Wright Medical Group, Inc. 8-K Filed May 5, 2011

8/6/2019 Wright Medical Group, Inc. 8-K Filed May 5, 2011

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WRIGHT MEDICAL GROUP INC (WMGI)

8-K Current report filingFiled on 05/05/2011Filed Period 05/05/2011
http://westlawbusiness.com/http://thomsonreuters.com/


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Table of Contents

UNITED STATESSECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-KCURRENT REPORT

Pursuant to Section 13 or 15(d) of theSecurities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 5, 2011

WRIGHT MEDICAL GROUP, INC.(Exact name of registrant as specified in charter)

Delaware

(State or Other Jurisdictionof Incorporation)

000-32883

(CommissionFile Number)

13-4088127

(IRS EmployerIdentification No.)

5677 Airline Road,Arlington, Tennessee 38002

(Address of Principal Executive Offices) (Zip Code)

Registrant's telephone number, including area code: ( 901) 867-9971

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of thefollowing provisions:o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))


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Item 2.02. Results of Operations and Financial ConditionItem 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; CompensatoryArrangements of Certain OfficersItem 8.01. Other EventsItem 9.01. Financial Statements and ExhibitsSIGNATUREEXHIBIT INDEXEX-10.1EX-99


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Item 2.02. Results of Operations and Financial Condition.

On May 5, 2011, Wright Medical Group, Inc. issued a press release announcing its consolidated financial results for the quarter ended March 31, 2011. Acopy of the press release is furnished as Exhibit 99 to this report.

The attached press release includes the following non-GAAP measures: net sales, excluding the impact of foreign currency; operating income, as adjusted; netincome, as adjusted; net income, as adjusted, per diluted share; effective tax rate, as adjusted; and free cash flow.

These non-GAAP measures are not in accordance with, or an alternative for, generally accepted accounting principles and may be different from non-GAAPmeasures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. Webelieve that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with our results of operations as determined inaccordance with GAAP and that these measures should only be used to evaluate our results of operations in conjunction with the corresponding GAAPmeasures.

For our internal budgeting and resource allocation process, our management uses financial information that does not include (a) restructuring charges, (b) non-cash stock-based compensation expenses, (c) costs associated with U.S. government inquiries and our deferred prosecution agreement (DPA), (d) transactioncosts and non-cash deferred financing fees associated with the 2.625% Convertible Senior Notes due 2014 (Convertible Notes) tender offer, and (e) theincome tax effects of the foregoing. Additionally, for our internal budgeting process and evaluation of net sales performance, our management uses net salesin constant currency. To measure our sales performance on a constant currency basis, it is necessary to remove the impact of changes in foreign exchangerates, which affects the comparability and trend of sales. Net sales, excluding the impact of foreign currency, is calculated by translating current year results atprior year average foreign currency exchange rates. For our internal budgeting and resource allocation process, management uses free cash flow. Free cashflow is calculated by subtracting capital expenditures from cash provided by operating activities.

We use these non-GAAP financial measures in making operating decisions because we believe the measures provide meaningful supplemental informationregarding our core operational performance and give us a better understanding of how we should invest in research and development activities and how weshould allocate resources to both ongoing and prospective business initiatives. We use these measures to help make budgeting and spending decisions, forexample, between product development expenses and research and development, sales and marketing and general and administrative expenses. Additionally,management is evaluated on the basis of these non-GAAP financial measures when determining achievement of their incentive performance compensationtargets. Further, these non-GAAP financial measures facilitate management's internal comparisons to both our historical operating results and to ourcompetitors' operating results.

As described above, we exclude the following items from one or more of our non-GAAP measures:

Foreign currency impact on net sales . We exclude the foreign currency impact on net sales compared to prior year from our non-GAAP measure, primarilybecause it is not reflective of our ongoing operating results, and it is not used by management for our internal budgeting process and evaluation of net salesperformance. We further believe that excluding this item from our non-GAAP results is useful to investors in that it allows for period-over-periodcomparability.

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Restructuring charges. We exclude restructuring charges associated with the closure of our Toulon, France operations and Creteil, France operations from ournon-GAAP measures, primarily because they are not reflective of our ongoing operating results, and they are not used by management to assess the coreprofitability of our business operations. We further believe that excluding this item from our non-GAAP results is useful to investors in that it allows forperiod-over-period comparability.

Non-cash stock-based compensation expense. We exclude stock-based compensation expenses from our non-GAAP measures primarily because they are non-cash expenses. We believe that it is useful to investors to understand the application of Financial Accounting Standards Board Accounting StandardCodification Topic 718, Compensation Stock Compensation (FASB ASC 718) and its impact on our operational performance, liquidity, and our ability toinvest in research and development and fund acquisitions and capital expenditures. While stock-based compensation expense calculated in accordance withFASB ASC 718 constitutes an ongoing and recurring expense, such expense is excluded from our non-GAAP results because it is not an expense that requires

cash settlement and is not used by management to assess the core profitability of our business operations. We further believe that excluding this item from ournon-GAAP results is useful to investors in that it allows for greater transparency to certain line items in our financial statements. In addition, excluding thisitem from our non-GAAP results facilitates comparisons to our competitors' operating results.

