UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Amendment No. 1
WPI Group, Inc.
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(Name of Issuer)
Common Stock, $0.01 par value
-------------------------------
(Title of Class and Securities)
929930k107
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(CUSIP Number)
Sunrise Capital Partners, L.P.
685 Third Avenue, 15th Floor
New York, NY 10017
Att: Joseph Julian
212-582-3015
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(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
November 16, 2000
-----------------------------
(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 Sections 240.13d-1(e), 240.13d-1(f) or
240.13d-1(g), check the following box. [ ]
Note: Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. See Section
240.13d-7 for other parties to whom copies are to be sent.
* The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of
that section of the Act but shall be subject to all other provisions of
the Act (however, see the Notes).
SCHEDULE 13D
CUSIP No. 929930k107
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1. NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (entities only)
Sunrise Capital Partners, L.P.
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (X)
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3. SEC USE ONLY
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4. SOURCE OF FUNDS*
WC
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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7. SOLE VOTING POWER
NUMBER OF 12,689,187
SHARES ---------------------------------------
BENEFICIALLY 8. SHARED VOTING POWER
OWNED BY 1,359,342
EACH ---------------------------------------
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON 12,689,187
WITH ---------------------------------------
10. SHARED DISPOSITIVE POWER
None
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11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
14,048,529
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12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
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13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
61%
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14. TYPE OF REPORTING PERSON
PN
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This Amendment No. 1 to Schedule 13D (this "Amendment") is being
filed pursuant to Rule 13d-2 of the Rules and Regulations under the
Securities Exchange Act of 1934, as amended (the "Act") by Sunrise Capital
Partners, L.P., a Delaware limited partnership ("Sunrise"), with respect to
the common stock, par value $0.01 per share (the "Common Stock"), of WPI
Group, Inc. (the "Company"). This Amendment amends the Schedule 13D filed
on August 21, 2000.
The Schedule 13D previously filed is hereby amended by the addition
of the following information:
Item 1. SECURITY AND ISSUER
This Schedule relates to the Common Stock, $0.01 par value, of WPI
Group, Inc., 1155 Elm Street, Manchester, New Hampshire 03101.
Item 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
The source of funds used for the purchase of securities is cash held
by Sunrise for investment. The amount is $4,553,215.71.
Item 4. PURPOSE OF TRANSACTION
The Convertible Note Agreement
As previously disclosed on Schedule 13D, on July 31, 2000, Sunrise
entered into a certain Convertible Note Agreement, by and among Sunrise,
the Company and the subsidiaries of the Company (the "Convertible Note
Agreement"). Pursuant to the terms of the Convertible Note Agreement,
Sunrise and certain participants (including certain members of the
Company's management and members of the Allard-Nazarian Group) agreed to
purchase from the Company a combination of convertible promissory notes
(the "Notes"), Common Stock, and warrants representing the right to
purchase shares of Common Stock (the "Warrants"). The Notes, the Warrants
and the shares of Common Stock purchased pursuant to the Convertible Note
Agreement are collectively referred to herein as the "Securities". The
Convertible Note Agreement was entered into by Sunrise for investment
purposes. The Company entered into the Convertible Note Agreement in order
to enhance its liquidity and refinance its existing indebtedness.
The Notes are convertible at any time at the option of the holders
thereof into Common Stock of the Company at a price of $1.75 per share,
subject to adjustment under certain circumstances. The Company may also
require the holders to convert their Notes into Common Stock if certain
requirements relating to the trading price and trading volume of the
Company's Common Stock are met. The Warrants have an exercise price of
$1.75 per share, subject to adjustment under certain circumstances, and are
exercisable at any time before the scheduled expiration date five years
from the date of issuance.
As previously disclosed on Schedule 13D, Sunrise and the other
participants agreed to purchase the Securities from the Company in three
series. The first series of Securities ("Term A") consisted of Notes in
aggregate principal amount of $14,116,875, a total of 1,833,906 shares of
Common Stock and Warrants representing the right to purchase in the
aggregate 1,613,357 shares of Common Stock. The second series of Securities
("Term B") consists of Notes in aggregate principal amount of $5,000,000
and Warrants representing the right to purchase in the aggregate 571,427
shares of Common Stock. The third series of Securities ("Term C") will
consist of Notes in an aggregate principal amount of up to $5,000,000 (the
exact amount to specified by Sunrise) and Warrants representing the right
to purchase in the aggregate the number of shares of Common Stock equal to
(x) the number of shares of Common Stock that would be issuable upon
conversion of the Term C Notes multiplied by (y) .20.
Pursuant to the terms of the Convertible Note Agreement, the Company
will pay to Sunrise and the other participants a closing fee equal to 2% of
the aggregate principal amount of the Notes purchased in each series. The
closing fee may be paid in cash upon sale of each series of Securities, or
it may be paid "in kind" by delivery of additional promissory notes in an
aggregate principal amount equal to the amount of such unpaid closing fee.
As previously disclosed on Schedule 13D, on August 9, 2000, Sunrise
and the other participants purchased from the Company the Term A
Securities.
