UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Amendment No.__
Under the Securities Exchange Act of 1934
SUNSOURCE INC.
(Name of Issuer)
Common Stock, par value $0.01
(Title of Class of Securities)
867948101000
(CUSIP Number)
Jennifer Marre
Secretary
Lehman Brothers Holdings Inc.
3 World Financial Center, 24th Floor
New York, NY 10285
(212)526-1936
(Name, Address and Telephone Number of Person Authorized to
Receive Notice and Communications)
October 1, 1997
(Date of Event which required Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ].
<PAGE>
CUSIP No.
867948101000
1) Names of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
Lehman Brothers Holdings Inc.
13-3216325
2) Check the Appropriate box if a Member of a Group (see instructions)
(a) [X]
(b) [ ]
3) SEC Use Only
4) Source of Funds (see instructions)
OO
5) Check Box if Disclosure of Legal Proceedings is Required
Pursuant to Items 2(d) or 2(E)
[ ]
6) Citizenship or Place of Organization
Delaware
Number of Shares Beneficially Owned by Each Reporting Person With:
7) Sole Voting Power
2,012,169
8) Shared Voting Power
-0-
9) Sole Dispositive Power
2,012,169
10) Shared Dispositive Power
-0-
11) Aggregate Amount Beneficially Owned by Each Reporting Person
2,012,169
<PAGE>
12) Check if the Aggregate Amount in Row (9) Excludes Certain Shares
[ ]
13) Percent of Class Represented by Amount in Row 9
30.3%
14) Type of Reporting Person
HC/CO
After reasonable inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Dated: October 1, 1997
LEHMAN BROTHERS HOLDINGS INC.
By: /s/ Jennifer Marre
---------------------
Name: Jennifer Marre
Title: Vice President and
Secretary
<PAGE>
CUSIP No.
867948101000
1) Names of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
Lehman Brothers Inc.
13-2518466
2) Check the Appropriate box if a Member of a Group (see instructions)
(a) [X]
(b) [ ]
3) SEC Use Only
4) Source of Funds (see instructions)
OO
5) Check Box if Disclosure of Legal Proceedings is Required
Pursuant to Items 2(d) or 2(E)
[X]
6) Citizenship or Place of Organization
Delaware
Number of Shares Beneficially Owned by Each Reporting Person With:
7) Sole Voting Power
1,447,031
8) Shared Voting Power
-0-
9) Sole Dispositive Power
1,447,031
10) Shared Dispositive Power
-0-
11) Aggregate Amount Beneficially Owned by Each Reporting Person
1,447,031
<PAGE>
12) Check if the Aggregate Amount in Row (9) Excludes Certain Shares
[ ]
13) Percent of Class Represented by Amount in Row 9
22.5%
14) Type of Reporting Person
BD/CO
After reasonable inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Dated: October 1, 1997
LEHMAN BROTHERS INC.
By: /s/ Jennifer Marre
---------------------
Name: Jennifer Marre
Title: Senior Vice President and
Secretary
<PAGE>
CUSIP No.
867948101000
1) Names of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
LB I Group Inc.
13-2741778
2) Check the Appropriate box if a Member of a Group (see instructions)
(a) [X]
(b) [ ]
3) SEC Use Only
4) Source of Funds (see instructions)
OO
5) Check Box if Disclosure of Legal Proceedings is Required
Pursuant to Items 2(d) or 2(E)
[ ]
6) Citizenship or Place of Organization
Delaware
Number of Shares Beneficially Owned by Each Reporting Person With:
7) Sole Voting Power
1,447,031
8) Shared Voting Power
-0-
9) Sole Dispositive Power
1,447,031
10) Shared Dispositive Power
-0-
11) Aggregate Amount Beneficially Owned by Each Reporting Person
1,447,031
<PAGE>
12) Check if the Aggregate Amount in Row (9) Excludes Certain Shares
[ ]
13) Percent of Class Represented by Amount in Row 9
22.5%
14) Type of Reporting Person
HC/CO
After reasonable inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Dated: October 1, 1997
LB I GROUP INC.
By: /s/ Jennifer Marre
---------------------
Name: Jennifer Marre
Title: Secretary
<PAGE>
CUSIP No.