Costs associated with U.S. government inquiries and our DPA. During 2009 and 2010, we recognized costs associated with inquiries by the U. S. Departmentof Justice (DOJ) and the U. S. Securities and Exchange Commission. Those costs resulted primarily from legal and consulting fees incurred as we respondedto these inquiries, and in 2010, our settlement of the investigation by the DOJ and our DPA (including the associated independent monitor). We excludedthose costs from our non-GAAP results because such costs are not used by management to assess the core profitability of our business operations. We furtherbelieve that these measures are useful to investors in that they allow for period-over-period comparability.

Transaction costs and non-cash deferred financing fees associated with our Convertible Notes tender offer. We excluded the transaction costs and non-cashdeferred financing fees from our non-GAAP measures, primarily because they are not reflective of our ongoing operating results, and they are not used bymanagement to assess the core profitability of our business operations. We further believe that excluding this item from our non-GAAP results is useful toinvestors in that they allow for period-over-period comparability.

Income tax effects of the foregoing. This amount is used to present each of the amounts described above, except for foreign currency impact on net sales, onan after-tax basis consistent with the presentation of net income, as adjusted.

We believe that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with our financial results as determined in

accordance with GAAP and that these measures should only be used to evaluate our financial results in conjunction with the corresponding GAAP measures,and that is why we qualify the use of non-GAAP financial information in a statement when non-GAAP information is presented.

We further believe that where the adjustments used in calculating net income, as adjusted, and net income, as adjusted, per diluted share are based on specific,identified amounts that impact different line items in our Condensed Consolidated Statements of Operations (including operating income and net income), thatit is useful to investors to understand how these specific line items in our Condensed Consolidated Statements of Operations are affected by these adjustmentsfor the following reasons:

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Operating income . Excluding non-cash stock-based compensation expense from the calculation of operating income assists investors in evaluating period-over-period changes without giving effect to these charges which are non-cash in nature, in order to evaluate the results of the underlying operating activitiesfor the periods presented. Excluding restructuring charges and the costs associated with the U.S. government inquiries and our DPA from the calculation of operating income assists investors in evaluating period-over-period changes in this measure without giving effect to transactions which do not relate to theperformance of our ongoing operations.

Net Income. Excluding non-cash stock-based compensation expense and non-cash deferred financing fees related to the Convertible Notes tender offer fromthe calculation of net income assists investors in evaluating period-over-period changes without giving effect to these charges which are non-cash in nature, inorder to evaluate the results of the underlying operating activities for the periods presented. Excluding restructuring charges, the costs associated with the U.S.government inquiries and our DPA and transaction costs related to the Convertible Notes tender offer from the calculation of net income assists investors in

evaluating period-over-period changes in this measure without giving effect to transactions which do not relate to the performance of our ongoing operations. Effective Tax Rate . Excluding the income tax effect of the non-GAAP, pre-tax adjustments from the provision for income taxes assists investors inunderstanding the tax provision associated with those adjustments and our effective tax rate related to our ongoing operations.

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Compensatory Arrangements of Certain Officers

On May 3, 2011, we entered into an employment agreement with David D. Stevens to serve as our interim President and Chief Executive Officer commencingon April 4, 2011. The principal terms of Mr. Stevens' employment agreement are summarized below.

Term. The term of the agreement begins on April 4, 2011, and ends on April 4, 2012, subject to earlier termination upon the employment of a Presidentand Chief Executive Officer.

Base Salary. The agreement establishes the initial annual base salary of Mr. Stevens at $610,000.

Long-Term, Equity-Based Incentives. The agreement provides that, on May 3, 2011, we will grant to Mr. Stevens an award of 39,400 restricted shares of our common stock under the Company's 2009 Equity Incentive Plan. The shares will vest 12 months from the effective date.

Fringe Benefits. The agreement provides that Mr. Stevens is eligible to participate in the fringe benefit programs, including those for medical insuranceand retirement benefits, that we generally furnish to our executive officers from time to time. Mr. Stevens is required to make any generally applicableemployee contribution that is required under such fringe benefit programs.

Restrictive Covenants. Mr. Stevens has agreed to customary restrictive covenants prohibiting his disclosure of our confidential information at any time,requiring him to assign to us any intellectual property developed in connection with his employment, prohibiting him from soliciting or recruiting ouremployees, and prohibiting him from competing and interfering with our business. The non-disclosure, non-solicitation, non-competition and non-interferencecovenants extend for a period following termination of Mr. Stevens' employment.

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Termination. We or Mr. Stevens "may terminate Mr. Stevens' employment with or without cause", as defined in the agreement, If we terminateMr. Stevens' employment for cause, or if he resigns, we will have no further obligations to Mr. Stevens, other than accrued obligations and standard COBRAbenefits. If we terminate Mr. Stevens' employment without cause, we will be required to pay Mr. Stevens his base salary for a period of eight weeks after histermination, to pay any accrued obligations, and to provide standard COBRA benefits. The definition of cause includes (i) the willful failure by Mr. Stevens tosubstantially perform his duties with us which failure amounts to an intentional and extended neglect of Mr. Stevens' duties, (ii) continued, documented poorperformance following a reasonably sufficient time for improvement, (iii) the determination by our Board of Directors that Mr. Stevens has engaged or isabout to engage in conduct materially injurious to us, (iv) the determination by our Board of Directors, that Mr. Stevens has engaged in or about to engage inconduct that is materially inconsistent with our legal and health care compliance policies, programs, or obligations, (v) Mr. Stevens' conviction of or enteringof a guilty or no contest plea to a felony charge, or (vi) Mr. Stevens' breach of his covenants under the agreement.

