<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 3)
Sunrise International Leasing Corporation
-----------------------------------------
(Name of Issuer)
Common Stock, $.01 par value
----------------------------
(Title of Class of Securities)
86769K-10-5
-------------
(CUSIP Number)
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)
May 27 and 28, 1998
-------------------
(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 that is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following
box: [ ]
Page 1 of 8
<PAGE>
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
340,358 (1)
------------------------------------------------------------
8) SHARED VOTING POWER
NUMBER OF -0-
SHARES ------------------------------------------------------------
BENEFICIALLY 9) SOLE DISPOSITIVE POWER
OWNED BY EACH 2,884,150 (2)
REPORTING PERSON ------------------------------------------------------------
WITH 10) SHARED DISPOSITIVE POWER
-0-
- --------------------------------------------------------------------------------
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,884,150
- --------------------------------------------------------------------------------
12) CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
[ ]
- --------------------------------------------------------------------------------
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
37.0% (3)
- --------------------------------------------------------------------------------
14) TYPE OF REPORTING PERSON
IN
- --------------------------------------------------------------------------------
(1) Includes: (a) 5,029 shares of common stock, $.01 par value (the "Common
Stock"), of Sunrise International Leasing Corporation ("Sunrise") held by Mr.
Higgins, individually; and (b) 335,329 shares of Common Stock held by the
William B. King Stock Trust dated November 21, 1989 for the benefit of William
B. King (the "WBK Trust"), of which Mr. Higgins is the co-trustee and has the
sole power to vote and dispose of such shares. Does not include the following
shares of Common Stock that were deposited into a voting trust pursuant to a
Voting Trust Agreement dated as of May 27, 1998, of which Peter J. King is the
Sole Voting Trustee: (a) 1,286,439 shares held by the WBK Trust, and (d)
1,262,382 shares held by the Russell S. King Stock Trust dated November 11, 1989
for the benefit of Russell S. King (the "RSK Trust"), of which Mr. Higgins is
the co-trustee.
(2) Includes: (a) 5,029 shares of Common Stock held by Mr. Higgins,
individually; (b) 1,621,768 shares of Common Stock held by the WBK Trust; and
(d) 1,262,382 shares held by the RSK Trust.
(3) Based upon 7,787,796 shares of Common Stock outstanding as of January 30,
1998, as reflected in Sunrise's Quarterly Report on Form 10-Q for the quarter
ended December 31, 1997.
Page 2 of 8
<PAGE>
SCHEDULE 13D
Pursuant to Rule 13d-2(c), this Amendment No. 3 amends Mr. Higgins'
Schedule 13D dated February 13, 1995, Amendment No. 1 thereto dated May 1, 1996,
and Amendment No. 2 thereto dated September 19, 1997.
ITEM 1. SECURITY AND ISSUER.
This statement relates to the common stock, par value $.01 per share
("Common Stock"), of Sunrise International Leasing Corporation, a Delaware
corporation formerly known as Sunrise Resources, Inc., a Minnesota corporation
("Sunrise"), the principal executive offices of which are located at 5500
Wayzata Boulevard, Suite 725, Minneapolis, Minnesota 55416.
ITEM 2. IDENTITY AND BACKGROUND.
This statement is filed by Stephen D. Higgins, individually and as trustee
under each of the William B. King Stock Trust dated November 21, 1989 for the
benefit of William B. King (the "WBK Trust") and Russell S. King Stock Trust
dated November 11, 1989 for the benefit of Russell S. King (the "RSK Trust").
Mr. Higgins' business address is 23785 Strehler Road, Loretto, Minnesota 55357.
Mr. Higgins' principal occupation is President and Chief Executive Officer of
Stephen D. Higgins Ltd., a corporation that provides tax and business consulting
services. The address of Stephen D. Higgins Ltd. is 23785 Strehler Road,
Loretto, Minnesota 55357.