867948101000
1) Names of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
Lehman Brothers Capital Partners I
2) Check the Appropriate box if a Member of a Group (see instructions)
(a) [X]
(b) [ ]
3) SEC Use Only
4) Source of Funds (see instructions)
OO
5) Check Box if Disclosure of Legal Proceedings is Required
Pursuant to Items 2(d) or 2(E)
[ ]
6) Citizenship or Place of Organization
Delaware
Number of Shares Beneficially Owned by Each Reporting Person With:
7) Sole Voting Power
1,447,031
8) Shared Voting Power
-0-
9) Sole Dispositive Power
1,447,031
10) Shared Dispositive Power
-0-
11) Aggregate Amount Beneficially Owned by Each Reporting Person
1,447,031
<PAGE>
12) Check if the Aggregate Amount in Row (9) Excludes Certain Shares
[ ]
13) Percent of Class Represented by Amount in Row 9
22.5%
14) Type of Reporting Person
LP
After reasonable inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Dated: October 1, 1997
LEHMAN BROTHERS CAPITAL PARTNERS I
By: /s/ Jennifer Marre
---------------------
Name: Jennifer Marre
Title: Authorized Signatory
<PAGE>
CUSIP No.
867948101000
1) Names of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
Lehman/SDI Inc.
13-3386604
2) Check the Appropriate box if a Member of a Group (see instructions)
(a) [X]
(b) [ ]
3) SEC Use Only
4) Source of Funds (see instructions)
OO
5) Check Box if Disclosure of Legal Proceedings is Required
Pursuant to Items 2(d) or 2(E)
[ ]
6) Citizenship or Place of Organization
Delaware
Number of Shares Beneficially Owned by Each Reporting Person With:
7) Sole Voting Power
538,000
8) Shared Voting Power
-0-
9) Sole Dispositive Power
538,000
10) Shared Dispositive Power
-0-
11) Aggregate Amount Beneficially Owned by Each Reporting Person
538,000
<PAGE>
12) Check if the Aggregate Amount in Row (9) Excludes Certain Shares
[ ]
13) Percent of Class Represented by Amount in Row 9
8.4%
14) Type of Reporting Person
CO
After reasonable inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Dated: October 1, 1997
LEHMAN/SDI INC.
By: /s/ Jennifer Marre
---------------------
Name: Jennifer Marre
Title: Secretary
<PAGE>
CUSIP No.
867948101000
1) Names of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
Lehman Ltd. I Inc.
13-3429418
2) Check the Appropriate box if a Member of a Group (see instructions)
(a) [X]
(b) [ ]
3) SEC Use Only
4) Source of Funds (see instructions)
OO
5) Check Box if Disclosure of Legal Proceedings is Required
Pursuant to Items 2(d) or 2(E)
[ ]
6) Citizenship or Place of Organization
Delaware
Number of Shares Beneficially Owned by Each Reporting Person With:
7) Sole Voting Power
27,138
8) Shared Voting Power
-0-
9) Sole Dispositive Power
27,138
10) Shared Dispositive Power
-0-
11) Aggregate Amount Beneficially Owned by Each Reporting Person
27,138
<PAGE>
12) Check if the Aggregate Amount in Row (9) Excludes Certain Shares
[ ]
13) Percent of Class Represented by Amount in Row 9
0.4%
14) Type of Reporting Person
CO
After reasonable inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Dated: October 1, 1997
LEHMAN LTD I INC.
By: /s/ Jennifer Marre
---------------------
Name: Jennifer Marre
Title: Secretary
<PAGE>
Schedule 13D
Item 1. Security and Issuer
This statement relates to the Common Stock, par value $0.01 (the "Common
Stock"), of SunSource Inc., a Delaware corporation ("SunSource"). The address of
the principal executive offices of SunSource is 3000 One Logan Square,
Philadelphia, PA 19103.
Item 2. Identity and Background
This statement is filed on behalf of the following entities:
Lehman Brothers Holdings Inc., a Delaware corporation ("Holdings"),
3 World Financial Center
200 Vesey Street
New York, NY 10285
Holdings through its domestic and foreign subsidiaries is a full-line
securities firm and is the parent of Lehman/SDI, Inc. and Lehman Ltd. I Inc.