Clawback. If we are required to restate our balance sheet or statement of operations affecting any reporting period that transpires during the term of theemployment agreement due to our material non-compliance with any financial requirements under securities laws, we may require Mr. Stevens to reimburseus for any bonus or incentive-based or equity-based compensation received by Mr. Stevens during the term of the employment agreement and any profitsrealized from the sale of our securities by Mr. Stevens during the term of the employment agreement. If our Board of Directors determines that such aforfeiture is appropriate, we may withhold future amounts owed to Mr. Stevens as compensation, and we may commence legal action to collect such sums asour Board of Directors determines is owed to us.

Item 8.01. Other Events.

On May 5, 2011, WMT received a letter from the USAO pursuant to Paragraph 50 of the DPA stating that the USAO believes that WMT has knowingly andwillfully committed at least two breaches of material provisions of the DPA. As required by the terms of the DPA, the letter provides WMT an opportunity tomake a presentation within three weeks of receipt of the letter. WMT intends to make a presentation in response to the letter. WMT's presentation couldaddress whether any breach has occurred, whether any breach was knowing or willful, materiality, and whether any breach has been cured. Pursuant to theDPA, we expect that the USAO would not take any further action until consideration of WMT's presentation.

Item 9.01. Financial Statements and Exhibits.(d) Exhibits.

Exhibit Number Description

10.1 Employment Agreement dated as of April 4, 2011, between Wright Medical Technology, Inc. and David D. Stevens.99 Press release issued by Wright Medical Group, Inc. on May 5, 2011.

Cautionary Note Regarding Forward-Looking Statements

This current report on Form 8-K contains "forward-looking statements" as defined under U.S. federal securities laws, including statements regarding potentialactions by the USAO, independent monitor, OIG and other agencies or their potential impact, and statements about financial results for the quarter endedMarch 31, 2011. These statements reflect management's current knowledge, assumptions, beliefs, estimates, and expectations and express management'scurrent views of future performance, results, and trends and may be identified by their use of terms such as anticipate, believe, could, estimate, expect, intend,may, plan, predict, project, will, and other similar terms. Forward-looking statements are subject to a number of risks and uncertainties that could cause ouractual results to materially differ from those described in the forward-looking statements. You should not place undue reliance on forward looking statements.Such statements are made as of the date of this current report on Form 8-K, and we undertake no obligation to update such statements after this date. Risksand uncertainties that could cause our actual results to materially differ from those described in forward-looking statements include those discussed in ourfilings with the Securities and Exchange Commission (including those described in Item 1A of our Annual Report on Form 10-K for the year ended December31, 2010, under the heading "Risk Factors" and elsewhere), and the impact of our settlement of the federal investigation into our consulting arrangements withorthopaedic surgeons relating to our hip and knee products in the United States, including our compliance with the Deferred Prosecution Agreement throughSeptember 2011 (which could, by its terms, be extended for a further six months) and the Corporate Integrity Agreement through September 2015. Our failureto comply with the Deferred Prosecution Agreement or the Corporate Integrity Agreement could expose us to significant liability including, but not limited to,extension of the term of the DPA by up to 6 months, exclusion from federal healthcare program participation, including Medicaid and Medicare, which wouldhave a material adverse effect on our financial condition, results of operations and cash flows, potential prosecution, including under the previously-filedcriminal complaint, civil and criminal fines or penalties, and additional litigation cost and expense.

Additional risks and uncertainties that could cause our actual results to materially differ from those described in forward-looking statements include demandfor and market acceptance of our new and existing products; future actions of governmental authorities and other third parties; tax measures; businessdevelopment and growth opportunities; product quality or patient safety issues; products liability claims; enforcement of our intellectual property rights; thegeographic and product mix impact on our sales; retention of sales representatives and independent distributors; inventory reductions or fluctuations in buyingpatterns by wholesalers or distributors; ability to realize the anticipated benefits of restructuring initiatives; and impact of the commercial and creditenvironment on us and our customers and suppliers.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersignedhereunto duly authorized.

Date: May 5, 2011

WRIGHT MEDICAL GROUP, INC. By: /s/ David D. Stevens

David D. StevensInterim Chief Executive Officer

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EXHIBIT INDEX

Exhibit Number Description

10.1 Employment Agreement dated as of April 4, 2011, between Wright Medical Technology, Inc. and David D. Stevens.99 Press release issued by Wright Medical Group, Inc. on May 5, 2011.


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Exhibit 10.1

EMPLOYMENT AGREEMENT

This Employment Agreement ("Agreement"), is made and entered into this 4th day of April, 2011, (the "Effective Date") by and between Wright Medical

Technology, Inc. ("Company"), a corporation organized and existing under the laws of the State of Delaware with its principal place of business at 5677Airline Road, Arlington, Tennessee 38002, and David D. Stevens ("Executive").

WHEREAS , the Company desires to employee Executive as its interim President and Chief Executive Officer to report to the Executive Committee of theCompany's Board of Directors; and

WHEREAS, the Company and the Executive desire to set forth the terms and conditions of Executive's employment with Company as the interimPresident and Chief Executive Officer;

NOW, THEREFORE , for and in consideration of the mutual covenants contained in this Agreement, Company and Executive agree as follows:

1. Definitions . For the purposes of this Agreement, the following capitalized terms have the meanings set forth below:

1.1. "Accrued Obligations" means a lump sum amount in cash equal to the sum of (i) the Executive's annual base salary through the Date of Termination to the extent not theretofore paid, (ii) an amount equal to the value of any accrued and/or untaken vacation, if any, and (iii) reimbursement forunreimbursed business expenses, if any, properly incurred by the Executive in the performance of the Executive's duties in accordance with the policiesestablished from time to time by the Board.

