SEIU Keeps Pressure On Sunrise Senior Living
The Service Employees International Union Master Trust, the union's $1.7 billion pension fund, today made clear they plan an active agenda for Tuesday's annual meeting of Sunrise Senior Living, the McLean assisted living company.
Though it's not among Sunrise's largest shareholders, the group has been among its most active. SEIU officials have raised questions about whether Sunrise executives participated in insider trading and options backdating as the company was forced to restate around $120 million in earnings.
Sunrise announced a week and a half ago the preliminary results of an investigation by a special committee of the board into the allegations of accounting misconduct.
The committee concluded that Sunrise executives did not intentionally manipulate earnings or engage in inappropriate conduct by awarding stock options or trading the company's shares. Sunrise declined to comment on the SEIU release.
At the annual meeting Tuesday - scheduled for 9 a.m. at the McLean Hilton - the SEIU is asking all shareholders to show up and vote on several measures. They include:
* Changing the way Sunrise's board is elected. Currently, several but not all directors are elected annually. Sunrise wants all directors to stand for annual election to make it easier to force change among the board.
Stephen Abrecht, executive director of the master trust, wrote in a letter to shareholders that the current situation "has contributed to the insularity and conflicts of interest that characterize the board and created an extremely high hurdle for significant leadership change."
* Opposing the reelection of board director Craig R. Callen, a member of the board's audit and compensation committee who SEIU blames in part for the company's accounting problems.
* Supporting a measure to reclaim compensation paid to senior executives "on performance goals that were not achieved."
* Supporting the election of Lynn Krominga, an independent management consultant, to the board. Krominga joined the board on an interim basis after Sunrise settled a lawsuit with Millennium Corp., a New York hedge fund and major investor in the company.
Millennium sued Sunrise to add a member to the board and hold an annual meeting. Sunrise agreed to do that and only that, but the SEIU then sued to say the company would have to entertain other shareholder proposals at an annual meeting. Sunrise agreed and the suit was settled.
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