were issued when the consideration was
paid for the Coleman merger. The total consideration given for the purchase of
the remaining publicly held Coleman shares was valued at $146 million.

The Company believes its borrowing capacity under the Credit Facility, foreign
working capital lines, cash flow from the operations of the Company, existing
cash and cash equivalent balances, proceeds from its receivable securitization
programs, the sale of Eastpak and sales of non-core assets will be sufficient to
support planned working capital needs, planned capital expenditures and
scheduled debt service to April 10, 2001. Although management believes they will
be successful in accomplishing the above, there can be no assurance that the
aforementioned sources of funds will be sufficient to meet the Company's cash
requirements on a consolidated basis. If the Company is unable to satisfy such
cash requirements, the Company could be required to adopt one or more
alternatives, such as reducing or delaying capital expenditures, restructuring
indebtedness, selling other assets or operations or issuing additional shares of
capital stock in the Company, and some of such actions would require the consent
of the lenders. There can be no assurance that any of such actions could be
effected, or if so, on terms favorable to the Company that such actions would
enable the Company to continue to satisfy its cash requirements or that such
actions would be permitted under the terms of the Credit Facility. In
anticipation of the expiration of the current waiver on April 10, 2001, the
Company intends to negotiate with its lenders regarding a further amendment to
the Credit Facility, further waiver of the covenants and other terms, or
refinancing of the Credit Facility. Any decisions with respect to such
amendment, waiver, or refinancing will be made based on a review from time to
time of the advisability of particular transactions. There can be no assurance
that an amendment, further waiver of existing covenants and other terms, or
refinancing will be entered into by April 10, 2001. The failure to obtain such
an amendment, further waiver or debt refinancing would likely result in
violation of existing covenants and compliance with other terms, which would
permit the bank lenders to accelerate the maturity of all outstanding borrowings
under the Credit Facility, which would likely have a material adverse effect on
the Company.

By letter dated June 17, 1998, the staff of the Division of Enforcement of the
Securities and Exchange Commission ("SEC") advised the Company that it was
conducting an informal inquiry into the Company 's accounting policies and
procedures and requested that the Company produce documents. On July 2, 1998,
the SEC issued a Formal Order of Private Investigation, designating officers to
take testimony and pursuant to which a subpoena was served on the Company
requiring the production of documents. On November 4, 1998, the Company received
another SEC subpoena requiring the production of additional documents. The
Company has provided numerous documents to the SEC staff and continues to
cooperate with the SEC staff. The Company has, however, declined to provide the
SEC with material that the Company believes is subject to the attorney-client
privilege and the work product immunity. The SEC has not commenced any civil or
administrative proceedings as a result of its investigations and the Company
cannot predict at this time whether the SEC will seek to impose any monetary or
other penalties against the Company. Under these circumstances, the Company
cannot estimate the duration of such investigation or its outcome.

                                      -26-
<PAGE>

The Company is involved in significant litigation, including class and
derivative actions, relating to events which led to the restatement of its
consolidated financial statements, the issuance of the M&F warrant, the sale of
the debentures and the employment agreements of Messrs. Dunlap and Kersh. The
Company intends to vigorously defend each of the actions, but cannot predict the
outcome and is not currently able to evaluate the likelihood of the Company's
success in each case or the range of potential loss. However, if the Company
were to lose these suits, the resulting judgments would likely have a material
adverse effect on the Company's financial position, results of operations or
cash flows. Additionally, the Company's insurance carriers, on the one hand, and
the Company on the other, have filed various suits against each other requesting
a declaratory judgment on the validity of the directors' and officers' liability
insurance policies or have advised the Company of their intent to deny coverage
under such policies. The Company is defending these claims and pursuing recovery
from its insurers. See Part 2- Other Information. The Company's failure to
obtain such insurance recoveries following an adverse judgment against the
Company on any of the foregoing actions could have a material adverse effect on
the Company's financial position, results of operations or cash flows.