1.2. "Affiliate" has the meaning set forth in Rule 12b-2 promulgated under the Exchange Act.

1.3. "Compensation Committee" means the compensation committee of the Board. 1.4. "Competitive Business" means the manufacturing, supplying, producing, selling, distributing, marketing or providing for sale of any product,device or instrument manufactured or sold by the Company or any of its Affiliates or subsidiaries, in each case as of the Executive's Date of Termination orthe Expiration Date.

1.5. "Exchange Act" means the Securities Exchange Act of 1934, as amended, and the applicable rulings and regulations thereunder.


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Wright Medical Technology, Inc.Employment Agreement David Stevens CONFIDENTIALPage 2 DO NOT COPY

1.6. "Incentive Compensation Awards" means awards granted under Incentive Compensation Plans providing the Executive with the opportunity toearn, on a year-by-year or a multi-year basis, annual and long-term incentive compensation.

1.7. "Incentive Compensation Plans" means annual incentive compensation plans and long-term incentive compensation plans of the Company, whichlong-term incentive compensation plans may include plans offering stock options, restricted stock and other forms of long-term incentive compensation.

1.8. "Person" has the meaning set forth in Section 3(a)(9) of the Exchange Act, as modified and used in sections 13 and 14 thereof, except that the termshall not include (i) the Company or any of its Affiliates, (ii) a trustee or other fiduciary holding securities under an employee benefit plan of the Company orany of its Affiliates, (iii) an underwriter temporarily holding securities pursuant to an offering of such securities, (iv) a corporation owned, directly orindirectly, by the shareholders of the Company in substantially the same proportions as their ownership of the stock in the Company, or (v) a person or groupas used in Rule 13d-1(b) promulgated under the Exchange Act.

2. Employment . The Company hereby employs the Executive, and the Executive hereby accepts employment, upon the terms and conditions herein setforth.

3. Duties . The Executive is engaged as the interim President and Chief Executive Officer of the Company and shall report to the Executive Committee of the Board of Directors of the Company ("Board") and hereby promises to perform and discharge well and faithfully the duties which may be assigned to himfrom time to time by the Board in connection with the conduct of the Company's business.

4. Extent of Services . The Executive shall devote his time, attention, and energies to the business of the Company and shall not, without the approval of the Company, during the term of this Agreement be engaged in any other business activity, regardless of whether such activity is pursued for gain, profit orother pecuniary advantage; provided, however, that this requirement shall not be construed as preventing the Executive from (a) investing his personal assetsin businesses which do not compete with the Company in such form or manner as will not require any services on the part of the Executive in the operation of the affairs of the companies in which such investments are made and in which his participation is solely that of an investor, or (b) purchasing securities in anycorporation engaged in a business competitive to that of the Company whose securities are regularly traded on the Nasdaq Stock Market, a national orregional stock exchange, or the over-the-counter market, provided that such purchase shall not result in his collectively owning beneficially at any one timeone percent (1%) or more of the equity securities of such corporation. Nothing in this Section 4 shall prevent the Executive from continuing to service on theBoard or the board of directors of any other company or from continuing his prior business activities for any other company.

5. Compensation Matters .


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absolute discretion, or the Executive may terminate the Executive's employment and the Company's obligations hereunder.

9. Termination and Effects of Termination .

9.1. Notice and Date of Termination .

9.1.1. Notice. Any termination of the Executive's employment by the Company or by the Executive prior to the Expiration Date shall becommunicated by a written notice of termination to the other party (the "Notice of Termination"). Where applicable, the Notice of Termination shall indicatethe specific termination provision in this Agreement relied upon and shall set forth in general terms the facts and circumstances claimed to provide a basis fortermination of the Executive's employment under the provision so indicated. Any termination by resignation by Executive shall provide the Company with notless than four (4) weeks notice.

9.1.2. Date. The date of the Executive's termination of employment with the Company ( "Date of Termination") shall be determined as follows:

9.1.2.1. If due to Company terminating the Executive's employment, either with or without Cause, the Date of Termination shall be the datespecified in the Notice of Termination; if for other than Cause, the Date of Termination shall not be less than two (2) weeks from the date such Notice of Termination is given, unless the Company elects to pay the Executive for that period in lieu of notice. Any such payment in lieu of notice would be in additionto any payments provided pursuant to Section 9.3

9.1.2.2. If due to death, the Date of Termination is the date of death.

9.1.2.3. If due to resignation by the Executive, the Date of Termination shall be determined by the Company, but shall not be less than four(4) weeks from the date such Notice of Termination is given.