On November 16, 2000, Sunrise and the other participants purchased
from the Company the Term B Securities for an aggregate purchase price of
$5,000,000. Sunrise purchased (i) Notes in aggregate principal amount of
$4,553,215.71 and (ii) Warrants representing the right to purchase in the
aggregate 520,368 shares of Common Stock. The purchase price for the
Securities purchased by Sunrise was $4,553,215.71. Based on the conversion
price of $1.75, the Notes purchased by Sunrise are convertible into
2,601,838 shares of Common Stock.
As part of the sale of the Term B Securities, the Company was
obligated to pay to Sunrise and the other participants a closing fee equal
to $100,000. Sunrise's portion of the closing fee was equal to $91,064.31.
The Company elected not to pay the closing fee in cash, and instead
delivered addtional Notes in aggregate principal amount of the unpaid fees.
The Notes received by Sunrise in lieu of the closing fee are convertible
into 52,037 shares of Common Stock.
As previously disclosed on Schedule 13D, and subject to the terms and
conditions of the Convertible Note Agreement, Sunrise may acquire
beneficial ownership of additional securities of the Company through the
purchase of the Term C Securities.
The Item 2 Persons disclaim membership in any group with respect to
the acquisition of Common Stock or other Securities through the Convertible
Note Agreement.
The Stockholders Agreement
As previously disclosed on Schedule 13D, concurrently with the
purchase of the Term A Securities, Sunrise entered into a certain
Stockholders Agreement, dated as of August 9, 2000 (the "Stockholders
Agreement"), by and among Sunrise, The John R. Allard Revocable Trust of
1993, Kim A. Socha, The Michael E. Allard Revocable Trust of 1994, Lisa A.
Dibrigida, Gerald R. Allard, The Samy Nazarian Trust, The David and Angella
Nazarian Family Trust, Younes Nazarian, Richard A. Beyer and Michael
Foster. Pursuant to the Stockholders Agreement, the parties thereto have
agreed to vote their respective owned shares of Common Stock in favor of up
to four nominees to the board of directors of the Company that are
designated in writing by Sunrise.
As previously described on Schedule 13D, there are 1,359,342 shares
of Common Stock which are subject to the Stockholders Agreement and not
owned of record by Sunrise; these shares are referred to herein as the
"Stockholders Agreement Shares." The Stockholders Agreement also provides
that Common Stock acquired by any party thereto at any time after execution
of the Stockholders Agreement will be subject to the voting requirements
contained therein. To the extent any of the other parties to the
Stockholders Agreement acquire additional Common Stock after the date of
this Amendment, including by conversion or exercise of Securities purchased
pursuant to the Convertible Note Agreement, Sunrise will be deemed to
acquire beneficial ownership of those shares by virtue of the Stockholders
Agreement.
Other than as specifically set forth above, Sunrise and the other
Item 2 Persons possess no rights or powers to vote, direct the voting of,
dispose or direct the disposition of the Stockholders Agreement Shares. The
Item 2 Persons disclaim beneficial ownership of the Stockholders Agreement
Shares.
* * * *
The Item 2 Persons may buy or sell additional shares of Common Stock
pursuant to the Convertible Note Agreement, in the open market or otherwise
on such terms and at such times as the Item 2 Persons consider desirable.
Any decision by the Item 2 Persons to increase, decrease, or dispose of
their position in the Company would be based upon factors, including but
not limited to, the business of the Company, the price of the Common Stock,
the terms and conditions of the transaction and prevailing market
conditions.
Except as set forth in this Schedule 13D, the Item 2 Persons have no
present plans or proposals that relate to or would result in any of the
actions described in paragraphs (a) through (j) of Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer.
(a)
Sunrise
After giving effect to the puruchase of the Term B Securities
described in this Amendment, Sunrise is deemed to beneficially own a total
of shares of Common Stock, comprised of the following:
Common Stock owned of record: 1,534,900
Common Stock issuable upon
exercise of the Warrants held
by Sunrise: 1,828,572
Common Stock issuable upon
conversion of the Notes held by
Sunrise: 9,325,715
Shares of Common Stock not
owned by Sunrise that are the
subject of the Stockholders
Agreement: 1,359,342
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Total Common Stock
Beneficially Owned by Sunrise: 14,048,529
==========
The 14,048,529 shares deemed to be beneficially owned by Sunrise represent
approximately 61% of the fully-diluted number of outstanding shares of
Common Stock of the Company.
All Other Item 2 Persons
Because of their direct or indirect ownership interests in, or
control of, Sunrise, all other Item 2 Persons may be deemed to beneficially
own under Rule 13d-3 of the Act 14,048,529 shares of Common Stock, which
constitutes approximately 61% of of the fully-diluted number of outstanding
shares of Common Stock of the Company.
(b)
Sunrise
Sunrise possesses (or will possess upon issuance of such shares) the
sole voting power to vote or direct the vote of, and the sole power to
dispose or direct the disposition of, 12,689,187 shares of Common Stock,
which constitutes approximately 55% of the fully-diluted number of
outstanding shares of Common Stock of the Company.