During the last five years, Mr. Higgins has not been convicted in a
criminal proceeding (excluding traffic violations or similar misdemeanors) and
has not been a party to a proceeding involving (and is not otherwise subject to)
a judgment or other order prohibiting or mandating activities subject to United
States federal or state securities laws.
Mr. Higgins is a United States citizen.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Not applicable. Beneficial ownership of the shares of Common Stock
reported herein changed under the following circumstances:
Effective as of May 27, 1998, Peter J. King ("Peter King"), The King
Management Corporation ("King Management"), the WBK Trust, the RSK Trust and the
Peter J. King 1996 Grantor Retained Annuity Trust, of which Mr. Higgins is the
sole trustee (the "1996 Grantor Trust"), entered into a Voting Trust Agreement
dated as of May 27, 1998 (the "Voting Trust Agreement"), pursuant to which Peter
King was granted the sole power to vote the shares of Common Stock of Sunrise
deposited into the voting trust by himself, King Management, the WBK Trust, the
RSK Trust and the 1996 Grantor Trust. An aggregate of 3,386,797 shares of
Common Stock are currently subject to the Voting Trust Agreement, of which (i)
517,158 shares
Page 3 of 8
<PAGE>
are held by Peter King; (ii) 320,818 shares are held by King Management; (iii)
1,286,439 shares are held by the WBK Trust; and (iv) 1,262,382 shares are held
by the RSK Trust. Peter King, the WBK Trust, the RSK Trust and King Management
constitute a group with respect to the shares of Common Stock referred to in
Item 3 within the meaning of Rule 13d-5(b)(1). See discussion below regarding
the participation of the 1996 Grantor Trust in the voting trust.
Pursuant to the Voting Trust Agreement, the 1996 Grantor Trust deposited
into the voting trust 276,235 shares of Common Stock on May 27, 1998. On May
28, 1998, Peter King, the WBK Trust, the RSK Trust and the 1996 Grantor Trust
transferred voting trust certificates representing an aggregate of 38,818 shares
of Common Stock to King Management in consideration of legal fees paid by King
Management in connection with an arbitration proceeding in June 1997. On May
28, 1998, the 1996 Grantor Trust transferred voting trust certificates
representing 273,119 shares of Common Stock to Peter King as a distribution of
the annuity portion of such trust. As of the date of this statement, the 1996
Grantor Trust does not own any shares of Common Stock of Sunrise or voting trust
certificates representing shares of Common Stock of Sunrise. Mr. Higgins is the
sole trustee of the 1996 Grantor Trust and prior to the creation of the voting
trust and the distribution of all of the shares of Common Stock held by the 1996
Grantor Trust to Peter King, Mr. Higgins had the sole power to vote and dispose
of such shares.
ITEM 4. PURPOSE OF TRANSACTION.
Peter King, King Management, the WBK Trust, the RSK Trust and the 1996
Grantor Trust entered into the Voting Trust Agreement because they determined it
to be in their mutual best interests to combine the voting power of the shares
of Common Stock of Sunrise owned by them and to vest such voting power in Peter
King, as Sole Voting Trustee, and King Management as Substitute Voting Trustee.
Peter King, the WBK Trust, the RSK Trust and the 1996 Grantor Trust
transferred voting trust certificates representing an aggregate of 38,818 shares
of Common Stock to King Management in consideration of legal fees paid by King
Management in connection with an arbitration proceedings in June 1997. The 1996
Grantor Trust transferred voting trust certificates representing 273,119 shares
of Common Stock to Peter King as a distribution of the annuity portion of such
trust.
Mr. Higgins (either individually or through the WBK Trust and the RSK
Trust) may from time to time purchase shares of Common Stock, either in
brokerage transactions, in the over-the-counter market or in privately
negotiated transactions. Any decision to increase the holdings in Sunrise will
depend, however, on numerous factors, including without limitation the price of
the shares of Common Stock, the terms and conditions relating to their purchase
and sale and the prospects and profitability of Sunrise, and general economic
conditions and stock and money market conditions. At any time, Mr. Higgins may
also determine to dispose of some or all of the Common Stock, depending on
various similar considerations. Mr. Higgins does not have any present plans or
proposals which relate to or would result in any of the events listed in Item
4(a) through (j) of Schedule 13D.