9.2. Termination for Cause or Resignation by Executive and Effects Thereof.

9.2.1. Termination for Cause. The Company may terminate Executive for the following reasons: (i) the willful failure by the Executive tosubstantially perform the Executive's duties with the Company (other than any such failure resulting from the Executive's incapacity due to physical or mentalillness) as determined by the Board, which failure amounts to an intentional and extended neglect of the Executive's duties, (ii) continued, documented poorperformance on the part of the Executive following a reasonably sufficient time for the Executive to improve, (iii) the determination by the Board, in its solediscretion, that the Executive has engaged or is about to engage in conduct materially injurious to the Company, (iv) the determination by the Board, in itssole discretion, that the Executive has engaged in or is about to engage in conduct that is materially inconsistent with the Company's legal and health


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care compliance policies, programs or obligations; (v) the Executive's conviction of or entering of a guilty or no contest plea to a felony charge (or equivalentthereof) in any jurisdiction; and/or (iv) the Executive's participation in activities proscribed in Sections 12.1, 12.3, and 12.4 or the material breach of any othercovenants contained herein. ("Cause"). For the purposes of clause (i) of this definition, no act, or failure to act, on the Executive's part shall be deemed to be"willful" unless done, or omitted to be done, by the Executive not in good faith and without reasonable belief that the Executive's act, or failure to act, was inthe best interests of the Company.

9.2.2. Effects of Termination for Cause or Resignation by Executive. If the Executive's employment shall be terminated for Cause, or if theExecutive resigns employment, the Company will have no further obligations to the Executive under this Agreement other than the Accrued Obligations. TheExecutive shall also be eligible for health and dental coverage as provided for under COBRA, using the normal COBRA administration process of theCompany.

9.3. Involuntary Termination Other Than for Cause and Effects Thereof. :

9.3.1. Involuntary Termination Other Than for Cause. The Company can terminate the employment of Executive for any reason other thanCause subject to the terms of this Agreement.

9.3.2. Effects of Involuntary Termination Other Than for Cause. If the Executive's employment is terminated for any reason other than forCause, the Company will be obligated to continue the Base Salary of Executive for a period of 8 weeks in addition to the payment of the Accrued Obligations.The Executive shall also be eligible for health and dental coverage as provided for under COBRA, using the normal COBRA administration process of theCompany. Payments of Base Salary continuation pursuant to Section 9.3.2 shall be subject to the Company's prior receipt of an executed and effective Releasethat has not been revoked prior to any payment.

9.4. Termination due to Death . If the Executive's employment shall terminate by reason of death, the Company shall pay the Executive's estate theAccrued Obligations. Such payments shall be in addition to those rights and benefits to which the Executive's estate may be entitled under the relevant

Company plans or programs. 9.5. Equity Based Compensation. Notwithstanding any other provision herein, all equity based Incentive Compensation Awards held by Executiveshall be governed by the terms of the applicable Incentive Compensation Plan and Incentive Compensation Award agreement and this Agreement shall haveno effect on them.

9.6. Nonexclusivity of Rights . Nothing in this Agreement shall prevent or limit the Executive's continuing or future participation in any benefit plan,program, policy or practice provided by the Company and for which the Executive may qualify (except with respect to any benefit to which the Executive haswaived the Executive's rights in writing), including, without


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limitation, any and all indemnification arrangements in favor of the Executive (whether under agreements or under the Company's charter documents orotherwise), and insurance policies covering the Executive, nor shall anything herein limit or otherwise affect such rights as the Executive may have under anyother contract or agreement entered into after the Effective Date with the Company. Amounts which are vested benefits or which the Executive is otherwiseentitled to receive under any benefit, plan, policy, practice or program of, or any contract or agreement entered into with, the Company shall be payable inaccordance with such benefit, plan, policy, practice or program or contract or agreement except as explicitly modified by this Agreement.

9.7. Indemnification . At all times during the Executive's employment with the Company and thereafter, the Company shall provide the Executive withindemnification and director and officer insurance insuring the Executive against insurable events which occur or have occurred while the Executive was adirector or executive officer of the Company, on terms and conditions that are at least as generous as that then provided to any other current or former directoror executive officer of the Company or any Affiliate.

10. Mitigation . In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts(including amounts for damages for breach) payable to the Executive under any of the provisions of this Agreement, and such amounts shall not be reducedwhether or not the Executive obtains other employment.

11. Representations . The Executive hereby represents to the Company that the Executive is legally entitled to enter into this Agreement and to performthe Executive's obligations hereunder, and that the Executive has the full right, power and authority to grant to the Company the rights contemplated inSection 12.2.

12. Executive's Covenants . The Executive hereby agrees to the following:

12.1. Confidentiality . The Executive recognizes and acknowledges that the Company's and its predecessor's Confidential Information is a valuable,special and unique asset of the Company's businesses, access to and knowledge of which are essential to the performance of the Executive's duties.Confidential Information shall include trade secrets and includes information acquired by the Executive in the course and scope of the Executive's job with the

Company, including information acquired from third parties, that is (i) not generally known or disseminated outside the Company (such as nonpublicinformation), (ii) is designated or marked by the Company as "confidential" or reasonably should be considered confidential or proprietary, or (iii) theCompany indicates through its policies, procedures or other instructions should not be disclosed to anyone outside the Company. Without limiting theforegoing definitions, some examples of Confidential Information under this Agreement include (a) matters of a technical nature, such as scientific, trade orengineering secrets, "know-how", formulae, secret processes, inventions, and research and development plans or projects regarding existing and prospectivecustomers, and products and services, (b) information about costs, profits, markets, sales, customer lists, customer needs, customer preferences and customerpurchasing histories, supplier lists, internal financial data, personnel evaluations, nonpublic information


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about medical devices or products of the Company (including future plans about them), information and material provided by third parties in confidence and/ or with nondisclosure restrictions, computer access passwords, and internal market studies or surveys and (c) any other information or matters of a similarnature. The Executive shall not, during or after the Executive's employment by the Company, in whole or in part, disclose such Confidential Information toany person, firm, corporation, association or other entity for any reason or purpose whatsoever, nor shall the Executive make use of any such property for theExecutive's own purposes or for the benefit of any person firm, corporation, association or other entity (except the Company) under any circumstances duringor after the Executive's employment by the Company; provided, however, that after the Executive's employment by the Company ceases these restrictionsshall not apply to such Confidential Information, if any, which are then in the public domain, and provided further that the Executive was not responsible,directly or indirectly, for such Confidential Information entering the public domain without the Company's consent.