Amounts accrued for litigation matters represent the anticipated costs (damages
and/or settlement amounts) in connection with pending litigation and claims and
related anticipated legal fees for defending such actions. The costs are accrued
when it is both probable that an asset has been impaired or a liability has been
incurred and the amount can be reasonably estimated. The accruals are based upon
the Company's assessment, after consultation with counsel, of probable loss
based on the facts and circumstances of each case, the legal issues involved,
the nature of the claim made, the nature of the damages sought and any relevant
information about the plaintiff, and other significant factors which vary by
case. When it is not possible to estimate a specific expected amount of cost to
be incurred, the Company evaluates the range of probable loss and records the
minimum end of the range. As of March 31, 2000 the Company had established
accruals for litigation matters of $22.3 million (representing $9.6 million and
$12.7 million for estimated damages or settlement amounts and legal fees,
respectively) and $24.3 million as of December 31, 1999 (representing $9.6
million and $14.7 million for estimated damages or settlements and legal fees,
respectively.) It is anticipated that the $22.3 million accrual will be paid as
follows: $19.5 million in 2000, $2.7 million in 2001 and $0.1 million in 2002.
The Company believes, based on information available to the Company on March 31,
2000, that anticipated probable costs of litigation matters existing as of March
31, 2000 have been adequately reserved, to the extent determinable.

As a consumer goods manufacturer and distributor, the Company faces the constant
risks of product liability and related lawsuits involving claims for substantial
money damages, product recall actions and higher than anticipated rates of
warranty returns or other returns of goods. These claims could result in
liabilities that could have a material adverse effect on the Company's financial
position, results of operations or cash flows. Some of the product lines the
Company acquired in the 1998 acquisitions have increased its exposure to product
liability and related claims.

The Company and its subsidiaries are also involved in various lawsuits from time
to time that the Company considers to be ordinary routine litigation incidental
to its business. In the opinion of the Company, the resolution of these routine
matters, and of certain matters relating to prior operations, individually or in
the aggregate, will not have a material adverse effect on the financial
position, results of operations or cash flows of the Company.

See Note 9 to the Condensed Consolidated Financial Statements.

                                      -27-
<PAGE>

NEW ACCOUNTING STANDARDS

In June 1999, the FASB issued SFAS No. 137, ACCOUNTING FOR DERIVATIVE
INSTRUMENTS AND HEDGING ACTIVITIES-DEFERRAL OF THE EFFECTIVE DATE OF STATEMENT
NO. 133, which delays the effective date of Statement No. 133 to fiscal years
beginning after June 15, 2000. SFAS No. 133 requires the recognition of all
derivatives in the Consolidated Balance Sheets as either assets or liabilities
measured at fair value. The Company will adopt SFAS No. 133 for the 2001 fiscal
year. The Company has not yet determined the impact SFAS No. 133 will have on
its consolidated financial position, results of operations or cash flows.

YEAR 2000 DISCLOSURE

As a result of the Company's readiness planning, systems corrections and testing
as well as the contingency plans that were developed, the Company was adequately
prepared for the impact of Year 2000 on its operations and experienced no major
Year 2000 issues. The Company initiated a global contingency planning effort to
support the Company's critical business operations. Critical sites were
identified worldwide, and local procedures were developed to maintain business
continuity if a Year 2000 issue should have arisen. For example, this included
having identified disaster-recovery facilities, alternative suppliers,
stockpiling critical materials or having a documented manual procedure.
Additionally, the Company established a Year 2000 Command Center to deal with
unexpected Year 2000 issues and possible disruptions as they occurred. The Year
2000 executive team, with worldwide coordination and oversight by the corporate
Project Management Office oversaw these efforts.

THE COSTS TO ADDRESS SUNBEAM'S YEAR 2000 ISSUES

Through March 31, 2000, including costs incurred in 1999 and 1998, the Company
had expended approximately $67 million to address Year 2000 issues of which
approximately 50% was recorded as capital expenditures and the remainder as SG&A
expense. The Company does not expect to incur material additional costs related
to Year 2000.

