As filed with the Securities and Exchange Commission on August __,2000
Registration No. __________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM SB-2
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
SUNRISE ACQUISITIONS, INC.
(Exact name of registrant as specified in its charter)
NEVADA 6770 91-2057992
(State or other juris-(Primary Standard Industrial(I.R.S. Employer
diction incorporationClassification Code Number)Identification Number)
or organization)
(Address, including zip code, and telephone number, including area
code of registrant's principal executive offices and principal place of
business)
EDWARD A. HEIL AND R. BRET JENKINS
SUNRISE ACQUISITIONS, INC.
80 ORVILLE DRIVE #120
BOHEMIA, NEW YORK 11716
(631)244-1454
(Address, including zip code, and telephone number,
including area code of agent for service)
Stephen B. Schneer, Esq.
Stephen B. Schneer LLC
605 Third Avenue
New York, NY 10158
Telephone -972-1100
Facsimile -983-5271
COPIES TO:
Approximate date of proposed sale to the public: As soon as
practicable after the effective date of the registration
statement and date of the prospectus.
If any of the securities being registered on this form are
to be offered on a delayed or continuous basis pursuant to Rule
415 of the Securities Act of 1933, check the following box: [X]
If this form is filed to register additional securities for
an offering pursuant to Rule 462(b) under the Securities Act,
check the following box and list the Securities Act registration
statement number of the earlier effective registration statement
for the same offering. [ ]
If this form is a post-effective amendment filed pursuant to
Rule 462(c) under the Securities Act, check the following box and
list the Securities Act registration statement number of the
earlier effective registration statement for the same offering. [
]
If this form is a post-effective amendment filed pursuant to
Rule 462(d) under the Securities Act, check the following box and
list the Securities Act registration statement number of the
earlier effective registration statement for the same offering.[
]
If delivery of the prospectus is expected to be made
pursuant to Rule 434, check the following box. [ ]
CALCULATION OF REGISTRATION FEE
<TABLE>
<S> <C> <C> <C> <C>
Title of Amount to be Proposed Proposed Amount of
Each Class Registered Maximum Maximum Registrat
of Offering Aggregate ion Fee
Securities Price Per Offering
to be Share Price
Registered
Common 300,000 $6.00 $1,800,000 $475.00
Stock
$.0001 par
value
</TABLE>
The registrant hereby amends this registration statement on
such date or dates as may be necessary to delay its effective
date until the registrant shall file a further amendment which
specifically states that this registration statement shall
thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the registration statement
shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
PROSPECTUS
SUBJECT TO COMPLETION
SUNRISE ACQUISITIONS, INC.
300,000 Shares of Common Stock
$6.00 per share
This prospectus relates to the sale of 300,000 shares of
common stock of Sunrise Acquisitions, Inc. for $6.00 per share
issued to and owned by existing stockholders. This offering
effectively serves as our initial public offering.
All of the shares being registered are to be offered by the
selling stockholders. We will not receive any of the proceeds
from the sale of these shares by the selling stockholders.
Prior to the offering, no public market exists for shares of
our common stock. We cannot guarantee that a trading market in
the shares of our common stock will ever develop. We will try to
have our common stock quoted on the OTC Bulletin Board but may
not be successful.
The selling stockholders have not entered into any
underwriting arrangements. The sale of the shares by the selling
stockholders may occur in one or more transactions that may take
place at a price of $6.00 per share:
on the over-the-counter market, including ordinary broker's
transactions,
as privately negotiated transactions, and
as sales to one or more dealers for transfer of the shares
as principals.
Brokerage fees or commissions may be paid by the selling
stockholders in connection with the sales of the common stock.
The selling stockholders may transfer some or all of the common
stock in exchange for consideration other than cash. This
prospectus may be used by the selling stockholders to transfer
the common stock to affiliates of the selling stockholders.
Neither the Securities and Exchange Commission nor any
state securities commission has approved or disapproved of these
securities or passed upon the accuracy or adequacy of this
prospectus. Any representation to the contrary is a criminal
offense.
These securities are highly speculative, involve a high
degree of risk and should be purchased only by persons who can
afford to lose their entire investment (see "Risk factors" for
special risks concerning us and the offering).
The date of the Prospectus is , 2000.
We have filed a registration statement with the SEC
under the Securities Act in connection with the shares of our
common stock. Our prospectus does not include all of the
information that is included in the registration statement and
the attached exhibits. Statements of the contents of any document
are not necessarily complete. You should be aware that copies of
these documents are contained as exhibits to the registration
statement.
TABLE OF CONTENTS
PROSPECTUS SUMMARY 7
SUMMARY FINANCIAL INFORMATION 7
RISK FACTORS 8
CAPITALIZATION 10
THE COMPANY 10
MANAGEMENT DISCUSSION AND ANALYSIS 20
MANAGEMENT 21
PRINCIPAL STOCKHOLDERS 24
DESCRIPTION OF COMMON STOCK 28
PRINCIPAL AND SELLING SHAREHOLDERS
AND PLAN OF DISTRIBUTION 28
LEGAL PROCEEDINGS 28
EXPERTS 28
DISCLOSURE REGARDING FORWARD-LOOKING
STATEMENTS AND CAUTIONARY STATEMENTS 20
FINANCIAL STATEMENTS 31
Prospectus summary
We were incorporated under the laws of the State of Nevada
on June 13, 2000 as a vehicle to acquire or merge with a
business. Our management believes that our characteristics as a
reporting public shell company will make us an attractive
combination candidate.
We maintain our mailing address at 80 Orville Drive,
Bohemia, New York. Our telephone number is (631) 244-1454.
The Offering
The selling stockholders may sell a total of up to 300,000
shares of our common stock. The shares will be offered at $6.00
per share. In addition, the selling stockholders may, in their
sole discretion, transfer the shares in exchange for
consideration other than cash. The selling stockholders have not
entered into any underwriting arrangements for the sale of the
shares. See "Selling Security Holders and Plan of Distribution."
We will not receive any proceeds from the sale of shares of
our common stock by the selling stockholders.
Common stock
outstanding
after the
Offering 2,000,000 shares
Summary financial information
The following is a summary of our financial information and
is qualified in its entirety by our audited financial statements.
As Of
July 20, 2000
-----------------
<TABLE>
<S> <C> <C>
Balance sheet data:
</TABLE>
<TABLE>
<S> <C> <C>
</TABLE>
<TABLE>
<S> <C> <C>
Total assets $2,500
</TABLE>
<TABLE>
<S> <C> <C>
Stockholders' equity $2,500
</TABLE>
Risk factors
You should carefully consider each of the following risks
and all of the other information contained in this prospectus
before deciding to invest in shares of our common stock. Some of
the following risks relate principally to our business in general
and the industry in which we operate. Other risks relate
principally to the securities markets and ownership of our stock.
If any of the following risks and uncertainties develop into
actual events, our business, financial condition or results of
operations could be materially adversely affected. In that case,
the trading price of our common stock could decline, and you may
lose all or part of your investment.
Our business is subject to the following risks:
We have no operating history or financial resources. If we do not
complete a business combination, we may not be able to finance
our operations.
We have no operating history nor any revenues or earnings
from operations. In addition, we have substantially no tangible
assets or financial resources. We will, in all likelihood, incur
operating expenses without corresponding revenues, at least until
we consummate a business combination. This may result in us
incurring a net operating loss that will increase continuously
until we consummate a business combination with a profitable
business. There is no assurance that we will identify such a
business opportunity or, if we do, be successful in consummating
a merger with it.
Our proposed plan of operation is highly speculative and we do
not have any fulltime employees to carry it out.
We have neither conducted, nor have others made available to
us, results of market research indicating that market demand
exists for the transactions contemplated by us. Moreover, we do
not have, and do not have the resources to establish, a marketing
or planning organization. While we intend to seek business
combination(s) with entities having established operating
histories, there can be no assurance that we will be successful
in locating candidates meeting such criteria. We currently have
no arrangement, agreement or understanding for a possible merger
or acquisition with any entity. We have not identified any
particular industry or specific business within an industry for
evaluation. We have not established any criteria to evaluate
prospective opportunities. It is possible that we may enter into
a business combination with a business opportunity having:
no significant operating history,
losses,
limited or no potential for earnings,
limited assets,
negative net worth, or
other negative characteristics.
While seeking a business combination, our management and
directors anticipate devoting up to ten hours per month to the
our business. We have not entered into any written employment
agreement with any member of management or our board of directors
and are not expected to do so in the foreseeable future.
In the event that we complete a business combination, of
which there can be no assurance, the success of our future
operations will likely be dependent upon management and resources
of the acquired firm or venture partner firm. A business
combination involving the issuance of shares of our common stock
will, in all likelihood, result in shareholders of an acquired
company obtaining a controlling interest in us. It is also likely
that our management may be required to sell or transfer all or a
portion of our common shares held by them or resign.
We are a very minor participant in our proposed market niche and
lack the resources to expand our position in that niche.
We are and will continue to be an insignificant participant
in the business of seeking mergers with and acquisitions of small
private and public entities. A large number of established and
well-financed entities, including venture capital firms, are
active in mergers and acquisitions of companies that may be
desirable target candidates for us. Nearly all of these
competing entities have significantly greater financial
resources, technical expertise and managerial capabilities than
we have. Therefore, we will be at a competitive disadvantage in
identifying possible business opportunities and successfully
completing a business combination.
Current and future members of our management have or are likely
to have conflicts of interest that may not be resolved in our
favor.
All members of our management and board of directors may
serve in similar capacities with other companies, including other
blank check companies. There can be no assurances that they will
refer opportunities to us instead of to other entities.
We may acquire a business in which our promoters, management
or their affiliates own a beneficial interest. In that event,
the transaction may be considered a related party transaction not
at arms-length. No related party transaction is presently
contemplated. If a related party transaction is contemplated
sometime in the future, we do not intend to seek stockholder
approval through a vote of stockholders.
Capitalization
The following table sets forth our capitalization of as of
July 20, 2000
<TABLE>
<S> <C> <C>
Long-term debt $0
</TABLE>
<TABLE>
<S> <C> <C>
</TABLE>
<TABLE>
<S> <C> <C>
Stockholders' equity: $2,500
</TABLE>
<TABLE>
<S> <C> <C>
Common Stock, $.001 par value; $2,000
authorized - 24,000,000 shares;
issued and outstanding
2,000,000 shares
</TABLE>
<TABLE>
<S> <C> <C>
Paid-in capital $500
</TABLE>
<TABLE>
<S> <C> <C>
Total $2,500
</TABLE>
<TABLE>
<S> <C> <C>
</TABLE>
<TABLE>
<S> <C> <C>
Total capitalization $2,500
</TABLE>
The company
Description of the business
We were incorporated on June 13, 2000 in the State of
Nevada, to engage in any lawful corporate undertaking, including,
but not limited to, selected mergers and acquisitions. Our
articles of incorporation authorize us to issue 24,000,000 shares
of common stock at $.001 par value and 1,000,000 shares of
preferred stock at $.001 par value. Each holder of the common
stock shall be entitled to one vote for each share of common
stock held. We may divide the preferred stock into series or
classes upon the approval of a majority vote of our directors.
Blank check company
We have been in the developmental stage since inception and have
had no operations to date. Other than issuing shares to our
shareholders, we have not commenced or undertaken any operational
activities. As such, we can be described as a "shell" company,
whose principal purpose at this time is to locate and consummate
a merger or acquisition with a private entity. Our proposed
business activities also classify us as a "blank check" company.
Transferability of the shares of our common stock is very limited
because many states have enacted regulations restricting or, in
some instances, prohibiting, the initial sale and subsequent
resale of securities of blank check companies such as us. In
addition, many states, while not specifically prohibiting or
restricting blank check companies, will not register our
securities for sale or resale in their states. Because of these
regulations, we currently have no plan to register any of our
securities with any state having these restrictions. To ensure
that state laws are not violated through the resale of our
securities, we will refuse to register the transfer of any of our
securities to residents of any state which prohibits the resale
of securities issued by blank check companies.
Penny stock restrictions
Until our shares of common stock qualify for inclusion in
the Nasdaq system, the trading of our securities, if any, will be
in the over-the-counter markets which are commonly referred to
as the "pink sheets" or on the OTC Bulletin Board. As a result,
an investor may find it difficult to dispose of, or to obtain
accurate quotations as to the price of the securities offered.
Rule 15g-9 establishes the definition of a "penny stock,"
for purposes relevant to us, as any equity security that has a
market price of less than $5.00 per share or with an exercise
price of less than $5.00 per share, subject to a limited number
of exceptions. For any transaction involving a penny stock,
unless exempt, the penny stock rules require that:
a broker or dealer approve a person's account for
transactions in penny stocks; and
the broker or dealer receive from the investor a written
agreement to the transaction setting forth the identity and
quantity of the penny stock to be purchased.
In order to approve a person's account for transactions in penny
stocks, the broker or dealer must:
obtain financial information and investment experience and
objectives of the person; and
make a reasonable determination that the transactions in
penny stocks are suitable for that person and that person
has sufficient knowledge and experience in financial matters
to be capable of evaluating the risks of transactions in
penny stocks.
The broker or dealer must also deliver, prior to any transaction
in a penny stock, a disclosure schedule prepared by the
Commission relating to the penny stock market, which, in
highlight form sets forth:
the basis on which the broker or dealer made the suitability
determination; and
that the broker or dealer received a signed, written
agreement from the investor prior to the transaction.
Disclosure also has to be made about:
the risks of investing in penny stock in both public
offering and in secondary trading, and
commissions payable to both the broker-dealer and the
registered representative, current quotations for the
securities and the rights and remedies available to an
investor in cases of fraud in penny stock transactions.
Finally, monthly statements have to be sent disclosing recent
price information for the penny stock held in the account and
information on the limited market in penny stocks.
In order to continue to be included on NASDAQ, a company must
maintain:
$2,000,000 in net tangible assets, or
$35,000,000 in market capitalization, or
$500,000 of net income in latest fiscal year or two of the
last three fiscal years, a $1,000,000 market value of its
publicly-traded securities and 500,000 shares in public
float.
Continued inclusion requires two market-makers and a minimum bid
price of $1.00 per share.
We intend to seek a transaction with any merger or
acquisition candidate that will allow our securities to be traded
without the penny stock limitations. However, there can be no
assurances that, upon a successful merger or acquisition, our
securities will qualify for listing on NASDAQ or some other
national exchange, or be able to maintain the maintenance
criteria necessary to ensure continued listing.