Page 4 of 8
<PAGE>
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
The 2,884,150 shares of Common Stock constitute 37.0% of Sunrise's
outstanding Common Stock based on Sunrise's Quarterly Report on Form 10-Q for
the quarter ended December 31, 1997. Mr. Higgins owns 5,029 shares of Common
Stock directly, or less than 1% of Sunrise's outstanding Common Stock, and has
the sole power to vote and dispose of such shares. In addition, Mr. Higgins is
the co-trustee of each of the RSK Trust and the WBK Trust, which collectively
own 2,884,150 shares of Common Stock, or 37.0% of Sunrise's outstanding shares
of Common Stock. Of these shares, 1,262,382 shares of Common Stock, or 16.2% of
Sunrise's outstanding shares of Common Stock, are held by the RSK Trust, and
1,621,768 shares of Common Stock, or 20.8% of Sunrise's outstanding shares of
Common Stock, are held by the WBK Trust. Mr. Higgins has the sole power to
dispose of all shares of Common Stock held by the WBK Trust and the RSK Trust in
his capacity as co-trustee of each trust. 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 Common Stock of Sunrise 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 Common Stock of Sunrise held in the RSK Trust to Mr. Higgins. Pursuant to
the Voting Trust Agreement, Mr. Higgins delegated all of his power to vote the
shares of Common Stock held by the RSK Trust and 1,286,439 shares of Common
Stock held by the WBK Trust to Peter King. Under the Voting Trust Agreement,
Peter King currently has sole voting power with respect to an aggregate of
3,386,797 shares of Common Stock. Voting trust certificates representing
1,286,439 and 1,262,382 shares of Common Stock are currently held by the WBK
Trust and the RSK Trust, respectively. Mr. Higgins retains sole voting power
with respect to the 335,329 shares of Common Stock held by the WBK Trust which
were not deposited into the voting trust.
Mr. Higgins has neither individually nor through the RSK Trust, the WBK
Trust or the 1996 Grantor Trust, effected any transactions in the Common Stock
of Sunrise during the past 60 days, except for: (i) the deposit of 1,276,783
shares of Common Stock held by the RSK Trust, 1,304,956 shares of Common Stock
held by the WBK Trust and 276,235 shares of Common Stock held by the 1996
Grantor Trust into the voting trust; (ii) the transfer of voting trust
certificates representing 14,401, 18,517 and 3,116 shares of Common Stock from
the RSK Trust, the WBK Trust and the 1996 Grantor Trust, respectively, to King
Management; and (iii) the distribution of voting trust certificates representing
273,119 shares of Common Stock from the 1996 Grantor Trust to Peter King.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER.
Effective as of May 27, 1998, Peter King, King Management, the WBK Trust,
the RSK Trust and the 1996 Grantor Trust (collectively, the "Shareholders")
entered into the Voting Trust Agreement with respect to an aggregate of
3,386,797 shares of Common Stock of Sunrise. See
Page 5 of 8
<PAGE>
Item 3 above. Under the Voting Trust Agreement, Peter King is the Sole Voting
Trustee and King Management is the Substitute Voting Trustee (the Sole Voting
Trustee and the Substitute Voting Trustee are referred to as the "Voting
Trustee"). The record ownership of the 3,386,797 shares of Common Stock
deposited by the Shareholders with the Voting Trustee was transferred into the
name of the Voting Trustee on the books of Sunrise. In exchange for such shares
of Common Stock, the Voting Trustee issued to the Shareholders a voting trust
certificate representing the number of shares of Common Stock deposited with the
Voting Trustee. In the event of a stock split, stock dividend or distribution
of shares of Common Stock of Sunrise, the Voting Trustee will issue additional
voting trust certificates to the then registered holders of the outstanding
voting trust certificates to reflect appropriately the interests of the
Shareholders in the shares of Common Stock held by the Voting Trustee. Subject
to any transfer restrictions set forth in the Articles of Incorporation and
Bylaws of Sunrise and imposed by applicable securities laws, the Shareholders
may sell or transfer the voting trust certificates as they determine to be
proper. Every transferee of a voting trust certificate will, by the acceptance
of such certificate, become a party to the Voting Trust Agreement.