Sunrise possesses the shared power to vote or direct the vote of
1,359,342 shares of Common Stock, which constitutes approximately 6% of the
fully-diluted number of outstanding shares of Common Stock of the Company.
All Other Item 2 Persons
Because of their direct or indirect ownership interests in, or
control of, Sunrise, all other Item 2 Persons may be deemed to possess (or
will be deemed to possess upon issuance of such shares)the sole voting
power to vote or direct the vote of, and the sole power to dispose or
direct the disposition of, 12,689,187 shares of Common Stock, which
constitutes approximately 55% of the fully-diluted number of outstanding
shares of Common Stock of the Company.
Because of their direct or indirect ownership interests in, or
control of, Sunrise, all other Item 2 Persons may be deemed to possess the
shared power to vote or direct the vote of 1,359,342 shares of Common
Stock, which constitutes approximately 6% of the fully-diluted number of
outstanding shares of Common Stock of the Company.
(d) Other than with respect to the voting rights granted pursuant to the
Stockholders Agreement, the Item 2 Persons possess no powers, rights or
privileges with respect to the Stockholders Agreement Shares. All other
powers, rights and privileges with respect to the Stockholders Agreement
Shares remain with the record owners of such shares, including the right to
vote on all matters unrelated to the matters covered by the Stockholders
Agreement, the right to receive and the power to direct the receipt of
dividends from such shares, and the power to direct the proceeds from the
sale of such shares.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer.
As previously disclosed in Schedule 13D, Sunrise has entered into the
Convertible Note Agreement with the Company providing for the sale of
additional Securities of the Company to Sunrise.
In connection with the purchase of Securities by Sunrise contemplated
by the Convertible Note Agreement, Sunrise is entitled to receive from the
Company a closing fee equal to 2% of the aggregate principal amount of each
series of Notes purchased by Sunrise. The closing fee may be paid by the
Company in cash or "in kind" by delivery of additional Notes in aggregate
principal amount of such fee.
In addition, Advisors is entitled to receive from the Company a
transaction fee equal to 2% of the aggregate principal amount of each
series of Notes issued by the Company. The transaction fee is compensation
for the services performed by Advisors in connection with each such
issuance. The transaction fee is payable in cash upon issuance of each
series of Notes.
Pursuant to the Convertible Note Agreement, Advisors is also entitled
to receive from the Company an annual administration fee while any Notes
remain outstanding. The administration fee is payable in cash in quarterly
installments.
Item 7. Material to be Filed as Exhibits.
Exhibit I Convertible Note Agreement, dated as of July 31, 2000,
By and among WPI Group, Inc., WPI Electronics, Inc.,
WPI Magnetec, Inc., WPI Micro Palm, Inc., WPI Power
Systems, Inc., WPI Termiflex, Inc., WPI Micro Processor
Systems, Inc., WPI Decisionkey, Inc., WPI UK Holding,
Inc., WPI UK Holding II, Inc., WPI Oyster Terminals,
Inc., WPI Husky Technology, Inc., and WPI Instruments,
Inc. as Borrowers, and Sunrise Capital Partners, L.P.
As Lender.*
Exhibit II Stockholders Agreement, dated as of August 9, 2000, made
by and among Sunrise Capital Partners, L.P. and each of
The John R. Allard Revocable Trust of 1993, Kim A. Socha,
The Michael E. Allard Revocable Trust of 1994, Lisa A.
Dibrigida, Gerald R. Allard, The Samy Nazarian Trust, The
David and Angella Nazarian Family Trust, Younes Nazarian,
Richard A. Beyer and Michael Foster.*
* Previously filed
SIGNATURE
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.
November 17, 2000
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(Date)
SUNRISE CAPITAL PARTNERS, L.P.
By: Sunrise Advisors, LLC
Its General Partner
By: /s/ Joseph Julian
-----------------------
(Signature)
Joseph Julian
Principal
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(Name/Title)
EXHIBIT INDEX
Exhibit I Convertible Note Agreement, dated as of July 31, 2000,
By and among WPI Group, Inc., WPI Electronics, Inc.,
WPI Magnetec, Inc., WPI Micro Palm, Inc., WPI Power
Systems, Inc., WPI Termiflex, Inc., WPI Micro Processor
Systems, Inc., WPI Decisionkey, Inc., WPI UK Holding,
Inc., WPI UK Holding II, Inc., WPI Oyster Terminals,
Inc., WPI Husky Technology, Inc., and WPI Instruments,
Inc. as Borrowers, and Sunrise Capital Partners, L.P.
As Lender.*
Exhibit II Stockholders Agreement, dated as of August 9, 2000, made
by and among Sunrise Capital Partners, L.P. and each of
The John R. Allard Revocable Trust of 1993, Kim A. Socha,
The Michael E. Allard Revocable Trust of 1994, Lisa A.
Dibrigida, Gerald R. Allard, The Samy Nazarian Trust, The
David and Angella Nazarian Family Trust, Younes Nazarian,
Richard A. Beyer and Michael Foster.*
* Previously filed