Other regulatory matters
Although we will be subject to regulation under the
Securities Act of 1933 and the Securities Exchange Act of 1934,
we believe that we will not be subject to regulation under the
Investment Company Act. The regulatory scope of the Investment
Company Act was enacted principally for the purpose of regulatory
vehicles for pooled investments in securities, extends generally
to companies primarily in the business of investing, reinvesting,
owning, holding or trading securities. The Investment Company
Act may, however, also be deemed to be applicable to a company
which does not intend to be characterized as an Investment
Company but which, nevertheless, engages in activities which may
be deemed to be within the definition of the scope of certain
provisions of the Investment Company Act. We believe that our
principal activities will not subject us to regulation under the
Investment Company Act. Nevertheless, there can be no assurances
that we will not be deemed to be an investment company.
Plan of operation
We intend to seek to acquire assets or shares of an
entity that is actively engaged in business and which generates
revenues, in exchange for our securities. We have no particular
acquisition in mind and have not entered into any negotiations
regarding such an acquisition. None of our officers, directors,
promoters or affiliates has entered into any preliminary contact
or discussions on our behalf with any representative of any other
company regarding the possibility of an acquisition or merger as
of the date of this registration statement.
Employees
We have no full time or part time employees. Edward A. Heil
and R. Bret Jenkins have agreed to allocate a small portion of
their time to our activities without compensation. We anticipate
that our business plan can be implemented through the efforts of
Messrs. Jenkins and Heil and consultants engaged on a contingency
basis. Conflicts of interest may arise because of the limited
time commitment by Messrs. Jenkins and Heil and any consultants
who are engaged to assist us to implement our plan.
R. Bret Jenkins and Edward A. Heil, as well as each
consultant who may be engaged, may, in the future, become
involved with other companies that have business purpose similar
to ours. As a result, additional potential conflicts of interest
may arise in the future. If such a conflict does arise and one of
our then officers or directors is presented with a business
opportunity under circumstances where there may be a doubt as to
whether the opportunity should belong to us or another "blank
check" or other company with which they are affiliated, they will
disclose the opportunity to all relevant companies. If a
situation arises in which more than one company desires to merge
with or acquire that target company and the principals of the
proposed target company have no preference, the company which
first had a registration statement declared effective by the
Securities and Exchange Commission will be entitled to proceed
with the proposed transaction.
General plan
Our purpose is to seek, investigate and, if the
investigation warrants, acquire an interest in business
opportunities presented to us by firms that desire to seek the
perceived advantages of an Exchange Act registered corporation.
We will not restrict our search to any specific business,
industry, or geographical location. We may participate in a
business venture of virtually any kind or nature. This
discussion of the proposed business is purposefully general and
is not meant to be restrictive of our virtually unlimited
discretion to search for and enter into potential business
opportunities. We anticipate that we may be able to participate
in only one potential business merger or acquisition because we
have nominal assets and limited financial resources. This lack of
diversification should be considered a substantial risk to our
shareholders because it will not permit us to offset potential
losses from one venture against gains from another.
We may seek a business opportunity with entities that have
recently commenced operations, or more established entities that
wish to utilize the public marketplace in order to raise
additional capital in order to expand into new products or
markets, to develop a new product or service, or for other
corporate purposes. We may acquire assets and establish wholly-
owned subsidiaries in various businesses or acquire existing
businesses as subsidiaries.
We may advertise and promote our efforts in newspapers,
magazines and on the Internet, although we have not yet prepared
any notices or advertisement.
We believe that the selection of a business opportunity in
which to participate will be complex and extremely risky. We also
believe that there are numerous firms seeking the perceived
benefits of a publicly registered corporation. These perceived
benefits may include:
facilitating or improving the terms on which additional
equity financing may be sought,
providing liquidity for incentive stock options or similar
benefits to key employees,
providing liquidity (subject to restrictions of applicable
statutes), for all shareholders, and
other factors.
A combination with us may appear attractive because a merger
candidate may attempt to avoid what it deems to be adverse
consequences of undertaking its own public offering by seeking a
business combination with us. These adverse consequences may
include, but are not limited to:
time delays of the registration process,
significant expenses to be incurred to complete an offering,
loss of voting control to public shareholders, and
the inability to enter into an underwriting agreement on
acceptable terms.
It is possible that available business opportunities may occur in
many different industries and at various stages of development,
all of which will make the task of comparative investigation and
analysis extremely difficult and complex.
We have, and will continue to have, no cash or other assets
to offer or provide to the owners of business opportunities as
part of a merger or acquisition transaction. However, we believe
that we will be able to offer owners of acquisition candidates
the opportunity to acquire a controlling ownership interest in a
publicly registered company without incurring the cost and time
required to conduct an initial public offering. The owners of
the business opportunities will, however, incur significant
legal, accounting and other professional service costs in
connection with this type of acquisition, including the costs of
preparing Form 8-K's, 10-K's or 10-KSB's, agreements and related
reports and documents. Section 13 and 15(d) of the Securities
Exchange Act of 1934 require subject companies to provide
specified information about significant acquisitions, including
certified financial statements for the company acquired, covering
one, two or three years, depending on the relative size of the
acquisition. The time and additional costs that may be incurred
by some target entities to prepare such statements may preclude
consummation of an otherwise desirable acquisition by us.
Acquisition prospects that do not have or are unable to obtain
the required audited financial statements may not be appropriate
for acquisition so long as the reporting requirements of the
Exchange Act are applicable.
We have not conducted market research and are not aware of
statistical data that would support the extent to which private
business owners and entrepreneurs perceive there to be benefits
from a merger or acquisition transaction with a public entity,
although we are aware that numerous transactions of that type
take place each year.
The analysis of new business opportunities will be
undertaken by, or under the supervision of, Messrs. Heil and
Jenkins, who may not be considered professional business
analysts. We intend to concentrate on identifying preliminary
prospective business opportunities that may be brought to our
attention through our present associations. In analyzing
prospective business opportunities, we will consider such matters
as:
available technical, financial and managerial resources;
working capital and other financial requirements;
history of operations, if any;
prospects for the future;
nature of present and expected competition;
quality, experience and depth of management;
potential need for further research, development, or
exploration;
potential for growth or expansion;
the potential for profit;
the perceived public recognition or acceptance of products,
services, or trades;
name identification; and
other relevant factors.
We may not meet personally with management and key personnel of
the business opportunity as part of our investigation because of
the lack of financial resources. To the extent possible, we
intend to utilize written reports and investigation to evaluate
the above factors. We will not acquire or merge with any company
for which audited financial statements cannot be obtained or are
not available.
We believe that we may utilize outside consultants or
advisors to effectuate our business plan. However, if we do
retain the services of an outside consultant or advisor,
substantially all, if not all, of the cash fee earned will need
to be paid by the prospective merger/acquisition candidate, since
we have no cash assets to use for that purpose. We currently have
no contracts or agreements with any outside consultants.
We will not restrict our search for any specific kind
of firms, but may acquire a venture that is:
in its preliminary or development stage,
already in operation, or
in essentially any stage of its corporate life.
It is impossible to predict at this time the status of any
business with which we may become engaged. It is possible that
potential candidates may need to seek additional capital.
However, we do not intend to seek or obtain funds to finance the
operation of any acquired business opportunity until we have
successfully consummated a merger or acquisition with that
entity.
We anticipate that we will incur nominal expenses
implementing our business plan. Because we have no capital with
which to pay these anticipated expenses, it is likely that our
principal shareholders will pay them in the form of interest free
loans.
Implementing the business plan
In designing and implementing a structure for a particular
business acquisition, we may become a party to a:
merger,
consolidation,
reorganization,
joint venture, or
licensing agreement with another corporation or entity.
We may also acquire stock or assets of an existing business.
On the consummation of a transaction, it is probable that our
management and shareholders will not be in control of the
combined company. In addition, our directors may, as part of the
terms of the acquisition transaction, resign and be replaced by
new directors without a vote of our shareholders or may sell
their stock. Any terms of sale of the shares presently held by
our officers and/or directors will not be afforded to all other
shareholders. Any and all sales will only be made in compliance
with the securities laws of the United States and any applicable
state or jurisdiction.
We believe that any securities issued to carry out our
business plan would be issued in reliance upon exemption from
registration available under applicable federal and state
securities laws. In some circumstances, however, as a negotiated
element of a transaction, we may agree to register all or a part
of the newly-issued securities immediately after the transaction
is consummated or at specified times thereafter. If we do
register newly-issued securities, of which there can be no
assurance, the process will be undertaken by the combined entity
after we have successfully consummated a merger or acquisition
and are no longer considered a "shell" company. The issuance of
substantial additional securities and their potential sale into
any trading market that may develop in our securities may have a
depressive effect on the value of our securities in the future.
No assurance can be given, however, that any market for our
securities will ever develop or be maintained.
While the actual terms of a transaction to which we may be a
party cannot be predicted, it may be expected that the parties to
the business transaction will find it desirable to avoid the
creation of a taxable event and thereby structure the acquisition
in a so-called "tax-free" reorganization under Sections 368(a)(1)
or 351 of the Internal Revenue Code. In order to obtain tax-free
treatment under the Code, it may be necessary for the owners of
the acquired business to own 80% or more of the voting stock of
the surviving entity. In that event, our shareholders would
retain less than 20% of the issued and outstanding shares of the
surviving combined entity, which would result in significant
dilution in the equity of those shareholders.
Negotiations with target company management are expected to
focus on the percentage of our equity that the target company's
shareholders would acquire in exchange for all of their
shareholdings in the target company. Depending upon, among other
things, the target company's assets and liabilities, our
shareholders will, in all likelihood, hold a substantially lesser
percentage ownership interest in the combined company following
any merger or acquisition. The percentage ownership may be
subject to significant reduction in the event that we acquire a
target company with substantial assets.
We will participate in a business opportunity only after the
negotiation and execution of appropriate written agreements.
Although the terms of these agreements cannot be predicted,
generally these type of agreements:
require some specific representations and warranties by all
parties,
specify events of default,
detail the terms of closing and the conditions which must be
satisfied by each of the parties prior to and after closing,
outline the manner of bearing costs, including costs
associated with attorneys and accountants,
set forth remedies on default, and
include miscellaneous other deal specific terms.
We do not intend to provide our security holders with a
complete disclosure document, including audited
financial statements, concerning an acquisition or merger
candidate and our business prior to the consummation of any
acquisition or merger transaction, except if required to do so by
appropriate laws or regulations.
Competition
We are and will remain an insignificant participant among
the firms that engage in the acquisition of business
opportunities. There are many established venture capital and
financial concerns that have significantly greater financial and
personnel resources and technical expertise than do we. In view
of our extremely limited financial resources and management
availability, we will continue to be at a significant competitive
disadvantage compared to our competitors.
Property
We currently maintain a mailing address at 80 Orville Drive,
Bohemia, New York. We pay no rent for the use of this mailing
address and do not believe that we will need to maintain an
office at any time in the foreseeable future.
Management's discussion and analysis of results of operations and
financial condition
We have not yet commenced operations.
Liquidity
We do not have any credit facilities or other commitments
for debt or equity. Our plan is to rely on borrowings from
shareholders to fund the needs for operations. No assurances can
be given that advances will be made available to us by
shareholders and others when needed.
New accounting pronouncements
No new pronouncement issued by the Financial Accounting
Standards Board, the American Institute of Certified Public
Accountants or the Securities and Exchange Commission is expected
to have a material impact on our financial position or reported
results of operations.
Forward looking information
This prospectus contains forward-looking statements that
involve risks and uncertainties. These statements relate to:
our future plans;
objectives;
expectations and intentions; and
the assumptions underlying or relating to any of these
statements.
We use words like as "expects," "anticipates," "intends,"
"plans" and similar expressions to identify forward-looking
statements.
Management
Directors and executive officers
Our current directors and executive officers who have served
from the date of our organization are set forth below.
<TABLE>
<S> <C> <C>
Name Age Position
</TABLE>
<TABLE>
<S> <C> <C>
</TABLE>
<TABLE>
<S> <C> <C>
R. Bret Jenkins 41 Co-chairman, co-
president
</TABLE>
<TABLE>
<S> <C> <C>
Edward A. Heil 48 Co-chairman, co-
president
</TABLE>
<TABLE>
<S> <C> <C>
</TABLE>
R. Bret Jenkins is an attorney engaged in limited private
practice since 1997. Mr. Jenkins was a shareholder in the firm
of Brown, Larson, Jenkins and Halliday from 1991 to 1997 and an
associate in the firm of McKay, Burton and Thurman from 1987 to
1991. Mr. Jenkins, who is also the chief financial officer and a
director of eSAFETYWORLD, Inc. He holds Bachelor of Arts
(accounting) and Juris Doctorate degrees from the University of
Utah.
Edward A. Heil is a certified public accountant and a managing
director, since January 1992, in Independent Network Group, Inc.,
a financial consulting firm. During that same period, he has been
a principal of EH Associates, LLC, a financial consulting firm.
From 1984 through December 1991 he was a partner in the
accounting firm, Deloitte & Touche, LLP. From 1973 to 1984 he was
employed in various professional capacities by Deloitte & Touche,
LLP. Mr. Heil holds Bachelor of Arts and Master of business
Administration degrees from New York University. Mr. Heil is also
president and chairman of eSAFETYWORLD, Inc. and a director of
Laminaire Corporation.
All directors hold office until the next annual meeting of
stockholders and the election and qualification of their
successors. Directors receive no compensation for serving on the
board of directors other than reimbursement of reasonable
expenses incurred in attending meetings, if funds are available
to pay those expenses. Officers are elected annually by the
board of directors and serve at the discretion of the board. We
have not entered into employment agreements with our officers.
Executive compensation
No executive officer or director has received any cash
compensation from us since inception for services rendered.
Prior to a business combination, our officers and directors will
receive no salaries for serving as officers or directors, other
than reimbursement for any reasonable accountable business
expenses incurred in connection with our activities. Messrs.
Heil and Jenkins, as well as consultants who may be engaged to
assist us, may be compensated in the form of shares of our common
stock upon completion of an acquisition or merger. It is
possible that this compensation may become a factor in
negotiations and present conflict of interest.
