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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 2)
Sunrise Resources, Inc.
(Name of Issuer)
Common Stock, $.01 par value
(Title of Class of Securities)
86769K-10-5
(CUSIP Number)
Stephen D. Higgins
c/o Stephen D. Higgins
23785 Strehler Road
Loretto, Minnesota 55357
(612) 498-7000
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
April 30, July 1 and September 1997
(Date of Event Which Requires Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box: [ ]
Check the following box if a fee is being paid with this statement: [ ]
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SCHEDULE 13D
CUSIP No. 86769K-10-5
1) NAME OF REPORTING PERSON AND S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE
PERSON
Stephen D. Higgins
###-##-####
2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [X ]
3) SEC USE ONLY
4) SOURCE OF FUNDS
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
United States of America
7) SOLE VOTING POWER
3,198,332
_______________________________________________________
8) SHARED VOTING POWER
NUMBER OF -0-
SHARES BENEFICIALLY _______________________________________________________
OWNED BY EACH 9) SOLE DISPOSITIVE POWER
REPORTING PERSON 3,198,332
WITH _______________________________________________________
10) SHARED DISPOSITIVE POWER
-0-
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,198,332
12) CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
[ ]
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
41.1%
14) TYPE OF REPORTING PERSON
IN
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SCHEDULE 13D
Pursuant to Rule 13d-2(c), this Amendment No. 2 amends Mr. Higgin's
Schedule 13D dated February 13, 1995 and Amendment No. 1 thereto dated May 1,
1996.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
See Item 4 and Item 6.
ITEM 4. PURPOSE OF TRANSACTION.
On April 30, 1997, Mr. Peter King terminated (i) the Shareholder Voting
Agreement dated May 1, 1996 among Peter J. King, the Russell S. King Stock
Trust dated November 11, 1989 for the benefit of Russell S. King (the "RSK
Trust") and the William B. King Stock Trust dated November 21, 1989 for the
benefit of William B. King (the "WBK Trust") (the "Shareholder Voting
Agreement"); (ii) the Voting Trust Agreement dated September 26, 1996 among
Stephen D. Higgins, as Trustee under the Peter J. King 1996 Grantor Retained
Annuity Trust (the "1996 Grantor Trust"), Russell S. King and Stephen D.
Higgins, as Trustees under the RSK Trust, William B. King and Stephen D.
Higgins, as Trustees under the WBK Trust and Peter J. King, as the Voting
Trustee (the "Voting Trust Agreement"); and (iii) the Appointment of Proxy
dated September 26, 1996 by William B. King and Stephen D. Higgins, as
Trustees under the WBK Trust (the "WBK Trust Proxy"). The Shareholder Voting
Agreement and the WBK Trust Proxy were terminated pursuant to a Termination
of Shareholder Voting Agreement and Termination of Proxy dated April 30, 1997
among Peter J. King, the WBK Trust and the RSK Trust (the "Termination of
Shareholder Voting Agreement and Proxy"). The Voting Trust Agreement was
terminated pursuant to a Termination of Voting Trust Agreement dated April
30, 1997 by Peter J. King, as the Voting Trustee (the "Termination of Voting
Trust").
On June 17 and June 25, 1997, an aggregate of 599,075 shares (the
"Arbitration Shares") of common stock (the "Common Stock") of Sunrise
Resources, Inc. (the "Company") were awarded to Mr. Peter King and Stephen D.
Higgins, as Trustee for the WBK Trust and the RSK Trust. The Arbitration
Shares were issued pursuant to an Arbitration Award dated June 17, 1997 of
George F. McGunnigle, arbitrator and a Supplemental Arbitration Award dated
June 25, 1997 of George F. McGunnigle, arbitrator (collectively, the
"Arbitration Award"), in resolution of an arbitration proceeding initiated by
Peter J. King, Stephen D. Higgins, for himself and as Trustee for the WBK
Trust and the RSK Trust, Jeffrey G. Jacobsen, Andrew Sall, Daniel W. Cadwell,
Carrie A. Halvorson, Thomas W. Kuharski, Anna M. Miller, Kelley A. Ross,
James C. Teal, Denise A. Willhite, Susan L. Rehberger and Barry J. Schwach
(the "Claimants") against Sunrise Leasing Corporation and its successor, the
Company (the "Arbitration Proceeding"). The Company subsequently approved
the issuance of the Arbitration Shares on July 1, 1997. Of the 599,075 shares
granted pursuant to the Arbitration Award, 285,759 shares were issued in the
name of Stephen D. Higgins, as Trustee for the WBK Trust; 222,257 shares were
issued in the name of Stephen D. Higgins, as Trustee for the RSK Trust and
91,059 shares were issued in the name of Peter J. King.