The $67 million expenditure includes the following categories:

o    uniform international business and accounting system           $47 million

o    localized business system software upgrades and remediation     $9 million

o    Year 2000 readiness assessment and tracking                     $6 million

o    upgrade of personal computers and related software              $5 million

The amount incurred for Year 2000 issues during 1999 of approximately $48
million represented over 50% of the Company's total 1999 budget for information
systems and related support, including Year 2000 costs. A majority of these
costs were incremental expenditures that will not recur in the Year 2000 or
thereafter. Fees and expenses related to third party consultants, who were
involved in the program management office as well as the modification and
replacement of software, represented approximately 75% of the total cost. The
balance of the total cost related primarily to software license fees and new
hardware, but excluded the costs associated with Company employees. The Company
financed these expenditures through operating cash flows or borrowings, as
applicable. A significant portion of these expenditures enhanced the Company's
operating systems in addition to resolving Year 2000 issues.

Because Year 2000 readiness was critical to the business, the Company redeployed
some resources from non-critical system enhancements to address Year 2000
issues. In addition, due to the importance of information technology systems to
the Company's business, management deferred non-critical systems enhancements as
much as possible. These redeployments and deferrals did not have a material
impact on the Company's financial condition, results of operations or cash
flows.

CAUTIONARY STATEMENTS

Certain statements in this Quarterly Report on Form 10-Q may constitute
"forward-looking" statements within the meaning of the Private Securities
Litigation Reform Act of 1995, as the same may be amended from time to time (the
"Act") and in releases made by the SEC. These forward-looking statements involve
known and unknown risks, uncertainties and other


                                      -28-
<PAGE>

factors which may cause the actual results, performance, or achievements of the
Company to be materially different from any future results, performance, or
achievements expressed or implied by such forward-looking statements. Statements
that are not historical fact are forward-looking statements. Forward-looking
statements can be identified by, among other things, the use of forward-looking
language, such as the word "estimate," "project," "intend," "expect," "believe,"
"may," "well," "should," "seeks," "plans," "scheduled to," "anticipates," or
"intends," or the negative of these terms or other variations of these terms or
comparable language, or by discussions of strategy or intentions, when used in
connection with the Company, including its management. These forward-looking
statements were based on various factors and were derived utilizing numerous
important assumptions and other important factors that could cause actual
results to differ materially from those in the forward-looking statements. These
cautionary statements are being made pursuant to the Act, with the intention of
obtaining the benefits of the "safe harbor" provisions of the Act. The Company
cautions investors that any forward-looking statements made by the Company are
not guarantees of future performance. Important assumptions and other important
factors that could cause actual results to differ materially from those in the
forward-looking statements with respect to the Company include, but are not
limited to, risks associated with:

o        high leverage;

o        the Company's ability to continue to have access to its revolving
         credit facility including the Company's ability to (I) comply with the
         terms of its Credit Facility, including financial covenants, (ii) enter
         into an amendment to its credit agreement containing financial
         covenants which it and its bank lenders find mutually acceptable, or
         (III) continue to obtain waivers from its bank lenders with respect to
         its compliance with the existing covenants contained in the Credit
         Facility;

o        the prices at which the Company is able to sell receivables under its
         trade accounts receivables securitization programs and/or the Company's
         ability to continue to sell receivables under either of such programs;

o        the Company's ability to refinance its indebtedness, including the
         Credit Facility and/or the Debentures, at acceptable rates with
         acceptable other terms;

o        the Company's ability to consummate the sale of Eastpak pursuant to the
         Eastpak Sale Agreement;

o        the Company's ability to consummate the planned sale of certain
         non-core assets and if consummated, the terms of such sales;

o        the Company's ability to continue to have access to foreign working
         capital lines;

o        the Company's ability to fully integrate the recently acquired Coleman,
         Signature Brands and First Alert companies and expenses associated with
         such integration;

o        the Company's sourcing of products from international vendors,
         including the ability to select reliable vendors and to avoid delays in
         shipments;

o        the Company's ability to maintain and increase market share for its
         products at acceptable margins;

o        the Company's ability to successfully introduce new products and to
         provide on-time delivery and a satisfactory level of customer service;

o        changes in domestic and/or foreign laws and regulations, including
         changes in tax laws, accounting standards, environmental laws,
         occupational, health and safety laws;

o        access to foreign markets together with foreign economic conditions,
         including currency fluctuations and trade, monetary and/or tax
         policies;

o        uncertainty as to the effect of competition in existing and potential
         future lines of business;

o        fluctuations in the cost and availability of raw materials and/or
         products;

o        changes in the availability and costs of labor;