Conflicts of interest
None of our key personnel is required to commit full time to
our affairs and, accordingly, these individuals may have
conflicts of interest in allocating management time among their
various business activities. Certain of these key personnel may
in the future become affiliated with entities, including other
"blank check" companies engaged in business activities similar to
those intended to be conducted by us. In the course of their
other business activities, certain key personnel may become aware
of investment and business opportunities which may be appropriate
for presentation to us, as well as the other entities with which
they are affiliated. As such, they may have conflicts of
interest in determining to which entity a particular business
opportunity should be presented.
Each officer and director is, so long as he is officer or
director subject to the restriction that all opportunities
contemplated by our plan of operation that come to his attention,
either in the performance of his duties or in any other manner,
will be considered opportunities of, and be made available to us
and the companies that he is affiliated with on an equal basis.
A breach of this requirement will be a breach of the fiduciary
duties of the officer or director. If we or the companies to
which the officer or director is affiliated each desire to take
advantage of an opportunity, then the applicable officer or
director would abstain from negotiating and voting upon the
opportunity. However, the officer or director may still take
advantage of opportunities if we should decline to do so. Except
as set forth above, we have not adopted any other conflict of
interest policy in connection with these types of transactions.
There are no agreements or understandings for either Edward
A. Heil or R. Bret Jenkins to resign at the request of another
person. In addition, they are not acting on behalf of or will not
act at the direction of any other person except at the time of
the acquisition or merger and at the request of the controlling
persons of the acquisition or merger candidate. We expects that
the controlling persons of the acquisition or merger candidate
will ask all of the current officers and directors to resign at
the time of the acquisition or merger because they will become
controlling persons of the combined company.
Indemnification of officers and directors
Our bylaws provide that we shall indemnify our officers,
directors, employees and other agents to the fullest extent
permitted by Nevada law. In addition, our certificate of
incorporation provides that, to the fullest extent permitted by
Nevada law, our directors will not be liable for monetary damages
for breach of the directors' fiduciary duty of care to us or our
shareholders. This provision in the certificate of incorporation
does not eliminate the directors' duty of care, and in
appropriate circumstances equitable remedies including as an
injunction or other forms of non-monetary relief would remain
available under Nevada law. Each director will continue to be
liable for breach of the director's duty of loyalty to us or our
shareholders, for acts or omissions not in good faith or
involving intentional misconduct, for knowing violations of law,
for any transaction from which the director derived an improper
personal benefit and for improper distributions to shareholders.
In addition, this provision does not affect a director's
responsibilities under any other laws, including federal
securities laws or state or federal environmental laws.
We have been advised that in the opinion of the SEC, this
type of indemnification is against public policy as expressed in
the Securities Act of 1933 and is, therefore, unenforceable. In
the event that a claim for indemnification against these types of
liabilities, other than the payment by us of expenses incurred or
paid by a director, officer or controlling person in the
successful defense of any action, suitor proceeding, is asserted
by a director, officer or controlling person in connection with
the securities being registered, we will submit the question of
whether indemnification by us is against public policy to an
appropriate court and will be governed by the final adjudication
of the case.
There is no pending litigation or proceeding involving a
director or officer as to which indemnification is or may be
sought.
Stock option plan
We have a stock option plan which expires ten years from
July 15, 2000, the date adopted and enables us to grant incentive
stock options, nonqualified options and stock appreciation rights
for up to an aggregate of 1,500,000 shares of our common stock.
Incentive stock options granted under the plan must conform to
applicable federal income tax regulations and have an exercise
price not less than the fair market value of shares at the date
of grant (110% of fair market value for ten percent or more
stockholders). Other options and SARs may be granted on terms
determined by the board of directors or a committee of the board
of directors. No options or other awards have been granted as of
July 28, 2000.
Principal and selling shareholders and plan of distribution
The following table sets forth information known to us
regarding beneficial ownership of our common stock at the date of
this prospectus by:
each person known by us to own, directly or beneficially,
more than 5% of our common stock,
each of our directors, and
all of our officers and directors as a group.
Except as otherwise indicated, we believe that the
beneficial owners of the common stock listed below, based on
information furnished by the owners, have sole investment and
voting power over to the shares. The table showing the shares of
common stock owned after the offering assumes that the officers
and directors do not buy any shares in the offering.
<TABLE>
<S> <C> <C>
Name and address of Number of shares ownedPercent of shares
beneficial owner owned
</TABLE>
<TABLE>
<S> <C> <C>
</TABLE>
<TABLE>
<S> <C> <C>
R. Bret Jenkins 500,000 25.0
80 Orville Drive
Bohemia, NY 11716
</TABLE>
<TABLE>
<S> <C> <C>
</TABLE>
<TABLE>
<S> <C> <C>
Edward A. Heil 500,000 25.0
80 Orville Drive
Bohemia, NY 11716
</TABLE>
<TABLE>
<S> <C> <C>
</TABLE>
<TABLE>
<S> <C> <C>
Raymond T. Burghard 500,000 25.0
120 Broadway, 28th FloorNew York, NY 10271
</TABLE>
<TABLE>
<S> <C> <C>
</TABLE>
<TABLE>
<S> <C> <C>
All directors and 1,000,000 50.0
officers as a group (2people)
</TABLE>
Description of common stock
General
We are authorized to issue up to 24,000,000 shares of common
stock with par value of $.001. At July 20, 2000 we had 2,000,000
shares of common stock outstanding held by approximately 30
holders of record. The holders of common stock are entitled to
one vote for each share of common stock on all matters on which
the holders of common stock are entitled to vote. The holders of
common stock are entitled to receive ratably dividends when, as
and if declared by our board of directors out of funds legally
available for the payment of dividends. In the event that we
liquidate, dissolve or wind up our business, the holders of
common stock are entitled, subject to the rights of holders of
our preferred stock, if any, to share ratably in all assets
remaining available for distribution after payment of liabilities
and after provision is made for each class of stock having
preference over the common stock.
The holders of common stock have no preemptive or conversion
rights, and we may not subject them to further calls or
assessments. There are no redemption or sinking fund provisions
applicable to the common stock. The outstanding shares of common
stock are fully paid and nonassessable.
We are serving as our own transfer agent and registrar for
our common stock.
Dividends
We have never paid any cash dividends on shares of its
common stock and do not anticipate that we will pay dividends in
the foreseeable future. We intend to apply any earnings to fund
the development of our business. Purchase of shares of common
stock is inappropriate for investors seeking current or near term
income.
Other
We intend to file a Form 2-11 to have our shares of common
stock listed and traded on the Over-the-Counter Electronic
Bulletin Board. We cannot give any assurances as to whether we
will be successful in having our shares listed on the Electronic
Bulletin Board. The selling stockholders and any of their
pledgees, assignees and successors-in-interest may, from time to
time, sell any or all of their shares of common stock on any
stock exchange, market or trading facility on which the shares
become traded or in private transactions. These shares will be
offered at $6.00 per share. The selling stockholders may use any
one or more of the following methods when selling shares:
ordinary brokerage transactions and transactions in which
the broker-dealer solicits purchasers;
block trades in which the broker-dealer will attempt to sell
the shares as agent but may position and resell a portion of
the block as principal to facilitate the transaction;
purchases by a broker-dealer as principal and resale by the
broker-dealer for its account;
an exchange distribution in accordance with the rules of the
applicable exchange;
privately negotiated transactions;
short sales;
broker-dealers may agree with the selling stockholders to
sell a specified number of such shares;
a combination of any of the above methods of sale; or
any other method permitted pursuant to applicable law.
Broker-dealers who act in connection with the sale of the
common stock may also be deemed to be underwriters. Profits on
any resale of the common stock as a principal by such broker-
dealers and any commissions received by the broker-dealers may be
deemed to be underwriting discounts and commissions under the
Securities Act of 1933, as amended.
If required, the following information will be disclosed in a
prospectus supplement or, if necessary, an amendment to the
registration statement:
the names of any of agent, dealer or underwriter;
the number of shares of common stock involved;
any applicable commissions or discounts; and
other facts material to the transaction.
Under applicable rules and regulations under the Securities
Exchange Act of 1934, any person engaged in a distribution of our
common stock may not simultaneously engage in market making
activities for the common stock for a period beginning when such
person becomes a distribution participant and ending upon the
person's completion of participation in a distribution, including
stabilization activities in the common stock to effect covering
transactions, to impose penalty bids or to effect passive market
making bids. In addition and without limiting the foregoing, in
connection with transactions in our common stock, we and the
selling stockholders will be subject to applicable provisions of
the Securities Exchange Act of 1934 and the rules and regulations
issued under this act, including, without limitation, Rule 10b-5
and, insofar as we and the selling stockholders are distribution
participants, Regulation M and Rules 100, 101, 102, 103, 104 and
105 of that act. All of the foregoing may affect the
marketability of our common stock.
The selling stockholders will pay all commissions and other
expenses associated with their sale of our common stock. We are
paying to register the common stock issued hereby.
General market risks
There is no public market for our common stock, and there
can be no assurance that any market will develop in the
foreseeable future. Transfer of our common stock may also be
restricted under the securities or blue sky laws of various
states and foreign jurisdictions. Consequently, investors may
not be able to liquidate their investments and should be prepared
to hold the common stock for an indefinite period of time. Our
proposed trading symbol does not imply that a liquid and active
market will be developed or sustained for our common stock.
The market price for our common stock, if publicly traded,
is likely to be highly volatile and subject to wide fluctuations
in response to factors, many of which are beyond our control,
including the following:
actual or anticipated variations in quarterly operating
results;
changes in financial estimates by securities analysts;
announcements by us or our competitors of significant
acquisitions, strategic partnerships, joint ventures or
capital commitments;
additions or departures of key personnel;
release of lock-up or other transfer restrictions on our
outstanding shares of common stock or sales of additional
shares of common stock; and
potential litigation.
The market prices of the securities of microcap companies
have been especially volatile. Broad market and industry factors
may adversely affect the market price of our common stock,
regardless of our actual operating performance. In the past,
following periods of volatility in the market price of their
stock, many companies have been the subject of securities class
action litigation. A shareholder lawsuit could result in
substantial costs and a diversion of management's attention and
resources and would adversely affect our stock price.
We have 24,000,000 authorized shares of common stock. The
board of directors, without stockholder approval, could issue up
to 22,000,000 shares of common stock upon whatever terms it
determines to whomever it determines, including persons or
entities that would help our present management.
Legal proceedings
We are not involved in any litigation.
Legal matters
The validity of the common stock offered hereby will be
passed upon for us by Stephen B. Schneer, LLC, New York.
Experts
The financial statements as of July 20, 2000 included in
this prospectus have been so included in reliance on the report
of HJ & Associates, LLP independent certified public accountants,
given on the authority of that firm as experts in auditing and
accounting.
Additional information
We will file reports, proxy statements and other information
with the SEC. Those reports, proxy statements and other
information may be obtained:
At the public reference room of the SEC, Room 1024,
Judiciary Plaza, 450 Fifth Street, N.W. Washington, D.C.
20549;
At the public reference facilities at the SEC's regional
offices located at Seven World Trade Center, 13th Floor, New
York, NY 10048 or Northwestern Atrium Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661;
By writing to the SEC, Public Reference Section, Judiciary
Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549;
At the offices of the Nasdaq Stock Market, Reports Section,
1735 K Street, N.W., Washington, D.C. 20549; and
From the Internet site maintained by the SEC at
http://www.sec.gov, which contains reports, proxy
information statements and other information regarding
issuers that file electronically with the SEC.
We have filed with the SEC a registration statement under
the Securities Act of 1933, for the common stock offered in this
prospectus. This prospectus, which is a part of the registration
statement, does not contain all the information included in that
registration statement, some portions of which have been omitted
under the rules and regulations of the SEC. For further
information regarding us and our common stock, please read that
registration statement, including exhibits filed with it, copies
of which may be inspected and copied at the facilities of the
SEC. Copies of the registration statement, including exhibits,
may be obtained from the Public Reference Section of the SEC at
the address listed above upon payment of the fee prescribed by
the SEC. Information regarding the operation of the SEC's public
reference facilities may be obtained by calling the SEC at 1-800-
SEC-0330.
We intend to distribute to our stockholders annual reports
containing financial statements audited and reported upon by our
independent public accountants after the close of each fiscal
year, and will make available other periodic reports as we
determine to be appropriate or as may be required by law. Our
fiscal year ends December 31 each year.
SUNRISE ACQUISITIONS, INC.
(A DEVELOPMENT STAGE COMPANY)
FINANCIAL STATEMENTS
JULY 20, 2000
C O N T E N T S
Independent Auditors= Report . . . . . . . . . . . . . . . F-3
Balance Sheet. . . . . . . . . . . . . . . . . . . . . . . F-4
Statement of Operations. . . . . . . . . . . . . . . . . . F-5
Statement of Net Stockholders= Equity (Deficit). . . . . . F-6
Statement of Cash Flows. . . . . . . . . . . . . . . . . . .F-7
Notes to the Financial Statements. . . . . . . . . . . . . F-8
INDEPENDENT AUDITORS= REPORT
To the Board of Directors
Sunrise Acquisitions, Inc.
(A Development Stage Company)
Bohemia, New York
We have audited the accompanying balance sheet of Sunrise
Acquisitions, Inc. (a development stage company) as of July 20, 2000
and the related statements of operations, net stockholders= deficiency
and cash flows from inception on June 13, 2000 through July 20, 2000.
These financial statements are the responsibility of the Company=s
management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We
believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Sunrise
Acquisitions, Inc. (a development stage company) as of July 20, 2000
and the results of its operations and its cash flows from inception on
June 13, 2000 through July 20, 2000 in conformity with generally
accepted accounting principles.
The accompanying financial statements have been prepared assuming that
the Company will continue as a going concern. As discussed in Note 3
to the financial statements, the Company is a development stage
company with no significant operating revenues to date, which raises
substantial doubt about its ability to continue as a going concern.
Management=s plans in regard to these matters are also described in
Note 3. The financial statements do not include any adjustments that
might result from the outcome of this uncertainty.
/s/
HJ & Associates, LLC
Salt Lake City, Utah
July 28, 2000
F-3
SUNRISE ACQUISITIONS, INC.