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In September 1997, Mr. Peter King received a distribution of 155,764 shares
of Common Stock of the Company from the 1996 Grantor Trust, in accordance with
the terms and conditions thereof.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
The 3,198,332 shares of Common Stock owned directly or indirectly by Mr.
Higgins constitutes approximately 41.1% of the Company's outstanding Common
Stock, based upon the Company's Form 10-K for the year ending June 30, 1997,
adjusted for the issuance of the Arbitration Shares. Mr. Higgins owns 5,029
shares individually and has the sole power to vote and dispose of those
shares.
Mr. Higgins is a co-trustee of each of the WBK Trust and the RSK Trust and
has the sole power to vote and dispose of the shares of the Company held by such
trusts. An aggregate of 1,640,285 and 1,276,783 are held by Mr. Higgins as
Trustee under each of the WBK Trust and the RSK Trust, respectively. Each of
the WBK Trust and the RSK Trust are irrevocable trusts. The WBK Trust is for
the benefit of William B. King, the son of Peter King. William B. King and Mr.
Higgins are co-trustees of the WBK Trust. Mr. William B. King has delegated all
of his power to vote and dispose of the shares of the Company held in the WBK
Trust to Mr. Higgins. The RSK Trust is for the benefit of Russell S. King, the
son of Peter King. Russell S. King and Mr. Higgins are co-trustees of the RSK
Trust. Mr. Russell S. King has delegated all of his power to vote and dispose
of the shares of the Company held in the RSK Trust to Mr. Higgins.
An aggregate of 276,235 shares are held of record by the 1996 Grantor
Trust, for which Mr. Higgins is the sole trustee and has the sole power to vote
and dispose of the shares. Mr. Peter King has retained an annuity interest in
the 1996 Grantor Trust and his sons, William B. and Russell S. King are the
beneficiaries of the principal of the 1996 Grantor Trust.
ITEM 6 CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER.
Mr. Peter King entered into the Termination of Shareholder Voting Agreement
and Proxy as a consequent of the final resolution of all of the claims of the
WBK Trust, the RSK Trust and the 1996 Grantor Trust against the Company that
were the subject of the Shareholder Voting Agreement and WBK Trust Proxy. The
Termination of Shareholder Voting Agreement and Proxy revoked any proxies in Mr.
Peter King's favor given under the Shareholder Voting Agreement and the WBK
Trust Proxy. The foregoing summary of certain provisions of the Termination of
Shareholder Voting Agreement and Proxy is qualified by the Company of the
Termination of Shareholder Voting Agreement and Proxy filed as Exhibit 3 hereto
and which is incorporated herein in its entirety by reference.
Mr. Peter King found the implementation of the Voting Trust Agreement to be
unnecessary and elected to terminate the Voting Trust Agreement. The foregoing
summary of
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ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
certain provisions of the Termination of Voting Trust filed as Exhibit 4
hereto and which is incorporated herein in its entirety by reference.
Exhibit 1 Arbitration Award dated June 17, 1997 issued by George
F. McGunnigle regarding the Arbitration Proceeding
between Peter J. King, Stephen D. Higgins, for himself
and as Trustee for the WBK Trust and the RSK Trust,
Jeffrey G. Jacobsen, Andrew Sall, Daniel W. Cadwell,
Carrie A. Halvorson, Thomas W. Kuharski, Anna M.
Miller, Kelley A. Ross, James C. Teal, Denise A.
Willhite, Susan L. Rehberger and Barry J. Schwach, as
Claimants versus Sunrise Leasing Corporation and its
successor the Company, as Respondents.