                                      -29-
<PAGE>

o        effectiveness of advertising and marketing programs;

o        economic uncertainty in Japan, Korea and other Asian countries, as well
         as in Mexico, Venezuela, and other Latin American countries;

o        product quality, including excess warranty costs;

o        product liability expenses consisting of insurance, litigation fees and
         damages and/or settlement costs, as well as other costs including
         Sunbeam's First Alert subsidiary and costs including legal fees and
         penalties (if any) and lost business and/or goodwill of product
         recalls;

o        weather conditions which can have an unfavorable impact upon sales of
         certain of the Company's products;

o        the numerous lawsuits against the Company and the SEC investigation
         into the Company's accounting practices and policies, and uncertainty
         regarding the Company's available coverage under its directors' and
         officers' liability insurance;

o        the possibility of a recession in the United States or other countries
         resulting in a decrease in consumer demands for the Company's products;

o        actions by competitors including business combinations, new product
         offerings and promotional activities; and

Other factors and assumptions not included in the list above may also cause the
Company's actual results to materially differ from those projected.

                                      -30-
<PAGE>

PART II.   OTHER INFORMATION

ITEM 1.    LITIGATION

On April 23, 1998, two class action lawsuits were filed on behalf of purchasers
of the Company's common stock in the U.S. District Court for the Southern
District of Florida against the Company and some of its present and former
directors and former officers alleging violations of the federal securities laws
as discussed below. After that date, approximately fifteen similar class actions
were filed in the same court. One of the lawsuits also named as defendant Arthur
Andersen LLP ("Arthur Andersen"), the Company's independent accountants for the
period covered by the lawsuit.

On June 16, 1998, the court entered an order consolidating all these suits and
all similar class actions subsequently filed (collectively, the "Consolidated
Federal Actions"). On January 6, 1999, plaintiffs filed a consolidated amended
class action complaint against the Company, some of its present and former
directors and former officers, and Arthur Andersen. The consolidated amended
class action complaint alleges, among other things, that defendants made
material misrepresentations and omissions regarding the Company's business
operations and future prospects in an effort to artificially inflate the price
of the Company's common stock and call options, and that, in violation of
section 20(a) of the Exchange Act, the individual defendants exercised influence
and control over the Company, causing the Company to make material
misrepresentations and omissions. The consolidated amended complaint seeks an
unspecified award of money damages. In February 1999, plaintiffs moved for an
order certifying a class consisting of all persons and entities who purchased
the Company's common stock or who purchased call options or sold put options
with respect to the Company's common stock during the period April 23, 1997
through June 30, 1998, excluding the defendants, their affiliates, and employees
of the Company. Defendants have opposed that motion. In March 1999, all
defendants who had been served with the consolidated amended class action
complaint moved to dismiss it and the court granted the motion only as to
certain non-employee current and former directors and a former officer, and
denied it as to the other defendants. Arthur Andersen has filed counterclaims
against the Company, and a third-party complaint against a director of the
Company and against unnamed third party corporations.