(A Development Stage Company)
Balance Sheet
ASSETS
July 20,
2000
CURRENT ASSETS
Cash $ 2,500
TOTAL ASSETS $ 2,500
LIABILITIES AND STOCKHOLDERS= DEFICIENCY
CURRENT LIABILITIES
Accrued expenses $ 15,000
Total Current Liabilities 15,000
STOCKHOLDERS= DEFICIENCY
Preferred stock at $0.001 par value; 1,000,000 shares
authorized, -0- outstanding -
Common stock at $0.001 par value; authorized 24,000,000
shares; 2,000,000 shares issued and outstanding 2,000
Additional paid-in capital 500
Loss incurred during development stage
(15,000)
Net Stockholders= Equity (12,500)
TOTAL LIABILITIES AND STOCKHOLDERS= DEFICIENCY $ 2,500
F-4
SUNRISE ACQUISITIONS, INC.
(A Development Stage Company)
Statement of Operations
From
Inception on
June 13,
2000 Through
July 20,
2000
REVENUE $ -
EXPENSES 15,000
NET LOSS $ (15,000)
BASIC LOSS PER SHARE $(0.01)
F-5
SUNRISE ACQUISITIONS, INC.
(A Development Stage Company)
Statement of Stockholders= Equity (Deficit)
From Inception on June 13, 2000 Through July 20, 2000
Deficit
Accumulated
Additional During the
Common Stock Paid-in Development
Shares Amount Capital Stage
Inception on June
13, 2000 - $- $ - $ -
Common stock
issued for cash
at $0.001 per
share 2,000,000 2,000 500 -
Net loss for
the period ended
July 20, 2000 - - - (15,000)
Balance,
July 20, 2000 2,000,000 $ 2,000 $ 500 $(15,000)
F-6
SUNRISE ACQUISITIONS, INC.
(A Development Stage Company)
Statement of Cash Flows
From
Inception on
June 13,
2000 Through
July 20,
2000
CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss $(15,000)
Changes in operating assets and liabilities:
Increase (decrease) in accrued expenses 15,000
Net Cash (Used) by Operating Activities -
CASH FLOWS FROM INVESTING ACTIVITIES -
CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of common stock for cash 2,500
Net Cash Provided by Financing Activities 2,500
INCREASE IN CASH AND CASH EQUIVALENTS 2,500
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD -
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 2,500
Cash Paid For:
Interest $ -
Income taxes $ -
F-7
SUNRISE ACQUISITIONS, INC.
(A Development Stage Company)
Notes to the Financial Statements
July 20, 2000
NOTE 1 - ORGANIZATION
Sunrise Acquisitions, Inc. (the "Company@) was incorporated
under the laws of the State of Nevada on June 13, 2000
(inception). The Company, which has not yet begun operations,
will look for a business to acquire.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Accounting Method
The Company=s financial statements are prepared using the
accrual method of accounting. The Company has elected a
calendar year end.
b. Provision for Taxes
No provision for income taxes has been made due to the limited
activities of the Company.
c. Cash Equivalents
The Company considers all highly liquid investments with a
maturity of three months or less when purchased to be cash
equivalents.
d. Estimates
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.
e. Basic Loss Per Common Share
Basic loss per common share has been calculated based on the
weighted average number of shares outstanding during the period.
July 20,
2000
Numerator (15,000)
Denominator
F-8
ERROR! MAIN DOCUMENT ONLY.
SUNRISE ACQUISITIONS, INC.
(A Development Stage Company)
Notes to the Financial Statements
July 20, 2000
NOTE 3 - GOING CONCERN
The Company=s financial statements are prepared using
generally accepted accounting principles applicable to a
going concern which contemplates the realization of assets
and liquidation of liabilities in the normal course of
business. The Company has not established revenues
sufficient to cover its operating costs and allow it to
continue as a going concern. In the interim, the shareholder
of the Company have committed to meeting its minimal
operating expenses.
NOTE 4 - STOCK TRANSACTIONS
On June 16, 2000, the Board of Directors issued 2,000,000
shares of common stock for $2,500 to the founding
shareholders of the Company.
The Company has a stock option plan which expires ten
years from July 20, 2000, the date adopted, and enables
it to grant incentive stock options, nonqualified
options and stock appreciation rights for up to an
aggregate of 1,500,000 shares of its common stock.
Incentive stock options granted under the plan must
conform to applicable federal income tax regulations and
have an exercise price not less than the fair market
value of shares at the date of grant (110% of fair
market value for ten percent or more stockholders).
Other options and SARs may be granted on terms
determined by the board of directors or a committee of
the board of directors. No options or other awards have
been granted as of July 29, 2000.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 22. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company has a provision in its charter, by-laws, or
other contracts providing for indemnification of its officers and
directors.
Insofar as indemnification for liabilities arising under
the Securities Act of 1933, as amended, may be permitted to
directors officers and controlling persons of the Company
pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such
liabilities (other than the payment by the Company of expenses
incurred or paid by a director, officer or controlling person of
the registrant in the successful defense of any such action, suit
or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final
adjudication of such issue.
ITEM 23. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Estimated expenses payable by the Registrant in connection
with the registration and distribution of the Common Stock
registered hereby are as follows:
<TABLE>
<S> <C>
SEC Filing fee $ 475
</TABLE>
<TABLE>
<S> <C>
Accounting fees $1,000
</TABLE>
<TABLE>
<S> <C>
Legal and professional 15,000
</TABLE>
<TABLE>
<S> <C>
Other 8,525
</TABLE>
<TABLE>
<S> <C>
</TABLE>
<TABLE>
<S> <C>
Total $25,000
</TABLE>
ITEM 24. RECENT SALES OF UNREGISTERED SECURITIES.
On June 14, 2000, we issued 550,000 shares of Common Stock
each to R. Bret Jenkins and Edward A. Heil, co-Presidents of the
Company, and 500,000 shares of Common Stock to Raymond Burghard
for a total of $1600, which is the par value at $.001 per common
share. We relied on exemption provided by Section 4(2) of the
Securities Act of 1933, as amended, for the issuance of 1,600,000
shares of Common Stock. We also issued 400,000 shares to seven
additional people as founders of the company. The shares were
issued at par value of $.001 per common share. We relied on an
exemption provided by Section 4(2) of the Securities Act of 1933,
as amended, for the issuance of the 400,000 shares to the
founders. All of these shares are "restricted" shares as defined
in Rule 144 under the Securities Act of 1933, as amended. These
shares may not be offered for public sale except under Rule 144,
or otherwise, pursuant to the Act. We are registering all of the
shares given to the founders with this registration statement.
On June 20, 2000, R. Bret Jenkins gifted 50,000 shares of
Common Stock each to 11 individuals. Mr. Jenkins relied on
exemption provided by Section 4(2) of the Securities Act of 1933,
as amended, for the transfer of the 50,000 shares. On June
21,2000 Edward A. Heil gifted 50,000 shares of Common Stock each
to twelve individuals. Mr. Heil relied on exemption provided by
Section 4(2) of the Securities Act of 1933, as amended, for the
transfer of the 50,000 shares. All of these shares are
"restricted" shares as defined in Rule 144 under the Securities
Act of 1933, as amended. These shares may not be offered for
public sale except under Rule 144, or otherwise, pursuant to the
Act. We are registering all of the shares that were gifted to
these people with this registration statement.
ITEM 25. EXHIBITS.
The following exhibits can be found as exhibits to the
filings listed.
<TABLE>
<S> <C>
3.1 Articles of Incorporation
</TABLE>
<TABLE>
<S> <C>
3.2 By-Laws
</TABLE>
<TABLE>
<S> <C>
4.1 Specimen of Certificate of Common Stock
</TABLE>
<TABLE>
<S> <C>
5.1 Opinion of Stephen B. Schneer LLC*
</TABLE>
<TABLE>
<S> <C>
10.7 Stock Option Plan
22.1 Consent of JH Associates, LLP
</TABLE>
<TABLE>
<S> <C>
23.2 Consent of Stephen B. Schneer LLC (included in exhibit
5.1)*
</TABLE>
<TABLE>
<S> <C>
27.1 Financial Data Schedule
</TABLE>
<TABLE>
<S> <C>
* To be filed with an amendment
</TABLE>
ITEM 26. UNDERTAKINGS.
Subject to the terms and conditions of Section 15(d) of
the Securities and Exchange Act of 1934, the undersigned
registrant hereby undertakes to file with the Securities and
Exchange Commission such supplementary and periodic information,
documents and reports as may be prescribed by any rule or
regulation of the Commission hereto before or hereafter duly
adopted pursuant to authority conferred in that section.
The Registrant further undertakes:
(1) To file, during any period in which offers or sales
are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by section
10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or
events arising after the
effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set
forth in the registration statement. Notwithstanding the
foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would
not exceed that which was registered) and any deviation from the
low or high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b). If, in the aggregate, the changes in
volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.
(iii) To include any material information with
respect to the plan of
distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective
amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of
such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-
effective amendment any of the securities being registered which
remain unsold at the termination of the offering.
(4) Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the registrant pursuant to
the foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses incurred or
paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of
1933, the registrant has duly caused this SB-2 Registration
Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in Bohemia, State of New York, on the
_8__th day of August, 2000.
SUNRISE ACQUISITIONS, INC.
By:/s/ Edward A. Heil
Co-President
By:/s/ R. Bret Jenkins
Co-President
Pursuant to the requirements of the Securities Act of
1933, this Registration Statement has been signed below by the
following persons in the capacities and on the date indicated.
SIGNATURE TITLE DATE
--------- ----- -------
/s/ Edward A. Heil Director August 8, 2000
-------------------------------
Edward A. Heil
/s/ R. Bret Jenkins Director August 8, 2000
-------------------------------
R. Bret Jenkins
ARTICLES OF INCORPORATION
OF
SUNRISE ACQUISITIONS, INC.
KNOW ALL BY THESE PRESENTS:
That the undersigned does hereby associate themselves,
desiring to be incorporated as a corporation in accordance with the
laws of the State of Nevada and hereby certify and adopt the
following Articles of Incorporation, the terms whereof have been
agreed upon to be equally obligatory upon the party signing this
instrument and all others who may from time to time hereinafter
become members of this corporation and who may hold stock therein.
ARTICLE I
The name of the corporation is: Sunrise Acquisitions,
Inc.
ARTICLE II
The name and address of the resident agent of the
corporation is:
NEVADA CORPORATE CENTER
2775 Old Highway 40/ Box 1450
Verdi, Nevada 89439
Principal and branch offices may hereinafter be
established at such place or places, either within or without the
State of Nevada, as may from time to time be determined by the
Board of Directors.
ARTICLE III
The nature and purpose of this business shall be to
conduct any lawful activity as governed by the laws of the State of
Nevada.
ARTICLE IV
(a) The Corporation shall be authorized to issue the
following shares:
Class Number of
Shares Par Value
Common 24,000,000 $.001
Preferred 1,000,000 $.001
(b) The designations and the powers, preferences and
rights, and the qualifications and restrictions thereof are as
follows:
(1) The Preferred Shares shall be issued from
time to time in one or more series, with such
distinctive serial designations as shall be stated and
expressed in the resolution or resolutions providing
for the issue of such shares from time to time adopted
by Board of Directors; and in such resolution or
resolutions providing for the issue of shares of each
particular series, the Board of Directors is expressly
authorized to fix the annual rate or rates of dividends
for the particular series; the dividend payment dates
for the particular series and the date from which
dividends on all shares of such series issued prior to
the record date for the first dividend payment date
shall be cumulative; the redemption price or prices for
the particular series; the voting powers for the
particular series, the rights, if any, of holders of
the shares of the particular series to convert the same
into shares of any other series or class or other
securities of the corporation, with any provisions for
the subsequent adjustment of such conversion rights;
and to classify or reclassify any unissued preferred
shares by fixing or altering from time to time any of
the foregoing rights, privileges and qualifications.
(2) All the Preferred shares of any one series
shall be identical with each other in all respects,
except that shares of any one series issued at
different times may differ as to the dates from which
dividends thereon shall be cumulative; and all
Preferred shares shall be of equal rank, regardless or
series, and shall be identical in all respects except
as to the particulars fixed by the Board as hereinabove
provided or as fixed herein.
(c) No holder of any of the shares of any class of the
Corporation shall be entitled as of right to subscribe for,
purchase, or otherwise acquire any shares of any class of the
Corporations which the Corporation proposes to issue or any rights
or options which the Corporation proposes to grant for the purchase
of shares of any class of the Corporation or for the purchase of
any shares, bonds, securities, or obligations of the Corporations
which are convertible into or exchangeable for, or which carry any
rights, to subscribe for, purchase, or otherwise acquire shares of
any class of the Corporation; and any and all of such shares,
bonds, securities, or obligations of the Corporation, whether now
or hereafter authorized or created may be issued, or may be
reissued or transferred if the same have been reacquired and have
treasury status, and any and all of such rights and options may be
granted by the Board of Directors to such persons, firms
corporations, and associations, and for such lawful consideration,
and on such terms, as the Board of Directors in its discretion may
determine, without first offering the same, or any thereof, to any
said holder.
(d) The capital stock of this corporation shall be
nonassessable and shall not be subject to assessment to pay the
debts of the corporation.
ARTICLE V
Members of the governing Board shall be known and styled
as "Directors" and the
number thereof shall be one (1) and may be increased or decreased
from time to time pursuant to the By-Laws.
The name and address of the first Board of Directors is
as follows:
Edward A. Heil
80 Orville Dr. #120
Bohemia, New York 11716
R. Bret Jenkins
80 Orville Dr. #120
Bohemia, New York 11716
The officers of the corporation shall be a President,
Vice President, Secretary, and Treasurer. The corporation may have
such additional officers as may be determined from time to time in
accordance with the By-Laws. The officers shall have the powers,
perform the duties, and be appointed as may be determined in
accordance with the By-Laws and laws of the State of Nevada. Any
person may hold two (2) or more offices in said corporation.
ARTICLE VI
The corporation shall have perpetual succession by its
corporate name and shall have all the powers herein enumerated or
implied herefrom and the powers now provided or which may
hereinafter be provided by law for corporations in the State of
Nevada.
ARTICLE VII
No stockholder shall be liable for the debts of the
corporation beyond the amount which may be due or unpaid upon any
share or shares of stock of said corporation owned by that person.
ARTICLE VIII
Each shareholder entitled to vote at any election for
directors shall have the right to vote, in person or by proxy, the
number of share owned by such shareholder for each director to be
elected. Shareholders shall not be entitled to cumulate their
votes.