12.2. Inventions . The Executive hereby sells, transfers and assigns to the Company or to any person or entity designated by the Company all of theright, title and interest of the Executive in and to all inventions, ideas, disclosures and improvements, whether patented or unpatented, and copyrightablematerial, made or conceived by the Executive, solely or jointly, during the Executive's employment by the Company or any of its predecessors which relate tomethods, apparatus, designs, products, processes or devices sold, leased, used or under consideration or development by the Company or any of itspredecessors, or which otherwise relate to or pertain to the business, functions or operations of the Company or any of its predecessors, or which arise fromthe efforts of the Executive during the Executive's employment with the Company or any of its predecessors. The Executive shall, during and after theExecutive's employment with the Company, communicate promptly and disclose to the Company, in such form as the Company requests, all information,details and data pertaining to the aforementioned inventions, ideas, disclosures and improvements. The Executive shall, during and after the Executive'semployment by the Company, execute and deliver to the Company such formal transfers and assignments and such other papers and documents as may benecessary by the Company to file and prosecute the patent applications and, as to copyrightable material, to obtain copyright thereof. Any invention relating tothe business of the Company and disclosed by the Executive within one (1) year after the Executive's employment with the Company ceases shall be deemedto fall within the provisions of Section 12.2 unless proved to have been first conceived and made following such termination or expiration.

12.3. Non-Solicitation of Employees . The Executive recognizes that the Executive possesses and will possess confidential information about otheremployees of the Company and its Affiliates relating to their education, experience, skills, abilities, compensation and benefits, and inter-personalrelationships with customer of the Company and its Affiliates. The Executive recognizes that the information the Executive possesses and will possess aboutthese other employees is not generally known, is of substantial value to the Company and its Affiliates in developing their business and in securing andretaining customers, and has been and will be acquired by the Executive because of the Executive's business position with the Company and its Affiliates. TheExecutive agrees that at all times during the Executive's


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Wright Medical Technology, Inc.

Employment Agreement David Stevens

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CONFIDENTIALDO NOT COPY

employment with the Company and for a period equal to the Executive's Total Number of Months thereafter, the Executive will not, directly or indirectly,solicit or recruit any employee of the Company or its Affiliates for the purpose of being employed by the Executive or by any competitor of the Company orits Affiliates on whose behalf the Executive is acting as an agent, representative or employee and that the Executive will not convey such confidential

information or trade secrets about other employees of the Company and its Affiliates to any other Person; provided, however, that it shall not constitute asolicitation or recruitment of employment in violation of paragraph to discuss employment opportunities with any employee of the Company or its Affiliateswho has either first contacted the Executive or regarding whose employment the Executive has discussed with and received the written approval of theCompany's Vice President, Human Resources (or, if such position is vacant, the Company's then Chief Executive Officer), prior to making such solicitation orrecruitment. In view of the nature of the Executive's employment with the Company, the Executive likewise agrees that the Company and its Affiliates wouldbe irreparably harmed by any such solicitation or recruitment in violation of the terms of this paragraph and that the Company and its Affiliates shall thereforebe entitled to preliminary and/or permanent injunctive relief prohibiting the Executive from engaging in any activity or threatened activity in violation of theterms of this paragraph and to any other relief available to them.

12.4. Non-Interference and Non-competition . During the Executive's employment by the Company and its Affiliates and for a period of 12 monthsafter such employment ceases, the Executive shall not, directly or indirectly (whether as an officer, director, owner, employee, partner, or other participant),engage in any Competitive Business. During this period, the Executive shall not solicit or entice any agent, supplier, consultant, distributor, contractor, lessorsor lessees of the Company or its Affiliates to make any changes whatsoever in their current relationships with the Company or its Affiliates, and will not assistany other Person or entity to interfere with or dispute such relationship. In view of the nature of the Executive's employment with the Company, the Executivelikewise agrees that the Company and its Affiliates would be irreparably harmed by any such interference or competitive actions in violation of the terms of this paragraph and that the Company and its Affiliates shall therefore be entitled to preliminary and/or permanent injunctive relief prohibiting the Executivefrom engaging in any activity or threatened activity in violation of the terms of this paragraph and to any other relief available to them.

12.5. Release . The Executive and the Company agree that if the Executive's employment is terminated for any reason other than Cause or death, theExecutive and the Company will execute a release (the "Release") of all claims substantially in the form attached hereto as Exhibit A within forty-five(45) days after the applicable Date of Termination and does not revoke such Release in accordance to the terms thereof. The Executive recognizes and agreesthat notwithstanding any other section to the contrary, this executed Release is required to be made prior to any post employment payments of any kind underthis Agreement. Furthermore, in the event that the Executive is covered under the Age Discrimination in Employment Act ("ADEA"), the Executive agrees toexecute the ADEA Release of all ADEA claims substantially in the form attached hereto as Exhibit B as provided in the ADEA Release.