On April 7, 1998, a purported derivative action was filed in the Circuit Court
for the Fifteenth Judicial Circuit in and for Palm Beach County, Florida against
the Company and some of its present and former directors and former officers.
The action alleged that the individual defendants breached their fiduciary
duties and wasted corporate assets when the Company granted stock options in
February 1998 to three of its now former officers and directors. In June 1998,
all defendants filed a motion to dismiss the complaint for failure to make a
pre-suit demand on the Company's board of directors. In February 1999,
plaintiffs filed an amended derivative complaint nominally on behalf of the
Company against some of its present and former directors and former officers and
Arthur Andersen. This amended complaint alleges, among other things, that
Messrs. Dunlap and Kersh, the Company's former Chairman and Chief Executive
Officer and former Chief Financial Officer, respectively, caused the Company to
employ fraudulent accounting procedures in order to enable them to secure new
employment contracts, and seeks a declaration that the individual defendants
have violated fiduciary duties, an injunction against the payment of
compensation to Messrs. Dunlap and Kersh or the imposition of a constructive
trust on such payments, and unspecified money damages. The defendants have each
moved to dismiss the amended complaint in whole or in part.

During 1998, purported class action and derivative lawsuits were filed in the
Court of Chancery of the State of Delaware in New Castle County and in the U.S.
District Court for the Southern District of Florida by stockholders of the
Company against the Company, MacAndrews & Forbes and some of the Company's
present and former directors. These complaints allege, among other things, that
the defendants breached their fiduciary duties when the Company entered into a
settlement agreement with the MacAndrews & Forbes subsidiary that sold the
Company a controlling interest in Coleman. In such settlement agreement, the
MacAndrews & Forbes subsidiary released the Company from threatened claims
arising out of the Company's acquisition of its interest in Coleman, and
MacAndrews & Forbes agreed to provide management support to the Company. Under
the settlement agreement, the MacAndrews & Forbes subsidiary was granted a
warrant expiring August 24, 2003 to purchase up to an additional 23 million
shares of the Company's common stock at an exercise price of $7 per share,
subject to anti-dilution provisions. The derivative actions filed in the
Delaware Court of Chancery were consolidated. The plaintiffs voluntarily
dismissed this action. The action filed in the U.S. District Court for the
Southern District of Florida has been dismissed. In April 2000, a complaint was
filed in the U.S. District Court for the Southern District of Florida against
the Company, certain current and former directors, Messrs. Dunlap and Kersh and
MacAndrews & Forbes alleging, among other things, that certain of the defendants
breached their fiduciary duty when the Company entered into a settlement
agreement with MacAndrews & Forbes, and certain of the defendants breached their
fiduciary duty and wasted corporate assets by, among other things, issuing
materially false and misleading statements regarding the Company's financial
condition. The plaintiff in this action seeks, among other things, recission of
the warrants issued to MacAndrews & Forbes and an injunction preventing the
issuance of warrants and damages.

                                      -31-
<PAGE>
In September 1998, an action was filed in the 56th Judicial District Court of
Galveston County, Texas alleging various claims in violation of the Texas
Securities Act and Texas Business & Commercial Code as well as common law fraud
as a result of the Company's alleged misstatements and omissions regarding the
Company's financial condition and prospects during a period beginning May 1,
1998 and ending June 16, 1998, in which the U.S. National Bank of Galveston,
Kempner Capital Management, Inc. and Legacy Trust Company engaged in
transactions in the Company's common stock on their own behalf and on behalf of
their respective clients. The Company is the only named defendant in this
action. The complaint requests recovery of compensatory damages, punitive
damages and expenses in an unspecified amount. This action was subsequently
transferred to the U.S. District Court for the Southern District of Florida and
consolidated with the Consolidated Federal Actions.

In October 1998, a class action lawsuit was filed in the U.S. District Court for
the Southern District of Florida on behalf of certain purchasers of the
debentures against the Company and certain of the Company's former officers and
directors. In April 1999, a class action lawsuit was filed in the U.S. District
Court for the Southern District of Florida on behalf of persons who purchased
debentures during the period of March 20, 1998 through June 30, 1998, inclusive,
but after the initial offering of such debentures against the Company, Arthur
Andersen, the Company's former auditor, and certain former officers and
directors. The court consolidated the two cases and the plaintiffs have filed a
consolidated class action on behalf of persons who purchased debentures in the
initial offering and in the market during the period March 20, 1998 through June
30, 1998. The amended complaint alleges, among other things, violations of the
federal and state securities laws and common law fraud. The plaintiffs seek,
among other things, either unspecified monetary damages or rescission of their
purchase of the debentures. This action is coordinated with the Consolidated
Federal Actions.

