SEC Form 4

FORM 4		UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934 or Section 30(h) of the Investment Company Act of 1940	OMB APPROVAL OMB Number: 3235-0287 Estimated average burden hours per response: 0.5
	Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

1. Name and Address of Reporting Person* RFE MANAGEMENT CORP (Last) (First) (Middle) C/O RFE MANAGEMENT CORP. 36 GROVE STREET (Street) NEW CANAAN CT 06840 (City) (State) (Zip)	2. Issuer Name and Ticker or Trading Symbol SUN HEALTHCARE GROUP INC [ SUNH ]	5. Relationship of Reporting Person(s) to Issuer (Check all applicable) Director X 10% Owner Officer (give title below) Other (specify below)
	3. Date of Earliest Transaction (Month/Day/Year) 03/15/2007
	4. If Amendment, Date of Original Filed (Month/Day/Year)	6. Individual or Joint/Group Filing (Check Applicable Line) Form filed by One Reporting Person X Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)		4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
			Code	V	Amount	(A) or (D)	Price
Common Stock	03/15/2007		A(13)		4,028	A	$0	4,028	I	See footnotes(2)(3)(4)
Common Stock	03/15/2007		A(13)		4,028	A	$0	4,028	I	See footnotes(3)(4)(5)
Common Stock								2,966	I	See footnotes(1)(2)(3)(4)
Common Stock								2,967	I	See footnotes(1)(3)(4)(5)
Common Stock								1,432	I	See footnotes(2)(3)(4)(12)
Common Stock								1,433	I	See footnotes(3)(4)(5)(12)
Common Stock(6)								2,358,583	D
Common Stock(7)								2,369,324	D

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)		5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
				Code	V	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares
Option (Right to Buy)	$12.36	03/15/2007		A(14)		4,028		(14)	03/15/2014	Common Stock	4,028	$0	4,028	I	See footnotes(3)(4)(10)
Option (Right to Buy)	$12.36	03/15/2007		A(14)		4,028		(14)	03/15/2014	Common Stock	4,028	$0	4,028	I	See footnotes(3)(4)(11)
Option (Right to Buy)	$8.21							(8)	05/30/2013	Common Stock	2,966		2,966	I	See footnotes(3)(4)(10)
Option (Right to Buy)	$8.21							(8)	05/30/2013	Common Stock	2,967		2,967	I	See footnotes(3)(4)(11)
Option (Right to Buy)	$7.64							(8)	12/08/2012	Common Stock	3,342		3,342	I	See footnotes(3)(4)(10)
Option (Right to Buy)	$7.64							(9)	12/08/2012	Common Stock	3,343		3,343	I	See footnotes(3)(4)(11)

1. Name and Address of Reporting Person* RFE MANAGEMENT CORP (Last) (First) (Middle) C/O RFE MANAGEMENT CORP. 36 GROVE STREET (Street) NEW CANAAN CT 06840 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* RFE Investment Partners V, L.P. (Last) (First) (Middle) C/O RFE MANAGEMENT CORP. 36 GROVE STREET (Street) NEW CANAAN CT 06840 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* RFE Associates V, L.P. (Last) (First) (Middle) C/O RFE MANAGEMENT CORP. 36 GROVE STREET (Street) NEW CANAAN CT 06840 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* RFE INVESTMENT PARTNERS VI L P (Last) (First) (Middle) C/O RFE MANAGEMENT CORP. 36 GROVE STREET (Street) NEW CANAAN CT 06840 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* RFE VI SBIC, L.P. (Last) (First) (Middle) C/O RFE MANAGEMENT CORP. 36 GROVE STREET (Street) NEW CANAAN CT 06840 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* RFE Associates VI SBIC, LLC (Last) (First) (Middle) C/O RFE MANAGEMENT CORP. 36 GROVE STREET (Street) NEW CANAAN CT 06840 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* RFE Associates VI, LLC (Last) (First) (Middle) C/O RFE MANAGEMENT CORP. 36 GROVE STREET (Street) NEW CANAAN CT 06840 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* FOSTER MICHAEL J (Last) (First) (Middle) C/O RFE MANAGEMENT CORP. 36 GROVE STREET (Street) NEW CANAAN CT 06840 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer X Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* Landis Howard C (Last) (First) (Middle) C/O RFE MANAGEMENT CORP. 36 GROVE STREET (Street) NEW CANAAN CT 06840 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* Parsons James A (Last) (First) (Middle) C/O RFE MANAGEMENT CORP. 36 GROVE STREET (Street) NEW CANAAN CT 06840 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

Explanation of Responses:

1. Grant of restricted stock units to Michael J. Foster, a director of the Issuer. The units were originally awarded May 31, 2006 under the Issuer's 2004 Equity Incentive Plan, but were subject to the satisfaction of certain performance targets. On February 27, 2007, the Issuer's Compensation Committee determined the level that those performance targets were satisfied. The units vest at the rate of 25% on each of June 30, 2007 and May 31, 2008, 2009 and 2010 and, upon vesting, will be paid on a one-for-one basis in shares of the Issuer's Common Stock.