ARTICLE IX
The Directors shall have the powers to make and alter
the By-Laws of the corporation. By-Laws made by the Board of
Directors under the powers so conferred may be altered, amended, or
repealed by the Board of Directors or by the stockholders at any
meeting called and held for that purpose.
ARTICLE X
The corporation specifically elects not to be governed
by NRS 78.411 to NRS 78.444 inclusive and successor statutory
provisions.
ARTICLE XI
The corporation shall indemnify all directors, officers,
employees, and agents to the fullest extent permitted by Nevada law
as provided within NRS 78.751 or any other law then in effect or as
it may hereafter be amended.
The corporation shall indemnify each present and future
director, officer, employee, or agent of the corporation who
becomes a party or is threatened to be made a party to any suit or
proceeding, whether pending, completed, or merely threatened, and
whether said suit or proceeding is civil, criminal, administrative,
investigative, or otherwise, except an action by or in the right of
the corporation, by reason of the fact that he is or was a
director, officer, employee, or agent of the corporation, or is or
was serving at the request of the corporation as a director,
officer, employee, or agent of another corporation, partnership,
joint venture, trust, or other enterprise, against expenses,
including but not limited to attorneys= fees, judgments, fines, and
amounts paid in settlement actually and reasonably incurred by him
in connection with the action, suit, or proceeding if he acted in
good faith and in a manner which he reasonably believed to be in or
not opposed to the best interest of the corporation, and, with
respect to any criminal action or proceeding, had no reasonable
cause to believe his conduct was unlawful.
The expenses of directors and officers incurred in
defending a civil or criminal action, suit, or proceeding must be
paid by the corporation as they are incurred and in advance of the
final disposition of the action, suit, or proceeding if and only if
the director or officer undertakes to repay said expenses to the
corporation if it is ultimately determined by a court of competent
jurisdiction that he is not entitled to be indemnified by the
corporation.
The indemnification and advancement of expenses may not
be made to or on behalf of any director or officer if a final
adjudication establishes that the director=s of officer=s acts or
omission involved intentional misconduct, fraud, or a knowing
violation of the law and was material to the cause of action.
ARTICLE XII
The name and address of the incorporator of this
corporation is:
Cammie Warburton
2775 Old Highway 40/Box 1490
Verdi, Nevada 89439
IN WITNESS WHEREOF, the undersigned incorporator has executed
these Articles of Incorporation of Sunrise Acquisitions, Inc.
Cammie Warburton
STATE OF NEVADA )
) ss.
COUNTY OF WASHOE )
On this day of , 2000
before me, a Notary Public in and for said County and State,
personally appeared Cammie Warburton, to me to be the person whose
names is subscribed to the foregoing instrument, and he duly
acknowledged to me that he executed the same.
IN WITNESS WHEREOF, I have hereunto set my hand and
affixed my official seal in said County and State the day and year
in this Certificate first above written.
NOTARY PUBLIC in and for the said
County and State
Exhibit 3.2
BYLAWS
OF
SUNRISE ACQUSITIONS, INC.
ARTICLE I - IDENTIFICATION
1. Name of Corporation: The name of the Corporation is Sunrise
Acquisitions, Inc.
2. Address: The address of the Corporation's registered office
is Nevada Corporate 2775 Old Highway 40/Box 1490 Verdi, Nevada 89439, and the
name of the registered agent at such address is Nevada Corporate Center.
3. Fiscal Year: The fiscal year of the Corporation shall be on a
calendar-year basis commencing on the first day of January, each year, and
ending on the last day of December of the same calendar year.
ARTICLE II - MEETINGS OF SHAREHOLDERS
1. Annual Meeting: The annual meeting of the Stockholders for
the election of Directors and for the transaction of such other business as
may lawfully come before the meeting shall be held during each calendar year
at a reasonable time, date and place to be fixed by the President or Board of
Directors. Failure to hold the annual meeting shall not work a forfeiture or
dissolution of the Corporation.
2. Special Meetings: Special meetings of the Stockholders may be
called for any reasonable time and place by the President, the Board of
Directors or the holders of not less than thirty percent (30%) of all of the
issued and outstanding shares entitled to vote at the meeting.
3. Notice of Shareholders' Meetings: Written or printed notice
stating the place, day and hour of the meeting and, in the case of a special
meeting, the purpose or purposes for which the meeting is called, shall be
given not less than ten (10) nor more than fifty (50) days before the date of
the meeting, either personally or by mail, by or at the direction of the
President, the Secretary or the officer or persons calling the meeting. If
mailed, such notice shall be deemed to be given when deposited in the United
States mail, addressed to the Shareholder at his address as it appears on the
stock transfer books of the Corporation, with postage thereon prepaid.
4. Quorum: At any meeting of the Stockholders, the
representation in person or by proxy of the majority of the capital stock
issued and outstanding on the books of the Corporation shall be necessary to
hold such meeting and such majority shall constitute a Quorum for all
purposes, unless a greater number is required by law. If the holders of the
amount of stock necessary to constitute a Quorum shall fail to attend in
person or by proxy at the time and place fixed by notice as above provided,
for either annual or special meetings, a vote of a majority of the stock
present in person or by proxy may adjourn the meeting, until holders of the
amount of stock requisite to constitute a Quorum shall be present, at which
time any business may be transacted which might have been transacted at the
meeting as originally notified.
5. Voting: The voting shall be oral or by ballot as the meeting
shall determine unless a different vote is required by law. A majority of the
votes cast on any motion shall carry that motion, and in the case of an
election, shall elect the person nominated. Voting by proxy duly given in
writing shall be allowed on all matters, including amendments to the Articles
of Incorporation.
On each matter submitted at the meeting, each Shareholder shall be
entitled to one vote for each share of stock held by him as shown by the books
of the Corporation at the close of business on a day preceding the meeting,
which day shall be fixed by the Board of Directors and which day shall not be
more than fifty (50) nor less than ten (10) days prior to the date of the
meeting.
Treasury shares shall not be voted at any meeting or counted in
determining the total number of outstanding shares at any given time.
A Shareholder may vote either in person or by proxy executed in
writing by the Shareholder or by his duly authorized attorney-in-fact. No
proxy shall be valid after eleven (11) months from the date of its execution,
unless otherwise provided in the proxy.
At each election for Directors, every Shareholder entitled to vote
at such election shall have the right to vote, in person or by proxy, the
number of shares owned by him for as many persons as there are Directors to be
elected and for whose election he has a right to vote. A Stockholder may not
accumulate his votes for one or more Directors.
A Shareholder whose shares are pledged shall be entitled to vote
such shares until the shares have been transferred into the name of the
pledge; thereafter, the pledgee shall be entitled to vote the shares so
transferred.
6. Waiver: Any Stockholder may waive notice of any meeting by
writing, signed by him or his duly authorized attorney, either before or after
the meeting.
7. Informal Action by Stockholders: Any action required to be
taken at a meeting of the Shareholders, or any required to be taken at a
meeting of the Shareholders, or any other action which may be taken at a
meeting of the Shareholders, may be taken without a meeting if a consent in
writing, setting forth the action so taken, shall be signed by all of the
Shareholders entitled to vote with respect to the subject matter thereof.
Failure to comply with the requirements of this paragraph shall
not invalidate any action taken at such meeting.
ARTICLE III - BOARD OF DIRECTORS
1. Number, Term, Election and Authority: The affairs of the
Corporation shall be managed by a Board of not less than two (2) Directors or
more than nine (9) Directors. At the annual meeting of the Shareholders, the
Shareholders shall elect Directors to hold office until the next succeeding
annual meeting. Each Director shall hold office for the term for which he is
elected and until his successor shall have elected and qualified. If for any
reason such Directors shall not be elected at the annual meeting of the
Stockholders which is called and held for that purpose. The number of
Directors may be increased or decreased from time to time by amendment of
these Bylaws. The Directors shall act only as a Board: the individual
Director shall have no power as such.
2. Vacancies: Any vacancy occurring in the Board of Directors
may be filled by the affirmative vote of a majority of the remaining
Directors, though less than a Quorum of the Board of Directors. A Director
elected to fill a vacancy shall be elected for the unexpired term of his
predecessor in office. Any directorship to be filled by reason of an increase
in the number of Directors shall be filled by the Board of Directors, such
appointment to be until the next annual meeting or a special meeting of the
Stockholders called for the purpose of electing a Director to the office so
created. Any directorship to be filled by reason of the removal of one or
more Directors by the Shareholders may be filled by election by the
Shareholders at the meeting at which the Director or Directors are removed.
3. Removal of Directors: One or more Directors or the entire
Board of Directors may be removed, with or with out cause, by a majority vote
of a Quorum of Stockholders at a regular or special meeting of the
Stockholders.
4. Place of Meeting: The Directors may hold their meetings at
the main office of the Corporation, or at such place or places as the Board
from time to time may determine.
5. Special Meetings: Special meetings of the Board of Directors
shall be held whenever called by the Chairman of the Board of Directors, by
the President or by a majority of the Board of Directors at that time in
office. The Chairman of the Board of Directors, President or Secretary shall
give notice of such special meeting by mailing the same at least five (5) days
before the meeting or telegraphing or telephoning the same at least three (3)
days before the meeting to each Director, but such notice may be waived by any
Director. At all meetings of the Board of Directors, each Director present,
whether or not he is acting as Chairman of the meeting, shall have one vote.
Voting by proxy shall not be allowed.
Whenever all Directors entitled to vote at any meeting consent,
either in writing on the records of the meeting, by filing a waiver with the
Secretary, by presence at such meeting, by oral consent entered on the minutes
or by taking part in the deliberation at such meeting without objecting to the
holding of such meeting, then such meeting and the action taken thereat shall
be as valid as if the meeting had been regularly called and noticed.
Furthermore, any business may be transacted at such meeting that could be
transacted at a regularly-called meeting with notice; and if any meeting is
irregular for want of notice or of such consent, the proceedings of such
meeting may be ratified and approved and rendered likewise valid, provided a
Quorum was present at such meeting. However, the irregularity or defect
therein waived by writing shall be signed by all Directors having the right to
vote at such meeting. Any Directors' meeting may be held without notice.
Attendance of a Director at meeting shall constitute a waiver of
notice of such meeting, except where a Director attends a meeting for the
express purpose of objecting to the transaction of any business because the
meeting is not lawfully called or convened. Neither the business to be
transacted at, nor the purpose of, any regular or special meeting of the Board
of Directors need be specified in notice or waiver of notice of such meeting.
6. Quorum: A majority of the Board of Directors in office at the
time shall constitute a Quorum for the transaction of business, but if at any
meeting of the Board there shall be fewer than a Quorum present, a majority of
those present may adjourn the meeting from time to time without notice, other
than by announcement of the meeting, until a Quorum shall be present.
7. Acting Outside Meeting: Any action of a majority of the Board
of Directors, although not at a regularly-called meeting, and the record
thereof as assented to in writing by all of the other members of the Board,
shall always be as valid and effective in all respects as if passed by the
Board in a regular meeting.
8. Designation of Depositories: Such bank or trust company as
the Board may choose from time to time shall be the depository of the money or
securities of the Corporation.
ARTICLE IV - OFFICERS
1. Officers: The officers of the Corporation shall consist of a
Chairman of the Board of Directors, a President, a Vice-President, a Secretary
and a Treasurer, who shall be chosen by the Board of Directors in any
regularly-called Directors' meeting. One person may not hold more than one
office, except the same person may serve as Chairman of the Board and at the
same time act in another official capacity. The same person may hold both
offices of Secretary and Treasurer. The Board of Directors may, in their
discretion, create such other offices and appoint such other officers and
agents as it desires. All officers, agents and employees of the Corporation
shall be subject to removal at any time by the affirmative vote of a majority
of the whole Board of Directors.
2. Powers and Duties of the Chairman of the Board of Directors:
He shall preside at all meetings of Directors and Shareholders of the
Corporation. He may call meetings of the Board of Directors from time to
time. The Chairman shall also perform such other duties as may be assigned to
him by the Board of Directors.
3. Powers and Duties of the President: The President shall be
the chief executive officer of the Corporation. He may sign and execute all
authorized contracts or obligations in the name of the Corporation, with the
Secretary or an Assistant Secretary, may sign all certificates of the shares
of the capital stock of the Corporation. He shall do and perform such other
duties as may from time to time be assigned to him by the Board of Directors.
4. Powers and Duties of the Vice-President: The Vice-President
shall possess the power and may perform the duties of the President in his
absence or disability. The Vice-President shall perform such other duties as
may be from time to time assigned to him by the Board of Directors or
President.
5. Powers and Duties of the Secretary: The Secretary shall keep
the minutes of all meetings of the Board of Directors and of all meetings of
Stockholders. He shall attend to the giving and serving of notices of the
Corporation; he may sign with the President, in the name of the Corporation,
all contracts authorized by the Board of Directors; and when so ordered by the
Board of Directors, he shall affix the seal of the Corporation thereto. The
Secretary shall, with the President or Vice-President sign all certificates of
the shares of the capital stock of the Corporation. He shall do and perform
such other duties as may be assigned from time to time by the Board of
Directors or President.
6. Powers and Duties of the Assistant Secretary: Each Assistant
Secretary, if appointed, shall have such powers and shall perform such duties
as may be assigned to him by the Board of Directors, President or Secretary.
7. Powers and Duties of the Treasurer: The Treasurer shall have
the custody of all funds and securities of the Corporation which may have come
into his hands. When necessary or proper, he shall endorse for collection,
on behalf of the Corporation, checks, notes and other obligations and shall
deposit the same to the credit of the Corporation in such bank or banks or
depository as the Board of Directors may designate. He shall sign all
receipts and vouchers for payments made to the Corporation jointly with such
other officers as may be designated by the Bylaws or by resolution of the
Board of Directors. He shall perform such other acts and duties as may be
assigned to him by the Board of Directors or President.
ARTICLE V - VOTING OF STOCK
Unless otherwise ordered by the Board of Directors, the President
shall have full power and authority in behalf of the Corporation to attend and
to act and to vote at any meeting of the Stockholders of any corporation in
which the Corporation may hold stock, and at any such meeting shall possess
and may exercise any and all of the rights and powers incident to the
ownership of such stock, and which, as the owner thereof, the Corporation may
have possessed and exercised if present. The Board of Directors, by
resolution, may from time to time confer such powers upon any other person or
persons.
