Sunrise Provides Status Report on Special Independent Committee Investigation; Provides Updates on Management's Internal Control Review Efforts and on Legal P...(mpany's new Chief Financial Office...),Health

Officer.

-- New Chief Accounting Officer. As previously disclosed, in April 2006,

Julie A. Pangelinan was hired as the Company's new Chief Accounting

Officer.

-- Expansion of Accounting Policy Group. The Company has expanded its

accounting policy group from one professional to six professionals,

including five certified public accountants.

-- SOX Compliance. In October 2006, the Company hired a Senior Director

of SOX Compliance, who reports to the Chief Accounting Officer.

-- Other Additional Accounting Personnel. In June 2006, the Company added

the position of Assistant Controller. In October 2006, the Company

named a new Controller. The Company has also added four additional

staff members in the financial reporting group, three additional

corporate staff members in the international reporting group and three

additional staff members in the operations accounting group.

Separately, at the Board level and as previously disclosed, in June 2007, the Company's Board of Directors appointed Stephen D. Harlan as a new member of the Board and as a member of the Audit Committee. In connection with his appointment to the Audit Committee, the Board determined that Mr. Harlan qualified as an "audit committee financial expert" as defined under the rules of the SEC.

As also previously disclosed, effective September 5, 2007 Sunrise's Board of Directors also appointed Lynn Krominga as a new member of the Board. On September 28, 2007, the Board of Directors appointed Ms. Krominga as a member of the Audit Committee.

Update on Legal Proceedings

CGB Occupational Therapy. As previously disclosed, Sunrise is a defendant in a lawsuit filed by CGB Occupational Therapy, Inc. ("CGB") in September 2000 in the U.S. District Court for the Eastern District of Pennsylvania. CGB provided therapy services to two nursi
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