The Company has been named as a defendant in an action filed in the District
Court of Tarrant County, Texas, 48th Judicial District, on November 20, 1998.
The plaintiffs in this action are purchasers of the debentures. The plaintiffs
allege that the Company violated the Texas Securities Act and the Texas Business
& Commercial Code and committed state common law fraud by materially misstating
the financial position of the Company in connection with the offering and sale
of the debentures. The complaint seeks rescission, as well as compensatory and
exemplary damages in an unspecified amount. The Company specially appeared to
assert an objection to the Texas court's exercise of personal jurisdiction over
the Company, and a hearing on this objection took place in April 1999. Following
the hearing, the court entered an order granting the Company's special
appearance and dismissing the case without prejudice. The plaintiffs appealed,
which appeal was denied.

On February 9, 1999, Messrs. Dunlap and Kersh filed with the American
Arbitration Association demands for arbitration of claims under their respective
employment agreements with the Company. Messrs. Dunlap and Kersh are requesting
a finding by the arbitrator that the Company terminated their employment without
cause and that they should be awarded certain benefits based upon their
respective employment agreements. The Company has answered the arbitration
demands of Messrs. Dunlap and Kersh and has filed counterclaims seeking, among
other things, the return of all consideration paid, or to be paid, under the
February 1998 Employment Agreements between the Company and Messrs. Dunlap and
Kersh. An answer was filed by Messrs. Dunlap and Kersh generally denying the
Company's counterclaim. Discovery is pending.

On September 13, 1999, an action naming the Company and Arthur Andersen as
defendants was filed in the Circuit Court for Montgomery County, Alabama. The
plaintiffs in this action are purchasers of the Company's common stock during
the period March 19, 1998 through May 6, 1998. The plaintiffs allege, among
other things, that the defendants violated the Alabama Securities Laws. The
plaintiffs seek compensatory and punitive damages in an unspecified amount.
Arthur Andersen has filed a cross claim against the Company for contribution and
indemnity. The Company has filed a motion to dismiss. In May 2000, the
plaintiffs in this action filed an amended complaint, which added allegations of
violations of the federal securities laws.

The Company intends to vigorously defend each of the foregoing lawsuits, but
cannot predict the outcome and is not currently able to evaluate the likelihood
of the Company's success in each case or the range of potential loss, if any.
However, if the Company were to lose one or more of these lawsuits, judgments
would likely have a material adverse effect on the Company's consolidated
financial position, results of operations or cash flows.

In July 1998, the American Alliance Insurance Company ("American Alliance")
filed suit against the Company in the U.S. District Court for the Southern
District of New York requesting a declaratory judgment of the court that the
directors' and officers' liability insurance policy for excess coverage issued
by American Alliance was invalid and/or had been properly canceled by American
Alliance. As a result of a motion made by the Company, this case has been
transferred to the U.S. District Court for the Southern District of Florida for
coordination and consolidation of pre-trial proceedings with the various actions
pending in that court. In October 1998, an action was filed by Federal Insurance

                                      -32-
<PAGE>

Company ("Federal Insurance") in the U.S. District Court for the Middle District
of Florida requesting the same relief as that requested by American Alliance in
the previously filed action as to additional coverage levels under the Company's
directors' and officers' liability insurance policy. This action has been
transferred to the U.S. District Court for the Southern District of Florida.