The Voting Trustee is entitled to exercise all shareholders' rights of
every kind with respect to voting, including the right to vote and the right to
take part in, or consent to, any corporate or shareholders' action including a
merger, exchange or consolidation involving Sunrise or the sale, lease, transfer
or other disposition of all or substantially all of Sunrise's assets, except as
such right is specifically limited in the Voting Trust Agreement. The Voting
Trustee will vote on all matters which come before any shareholders' meeting of
Sunrise and must exercise his best judgment from time to time to select suitable
directors to the end that the affairs of Sunrise are properly managed. The
holder of each voting trust certificate is entitled to receive, from time to
time, dividends or distributions payable in cash or property (other than shares
of any class of Sunrise). The majority of the interest of the holders of the
voting trust certificates may approve amendments to the Voting Trust Agreement.
The Voting Trust Agreement will terminate automatically on December 31, 2007,
unless terminated earlier in the event that: (i) the Voting Trustee elects at
any time to terminate the Agreement, (ii) the Sole Voting Trustee resigns, dies
or is determined to be incompetent or incapacitated by the Substitute Voting
Trustee, after consultation with a licensed physician who has examined the Sole
Voting Trustee, and the Substitute Voting Trustee has been dissolved or
liquidated, (iii) Sunrise is dissolved or liquidated, or (iv) no Voting Trustee
is acting under the Agreement. The foregoing summary of certain provisions of
the Voting Trust Agreement is qualified by the copy of the Voting Trust
Agreement filed as Exhibit 1 hereto and which is incorporated herein in its
entirety by this reference.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit 1 Voting Trust Agreement dated as of May 27, 1998 among Peter
J. King, The King Management Corporation, the William B.
King Stock Trust, the Russell S. King Stock Trust and the
Peter J. King 1996 Grantor Retained Annuity Trust.
Page 6 of 8
<PAGE>
SIGNATURES
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.
/s/ Stephen D. Higgins
----------------------------------
June 16, 1998 Stephen D. Higgins
Page 7 of 8
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Description Method of Filing
No. ----------- ----------------
---
<S> <C>
1 Voting Trust Agreement dated as of May 27, 1998 Filed herewith
among Peter J. King, The King Management electronically
Corporation, the William B. King Stock Trust,
the Russell S. King Stock Trust and the Peter
J. King 1996 Grantor Retained Annuity Trust. ..
</TABLE>
Page 8 of 8
<PAGE>
VOTING TRUST AGREEMENT
Agreement, dated as of May 27, 1998, between each of the record owners of
shares of common stock of Sunrise International Leasing Corporation, a Delaware
corporation (the "Corporation"), that are listed on schedule 1 to this agreement
and others who may become parties to this agreement in the manner hereinafter
provided (the "Shareholders"), and Peter J. King (the "Sole Voting Trustee") and
King Management Corporation, a Minnesota corporation (the "Substitute Voting
Trustee") (the Sole Voting Trustee and Substitute Voting Trustee, when acting
hereunder are referred to as the "Voting Trustee");
WHEREAS, the Shareholders deem it to be in their mutual best interests to
combine the voting power of the shares of the Corporation's common stock owned
by them and vest such voting power in the Voting Trustees as provided in this
agreement; and
WHEREAS, the Sole Voting Trustee and Substitute Voting Trustee are willing
to act in such capacity pursuant to the terms of this agreement.