Lehman Brothers Inc., a Delaware corporation ("LBI"),
3 World Financial Center
200 Vesey Street
New York, NY 10285
LBI is a wholly owned subsidiary of Holdings and is the parent
of LB I Group Inc.
LB I Group Inc., a Delaware corporation, ("LB I Group"),
3 World Financial Center
200 Vesey Street
New York, NY 10285
LB I Group is a wholly owned subsidiary of LBI and is the General
Partner of Lehman Brothers Capital Partners I.
Lehman Brothers Capital Partners I, a Delaware limited partnership
("Capital Partners"),
3 World Financial Center
200 Vesey Street
New York, NY 10285
Capital Partners is a limited partnership.
<PAGE>
Lehman/SDI Inc., a Delaware corporation ("Lehman/SDI"),
3 World Financial Center
200 Vesey Street
New York, NY 10285
Lehman/SDI is a wholly owned subsidiary of Holdings.
Lehman Ltd. I Inc., a Delaware corporation ("Lehman Ltd."),
3 World Financial Center
200 Vesey Street
New York, NY 10285
Lehman Ltd. is a wholly owned subsidiary of Holdings.
The names, residence or business addresses, citizenships and present
principal occupations or employment of the senior executive officers and
directors of the Reporting Persons are set forth in Appendix A hereto.
Neither the Reporting Persons nor to the best knowledge of the Reporting
Persons nor any of the persons listed in Appendix A hereto have during the last
five years (i) been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors) or (ii) except as set forth in Appendix
B attached hereto and incorporated herein by reference has been party to a
civil proceeding of a judicial or administrative body of a competent
jurisdiction and as a result of such proceeding was or is subject to a judgment,
decree or final order enjoining future violations of, or mandating activities
subject to, federal or state securities laws or finding any violation with
respect to such laws.
Item 3. Source of Funds or Other Consideration
See Item 4.
Item 4. Purpose of Transaction
Pursuant to the Agreement and Plan of Conversion, dated as of July 31,
1997, by and among SunSource, SunSource L.P., a Delaware limited
partnership (the "Partnership"), LPSub Inc., a Delaware corporation ("LPSub"),
Lehman/SDI and the limited partners of SDI Partners I, L.P. ("GP Limited
Partners"), the conversion (the "Conversion") of the Partnership to corporate
form was accomplished through a merger (the "Merger") of the Partnership and
LPSub with and into SunSource.
In the Conversion, (i) the outstanding Class A limited partnership
interests were converted into 11.6% Trust Preferred Securities issued by
SunSource Capital Trust and cash, (ii) each of the outstanding Class B limited
partnership interests were converted into 0.25 shares of the Common Stock of
SunSource and (iii) Lehman/SDI which is general partner of SDI Partners I, L.P.,
the general partner of the Partnership (the "General Partner"),
<PAGE>
received common stock of LPSub which was converted into shares of Common Stock
in the Merger in exchange for its interests in the General Partner and the GP
Limited Partners received shares of Common Stock in exchange for their interests
in the General Partner.
Prior to the Conversion, Capital Partners owned 5,788,124 Class B
interests of the Partnership and Lehman Ltd. owned 108,554 Class B interests
of the Partnership. As a result of the Conversion, Capital Partners received
1,447,031 shares of Common Stock and Lehman Ltd. received 27,138 shares of
Common Stock. Lehman/SDI received 538,000 shares of Common Stock. The GP
Limited Partners received shares of Common Stock of which 75,000 shares of the
Common Stock received was placed in escrow to be distributed after two years if
all distributions and required payments in respect of the Trust 11.6% Preferred
Securities have been made.
SunSource, LB I Group, Lehman Ltd., Lehman/SDI, Capital Partners and
the Senior Executives entered into a Registration Rights Agreement, dated as of
July 31, 1997, granting the parties certain rights to have the shares of
SunSource Common Stock acquired in the Conversion registered for resale under
the Securities Act of 1933.