2. Restricted stock units comprised of shares of Common Stock which are held by Michael J. Foster, a director of the Issuer, on behalf of RFE Investment Partners V, L.P. ("RFE V"), which restricted stock units may be deemed to be indirectly owned by RFE V

3. RFE Associates V, L.P. ("RFE V Associates") is the general partner of RFE V. RFE Associates VI SBIC, LLC ("RFE Associates VI SBIC") is the general partner of RFE VI SBIC. RFE Investment Partners VI, L.P. ("RFE VI") is the sole member of RFE Associates VI SBIC. RFE Associates VI, LLC ("RFE Associates VI") is the general partner of RFE VI. RFE Management Corp. ("RFE Management") is an investment manager. Messrs. Michael J. Foster, Howard C. Landis and James A. Parsons are general partners and/or managing members of RFE Associates V and RFE Associates VI and officers and/or directors of RFE Management.

4. Mr. Foster is also a director of the Issuer. Each Reporting Person disclaims the existence of a "group" and disclaims beneficial ownership of any securities (except to the extent of such Reporting Person's pecuniary interest in such securities) other than any securities reported herein as being directly owned by such Reporting Person and this report shall not be deemed an admission that such Reporting person is the beneficial owner of any such securities for purposes of Section 16 or for any other purpose.

5. Restricted stock units comprised of shares of Common Stock which are held by Michael J. Foster, a director of the Issuer, on behalf of RFE VI SBIC, L.P. ("RFE VI SBIC"), which restricted stock units may be deemed to be indirectly owned by RFE VI SBIC.

6. Shares are held directly by RFE V.

7. Shares are held directly by RFE VI SBIC.

8. Grant of stock options to Michael J. Foster, a director of the Issuer. The options were originally awarded May 31, 2006 under the Issuers' 2004 Equity Incentive Plan, but were subject to the satisfaction of certain performance targets. On February 27, 2007, the Issuer's Compensation Committee determined the level that those performance targets were satisfied. The options vest at the rate of 25% on each of May 31, 2007, 2008, 2009 and 2010.

9. Grant of stock options to Michael J. Foster, a director of the Issuer, under the Issuer's 2004 Equity Incentive Plan; vests at the rate of 25% on each of December 9, 2006, 2007, 2008 and 2009.

10. Options to purchase shares of Common Stock which are held by Michael J. Foster, a director of the Issuer, on behalf of RFE V, which options may be deemed to be indirectly owned by RFE V.

11. Options to purchase shares of Common Stock which are held by Michael J. Foster on behalf of RFE VI SBIC, which options may be deemed to be indirectly owned by RFE VI SBIC.

12. Restricted stock units awarded to Michael J. Foster, a director of the Issuer, under the Issuer's 2004 Equity Incentive Plan; vests at the rate of 25% on each of December 9, 2006, 2007, 2008 and 2009.

13. Grant of restricted stock units to Michael J. Foster, a director of the Issuer, under the Issuer's 2004 Equity Incentive Plan. The units vest at the rate of 25% on each of April 15, 2008, and March 15, 2009, 2010 and 2011 and, upon vesting, will be paid on a one-for-one basis in shares of the Issuer's Common Stock.

14. Grant of stock options to Michael J. Foster, a director of the Issuer, under the Issuer's 2004 Equity Incentive Plan; vests at the rate of 25% on each of March 15, 2008, 2009, 2010 and 2011.

	/s/ James A. Parsons, by power of attorney, for RFE Management Corp.	03/19/2007
	/s/ James A. Parsons, by power of attorney, for RFE Investment Partners V, L.P.	03/19/2007
	/s/ James A. Parsons, by power of attorney, for RFE Associates V, L.P.	03/19/2007
	/s/ James A. Parsons, by power of attorney, for RFE Investment Partners VI, L.P.	03/19/2007
	/s/ James A. Parsons, by power of attorney, for RFE VI SBIC, L.P.	03/19/2007
	/s/ James A. Parsons, by power of attorney, for RFE Associates VI SBIC, LLC	03/19/2007
	/s/ James A. Parsons, by power of attorney, for RFE Associates VI, LLC	03/19/2007
	/s/ James A. Parsons, by power of attorney, for Michael J. Foster	03/19/2007
	/s/ James A. Parsons, by power of attorney, for Howard C. Landis	03/19/2007
	/s/ James A. Parsons	03/19/2007
	** Signature of Reporting Person	Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 4 (b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
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