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Page 9


12.6. Cooperation with Legal Matters . Executive agrees to cooperate with the Company and its designated attorneys, representatives and agents inconnection with any actual or threatened judicial, administrative or other legal or equitable proceeding in which the Company is or may become involved.Upon reasonable notice, Executive agrees to meet with and provide to the Company or its designated attorneys, representatives or agents all information and

knowledge Executive may have relating to the subject matter of any such proceeding. The Company agrees to reimburse Executive for any reasonable costsincurred by Executive in providing such cooperation.

13. Specific Remedies for Executive Breach of the Covenants as outlined in Section 13 . Without limiting the legal rights and remedies available to theCompany, in the event of any breach by the Executive of the covenants set forth in Section 12 above, the following actions may be taken by the Company:

13.1. The Company's obligation to make any payment or provide any benefits to the Executive under of this Agreement (except those covered byCOBRA) shall cease immediately and permanently, which shall not have any impact whatsoever on the Executive's continuing obligations under Section 12;

13.2. The Executive shall repay to the Company, within ten (10) days after the Executive receives written demand therefore, an amount equal to ninetypercent (90%) of the post employment payments and benefits previously received by the Executive under this Agreement, plus interest on such amount at anannual rate equal to the lesser of ten percent (10%) or the maximum non-usurious rate under applicable law, from the dates on which such payments andbenefits were received to the date of repayment to the Company; and

13.3. It is the desire and intent of the parties that the provisions of Section 12 be enforced to the fullest extent permissible under the applicable laws ineach jurisdiction in which enforcement is sought. Accordingly, if any portion of Section 12 is adjudicated to be invalid or unenforceable, Section 12 shall bedeemed curtailed, whether as to time or location, to the minimum extent required for its validity under applicable law and shall be binding and enforceablewith respect to the Executive as so curtailed, such curtailment to apply only with respect to the operation of Section 12 in the jurisdiction in which the suchadjudication is made. If a court in any jurisdiction, in adjudicating the validity of Section 132, imposes any additional terms or restrictions, then Section 12

shall be deemed amended to incorporate such additional terms or restrictions. 13.4. Executive agrees and acknowledges that Executive has received good and adequate consideration for the covenants set forth in Section 12 in theform of employment, compensation and benefits separate and independent of any post employment payments or potential payments in this Agreement.

14. Potential Impact of Accounting Restatements on Certain Bonuses and Profits .


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16. Miscellaneous .

16.1. Governing Law . This Agreement shall be governed by, construed under and enforced in accordance with the laws of the State of Tennesseewithout regard to conflicts-of-laws principles that would require the application of any other law. The captions of this Agreement are not part of the provisionshereof and shall have no force or effect.

16.2. Amendment . This Agreement may not be amended, modified, repealed, waived, extended or discharged except by an agreement in writing of both parties. No person, other than pursuant to a resolution of the Board or the Compensation Committee, shall have authority on behalf of the Company toagree to amend, modify, repeal, waive, extend or discharge any provision of this Agreement or anything in reference thereto.

16.3. Assignment . This Agreement may be assigned, without the consent of the Executive, by the Company to any person, partnership, corporation, andassociation or other entity which has purchased all or substantially all the assets of the Company, provided that such assignee assumes all the liabilities of theCompany hereunder.

16.4. Insurance . The Company may, at its election and for its benefit, insure the Executive against accidental loss or death, and the Executive shallsubmit to such physical examination and supply such information to the insurance company as may be required in connection therewith; provided, however,that no detailed information concerning the Executive's physical examination will be provided to the Company or made available to the Company by theinsurance company.

16.5. Waiver of Breach . A waiver by the Company or the Executive of a breach of any provision of this Agreement by the other party shall not operateor be construed as a waiver of any subsequent breach of the other party.

16.6. Severability . The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any otherprovision of this Agreement. 16.7. Notices . Any notice required or permitted to be given under this Agreement shall be sufficient in writing and if sent by certified mail or expressdelivery to the Executive at 10047 French Springs Road, Lakeland, TN 38002, or to the Company at Wright Medical Technology, Inc., Attention: GeneralCounsel, 5677 Airline Road, Arlington, Tennessee 38002, or to such other address as either party shall notify the other. Notices and communications shall beeffective when actually received by the addressee.

16.8. Taxes . The Company may withhold from any amounts payable under this Agreement such federal, state or local taxes as shall be required to bewithheld pursuant to any applicable law or regulation.


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16.9. Entire Agreement . This Agreement contains the entire agreement of the parties with respect to the subject matter referred to herein andsupersedes any and all prior negotiations, understandings, arrangements, letters of intent, and agreements, whether written or oral, between the Executive andthe Company and its Affiliates, or any of its or their directors, officers, employees or representatives with respect thereto.

16.10. No Right of Employment . Nothing in this Agreement shall be construed as giving the Executive any right to be retained in the employ of theCompany or shall interfere in any way with the right of the Company to terminate the Executive's employment at any time, with or without Cause.

16.11. Unfunded Obligation . The obligations under this Agreement shall be unfunded. Benefits payable under this Agreement shall be paid from thegeneral assets of the Company. The Company shall have no obligation to establish any fund or to set aside any assets to provide benefits under thisAgreement.