ARTICLE VI - CAPITAL STOCK
1. Certificate of Shares: Each holder of stock of the
Corporation shall be entitled to a stock certificate signed by the President
or a Vice-President, and also by the Secretary or and Assistant Secretary,
duly authorized by the Board of Directors to do so.
2. Transfer of Shares: Shares of the capital stock of the
Corporation shall be transferred only on the books of the Corporation at the
instance of the holder thereof in person, or by his attorney, upon surrender
and cancellation of certificates for a like number of shares.
The delivery of a certificate of stock in this Corporation to a
bona fide purchaser or pledgee for value, together with a written transfer of
the same or a written power of attorney to sell, assign and transfer the same,
signed by the owner of the certificate, shall be a sufficient delivery to
transfer the title against all persons except the Corporation, provided all
provisions of the Stock Buy and Sell Agreement in force at the time have been
complied with. No transfer of stock shall be valid against the Corporation
until it shall have been registered upon the books of the Corporation.
The Corporation shall be entitled to treat the holder of record of
any shares as the holder in fact thereof, and accordingly, shall not be bound
to recognize any equitable or other claim to or interest in such hares on the
part of any other person, whether or not it shall have express or other notice
thereof, except as expressly provided by the laws of this state.
ARTICLE VII - DIVIDENDS AND WORKING CAPITAL
1. Dividends: Dividends may be declared by the Board of
Directors from time to time out of the net earnings or from the surplus of its
assets over its liabilities, but not otherwise. When the Directors shall so
determine, dividends may be paid in stock.
2. Working Capital: Before payment of any dividend or making any
distribution of profits, there may be set aside out of the net profits of the
Corporation such sum or sums as the Directors may from time to time in their
discretion think proper as a working capital or as a reserve fund to meet
contingencies and emergencies, and from time to time the Board of Directors
may increase, diminish and vary such working capital or such reserve fund in
its absolute judgment and discretion.
ARTICLE VIII - CHECKS, NOTES AND EVIDENCE OF INDEBTEDNESS
Disbursements shall be made by checks, all of which shall be
signed as determined by the Board of Directors. Bills receivable, drafts and
other evidences of indebtedness tot he corporation shall be endorsed for the
purpose of discount or collection by the President or such other office or
officers of the Corporation as the Board of Directors shall from time to time,
by resolution, designate. No bonds, notes or other evidence of indebtedness
shall be executed by or on behalf of the Corporation unless the Board of
Directors shall expressly authorize the same.
ARTICLE IX - INDEMNIFICATION
The Corporation shall indemnify any person who was or is a party
or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Corporation) by
reason of the fact the he is or was a Director, officer, employee or agent of
the Corporation, or is or was serving at the request of the Corporation as a
Director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually
and reasonably incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the Corporation, and with
respect to any criminal action or proceeding, had no reasonable cause to
believe his conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction or upon a plea of nolo
contendere or its equivalent, shall not, of itself, create a presumption that
the person did not act in good faith and in a manner which he reasonably
believed to be in or not opposed to the best interests of the Corporation, and
with respect to any criminal action or proceeding, had not reasonable cause to
believe that his conduct was unlawful.
ARTICLE X - AMENDMENT
These Bylaws and any other Bylaws may be adopted, amended or
repealed either by the Shareholders or by the Board of Directors, except that:
1. The Board of Directors shall not alter or repeal any Bylaw
which the Stockholders have specifically precluded the Directors from altering
or repealing.
2. No Bylaw shall be adopted by the Directors which shall require
more than a majority of the voting shares for a Quorum at a meeting of
Shareholders, or more than a majority of the votes cast to constitute action
by the Shareholders, except where higher percentages are required by law.
CERTIFICATE OF SECRETARY
I, the undersigned, do hereby certify:
1. That I am the duly elected and acting Secretary of Sunrise
Acquisitions, Inc.; and,
2. That the foregoing Bylaws, comprising nine (9) pages,
constitute the Bylaws of said Corporation as duly adopted at a meeting of the
Board of directors thereof duly held on the 16 day of June, 2000.
_____/s/___________________
R. Bret Jenkins, Secretary
FORM OF COMMON STOCK CERTIFICATE
EXHIBIT 4.1
Number Shares
/---------/ /--------/
Sunrise Acquisitions, Inc.
AUTHORIZED COMMON STOCK: 24,000,000 SHARES
PAR VALUE: $.001
THIS CERTIFIES THAT
---------------------------------------------
IS THE RECORD HOLDER OF
Shares of Sunrise Acquisitions, Inc. Common Stock transferable on the
books of
the Corporation in person or by duly authorized attorney upon surrender of this
Certificate properly endorsed. This Certificate is not valid until countersigned
by the Transfer Agent and registered by the Registrar.
Witness the facsimile seal of the Corporation and the facsimile signatures
of its duly authorized officers.
Dated:
-------------------------- -----------------------------
Secretary President
Sunrise Acquisitions, Inc.
CORPORATE
SEAL
NEVADA
NOTICE: Signature must be guaranteed by a firm which is a member of a
registered national stock exchange, or by a bank (other than a saving
bank), or a trust company. The following abbreviations, when used in
the inscription on the face of this certificate, shall be construed as
though they were written out in full according to applicable laws or
regulations:
TEN COM - as tenants in common unif gift min act-
......Custodian.........
TEN ENT - as tenants by the entireties (Cust (Minor)
JF TEN - as joint tenants with right under Uniform Gifts to
of survivorship and not as Minors Act ...........
tenants in common (State)
Additional abbreviations may also be used though not in the above list
For Value Received, ____________ hereby sell, assign and
transfer unto (Please insert Social Security or Other Identifying Number
of Assignee)
--------------------------------------------------------------------------
(Please print or typewrite name and address, including zip code of Assignee)
--------------------------------------------------------------------------
--------------------------------------------------------------------------
_____________________________________________________________Shares of
the capital stock represented by the within certificate, and do hereby
irrevocably constitute and appoint
____________________________________________________________Attorney
to transfer the said stock on the books of the within named
Corporation with full power of substitution in the premises.
Dated _______________________
------------------------------------------------------------------------------
NOTICE: The signature to this assignment must correspond with the name as
written upon the face of the certificate in every particular without
alteration or enlargement or any change whatever
SUNRISE ACQUISITIONS, INC.
2000 STOCK INCENTIVE PLAN
1. Purpose.
The purpose of this Plan is to enable Sunrise Acquisitions, Inc. and its
affiliates to recruit and retain capable employees for the successful conduct
of its business and to provide an additional incentive to directors, officers
and other eligible key employees, consultants and advisors upon whom rest
major responsibilities for the successful operation and management of the
Company and its affiliates.
2. Definitions.
For purposes of the Plan:
2.1 "Adjusted Fair Market Value" means, in the event of a
Change in Control, the greater of (i) the highest price per Share of Common
Stock paid to holders of the Shares of Common Stock in any transaction (or
series of transactions) constituting or resulting in a Change in Control or
(ii) the highest Fair Market Value of a Share during the ninety (90) day
period ending on the date of a Change in Control.
2.2 "Affiliate Corporation" or "Affiliate" shall mean any
corporation, directly or indirectly, through one of more intermediaries,
controlling, controlled by or under common control with the Company.
2.3 "Agreement" means the written agreement between the
Company and an Optionee evidencing the grant of an Award.
2.4 "Award" means an Incentive Stock Option, Nonqualified
Stock Option or Stock Appreciation Right granted or to be granted pursuant to
the Plan.
2.5 "Board" means the Board of Directors of the Company.
2.6 "Cause" means:
(a) Solely with respect to Nonemployee Directors,
the commission of an act of fraud or an act of embezzlement, misappropriation
or conversion of assets or opportunities of the Company or any Affiliate, and
(b) For all other purposes, unless otherwise defined
in the Agreement evidencing a particular Award, an Optionee (other than a
Nonemployee Director) (i) intentional failure to perform reasonably assigned
duties, (ii) dishonesty or willful misconduct in the performance of duties,
(iii) involvement in a transaction in connection with the performance of
duties to the Company which transaction is adverse to the interests of the
Company and which is engaged in for personal profit, or (iv) willful violation
of any law, rule or regulation in connection with the performance of duties
(other than traffic violations or similar offenses).
2.7 "Change in Capitalization" means any increase or
reduction in the Number of Shares, or any change (including, but not limited
to, a change in value) in the Shares or exchange of Shares for a different
number or kind of shares or other securities of the Company, by reason of a
reclassification, recapitalization, merger, consolidation, reorganization,
spin-off, split-up, issuance of warrants or rights or debentures, stock
dividend, stock split or reverse stock split, combination or exchange of
shares, repurchase of shares, change in corporate structure or otherwise.
2.8 A "Change in Control" shall mean the occurrence during
the term of the Plan of either of any "person" (as such term is used in
Section 13(c) and 14(d) of the Exchange Act), other than a trustee or other
fiduciary holding securities under an employee benefit plan of the Company or
a corporation owned directly or indirectly by the stockholders of the Company,
is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of Securities of the Company
representing 50% or more of the total voting power represented by the
Company's then outstanding voting securities, except that the issuance of
shares of Common Stock in a public offering made pursuant to the Securities
Act of 1933, as amended shall not constitute a Change of Control.
2.9 "Code" means the Internal Revenue Code of 1986, as
amended.
2.10 "Committee" means a committee, as described in Section
3.1, appointed by the Board to administer the Plan and to perform the
functions set forth herein.
2.11 "Company" means Sunrise Acquisitions, Inc (including
any and all subsidiaries currently existing or hereafter acquired or
established).
2.12 "Director Option" means an Option for Shares, Stock
Appreciation Rights or Units granted pursuant to Section 6.
2.13 "Disability" means a physical or mental infirmity
which impairs an Optionee's ability to perform substantially his or her duties
for a period of one hundred eighty (180) consecutive days.
2.14 "Disinterested Director" means a director of the
Company who is "disinterested" within the meaning of Rule 16b-3 under the
Exchange Act.
2.15 "Eligible Individual" means any director (other than a
Nonemployee Director), officer or employee of, or consultant or advisor to,
the Company or an Affiliate who is receiving cash compensation and who is
designated by the Committee as eligible to receive Awards subject to the
conditions set forth herein.
2.16 "Employee Option" means an option granted pursuant to
Section 5.
2.17 "Exchange Act" means the Securities Exchange Act of 1934,
as amended.
2.18 "Fair Market Value" on any date means the average of the
high and low sales prices of the Shares on such date on the principal
securities exchange on which such Shares are listed, or if such Shares are not
so listed or admitted to trading, the arithmetic mean of the per Share closing
bid price and closing asked price per Share on such date as quoted on the
quotation system of the Nasdaq Stock Market, Inc. or such other market in
which such prices are regularly quoted, or, if there have been no published
bid or asked quotations with respect to Shares on such date, the Fair Market
Value as established by the Board in good faith and, in the case of an
Incentive Stock Option, in accordance with Section 422 of the Code.
2.19 "Incentive Stock Option" means an Option satisfying the
requirements of Section 422 of the Code and designated by the Committee as an
Incentive Stock Option.
2.20 "Nonemployee Director" means a director of the Company who
is not an employee of the Company or an Affiliate.
2.21 "Nonqualified Stock Option" means an Option which is not
an Incentive Stock Option.
2.22 "Option" means a Nonqualified Stock Option, an Incentive
Stock Option, a Director Option, an Employee Option or any or all of them.
2.23 "Optionee" means a person to whom an Option is being
granted under the Plan.
2.24 "Outside Director" means a director of the Company who is
an "outside director" within the meaning of Section 162(m) of the Code and the
regulations promulgated thereunder.
2.25 "Parent" means any corporation which is a parent
corporation (within the meaning of Section 424(e) of the Code) with respect to
the Company.
2.26 "Plan" means The SL Group, Inc. 1999 Stock Option Plan.
2.27 "Pooling Transaction" means an acquisition of the Company
in a transaction which is intended to be treated as a "pooling of interests"
under generally accepted accounting principles as defined in Opinion No. 16 of
the Accounting Principles Board and the amendments thereto.
2.28 "Shares" means the common stock, par value $.001 per
share, of the Company and any securities or other consideration issuable in
respect of Shares in connection with a Change in Capitalization or Change in
Control.
2.29 "Stock Appreciation Right" or "SARs" means a right to
receive all or some portion of the increase in the value of the Shares as
provided in Section 8 hereof.
2.30 "Subsidiary" means any corporation which is a
subsidiary corporation (within the meaning of Section 424(f) of the Code) with
respect to the Company.
2.31 "Successor Corporation" means a corporation, or a
parent or subsidiary thereof within the meaning of 424(a) of the Code, which
issues or assumes a stock option in a transaction to which Section 424(a) of
the Code applies.
2.32 "Ten Percent Stockholder" means an Eligible
Individual, who, at the time an Incentive Stock Option is to be granted to him
or her owns (within the meaning of Section 422(b) (6) of the Code) stock
possessing more than ten percent (10%) of the total combined voting power of
all classes of stock of the Company, or of a Parent or a Subsidiary thereof.
3. Administration.
3.1 The Plan shall be administered by the Committee which
shall hold meetings at such times as may be necessary for the proper
administration of the Plan. The Committee shall keep minutes of its meetings.
A quorum shall consist of not fewer than two (2) members of the Committee and
a majority of a quorum may authorize any action. Any decision or
determination reduced to writing and signed by a majority of all of the
members shall be as fully effective as if made by a majority vote at a meeting
duly called and held. The Committee shall consist of at least two (2)
directors of the Company. If the Board of Directors has any Disinterested
Directors or Outside Directors, at least one such Disinterested or Outside
Director shall be on the Committee. No member of the Committee shall be
liable for any action, failure to act, determination or interpretation made in
good faith with respect to this Plan or any transaction hereunder, except for
liability arising from his or her own willful misfeasance, gross negligence or
reckless disregard of his or her duties. The Company hereby agrees to
indemnify each member of the Committee for all costs and expenses and, to the
extent permitted by applicable law, any liability incurred in connection with
defending against, responding to, negotiating for the settlement of or
otherwise dealing with any claim, cause of action or dispute of any kind
arising in connection with any actions in administering this Plan or in
authorizing or denying authorization to any transaction hereunder.