Pursuant to a Stockholders Agreement, dated as of July 31, 1997, among
SunSource, LB I Group, Lehman Ltd., Lehman/SDI, Capital Partners and certain of
the GP Limited Partners, certain rights are restricted on the sale of Common
Stock of SunSource by the parties after the Conversion. The parties agree to
vote any excess shares as defined therein. With respect to the Board of
Directors, three directors may be nominated by management, four will be
Independent Directors (as defined in the provision of the By-Laws of SunSource
attached as Annex 1) and two directors may be nominated by Lehman Brothers if
Lehman Brothers holds more than 20% of the outstanding shares of Common Stock or
one director if Lehman Brothers holds between 10% and 20% of the outstanding
shares of Common Stock.
Holdings and SunSource entered into a Contribution Agreement, dated July
31, 1997 which provides for the contribution by Holdings to SunSource of a
portion of the premium payable upon an Initial Tax Redemption if shares are
still held in escrow and Holdings and its affiliates have disposed of some or
all of the Common Stock received by it or its affiliates in the Conversion.
Holdings intends to continually evaluate SunSource's business, prospects,
financial condition, the market for the Shares, other opportunities available
to Holdings, general economic conditions, money and stock market conditions
and other factors and future developments which Holdings may deem relevant
from time to time. Depending on same factors, Holdings may decide, subject
to the above referenced agreements, to sell all or part of the shares it holds.
Any such acquisition or disposition of Shares may be effected through open
market or privately negotiated transactions, or otherwise.
<PAGE>
Except as set forth in this Item 4, Holdings does not have any specific
plans or proposals that relate to or would result in any of the actions
specified in clauses (a) through (j) of Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer
(a) See Item 4.
(b) The Reporting Persons have sole power to vote and dispose of all the
shares of Common Stock of SunSource except as to shares listed on Appendix C.
(c) LBI and other affiliates in the ordinary course of business as
broker dealers, may have purchased and sold shares of Common Stock on behalf
of their customers.
(d) Neither the Reporting Persons nor to the best knowledge of the
Reporting Persons nor any of the persons listed in Appendix A hereto know of any
other person who has the right to receive or the power to direct the receipt
of dividends from, or the proceeds from the sale of, any shares of Common Stock
beneficially owned by the Reporting Persons, other than customers of Lehman
Brothers over whose shares Lehman Brothers may have investment discretion.
(e) Not Applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer.
See Item 4.
Eliot M. Fried and Henri I. Talerman, Managing Directors of LBI, are
Directors of SunSource.
Item 7. Material to be Filed as Exhibits.
Agreement and Plan of Conversion, dated as of July 31, 1997, among
SunSource, the Partnership, LPSub, Lehman/SDI and the GP Limited Partners
incorporated by reference as Exhibit 2.1 to Registration Statement File No.
333-19077
Stockholders Agreement, dated as of July 31, 1997, among SunSource, LB I
Group, Lehman Ltd., Lehman/SDI, Capital Partners and certain of the GP Limited
<PAGE>
Partners incorporated by reference as Exhibit 10.2 to Registration File No.
333-19077
Registration Rights Agreement, dated as of July 31, 1997, among
SunSource, LB I Group, Lehman Ltd., Lehman/SDI, Capital Partners and the
Senior Executives incorporated by reference as Exhibit 10.1 to Registration File
No. 333-19077
Contribution Agreement, dated as of July 31, 1997, between Holdings and
SunSource incorporated by reference as Exhibit 10.3 to Registration File No.
333-19077
<PAGE>
APPENDIX A
LEHMAN BROTHERS HOLDINGS INC.
BOARD OF DIRECTORS
NAME / TITLE BUSINESS ADDRESS
Michael L. Ainslie Lehman Brothers Holdings Inc.
Private Investor and former 3 World Financial Center
President and Chief Executive New York, New York 10285
Officer of Sotheby's Holdings
John F. Akers Lehman Brothers Holdings Inc.
Retired Chairman of 3 World Financial Center
International Business Machines New York, New York 10285
Corporation
Roger S. Berlind Lehman Brothers Holdings Inc.
Theatrical Producer 3 World Financial Center
New York, New York 10285
Thomas H. Cruikshank Lehman Brothers Holdings Inc.
Retired Chairman and Chief 3 World Financial Center
Executive Officer of Halliburton New York, New York 10285
Company
Richard S. Fuld, Jr. Lehman Brothers Holdings Inc.
Chairman and Chief Executive 3 World Financial Center
Officer of Lehman Brothers Holdings New York, NY 10285
Inc.