NOW THEREFORE, in consideration of the premises, the respective commitments
and undertakings of the Shareholders and the Sole Voting Trustee and Substitute
Voting Trustee set forth in this agreement, and other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
Shareholders and the Sole Voting Trustee and Substitute Voting Trustee agree as
follows:
1. DELIVER OF SHARES. Concurrently with the execution of this agreement,
each Shareholder shall transfer and deliver to the Voting Trustee stock
certificates evidencing the number of shares of the Corporation's common stock
as is set forth on schedule 2, which certificates shall be properly endorsed for
transfer on the books of the Corporation, and the Voting Trustee shall hold and
deal with such certificates in the manner contemplated by this agreement.
2. VOTING TRUST CERTIFICATES. Upon receipt from the Shareholders of
stock certificates for shares of the Corporation's common stock, the Voting
Trustee shall deliver or cause to be delivered to the Shareholders a voting
trust certificate or certificates for the number of shares that is represented
by the stock certificate or certificates so deposited with the Voting Trustee.
The voting trust certificates shall be in substantially the following form:
<PAGE>
VOTING TRUST CERTIFICATE
FOR SHARE OF COMMON STOCK OF
SUNRISE INTERNATIONAL LEASING CORPORATION
(A DELAWARE CORPORATION)
(Under Voting Trust Agreement Dated as of May 27, 1998)
No.___ ________ Shares
This certifies that ______________________ has deposited _______________
shares of common stock of Sunrise International Leasing Corporation, a Delaware
corporation (the "Corporation"), with the Voting Trustee hereinafter named,
pursuant to an agreement dated ______, 199__, between certain shareholders of
the Corporation and the Voting Trustee (the "Agreement"). This certificate and
the interest represented thereby is transferable only on the books of the Voting
Trustee upon the presentation and surrender of this certificate. The holder of
this certificate shall be subject to all the terms and conditions of the
Agreement and shall be entitled to the benefits thereof.
IN WITNESS WHEREOF, the Voting Trustee have caused this certificate to be
signed this ____ day of _________________.
____________________________________
Peter J. King, Sole Voting Trustee
In the event of a stock split, stock dividend or distribution of shares of
any class of the Corporation, the Voting Trustee shall issue additional
certificates to the registered holders of outstanding voting trust certificates,
which additional certificates shall be modified as necessary to indicate the
class of shares so represented and to reflect the interests of the Shareholders
in the shares of the Corporation's stock held by the Voting Trustee.
<PAGE>
3. TRANSFER OF VOTING TRUST CERTIFICATES. Subject to any transfer
restrictions set forth in the Articles of Incorporation and Bylaws of the
Corporation now or hereafter and transfer restrictions imposed by applicable
securities laws, the Shareholders shall be at liberty to sell or transfer the
voting trust certificates as they determine to be proper. The voting trust
certificates issued by the Voting Trustee may be transferred on the books of the
Voting Trustee upon the surrender to the Voting Trustee of such certificates,
which have been properly endorsed by the registered holders. Title to the
voting trust certificates when duly endorsed shall, to the extent permitted by
law, be transferable with the same effect as in the case of negotiable
instruments.
Every transferee of a voting trust certificate shall, by the acceptance of
such certificate, become a party to this agreement with the effect that such
transferee shall deem to be an original party to this agreement and shall be
regarded as a Shareholder for all purposes of this agreement.
4. SHAREHOLDERS' RIGHTS. The record ownership of the shares of stock of
the Corporation for which certificates have been deposited with the Voting
Trustee shall be vested in the Voting Trustee and shall be transferred into the
name of the Voting Trustee upon the books of the Corporation. The Voting
Trustee shall, as to all shares of stock so held by the Voting Trustee, possess
and be entitled to exercise all shareholders' rights of every kind, including
the right to vote and the right to take part in, or consent to, any corporate or
shareholders' action including a merger, exchange or consolidation involving the
Corporation or the sale, lease, transfer or other disposition of all or
substantially all of the Corporation's assets, except as such right is
specifically limited by this agreement.
The holders of the voting trust certificates shall not have any right, with
respect to any shares of stock held by the Voting Trustee, to vote such shares
or to take part in or consent to any corporate or shareholders' action of the
Corporation.