Exhibit 2 Supplemental Arbitration Award dated June 25, 1997
issued by George F. McGunnigle regarding the
Arbitration Proceeding.
Exhibit 3 Termination of Shareholder Voting Agreement and
Termination of Proxy dated April 30, 1997 among Peter
J. King, the WBK Trust and the RSK Trust.
Exhibit 4 Termination of Voting Trust Agreement dated April 30,
1997 by Peter J. King, as the Voting Trustee.
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SIGNATURES
After reasonable inquiry and to the best knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
/s/ Stephen D. Higgins
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September 12, 1997 Stephen D. Higgins
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EXHIBIT INDEX
Exhibit No. Description Method of Filing
1 Arbitration Award dated June 17, 1997 issued by
George F. McGunnigle regarding the Arbitration
Proceeding between Peter J. King, Stephen D.
Higgins, for himself and as Trustee for the WBK
Trust and the RSK Trust, Jeffrey G. Jacobsen,
Andrew Sall, Daniel W. Cadwell, Carrie A.
Halvorson, Thomas W. Kuharski, Anna M. Miller,
Kelley A. Ross, James C. Teal, Denise A. Willhite,
Susan L. Rehberger and Barry J. Schwach, as
Claimants versus Sunrise Leasing Corporation and
its successor the Company, as Respondents.........Electronically
2 Supplemental Arbitration Award dated June 25, 1997
issued by George F. McGunnigle regarding the
Arbitration Proceeding............................Electronically
3 Termination of Shareholder Voting Agreement and
Termination of Proxy dated April 30, 1997 among
Peter J. King, the WBK Trust and the RSK
Trust.............................................Electronically
4 Termination of Voting Trust Agreement dated April
30, 1997 by Peter J. King, as the Voting
Trustee...............................................Electronically
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Exhibit 1
ARBITRATION PROCEEDING
MINNEAPOLIS, MINNESOTA
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Peter J. King,
Stephen D. Higgins,
for himself and as
Trustee for the
William B. King Trust and
the Russell S. King Trust,
Jeffrey G. Jacobsen,
Andrew Sall,
Daniel W. Cadwell,
Carrie A. Halvorson,
Thomas W. Kuharski,
Anna M. Miller,
Kelley A. Ross,
James C. Teal,
Denise A. Willhite,
Susan L. Rehberger,
and Barry J. Schwach,
Claimants,
v. Arbitrator:
George F. McGunnigle
Sunrise Leasing Corporation
and its successor Sunrise
Resources, Inc.,
Respondents.
- --------------------------------
ARBITRATION AWARD
The above-captioned matter was submitted to the undersigned pursuant to
paragraph 10.7 of the Agreement and Plan of Reorganization by and among Sunrise
Leasing Corporation and The P.J. King Companies, Inc. d/b/a International
Leasing Corporation and Affiliates, dated
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October 14, 1994 (hereinafter "Merger Agreement") and by Submission Agreement
of the parties dated October 17, 1996, for binding arbitration of all
disputes, controversies and differences arising out of or in connection with
the Merger Agreement.
Pursuant to the Merger Agreement and the Submission Agreement, hearings
were conducted commencing on November 22, 1996, and continuing from time to time
on 26 separate days until February 14, 1997. Thereafter, the parties submitted
briefs and reply briefs, such that the matter was submitted on March 24, 1997.
Based upon the pleadings in the arbitration, the testimony and exhibits
adduced at hearings, the pre-hearing and post-hearing submissions of the
parties, and all the files, records and proceedings herein, I, the undersigned
Arbitrator, having been duly sworn, enter the following:
AWARD
With respect to Claimants' Statement of Claim for Rescission, Reformation
and Money Damages ("Statement of Claim"):
1. Claimants' request for rescission of the Merger Agreement and the
Consulting and Noncompetition Agreement is denied.
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2. Claimants' alternative request for reformation of the Merger Agreement
is denied.
3. With respect to Counts One, Two, Three, Four and Six of the Statement
of Claim, Claimants' requests for relief are denied.