Henry Kaufman Lehman Brothers Holdings Inc.
President of Henry Kaufman & 3 World Financial Center
Company, Inc. New York, NY 10285
Hideichiro Kobayashi* Lehman Brothers Holdings Inc.
General Manager for the Americas 3 World Financial Center
Nippon Life Insurance Co. New York, NY 10285
John D. Macomber Lehman Brothers Holdings Inc.
Principal of JDM Investment Group 3 World Financial Center
New York, NY 10285
Dina Merrill Lehman Brothers Holdings Inc.
Actress and Director and Vice 3 World Financial Center
Chairman of RKO Pictures, Inc. New York, NY 10285
<PAGE>
Masahiro Yamada* Lehman Brothers Holdings Inc.
Managing Director 3 World Financial Center
Nippon Life Insurance Company New York, NY 10285
LEHMAN BROTHERS HOLDINGS INC.
EXECUTIVE OFFICERS
NAME / TITLE BUSINESS ADDRESS
Richard S. Fuld, Jr. Lehman Brothers Holdings Inc.
Chairman and Chief Executive Officer 3 World Financial Center
of Lehman Brothers Holdings Inc. New York, NY 10285
Jeremiah M. Callaghan Lehman Brothers Holdings Inc.
Chief of Operations and Technology 3 World Financial Center
New York, NY 10285
John L. Cecil Lehman Brothers Holdings Inc.
Chief Administrative Officer 3 World Financial Center
New York, NY 10285
Thomas A. Russo Lehman Brothers Holdings Inc.
Chief Legal Officer 3 World Financial Center
New York, NY 10285
Charles B. Hintz Lehman Brothers Holdings Inc.
Chief Financial Officer 3 World Financial Center
New York, NY 10285
- -----
All above individuals are citizens of the United States except those individuals
with an * who are citizens of Japan.
<PAGE>
LEHMAN BROTHERS INC.
BOARD OF DIRECTORS
NAME BUSINESS ADDRESS
Roger S. Berlind Lehman Brothers Inc.
Theatrical Producer 3 World Financial Center
New York, New York 10285
Philip Caldwell Lehman Brothers Inc.
Senior Managing Director 3 World Financial Center
New York, New York 10285
Howard L. Clark, Jr. Lehman Brothers Inc.
Vice Chairman 3 World Financial Center
New York, New York 10285
Frederick Frank Lehman Brothers Inc.
Vice Chairman 3 World Financial Center
New York, New York 10285
Richard S. Fuld, Jr. Lehman Brothers Inc.
Chairman and Chief Executive 3 World Financial Center
Officer of Lehman Brothers Holdings New York, NY 10285
Inc.
Charles B. Hintz Lehman Brothers Inc.
Chief Financial Officer 3 World Financial Center
New York, NY 10285
Bruce R. Lakefield * Lehman Brothers Inc.
Director 3 World Financial Center
New York, NY 10285
Sherman R. Lewis, Jr. Lehman Brothers Inc.
Vice Chairman 3 World Financial Center
New York, NY 10285
Mel A. Shaftel Lehman Brothers Inc.
Vice Chairman 3 World Financial Center
New York, NY 10285
- -----
Above individuals are citizens of the United States except those individuals
with an * who are citizens of the United Kingdom.
<PAGE>
LEHMAN BROTHERS INC.
EXECUTIVE OFFICERS
NAME / TITLE BUSINESS ADDRESS
Richard S. Fuld Lehman Brothers Inc.
Chairman & Chief Executive Officer of 3 World Financial Center
Lehman Brothers Holdings Inc. New York, NY 10285
Jeremiah M. Callaghan Lehman Brothers Inc.
Chief of Operations and Technology 3 World Financial Center
New York, NY 10285
John L. Cecil Lehman Brothers Inc.
Chief Administrative Officer 3 World Financial Center
New York, NY 10285
Thomas A. Russo Lehman Brothers Inc.
Chief Legal Officer 3 World Financial Center
New York, NY 10285
Charles B. Hintz Lehman Brothers Inc.
Chief Financial Officer 3 World Financial Center
New York, NY 10285
- -----
Above individuals are citizens of the United States.
<PAGE>
LEHMAN/SDI INC.