Discovery in the cases brought by American Alliance and Federal Insurance is
underway and coordinated with the discovery in the Consolidated Federal Actions.
In December 1998, an action was filed by Executive Risk Indemnity, Inc. in the
Circuit Court of the Seventeenth Judicial Circuit in and for Broward County,
Florida requesting the same relief as that requested by American Alliance and
Federal Insurance in their previously filed actions as to additional coverage
levels under the Company's directors' and officers' liability insurance policy.
In April 1999, the Company filed an action in the U.S. District Court for the
Southern District of Florida against National Union Fire Insurance Company of
Pittsburgh, PA ("National Union"), Gulf Insurance Company ("Gulf") and St. Paul
Mercury Insurance Company ("St. Paul") requesting, among other things, a
declaratory judgment that National Union is not entitled to rescind its
directors' and officers' liability insurance policies to the Company and a
declaratory judgment that the Company is entitled to coverage from these
insurance companies for the various lawsuits described herein under directors'
and officers' liability insurance policies issued by each of the defendants. The
Company has settled its litigation with National Union. In response to the
Company's complaint, defendants St. Paul and Gulf have answered and asserted
counterclaims seeking rescission and declaratory relief that no coverage is
available to the Company. The Company intends to pursue recovery from all of its
insurers if damages are awarded against the Company or its indemnified officers
and/or directors under any of the foregoing actions and to recover attorneys'
fees covered under those policies. The Company's failure to obtain such
insurance recoveries following an adverse judgment in any of the actions
described above could have a material adverse effect on the Company's financial
position, results of operations or cash flows.

By letter dated June 17, 1998, the staff of the Division of Enforcement of the
SEC advised the Company that it was conducting an informal inquiry into the
Company's accounting policies and procedures and requested that the Company
produce certain documents. In July 1998, the SEC issued a Formal Order of
Private Investigation, designating SEC officers to take testimony and pursuant
to which a subpoena was served on the Company requiring the production of
certain documents. In November 1998, another SEC subpoena requiring the
production of additional documents was received by the Company. The Company has
provided numerous documents to the SEC staff and continues to cooperate with the
SEC staff. The Company has, however, declined to provide the SEC with material
that the Company believes is subject to the attorney-client privilege and the
work product immunity. The SEC has not commenced any civil or administrative
proceedings as a result of its investigation, and the Company cannot predict at
this time whether the SEC will seek to impose any monetary or other penalties
against the Company. Under these circumstances, the Company cannot estimate the
duration of the investigation or its outcome.

The Company and its subsidiaries are also involved in various other lawsuits
arising from time to time which the Company considers to be ordinary routine
litigation incidental to its business. In the opinion of the Company, the
resolution of these routine matters, and of certain matters relating to prior
operations, individually or in the aggregate, will not have a material adverse
effect upon the financial position, results of operations or cash flows of the
Company.

Amounts accrued for litigation matters represent the anticipated costs (damages
and/or settlement amounts) in connection with pending litigation and claims and
related anticipated legal fees for defending such actions. The costs are accrued
when it is both probable that an asset has been impaired or a liability has been
incurred and the amount can be reasonably estimated. The accruals are based upon
the Company's assessment, after consultation with counsel, of probable loss
based on the facts and circumstances of each case, the legal issues involved,
the nature of the claim made, the nature of the damages sought and any relevant
information about the plaintiffs and other significant factors which vary by
case. When it is not possible to estimate a specific expected cost to be
incurred, the Company evaluates the range of probable loss and records the
minimum end of the range. As of March 31, 2000, the Company had established
accruals for litigation matters of $22.3 million (representing $9.6 million and
12.7 million for estimated damages or settlement amounts and legal fees,
respectively) and $24.3 million as of December 31, 1999 (representing $9.6
million and $14.7 million for estimated damages or settlement amounts and legal
fees, respectively). It is anticipated that the $22.3 million accrual at March
31, 2000 will be paid as follows: $19.5 million in 2000, $2.7 million in 2001
and $0.1 million in 2002. The Company believes, based on information available
on March 31, 2000, that anticipated probable costs of litigation matters
existing as of March 31, 2000 have been adequately reserved to the extent
determinable.