4. With respect to Count Five of the Statement of Claim, the following
relief is granted:
- In favor of (i) Peter J. King, (ii) Stephen D. Higgins, as Trustee
under the William B. King Stock Trust dated November 21, 1989, for the
benefit of William B. King ("WBK Trust"), and (iii) Stephen D.
Higgins, as Trustee under the Russell S. King Stock Trust dated
November 11, 1989, for the benefit of Russell S. King ("RSK Trust"),
(collectively "Indemnifying Shareholders") an award in the aggregate
amount of $3,081,413.90, payable in the form of an issuance or
transfer of Sunrise Resources, Inc. Common Stock valued at $5.50 per
share, or (rounded) 560,257 shares. Said shares shall be awarded to
the Indemnifying Shareholders in the same proportion as the shares
issued to them on February 13, 1995, as part of the merger
transaction.
- As to the claims of the remaining Claimants under Count Five: -0-
5. With respect to Claimants' request for attorneys' fees and costs:
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- In favor of the Indemnifying Shareholders, an award of reasonable
attorneys' fees and costs related to their prosecution of Count Five
of the Statement of Claim, payable in the form of an issuance or
transfer of Sunrise Resources, Inc. Common Stock valued at $5.50 per
share.
- Counsel for Claimants shall, no later than June 19, 1997, submit to
the undersigned, with a copy to counsel for Respondents, an affidavit
setting forth the fees and costs reasonably incurred in connection
with the prosecution of Count Five on behalf of the Indemnifying
Shareholders, together with a Memorandum, not to exceed five pages in
length, explaining Claimants' allocation of fees and expenses to said
Count and said Indemnifying Shareholders. Counsel for Respondents
shall file a responsive Memorandum, not to exceed five pages in
length, no later than 9:30 a.m. on June 23, 1997. The Arbitrator
shall keep the record open, and shall retain jurisdiction, for the
purpose of entering a Supplemental Award for such attorneys' fees and
costs.
6. Except for the Supplemental Award to be made pursuant to paragraph 5
of this Award, this Award is in full settlement of all claims submitted to this
arbitration.
/s/ George F. McGunnigle
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George F. McGunnigle
Arbitrator
Subscribed and sworn to before me
this 17th day of June, 1997.
/s/ Sharon Tilden
- -----------------------------
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Exhibit 2
ARBITRATION PROCEEDING
MINNEAPOLIS, MINNESOTA
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Peter J. King,
Stephen D. Higgins,
for himself and as
Trustee for the
William B. King Trust and
the Russell S. King Trust,
Jeffrey G. Jacobsen,
Andrew Sall,
Daniel W. Cadwell,
Carrie A. Halvorson,
Thomas W. Kuharski,
Anna M. Miller,
Kelley A. Ross,
James C. Teal,
Denise A. Willhite,
Susan L. Rehberger,
and Barry J. Schwach,
Claimants,
v. Arbitrator:
George F. McGunnigle
Sunrise Leasing Corporation
and its successor Sunrise
Resources, Inc.,
Respondents.
- ---------------------------------
SUPPLEMENTAL ARBITRATION AWARD
The above-captioned matter was submitted to the undersigned pursuant to
paragraph 10.7 of the Agreement and Plan of Reorganization by and among Sunrise
Leasing Corporation and
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The P.J. King Companies, Inc. d/b/a International Leasing Corporation and
Affiliates, dated October 14, 1994 (hereinafter "Merger Agreement") and by
Submission Agreement of the parties dated October 17, 1996, for binding
arbitration of all disputes, controversies and differences arising out of or
in connection with the Merger Agreement.
The Arbitrator entered an Award on June 17, 1997, disposing of the claims
in the Statement of Claim, except for the claimants' request for an award of
attorney's fees and costs. The Award set forth a procedure and schedule with
respect to said request, providing for claimants to submit an affidavit and
supporting memorandum and for respondents to file a response thereto.
