According to the Company’s FORM 10-Q for the period ended September 30, 2002, in May 2001, the shareholder case was settled as to Arthur Andersen and in connection with such settlement Arthur Andersen agreed to pay $110.0 million. In August 2002, the case was settled as to defendants Dunlap, Kersh, Gluck, Uzzi and Fannin. Under the settlement agreements, judgments totaling $220.0 million were entered against these individuals. However only defendants Dunlap and Kersh will be required to fund the judgments, in the amount of $15.0 million and $0.3 million, respectively, while an additional $15.5 million is to be paid from a portion of the proceeds of settlements among the individual defendants and insurance carriers.

As summarized by the same SEC filing, commencing in April 1998, lawsuits were filed on behalf of purchasers of Sunbeam Corporation's common stock against Sunbeam Corporation and some of its present and former directors and former officers, as well as Arthur Andersen LLP ("Arthur Andersen"), Sunbeam Corporation's independent accountants for the period covered by the lawsuits, alleging violations of the federal and state securities laws. The plaintiffs sought an unspecified award of money damages. Commencing October 1998, lawsuits were filed in the U.S. District Court for the Southern District of Florida on behalf of certain purchasers of the Debentures against Sunbeam Corporation, certain of Sunbeam Corporation's former officers and directors and Arthur Andersen, alleging, among other things, violations of federal and state securities laws. The plaintiffs in the debentures actions sought, among other things, either unspecified monetary damages or rescission of their purchase of the Debentures. These lawsuits were consolidated in the U.S. District Court for the Southern District of Florida. As a result of Sunbeam Corporation's Filing, these cases were automatically stayed under the Bankruptcy Code as against Sunbeam Corporation. Under the Sunbeam Corporation Plan, if it is confirmed and becomes effective, the claims of the plaintiffs against Sunbeam Corporation will be discharged and such claimants may potentially share in the $1.0 million provided for unsecured creditors of Sunbeam Corporation (other than holders of Debentures) under the Sunbeam Corporate Plan.

The original complaint alleges that Sunbeam and its CEO violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 by misrepresenting information about business operations, sales and sales trends. The complaint further alleges that the defendants artificially inflated the price of the common stock so that the company could complete millions of dollars of debt financing needed to complete mergers with First Alert Inc., Signature Brands USA Corp., and Coleman Company. The complaint also states that following the tender offers for First Alert and Signature Brands, defendant announced that sale deficiencies and merger costs would reduce earnings below revised estimates issued only two weeks before this announcement; due to this announcement, the company's stock took a significant drop.