The Voting Trustee may deliver the shares of stock subject to this
agreement to the Corporation for exchange or surrender pursuant to any
amendments to the articles of incorporation, plan of reclassification, merger,
consolidation, liquidation or dissolution of the Corporation.
5. SUCCESSION OF TRUSTEES. Upon the death or resignation of the Sole
Voting Trustee, or during any period that the Sole Voting Trustee is determined
to be incapacitated or incompetent as hereinafter provided, the Substitute
Voting Trustee is appointed to act as the Voting Trustee hereunder. If at any
time there is no Voting Trustee acting hereunder, this Voting Trust shall
thereupon terminate as provided in section 13.
The incapacity or incompetency of the Sole Voting Trustee shall bee
determined by the Substitute Voting Trustee, after consultation with a licensed
physician who has examined the Sole Voting Trustee.
6. EXERCISE OF VOTING RIGHTS BY VOTING TRUSTEE. The Voting Trustee shall
vote on matters which may come before him at any shareholders' meeting and shall
exercise his best judgment from time to time to select suitable directors to the
end that the affairs of the Corporation shall be properly managed.
<PAGE>
The Voting Trustee may vote all shares of stock held by the Voting Trustee
in person or by such person or persons as the Voting Trustee shall select as the
Voting Trustee's proxy.
When the Substitute Voting Trustee is acting as the Voting Trustee, all
shares of stock held by the Voting Trustee shall be voted by the Chief Executive
Officer of the Substitute Voting Trustee or by another authorized representative
appointed by a written instrument signed by a majority of the members of the
Board of Directors of the Substitute Voting Trustee. If the Board of Directors
of the Substitute Voting Trustee is divided equally as to appointment of an
authorized representative to vote the shares of stock held by the Voting Trustee
or as to the right and manner of voting shares of stock held by the Voting
Trustee, the vote of the stock in either such case shall be divided equally
among the members of the Board of Directors of the Substitute Voting Trustee.
7. EXCULPATION. The Voting Trustee shall not be liable for any error of
judgment or mistake of law, or other mistake, and shall incur no responsibility
as stockholder, trustee or otherwise, except for the Voting Trustee's own
individual malfeasance.
8. COMPENSATION; EXPENSE REIMBURSEMENT. The Voting Trustee shall not be
entitled to any compensation for the Voting Trustee's services, but shall be
reimbursed by the Shareholders, on a pro rata basis, for any expenses or
liabilities incurred by the Voting Trustee in connection with the Voting
Trustee's duties under this agreement, including the disbursements and
reasonable compensation of the Voting Trustee's agents, attorneys, employees and
officers whom the Voting Trustee may employ in carrying out the terms and
provisions of this agreement.
The Voting Trustee shall be entitled to reimbursement for all expenses
incurred in the performance of the Voting Trustee's duties, out of any monies
held or received by the Voting Trustee as distributions with respect to any
shares held in the voting trust created by this agreement.
9. DISTRIBUTIONS. The holder of each voting trust certificate shall be
entitled to receive, from time to time, payments equal to the dividends or
distribution payable in cash or property (other than shares of any class of the
Corporation), if any, collected by the Voting Trustee, as is specified in such
voting trust certificates, subject to the ratable payment of expenses of the
Voting Trustee.
10. RESTRICTION ON TRANSFER OF SHARES. During the term of this agreement,
the Shareholders shall not be entitled to sell their respective shares of
Corporation stock. The Voting Trustee shall not be entitled to transfer the
shares of Corporation stock registered in the Voting Trustee's name to any other
person, including the Shareholder from whom such shares were received. However,
notwithstanding the foregoing restriction, the Voting Trustee shall be entitled
to vote to approve a merger or sale of the Corporation or the sale, lease,
transfer or other disposition of all or substantially all of the Corporation's
assets.