3.2 Subject to the express terms and conditions set forth
herein, the Committee shall have the power from time to time to:
(a) determine those Eligible Individuals to whom Employee
Options shall be granted under the Plan and the number of Employee Options to
be granted and to prescribe the terms and conditions (which need not be
identical) of each such Employee Option, including the purchase price per
Share subject to each Employee Option, and make any amendment or modification
to any Option Agreement consistent with the terms of this Plan;
(b) construe and interpret the Plan and the Options
granted hereunder and to establish, amend and revoke rules and regulations for
the administration of the Plan, including, but not limited to, correcting any
defect or supplying any omission, or reconciling any inconsistency in the Plan
or in any Agreement, in the manner and to the extent it shall deem necessary
or advisable so that the Plan complies with applicable law, including Rule
16b-3 under the Exchange Act and the Code to the extent applicable, and
otherwise to make the Plan fully effective. All decisions and determinations
by the Committee or the exercise of this power shall be final, binding and
conclusive upon the Company, its Affiliate Corporations, the Options, and all
other persons having any interest therein;
(c) determine the duration and purposes for leaves of
absence which may be granted to an Optionee on an individual basis without
constituting a termination of employment or service for purposes of this Plan;
(d) exercise its discretion with respect to the powers
and rights granted to it as set forth in the Plan; and
(e) exercise such powers and perform such acts as it
deems necessary or advisable to promote the best interests of the Company with
respect to the Plan.
4. Stock Subject to the Plan.
4.1 The maximum number of Shares that may be made the subject of
Options granted under the Plan is 1,500,000. Upon a Change in Capitalization
the maximum number of Shares shall be adjusted in number and kind pursuant to
Section 11. The Company shall reserve for purposes of the Plan, out of its
authorized but unissued Shares or out of Shares held in the Company's
treasury, or partly out of each, such number of Shares as shall be determined
by the Board.
4.2 Upon the granting of an Option, the number of Shares
available under Section 4.1 for the granting of further Options shall be
reduced by the number of shares subject to such Option granted. Whenever any
outstanding Option or portion thereof expires, is canceled or is otherwise
terminated for any reason without having been exercised or payment having been
made in respect of the entire Option, the Shares allocable to the expired,
canceled or otherwise terminated portion of the Option may again be the
subject of Options granted hereunder.
5. Option Grants for Eligible Individuals.
5.1 Authority of Committee. Subject to the provisions of the
Plan, the Committee shall have full and final authority to select those
Eligible Individuals who will receive Employee Options, the terms and
conditions of which shall be set forth in an Agreement.
5.2 Purchase Price. The purchase price or the manner in which
the purchase price is to be determined for Shares under each Employee Option
shall be determined by the Committee and set forth in the Agreement;
provided, however, that the purchase price per Share under each Incentive
Stock Option shall not be less than 100% of the Fair Market Value of a Share
on the date the Incentive Stock Option is granted (110% in the case of an
Incentive Stock Option granted to a Ten-Percent Stockholder).
5.3 Maximum Duration. Employee Options granted hereunder shall
be for such term as the Committee shall determine, provided that an Incentive
Stock Option granted hereunder shall not be exercisable after the expiration
of ten (10) years from the date it is granted (five (5) years in the case of
an Incentive Stock Option granted to a Ten-Percent Stockholder), and a
Nonqualified Stock Option shall not be exercisable after the expiration of ten
(10) years from the date it is granted. The Committee may, subsequent to the
granting of any Employee Option, extend the term thereof but in no event shall
the term as so extended exceed the maximum term provided for in the preceding
sentence.
5.4 Vesting. Subject to Section 7.5 hereof, each Employee
Option shall become exercisable in such installments (which need not be equal)
and at such times as may be designated by the Committee and set forth in the
Agreement. To the extent not exercised, installments shall accumulate and be
exercisable, in whole or in part, at any time after becoming exercisable, but
not later than the date the Employee Option expires. The Committee may
accelerate the exercisability of any Option or portion thereof at any time.
5.5 Modification. No modification of an Employee Option
shall adversely alter or impair any rights or obligations under the Employee
Option without the Optionee's consent.
6. Option Grants for Nonemployee Directors.
6.1 Purchase Price. The purchase price for Shares or SARs under
each Director Option shall be not less than to 100% of the Fair Market Value
of such Shares on the date immediately preceding the date of the grant unless
specifically determined to be otherwise by the Committee.
6.2 Vesting. Subject to Sections 6.3 and 7.5 each Director
Option shall become exercisable within four (4) equal annual installments
beginning on the date of grant; provided, however, that the Optionee continues
to serve as a Director as of such dates. If an Optionee ceases to serve as a
Director for any reason, the Optionee shall have no rights with respect to
that portion of a Director Option which has not then vested pursuant to the
preceding sentence and the Optionee shall automatically forfeit that portion
of the Director Option which remains unvested.
6.3 Limitations on Amendment. The provisions in this Section
6 and Section 7.1 shall not be amended more than once every six (6) months,
other than to comport with changes in the Code or the rules and regulations
thereunder.
7. Terms and Conditions Applicable to All Options.
7.1 Duration. Each Option shall terminate on the date which
is the tenth anniversary of the grant date, unless terminated earlier as
follows:
(a) If an Optionee's employment or service terminates for
any reason other than Disability, death or Cause, the Optionee may for a
period of three (3) months after such termination exercise his or her Option
to the extent, and only to the extent, such Option or portion thereof was
vested and exercisable as of the date of the Optionee's employment or service
terminated, after which time the Option shall automatically terminate in full.
(b) If an Optionee's employment or service terminates by
reason of the Optionee's Disability, the Optionee may, for a period of one (1)
year after such termination, exercise his or her Option to the extent, and
only to the extent, such Option or portion thereof was vested and exercisable
as of the date the Optionee's employment or service terminated, after which
time the Option shall automatically terminate in full.
(c) If an Optionee's employment or service terminates for
Cause, the Option granted to the Optionee hereunder shall immediately
terminate in full and no rights thereunder may be exercised.
(d) If an Optionee dies while employed or in the service
of the Company or an Affiliate or within the three (3) month or twelve (12)
month period described in clause (a) or (b), respectively, of this Section 7.1
the Option granted to the Optionee may be exercised at any time within twelve
(12) months after the Optionee's death by the person or persons to whom such
rights under the Option shall pass by will, or by the laws of descent and
distribution, after which time the Option shall terminate in full; provided,
however, that an Option may be exercised to the extent, and only to the
extent, such Option or portion thereof was exercisable on the date of death or
earlier termination of the Optionee's services as a Director.
Notwithstanding clauses (a) through (d) above, the Agreement evidencing the
grant of an Employee Option may, in the Committee's sole and absolute
discretion, set forth additional or different terms and conditions applicable
to Employee Options upon a termination or change in status of the employment
or service of an Eligible Individual. Such terms and conditions may be
determined at the time the Employee Option is granted or thereafter.
7.2 Non-transferability. No Option granted hereunder shall be
transferable by the Optionee to whom granted except by will or the laws of
descent and distribution, and an Option may be exercised during the lifetime
of such Optionee only by the Optionee or his or her guardian or legal
representative. The terms of such Option shall be final, binding and
conclusive upon the beneficiaries, executors, administrators, heirs and
successors of the Optionee.
7.3 Method of Exercise. The exercise of an option shall
be made only by a written notice delivered in person or by mail to the
Secretary or Chief Financial Officer of the Company at the Company's principal
executive office, specifying the number of Shares to be purchased and
accompanied by payment therefor and otherwise in accordance with the Agreement
pursuant to which the Option was granted. The purchase price for any Shares
purchased pursuant to the exercise of an Option shall be paid in full in cash
upon such exercise. Notwithstanding the foregoing, the Committee shall have
discretion to determine at the time of grant of each Employee Option or at any
later date (up to and including the date of exercise) that the form of payment
acceptable in respect of the exercise of such Employee Option may consist of
either of the following (or any combination thereof): (i) cash or (ii) the
transfer of Shares to the Company upon such terms and conditions as determined
by the Committee. The Optionee shall deliver the Agreement evidencing the
Option to the Secretary or Chief Financial Officer of the Company who shall
endorse thereon a notation of such exercise and return such Agreement to the
Optionee. No fractional Shares (or cash in lieu thereof) shall be issued upon
exercise of an Option and the number of Shares that may be purchased upon
exercise shall be rounded to the nearest number of whole Shares.
7.4 Rights of Optionees. No Optionee shall be deemed for any
purpose to be the owner of any Shares subject to any Option unless and until
(i) the Option shall have been exercised pursuant to the terms thereof, (ii)
the Company shall have issued and delivered the Shares to the Optionee and
(iii) the Optionee's name shall have been entered as a stockholder of record
on the books of the Company. Thereupon, the Optionee shall have full voting,
dividend and other ownership rights with respect to such Shares, subject to
such terms and conditions as may be set forth in the applicable Agreement.
7.5 Effect of Change in Control. In the event of a Change in
Control, all Options outstanding on the date of such Change in Control shall
become immediately and fully vested and exercisable. In addition, to the
extent set forth in an Agreement evidencing the grant of an Employee Option,
an Optionee will be permitted to surrender for cancellation within sixty (60)
days after such Change in Control, any Employee Option or portion of an
Employee Option to the extent not yet exercised and the Optionee will be
entitled to receive a cash payment in an amount equal to the excess, if any of
(x) (A) in the case of a Nonqualified Stock Option, the greater of (1) the
Fair Market Value, on the date preceding the date of surrender, of the Shares
subject to the Employee Option or portion thereof surrendered or (2) the
Adjusted Fair Market Value of the Shares subject to the Employee Option or
portion thereof surrendered or (B) in the case of an Incentive Stock Option,
the Fair Market Value, on the date preceding the date of surrender, of the
Shares subject to the Employee Option or portion thereof surrendered, over (y)
the aggregate purchase price for such Shares under the Employee Option or
portion thereof surrendered; provided, however, that in the case of an
Employee Option granted within six (6) months prior to the Change in Control
to any Optionee who may be subject to liability under Section 16(b) of the
Exchange Act, such Optionee shall be entitled to surrender for cancellation
his or her Option during the sixty (60) day period commencing upon the
expiration of six (6) months from the date of grant of any such Employee
Option. In the event an Optionee's employment or service with the Company is
terminated by the Company following a Change in Control, each Option held by
the Optionee that was exercisable as of the date of termination of the
Optionee's employment or service shall remain exercisable for a period ending
not before the earlier of the first anniversary of the termination of the
Optionee's employment or service or the expiration of the stated term of the
Option.
8. Stock Appreciation Rights. The Committee may, in its
discretion, either alone or in connection with the grant of an Employee
Option, grant Stock Appreciation Rights in accordance with the Plan, the terms
and conditions of which shall be set forth in an Agreement. If granted in
connection with an Option, a Stock Appreciation Right shall cover the same
Shares covered by the Option (or such lesser number of Shares as the Committee
may determine) and shall, except as provided in this Section 8, be subject to
the same terms.
8.1 Time of Grant. A Stock Appreciation Right may be
granted (i) at any time if unrelated to an Option, or (ii) if related to an
Option, either at the time of grant, or at any time thereafter during the term
of the Option.
8.2 Stock Appreciation Right Related to an Option.
(a) Exercise. Subject to Section 8.8, a Stock Appreciation
Right granted in connection with an Option shall be exercisable at such time
or times and only to the extent that the related Options are exercisable, and
will not be transferable except to the extent the related Option may be
transferable. A Stock Appreciation Right granted in connection with an
Incentive Stock Option shall be exercisable only if the Fair Market Value of a
Share on the date of exercise exceeds the purchase price specified in the
related Incentive Stock Option Agreement.
(b) Amount Payable. Upon the exercise of a Stock
Appreciation Right related to an Option, the holder shall be entitled to
receive an amount determined by multiplying (A) the excess of the Fair Market
Value of a Share on the date preceding the date of exercise of such Stock
Appreciation Right over the per Share purchase price under the related Option,
by (B) the number of Shares as to which such Stock Appreciation Right is being
exercised. Notwithstanding the foregoing, the Committee may limit, in any
manner, the amount payable with respect to any Stock Appreciation Right by
including such a limit in the Agreement evidencing the Stock Appreciation
Right at the time it is granted.
(c) Treatment of Related Options and Stock Appreciation
Rights Upon Exercise. Upon the exercise of a Stock Appreciation Right
granted in connection with an Option, the Option shall be canceled to the
extent of the number of Shares as to which the Stock Appreciation Right is
exercised, and upon the exercise of an Option granted in connection with a
Stock Appreciation Right or the surrender of such Option pursuant to Section
7.3, the Stock Appreciation Right shall be canceled to the extent of the
number of Shares as to which the Option is exercised or surrendered.
8.3 Stock Appreciation Right Unrelated to an Option.
The Committee may grant to Eligible Individuals Stock Appreciation Rights
unrelated to Options. Stock Appreciation Rights unrelated to Options shall
not have a term of greater than ten (10) years. Upon exercise of a Stock
Appreciation Right unrelated to an Option, the holder shall be entitled to
contain such terms and conditions as to exercisability (subject to Section
8.8), vesting and duration as the Committee shall determine, but, in no event,
shall they have a term of greater than ten (10) years. Upon exercise of a
Stock Appreciation Right unrelated to an Option, the holder shall be entitled
to receive an amount determined by multiplying (A) the excess of the Fair
Market Value of a Share on the date preceding the date of exercise of such
Stock Appreciation Right over the Fair Market Value of a Share on the date the
Stock Appreciation Right was granted, by (B) the number of Shares as to which
the Stock Appreciation Right is being exercised. Notwithstanding the
foregoing, the Committee may limit, in any manner, the amount payable with
respect to any Stock Appreciation Right by including such a limit in the
Agreement evidencing the same Stock Appreciation Right at the time it is
granted.
8.4 Method of Exercise. Stock Appreciation Rights shall be
exercised by a holder only by a written notice delivered in person or by mail
to the Secretary or Chief Financial Officer of the Company at the Company's
principal executive office, specifying the number of Shares with respect to
which the Stock Appreciation Right is being exercised. If requested by the
Committee, the holder shall deliver the Agreement evidencing the Stock
Appreciation Right being exercised and the Agreement evidencing any related
Option to the Secretary or Chief Financial Officer of the Company who shall
endorse thereon a notation of such exercise and return such Agreement to the
holder.