Based upon the pleadings in the arbitration, the testimony and exhibits
adduced at hearings, the pre-hearing and post-hearing submissions of the
parties, the supplementation of the record with respect to attorney's fees and
costs, and memoranda submitted in connection therewith, and all the files,
records and proceedings herein, I, the undersigned Arbitrator, having been duly
sworn, enter the following:
SUPPLEMENTAL AWARD
1. The Indemnifying Shareholders (as defined in the Award), are awarded
reasonable attorney's fees and costs in the aggregate amount of $213,500,
payable in the form of an issuance or transfer of Sunrise Resources, Inc. common
stock valued at $5.50 per share, or (rounded) 38,818 shares.
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2. This Supplemental Arbitration Award is in full settlement of all
remaining claims submitted pursuant to the parties' Agreement dated October 14,
1994, and Submission Agreement dated October 17, 1996.
/s/ George F. McGunnigle
--------------------------------
George F. McGunnigle
Arbitrator
Subscribed and sworn to before me
this 25th day of June, 1997.
/s/ Sharon Tilden
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Exhibit 3
TERMINATION OF SHAREHOLDER VOTING AGREEMENT AND TERMINATION OF PROXY
WHEREAS, the record owners of shares of common stock of Sunrise Resources,
Inc., a Minnesota corporation (the "Company"), that are listed on Exhibit A
hereto (the "Shareholders") have entered into that certain Shareholder Voting
Agreement as of May 1, 1996 (the "Agreement"); and
WHEREAS, under the Agreement, the Shareholders agreed to vote their shares
and take such other actions as Peter J. King ("Mr. King") directs with respect
to the resolution of the Claims described in the Agreement; appointed Mr. King
as their agent with respect to all rights and powers of such Shareholder arising
in connection with the Claims; and appointed Mr. King as each such Shareholders'
proxy to vote the shares if such Shareholder failed to vote such shares as Mr.
King directed; and
WHEREAS, pursuant to paragraph 7 of the Agreement, the Agreement shall
terminate and cease to be effective upon a resolution of the Claims, as
determined by Mr. King, in his sole discretion; and
WHEREAS, as of this date, the arbitration proceedings with respect to the
Claims has been completed, subject only to the granting of an award with respect
thereto; and
WHEREAS, pursuant to that certain Proxy dated September 26, 1996, Mr. King
was appointed a proxy to vote 300,000 of the shares of the Company on behalf of
the William B. King Trust, Stephen D. Higgins, Trustee ("Proxy"), and Mr. King
wishes to terminate the Proxy, effective immediately;
THEREFORE, pursuant to paragraph 7 of the Agreement, Mr. King hereby
determines that for purposes of the Agreement the completion of the arbitration
proceedings represents a resolution of the Claims and the Agreement is hereby
terminated and, as a result, any proxies in favor of Mr. King given under the
Agreement are hereby revoked;
FURTHER, the Proxy is hereby revoked and terminated, effective immediately.
Dated: April 30, 1997 /s/ Peter J. King
---------------------------
Peter J. King
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Exhibit 4
TERMINATION OF VOTING TRUST AGREEMENT
WHEREAS, each of the record owners of shares of common stock of Sunrise
Resources, Inc., a Minnesota corporation (the "Corporation"), that are listed on
Schedule 1 hereto (the "Subject Share") and Peter J. King (the "Voting Trustee")
entered into that certain Voting Trust Agreement dated September 26, 1996; and
WHEREAS, the stock certificates evidencing the Subject Shares have not
been transferred on the books of the Corporation into the name of the Voting
Trustee; and
WHEREAS, under paragraph 12 of the Voting Trust Agreement, the terms of the
Agreement shall automatically terminate in the event that, inter alia, the
Voting Trustee elects at any time to terminate this Agreement; and
WHEREAS, the Voting Trustee believes that it is unnecessary to complete the
implementation of the transfer of the Subject Shares to the Voting Trust
Agreement;
THEREFORE, pursuant to the power granted to the Voting Trustee under
paragraph 12 of the Voting Trust Agreement, the undersigned Voting Trustee
hereby elects to eliminate the Voting Trust Agreement ab initio.
Dated: April 30, 1997 /s/ Peter J. King
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Peter J. King, Voting Trustee
Schedule 1
Shareholders Number of Shares
Peter J. King 1996 Grantor 431,999
Retained Annuity Trust
William B. King Stock Trust 1,054,526
Russell S. King Stock Trust 1,054,526
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