11. INSPECTION OF AGREEMENT. A copy of this agreement and any amendment
of this agreement shall be filed by the Voting Trustee in the registered office
of the Corporation in Delaware and shall be available during business hours for
inspection by the Corporation's shareholders or by the trust certificate
holders.
<PAGE>
12. AMENDMENT. If at any time the Voting Trustee shall deem it advisable
to amend this agreement, the Voting Trustee shall submit such amendment, in
writing, to the holders of voting trust certificates for their approval. Such
amendment shall become effective when signed by the Shareholders and a copy has
been filed in the registered office of the Corporation in Delaware.
13. TERM; TERMINATION. The term of this agreement shall commence on the
date hereof and shall extend through December 31, 2007. Notwithstanding the
foregoing, the term of this agreement shall automatically terminate prior to the
expiration of the term in the event that (a) the Voting Trustee elects at any
time to terminate this agreement, (b) the Sole Voting Trustee shall have
resigned as Voting Trustee or died or been determined to be incompetent or
incapacitated as provided in section 5 and the Substitute Voting trustee has
been dissolved and liquidated, (c) the Corporation is dissolved and liquidated,
or (d) no Voting Trustee is acting hereunder.
At any time after such termination, the holders of voting trust
certificates shall be entitled, upon surrender of such certificates to the
Corporation for cancellation, to receive certificates for the number of shares
of the Corporation's common stock represented by their respective voting trust
certificates. For the purpose of transferring such certificates upon
termination, the officers of the Corporation shall be deemed to be the Trustee
for that purpose and that purpose only, and any one of such officers shall have
the power to make such transfer without the consent of any other officer.
14. ACCEPTANCE BY VOTING TRUSTEE. The Sole Voting Trustee and Substitute
Voting Trustee each hereby accepts the trust created by the terms of this
agreement and agrees to perform their respective duties hereunder.
15. MISCELLANEOUS. This agreement shall be construed and enforced in
accordance with the laws of the state of Delaware. This agreement shall
evidence the complete understanding and agreement among the parties hereto
relative to the matters discussed herein and supersedes all prior written or
oral agreements or understandings relative to such matters. This agreement and
any amendment hereof may be executed in multiple counterparts, each of which
shall be deemed an original, and such counterparts together shall constitute one
instrument. "King Management Corporation" includes King Management Corporation,
a Minnesota Corporation, any successor entity to King Management Corporation by
merger, consolidation, change of name or state of incorporation.
[THE BALANCE OF THIS PAGE LEFT BLANK INTENTIONALLY]
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this agreement as of
the date set forth in the first paragraph.
VOTING TRUSTEES
SOLE VOTING TRUSTEE;
/s/ Peter J. King
---------------------------------
Peter J. King
SUBSTITUTE VOTING TRUSTEE:
KING MANAGEMENT
CORPORATION
By /s/ Peter J. King
-----------------------------
Its CEO
------------------------
And /s/ James C. Teal
----------------------------
Its Controller
------------------------
<PAGE>
SHAREHOLDERS
/s/ Peter J. King
---------------------------------
Peter J. King
WILLIAM B. KING STOCK TRUST:
/s/ Stephen D. Higgins
---------------------------------
Stephen D. Higgins, Trustee
RUSSELL S. KING STOCK TRUST:
/s/ Stephen D. Higgins
---------------------------------
Stephen D. Higgins, Trustee
PETER J. KING 1996 GRANTOR
RETAINED ANNUITY TRUST:
/s/ Stephen D. Higgins
---------------------------------
Stephen D. Higgins, Trustee
KING MANAGEMENT CORPORATION
/s/ Peter J. King
---------------------------------
Peter J. King, CEO
<PAGE>
SCHEDULE 1
----------
<TABLE>
<CAPTION>
Shareholders Number of shares
- ------------ ----------------
<S> <C>
Peter J. King 246,823
William B. King Stock Trust 1,304,956
Russell S. King Stock Trust 1,270,783
Peter J. King 1996 Grantor Retained Annuity Trust 276,235
King Management Corporation 282,000
</TABLE>