         PRODUCT LIABILITY

BRK Brands, Inc. and Sunbeam (Canada Limited) are defendants in an alleged class
action lawsuit in Ontario, Canada (the "Canada Action") that claims, among other
things, that the defendants failed to adequately inform consumers of the varying
performance characteristics of smoke detectors utilizing ionization and
photoelectric technology. The alleged class action consists of all consumers in
Ontario, Canada who have purchased ionization detectors manufactured or sold by
the defendants or their predecessors. BRK Brands is also a defendant in two
separate alleged nationwide class action lawsuits in the United States, one in
the United States District Court for the Northern District of Alabama (the
"Alabama Action") and the other in Circuit Court, Twentieth Judicial District,
St. Clair County, Illinois (the "Illinois Action"). The plaintiffs in both the
Alabama Action and the Illinois Action make substantially the same allegations
as in the Canada Action. The defendants and the plaintiffs have entered into a
settlement of the Alabama Action which provides for a nationwide public
information campaign regarding the performance characteristics of ionization and
photoelectric smoke detector technology and also provides for a rebate on the
purchase of dual sensor smoke detectors. The settlement of the Alabama Action is
intended to resolve all similar claims nationwide. The settlement has received
preliminary approval from the U.S. District Court for the Northern District of
Alabama. The defendants intend to vigorously defend the Canada Action and the
Illinois Action, but cannot predict the outcome and is not currently able to
evaluate the likelihood of the defendant's success or the range of potential
loss, if any. However, if the defendants were to lose one of these lawsuits, it
could have a material adverse effect on the defendants' financial position,
results of operations or cash flows.

                                      -33-
<PAGE>

     ITEM 6.    EXHIBITS AND REPORTS ON FORM 8-K

(a)      Exhibits

         EXHIBIT NO.                                       DESCRIPTION
         -----------                                       -----------
             10.1                           Tenth Amendment to Credit Agreement,
                                            dated as of April 14, 2000 among
                                            Sunbeam Corporation ("Sunbeam"), the
                                            Subsidiary Borrowers referred to
                                            therein, the Lenders party thereto,
                                            Morgan Stanley Senior Funding, Inc.,
                                            Bank of America National Trust and
                                            Savings Association and First Union
                                            National Bank.

             10.2                           Employment agreement dated as of
                                            January 3, 2000 between Sunbeam and
                                            Jerry W. Levin.

             10.3                           Employment agreement dated as of
                                            January 3, 2000 between Sunbeam and
                                            Paul E. Shapiro.

             10.4                           Employment agreement dated as of
                                            January 3, 2000 between Sunbeam and
                                            Bobby G. Jenkins.

             27                             Financial Data Schedule submitted
                                            electronically to the Securities
                                            and Exchange Commission for
                                            information only and not filed.

(b)      Report on Form 8-K

         No reports on Form 8-K were filed through March 31, 2000.

                                      -34-
<PAGE>

                                    SIGNATURE

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

                                      SUNBEAM CORPORATION




                                      By:  /s/ BOBBY G. JENKINS
                                      Bobby G. Jenkins
                                      Executive Vice President, and
                                      Chief Financial Officer
                                      (Principal Financial Officer)

                                      Dated: May 12, 2000

                                      -35-


<PAGE>
                                 EXHIBIT INDEX

         EXHIBIT NO.                                       DESCRIPTION
         -----------                                       -----------
             10.1                           Tenth Amendment to Credit Agreement,
                                            dated as of April 14, 2000 among
                                            Sunbeam Corporation ("Sunbeam"), the
                                            Subsidiary Borrowers referred to
                                            therein, the Lenders party thereto,
                                            Morgan Stanley Senior Funding, Inc.,
                                            Bank of America National Trust and
                                            Savings Association and First Union
                                            National Bank.

             10.2                           Employment agreement dated as of
                                            January 3, 2000 between Sunbeam and
                                            Jerry W. Levin.

             10.3                           Employment agreement dated as of
                                            January 3, 2000 between Sunbeam and
                                            Paul E. Shapiro.

             10.4                           Employment agreement dated as of
                                            January 3, 2000 between Sunbeam and
                                            Bobby G. Jenkins.

             27                             Financial Data Schedule submitted
                                            electronically to the Securities
                                            and Exchange Commission for
                                            information only and not filed.