Successor Issuer Granted Accelerated Filer Status

At a November 4 special meeting, Sun Healthcare Group, Inc. ("Old Sun") will seek shareholder approval to restructure its business by splitting into two separate publicly-traded companies.  Sabra Health Care REIT, Inc. would control real property assets following a REIT conversion merger and SHG Services, Inc. ("New Sun") will control operating assets.  SHG Services, which would continue to conduct the historical operations and business of Old Sun, would be renamed Sun Healthcare Group, Inc. and begin trading under Old Sun's ticker symbol (SUNH).  The separation/spin-off of New Sun was detailed in a Form S-1 filed by SHG Services (SEC File No. 333-167041) and shares for the REIT conversion were registered on a Form S-4 filed by Sabra Health Care REIT (333-167044).  The definitive proxy statement was filed on 9/29/10 (File No. 001-12040). 

In connection with the restructuring, Old Sun sought a No Action letter from the SEC on September 28 (WSB No.: 1004201001).  The letter asked the SEC to not take enforcement actions on several key issues regarding the restructuring.  First, the company asked that New Sun, as a successor, be deemed an accelerated filer immediately.  Second, that filers of Schedules 13D and 13G will not be required to make any additional filings.  Third, that New Sun can use the reporting history of Old Sun to determine 1933 Act eligibility.  Fourth, exemption from Section 4(3) and Rule 174 regarding prospectus delivery requirements.  Fifth, to use Old Sun's periodic report history to determine New Sun's compliance with Rule 144(c)(1).  Sixth, to allow New Sun to file post-effective amendments as a successor issuer to registrations filed by Old Sun.  Seventh, that New Sun will continue to use the 1934 file number (001-12040) and EDGAR access codes of Old Sun. 

In making its case to the SEC, the company referenced several No-Action letters where SEC Staff has taken similar positions with respect to successors in similar restructurings.  Such examples include: GulfMark Offshore, Inc. (available 1/11/10), Tim Hortons Inc. (available 9/9/09), Willbros Group, Inc. (available 2/27/09), Hungarian Telephone and Cable Corp. (available 2/27/09), and Weatherford International Ltd. (available 1/14/09).  In a brief reply, the SEC staff agreed to all of the requests for non-enforcement that had been laid out by the company.  The S-1 and S-3 Registrations Statements were each declared effective on 9/28/10.