BOARD OF DIRECTORS
NAME BUSINESS ADDRESS
Eliot M. Fried Lehman Brothers Inc.
Managing Director 3 World Financial Center
New York, NY 10285
Henri I. Talerman Lehman Brothers Inc.
Managing Director 3 World Financial Center
New York, NY 10285
O. Gordon Brewer, Jr. SunSource Inc.
Director 1 Logan Square
Philadelphia, PA 19103
Norman V. Edmonson SunSource Inc.
Director 1 Logan Square
Philadelphia, PA 19103
Arnold S. Hoffman SunSource Inc.
Director 1 Logan Square
Philadelphia, PA 19103
Donald T. Marshall SunSource Inc.
Chairman of the Board of Directors & 1 Logan Square
Chief Executive Officer of Lehman/SDI Philadelphia, PA 19103
Inc.
John P. McDonnell SunSource Inc.
President & Chief Operating Officer 1 Logan Square
Philadelphia, PA 19103
Ernest L. Ransome, III SunSource Inc.
Director 1 Logan Square
Philadelphia, PA 19103
Donald A. Scott SunSource Inc.
Director 1 Logan Square
Philadelphia, PA 19103
- -----
Above individuals are residents of the United States.
<PAGE>
LEHMAN/SDI INC.
EXECUTIVE OFFICERS
NAME / TITLE BUSINESS ADDRESS
Donald T. Marshall SunSource Inc.
Chairman of the Board and Chief 1 Logan Square
Executive Officer of Lehman/SDI Inc. Philadelphia, PA 19103
John P. McDonnell SunSource Inc.
President and Chief Operating Officer 1 Logan Square
Philadelphia, PA 19103
Joseph Corvino SunSource Inc.
Chief Financial Officer 1 Logan Square
Philadelphia, PA 19103
LB I GROUP INC.
BOARD OF DIRECTORS
NAME BUSINESS ADDRESS
Eliot M. Fried Lehman Brothers Inc.
Managing Director 3 World Financial Center
New York, NY 10285
David Goldfarb Lehman Brothers Inc.
Controller 3 World Financial Center
New York, NY 10285
Allan S. Kaplan Lehman Brothers Inc.
Managing Director 3 World Financial Center
New York, NY 10285
LEHMAN LTD. I INC.
BOARD OF DIRECTORS
NAME BUSINESS ADDRESS
Eliot M. Fried Lehman Brothers Inc.
Managing Director 3 World Financial Center
New York, NY 10285
- -----
Above individual is a citizen of the United States.
<PAGE>
APPENDIX B
Fulco v. Continental Cablevision. This civil action was brought in the United
States District Court for the District of Massachusetts alleging a violation of
Rule 10b(5) for a material omission in the disclosure documents related to a
1989 partnership roll-up in which Shearson Lehman Brothers rendered a fairness
opinion. The jury rendered a verdict in 1993 jointly against Shearson Lehman
Brothers and Continental Cablevision, the issuer, for a total of $4.6 million.
The case was settled shortly thereafter.
Lehman Brothers has been involved in a number of civil proceedings which concern
matters arising in connection with the conduct of its business. Certain of such
proceedings have resulted in findings of violation of federal or state
securities laws. Each of these proceedings was settled by Lehman Brothers
consenting to the entry of an order without admitting or denying the allegations
in the complaint. All of such proceedings are reported and summarized in the
Schedule D to Lehman Brother's Form BD filed with the Securities and Exchange
Commission, which descriptions are hereby incorporated by reference.
<PAGE>
APPENDIX C
BENEFICIAL OWNERSHIP OF THE SHARES OF COMMON STOCK OF SUNSOURCE INC.
BY OFFICERS, DIRECTORS AND CONTROLLING PERSONS
% OF CLASS
NAME NO. OF SHARES OF SECURITIES
- ---- ------------- -------------
O. Gordon Brewer, Jr. 250 0.0%
Norman V. Edmonson 440,729 6.8%
Arnold S. Hoffman 3,250 0.0%
Donald T. Marshall 698,988 10.8%
John P. McDonnell 211,208 3.2%
Ernest L. Ransome III 1,350 0.0%
Donald A. Scott 2,250 0.0%
Joseph M. Corvino 36,126 0.5%
