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UPDATE 2-Sunrise Senior Living names CFO, settles lawsuit

(Adds detail on board elections)

CHICAGO, Sept 10 (Reuters) - Sunrise Senior Living Inc. SRZ.N, the biggest U.S. owner of assisted-living facilities, said on Monday it named Richard Nadeau as chief financial officer and settled a lawsuit related to the timing of its annual meeting.

Sunrise, which is restating its earnings for 2003 to 2005, said it settled a lawsuit filed by Millenco LLC seeking a court order requiring the company to hold its 2007 annual meeting of stockholders within 45 days. Sunrise said it will hold the meeting on Oct. 16.

Sunrise, also the subject of a government probe into insider stock sales and accounting practices, in July said its board was weighing strategic alternatives, including a possible sale.

Nadeau, previously CFO of shopping mall developer Mills Corp MLS.H, will work toward completing Sunrise's pending financial restatements and assist with the board's ongoing exploration of strategic alternatives, the company said.

Nadeau replaces Julie Pangelinan, who was acting chief financial officer since April and will continue as Sunrise’s chief accounting officer. Sunrise in May fired its former CFO, Bradley Rush, citing a failure to follow the company’s document retention policies.

As part of its settlement with Millenco, Sunrise said it expanded its board of directors to nine members from eight and appointed Lynn Krominga, an attorney and private equity consultant, to an initial term of office expiring at the October annual meeting.

At the meeting, incumbent directors Paul Klaassen and Craig Callen will seek re-election. Krominga, who was proposed by Millenco and agreed to by the Sunrise board of directors, will also run for election.

Shares of Sunrise, based in McLean, Virginia, rose 61 cents, or 1.74 percent, to $35.65 in morning trading on the New York Stock Exchange. (Reporting by Susan Kelly in Chicago)

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