8.5 Form of Payment. Payment of the amount determined under
Sections 8.2(b) or 8.3 may be made in the discretion of the Committee, solely
in whole Shares in a number determined at their Fair Market Value in the date
preceding the date of exercise of the Stock Appreciation Right, or solely in
cash, or in a combination of cash and Shares. If the Committee decides to
make full payment in Shares and the amount payable results in a fractional
Share, payment for the fractional Share will be made in cash. Notwithstanding
the foregoing, no payment in the form of cash may be made upon the exercise of
a Stock Appreciation Right pursuant to Sections 8.2(b) or 8.3 to an officer of
the Company who is subject to liability under Section 16(b) of the Exchange
Act, unless the exercise of such Stock Appreciation Right is made either (i)
during the period beginning on the third business day and ending on the
twelfth business day following the date of release for publication of the
Company's quarterly or annual statements of earnings (the "Window Period") or
(ii) pursuant to an irrevocable election to receive cash made at least six (6)
months prior to the exercise of such Stock Appreciation Right.
8.6 Modification. No modification of an Award shall
adversely alter or impair any rights or obligations under the Agreement
without the holder's consent.
8.7 Effect of Change in Control. In the event of a Change in
Control, all Stock Appreciation Rights shall become immediately and fully
exercisable. In addition, to the extent set forth in an Agreement evidencing
the grant of a Stock Appreciation Right, a holder will be entitled to receive
a payment in cash or stock, in either case, with a value equal to the excess,
if any, of (A) the greater of (x) the Fair Market Value, on the date preceding
the date of exercise, of the underlying Shares subject to the Stock
Appreciation Right or portion thereof exercised and (y) the Adjusted Fair
Market Value, on the date preceding the date of exercise, of the Shared over
(B) the aggregate Fair Market Value, on the date the Stock Appreciation Right
was granted, of the Shares subject to the Stock Appreciation Right or portion
thereof exercised; provided, however, that in the case of a Stock Appreciation
Right granted within six (6) months of the Change in Control to any holder who
may be subject to liability under Section 15(b) of the Exchange Act, such
holder shall be entitled to exercise his or her Stock Appreciation Right
during the sixty (60) day period commencing upon the expiration of six months
from the date of grant of any such Stock Appreciation Right. In the event of
a holder's employment or service with the Company is terminated by the Company
following a Change in Control, each Stock Appreciation Right held by the
holder that was exercisable as of the date of termination of the holder's
employment or service shall remain exercisable for a period ending but not
before the earlier of the first anniversary of the termination of the holder's
employment or service or the expiration of the stated term of the Stock
Appreciation Right.
9. Adjustment Upon Changes n Capitalization.
(a) In the event of a Change in Capitalization, the Committee
shall conclusively determine the appropriate adjustments, if any, to the (i)
maximum number of Shares with respect to which Options may be granted under
the Plan, (ii) maximum number of Shares with respect to which Options may be
granted to any Eligible Individual during the term of the Plan, (iii) the
number of Shares which are subject to outstanding Options granted under the
Plan, and the purchase price therefor, if applicable, and (iv) the number of
Shares in respect of which Director Options are to be granted under Section 6.
(b) Any such adjustment in the Shares subject to Incentive Stock
Options (including any adjustments in the purchase price) shall be made in
such manner as not to constitute a modification as defined by Section
424(h)(3) of the Code and only to the extent otherwise permitted by Sections
422 and 424 of the Code.
(c) If, by reason of a Change of Capitalization, an Optionee
shall be entitled to exercise an Option with respect to new, additional or
different shares of stock, such new, additional or different shares shall
thereupon be subject to all of the conditions, restrictions and performance
criteria which were applicable to the Shares subject to the Option, prior to
such Change in Capitalization.
10. Effect of Certain Transactions. Subject to Sections 7.5 and
8.7 or as otherwise provided in an Agreement, in the event of (i) the
liquidation or dissolution of the Company or (ii) a merger or consolidation of
the Company, the Plan and the Options issued hereunder shall continue in
effect in accordance with their respective terms.
11. Interpretation.
(a) The Plan is intended to comply with Rule 16b-3 promulgated
under the Exchange Act and the Committee shall interpret and administer the
provisions of the Plan or any Agreement in a manner consistent therewith. Any
provisions inconsistent with such Rule shall be inoperative and shall not
affect the validity of the Plan.
(b) The Director Options described in Section 6 are intended to
qualify as formula awards under Rule 16b-3 promulgated under the Exchange Act
(thereby preserving the disinterested status of Nonemployee Directors
receiving such Awards) and the Committee shall generally interpret and
administer the provisions of the Plan or any Agreement in a manner consistent
therewith. Any provisions inconsistent with the foregoing intent shall be
inoperative and shall interpret and administer the provisions of the Plan or
any Agreement in a manner consistent therewith. Any provisions inconsistent
with the foregoing intent shall be inoperative and shall not affect the
validity of the Plan.
(c) Unless otherwise expressly stated in the relevant Agreement,
each Option granted under the Plan is intended to be performance-based
compensation within the meaning of Section 162(m)(4)(C) of the Code. The
Committee shall not be entitled to exercise any discretion otherwise
authorized hereunder with respect to such Options if the ability to exercise
such discretion or the exercise of such discretion itself would cause the
compensation attributable to such Options to fail to qualify as performance-
based compensation.
12. Pooling Transactions.
Notwithstanding anything contained in the Plan or any Agreement
to the contrary, in the event of a Change in Control which is also intended to
constitute a Pooling Transaction, the Committee shall take such actions, if
any, which are specifically recommended by an independent public accounting
firm engaged by the Company to the extent reasonably necessary in order to
assure that the Pooling Transaction will qualify as such, including but not
limited to (i) deferring the vesting, exercise, payment or settlement in
respect of any Option, (ii) providing that the payment or settlement in
respect of any Option be made in the form of cash, Shares or securities of a
successor or acquiree of the Company, or a combination of the foregoing, and
(iii) providing for the extension of term of any Option to the extent
necessary to accommodate the foregoing, but not beyond the maximum term
permitted for any Option.
13. Termination and Amendment of the Plan.
The Plan shall terminate on the preceding the tenth anniversary of
the date of its adoption by the stockholders of the Company, and no Option may
be granted thereafter. Subject to Section 6.5, the Board may sooner terminate
the Plan, and the Board may at any time and from time to time amend, modify or
suspend the Plan; provided, however, that:
(a) No such amendment, modification, suspension or termination
shall impair or adversely alter any Award already granted under the Plan,
except with the consent of the Optionee or holder of an SAR nor shall any
amendment, modification or termination deprive any Optionee or holder of an
SAR of any Shares which he or she may have acquired through or as a result of
the Plan; and
(b) To the extent necessary under Section 16(b) of the Exchange
Act and the rules and regulations promulgated thereunder or other applicable
law, no amendment shall be effective unless approved by the stockholders of
the Company in accordance with applicable law and regulations.
14. Non-Exclusivity of the Plan.
The adoption of the Plan by the Board shall not be construed as
amending, modifying or rescinding any previously approved incentive
arrangement or as creating any limitations on the power of the Board to adopt
such other incentive arrangements as it may deem desirable, including, without
limitation, the granting of stock options otherwise than under the Plan, and
such arrangements may be either applicable generally or only in specific
cases.
15. Limitation of Liability.
As illustrative of the limitations of liability of the Company,
but not intended to be exhaustive thereof, nothing in the Plan shall be
construed to:
(a) give any person any right to be granted an Option
other than at the sole discretion of the Committee;
(b) give any person any rights whatsoever with respect to
Shares except as specifically provided in the Plan;
(c) limit in any way the right of the Company to terminate
the employment of any person at any time; or
(d) be evidence of any agreement or understanding,
expressed or implied, that the Company will employ any person at any
particular rate of compensation or for any particular period of time.
16. Regulations and Other Approvals; Governing Law.
16.1 Except as to matters of Federal law, this Plan and the
rights of all persons claiming hereunder shall be construed and determined in
accordance with the laws of the State of New York.
16.2 The obligation of the Company to sell or deliver Shares
with respect to Options granted under the Plan shall be subject to all
applicable laws, rules and regulations, including all applicable Federal and
state securities laws, and the obtaining of all such approvals by governmental
agencies as may be deemed necessary or appropriate by the Committee.
16.3 The Board may make such changes as may be necessary or
appropriate to comply with the rules and regulations of any government
authority, or to obtain for Eligible Individuals granted Incentive Stock
Options the tax benefits under the applicable provisions of the Code and
regulations promulgated thereunder.
16.4 Each Option is subject to the requirement that, if at any
time the Committee determines, in its discretion, that the listing,
registration or qualification of Shares issuable pursuant to the Plan is
required by any securities exchange or under any state or federal law, or the
consent or approval or any governmental regulatory body is necessary or
desirable as a condition of, or in connection with, the grant of an Option or
the issuance of Shares, no Options shall be granted or payment made or Shares
issued, in whole or in part, unless listing, registration, qualification,
consent or approval has been effected or obtained free of any conditions as
acceptable to the Committee.
16.5 Notwithstanding anything contained in the Plan or any
Agreement to the contrary, in the event that the disposition of Shares
acquired pursuant to the Plan is not covered by a then current registration
statement under the Securities Act of 1933, as amended (the "Securities Act"),
and is not otherwise exempt from such registration, such Shares shall be
restricted against transfer to the extent required by the Securities Act and
Rule 144 or other regulations thereunder. The Committee may require an
individual receiving Shares pursuant to an Award granted under the Plan, as a
condition precedent to receipt of such Shares, to represent and warrant to the
Company in writing that the Shares acquired by such individual are acquired
without a view to any distribution thereof and will not be sold or transferred
other than pursuant to an exemption applicable under the Securities Act as
amended, or the rules and regulations promulgated thereunder. The
certificates evidencing any of such Shares shall be appropriately amended to
reflect their status as restricted securities as aforesaid.
17. Miscellaneous.
17.1 Multiple Agreements. The terms of each Award granted to
an Eligible Individual may differ from other Awards granted under the Plan at
the same time, or at some other time. The Committee may also grant more than
one Award to a given Eligible Individual during the term of the Plan, either
in addition to, or in substitution for, one or more Awards previously granted
to that Eligible Individual.
17.2 Withholding of Taxes.
(a) At such times as an Optionee or holder of an SAR
recognizes taxable income in connection with the receipt of Shares or cash
hereunder (a "Taxable Event"), the Optionee or holder shall pay other amounts
as may be required by law to be withheld by the Company in issuance or release
from escrow of such Shares or the payment of such cash. The Company shall
have the right to deduct from any payment of cash to an Optionee or holder an
amount equal to the Withholding Taxes in satisfaction of the obligation to pay
Withholding Taxes. In satisfaction of the obligation to pay Withholding Taxes
to the Company, the Optionee or holder may make a written election (the "Tax
Election"), which may be accepted or rejected in the discretion of the
Committee to have withheld a portion of the Shares then issuable to him or her
having an aggregate Fair Market Value, on the date preceding the date of such
issuance, equal to the Withholding Taxes, provided that in respect of an
Optionee or holder who may be subject to liability under Section 16(b) of the
Exchange Act either; (i)(A) the Tax Election is made at least six (6) months
prior to the date of the Taxable Event and (B) the Tax Election is irrevocable
with respect to all Taxable Events of a similar nature occurring prior to the
expiration of six (6) months following a revocation of the Tax Election; or
(ii)(A) the Tax Election is made at least six (6) months after the date the
Award was granted, (B) the Award is exercised during the Window Period and (C)
the Tax Election is made during the Window Period in which the related Award
is exercised or prior to such Window Period and subsequent to the immediately
preceding Window Period. Notwithstanding the foregoing, the Committee may, by
the adoption of rules or otherwise, (i) modify this Section 17.2 (other than
as regards Director Options) or impose such other restrictions or limitations
on Tax Elections to be made at such times and subject to such other conditions
as the Committee determines will constitute exempt transactions under Section
16(b) of the Exchange Act.
(b) If an Optionee makes a disposition, within the meaning
of Section 424 (c) of the Code and regulations promulgated thereunder, of any
Share or Shares issued to such Optionee pursuant to the exercise of an
Incentive Stock Option within the two-year period commencing on the day after
the date of the grant or within the one-year period commencing on the day
after the date of transfer of such Share or Shares to the Optionee pursuant to
such exercise, the Optionee shall, within ten (10) days of such disposition,
notify the Company thereof, by delivery of written notice to the Company at
its principal executive office.
17.3 Effective Date. The effective date of the Plan shall be as
determined by the Board, subject only to the approval by the affirmative vote
of the stockholders.
Consent of HJ & Associates, LLC
Exhibit 22.1
HJ & Associates, LLC
Key Bank Tower, Suite 1450
50 South Main Street
Salt Lake City, Utah 84144
Tel. (801) 328-4408
Fax (801) 328-4461
Board of Directors
Sunrise Acquisitions, Inc.
80 Orville Drive
Bohemia, New York 11716
We hereby consent to the use in this Registration Statement of Sunrise
Acquisitions, Inc. on Form SB-2, of our report dated July , 2000 of Sunrise
Acquisitions, Inc. for the period ended July 20, 2000, which are part of the
Registration Statement and to all references to our firm included in this
Registration Statement.
/s/
HJ & Associates LLC
Salt Lake City, Utah
August 8, 2000
August 8, 2000
Salt Lake City, Utah
[LEGEND]
This schedule contains summary financial information extracted
from the Balance Sheet at July 20, 2000 and the Statement of
Operations from inception through July 20, 2000 and is qualified
in its entirety by reference to such financial statements.
[/LEGEND]
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END] DEC-31-2000
[PERIOD-END] JULY-15-2000
[CASH] 0
[SECURITIES] 0
[RECEIVABLES] 0
[ALLOWANCES] 0
[INVENTORY] 0
[CURRENT-ASSETS] 2,500
[PP&E] 0
[DEPRECIATION] 0
[TOTAL-ASSETS] 2,500
[CURRENT-LIABILITIES] 0
[BONDS] 0
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[COMMON] 2,500
[OTHER-SE] 0
[TOTAL-LIABILITY-AND-EQUITY] 2,500
[SALES] 0
[TOTAL-REVENUES] 0
[CGS] 0
[TOTAL-COSTS] 0
[OTHER-EXPENSES] 0
[LOSS-PROVISION] 0
[INTEREST-EXPENSE] 0
[INCOME-PRETAX] 0
[INCOME-TAX] 0
[INCOME-CONTINUING] 0
[DISCONTINUED] 0
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] (15,000)
[EPS-BASIC] 0