16.12. Sarbanes-Oxley Act of 2002 . Notwithstanding anything herein to the contrary, if the Company determines, in its good faith judgment, that anyprovision of this Agreement is likely to be interpreted as a personal loan prohibited by the Sarbanes-Oxley Act of 2002 and the rules and regulationspromulgated there under (the "Act"), then such provision shall be modified as necessary or appropriate so as to not violate the Act; and if this cannot beaccomplished, then the Company shall use its best efforts to provide the Executive with similar, but lawful, substitute benefit(s) at a cost to the Company notto significantly exceed the amount the Company would have otherwise paid to provide such benefit(s) to the Executive. In addition, if the Executive isrequired to forfeit or to make any repayment of any compensation or benefit(s) to the Company under the Act or any other law, such forfeiture or repaymentshall not constitute Good Reason.

16.13. Attorneys' Fees. Should either party file any action to enforce the terms of this Agreement, the prevailing party shall be entitled to recover allreasonable attorneys' fees and litigation costs.

IN WITNESS WHEREOF , the parties have executed this Agreement as of the Effective Date.

AGREED AND ACCEPTED WRIGHT MEDICAL TECHNOLOGY, INC. DAVID D. STEVENS By: /s/ Edward A. Steiger

/s/ David D. Stevens Title: Senior Vice President, Human Resources


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Page 13


EXHIBIT A

MUTUAL RELEASE AGREEMENTThis Mutual Release Agreement (this "Agreement"), is made and entered into this __ day of_________,_______ , , by and between Wright Medical

Technology, Inc. (the "Company"), a corporation organized and existing under the laws of the State of Delaware with its principal place of business at 5677Airline Road, Arlington, Tennessee 38002, and David D. Stevens (the "Executive").

The Executive, on behalf of the Executive and the Executive's heirs, executors, administrators, successors and assigns, whether herein named or referred toor not, does hereby release, discharge, and acquit and by these presents does hereby release, acquit, and forever discharge Company, its successors andassigns, its agents, servants, and employees, its divisions, subdivisions, and affiliates (collectively, the "Company"), of and from any and all past, present, andfuture claims, counterclaims, demands, actions, causes of action, liabilities, damages, costs, loss of services, expenses, compensation, third-party actions, suitsat law or in equity, of every nature and description, whether known or unknown, suspected or unsuspected, foreseen, or unforeseen, real or imaginary, actualor potential, and whether arising at law or in equity, under the common law, state or federal law, or any other law, or otherwise, including, but not limited to,any claims that have been or might have been asserted as a result of the establishment or termination of the employer-employee relationship, hereinaftercollectively referred to as claims. It is the intention of the parties hereto to effect a full and final general release of all such claims. It is expressly understoodand agreed that this release and agreement is intended to cover, and does cover, not only all now known injuries, losses, and damages, but any future injuries,losses, and damages not now known or anticipated, but which may later develop or be discovered, including all the effects and consequences thereof.

Executive does hereby declare that the Executive does understand, covenant, and agree that the Executive will not make any claims or demands, or file anylegal proceedings against Company or join Company as a party to any claim, demand, or legal proceedings nor shall Executive proceed against any other

party, person, firm, or corporation on the claims described above except as is necessary in order to enforce the terms and conditions of this Release and theSeverance Pay Agreement.

THE FILING OF ANY CLAIM, DEMAND, OR ANY AND ALL OTHER LEGAL PROCEEDINGS, BY THE EXECUTIVE, AGAINST COMPANY,SHALL BE DEEMED TO BE A MATERIAL BREACH OF THE TERMS OF THIS AGREEMENT. SUCH BREACH SHALL, IMMEDIATELY,TERMINATE COMPANY'S DUTY TO PAY ANY FURTHER SUMS TO EXECUTIVE AND SHALL ALSO BIND EXECUTIVE TO REPAY ANY ANDALL SUMS PAID TO EXECUTIVE PURSUANT TO THE TERMS OF THIS AGREEMENT. ADDITIONALLY, EXECUTIVE SHALL INDEMNIFYAND HOLD HARMLESS COMPANY FROM ANY AND ALL JUDGMENTS, COSTS, EXPENSES, OR ATTORNEY


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FEES WHATSOEVER ARISING ON ACCOUNT OF THE FILING OF ANY SUCH CLAIM, DEMAND, OR OTHER LEGAL PROCEEDINGS BY THEEXECUTIVE.

It is further understood and agreed that the acceptance of the consideration more fully described in the Severance Pay Agreement between the parties is infull accord and satisfaction of any obligations, claims, and/or disputes that Executive may have with Company.

And the parties hereby declare, understand, covenant, and agree that the terms of the Severance Pay Agreement, and the amount stated therein, are the soleconsideration for this release and agreement and that the parties voluntarily accept said consideration for the purpose of making a full and final compromise,adjustment and settlement of all claims for injuries, losses, and damages resulting, or to result, from said claims.

Except for any claim under Sections 12, 13 or 14 of the Employment Agreement, the Company, on behalf of itself, its agents, servants, and employees, itsdivisions, subdivisions, and affiliates (collectively, the "Company"), successors and assigns, whether herein named or referred to or not, does hereby release,discharge, and acquit and by these presents does hereby release, acquit, and forever discharge Executive, the Executive's heirs, executors, administrators,successors and assigns, of and from any and all past, present, and future claims, counterclaims, demands, actions, causes of action, liabilities, damages, costs,loss of services, expenses, compensation, third-party actions, suits at law or in equity, of every nature and description, whether known or unknown, suspectedor unsuspected, foreseen, or unforeseen, real or imaginary, actual or potential, and whether arising at law or in equity, under the common law, state or federallaw, or any other law, or otherwise, including, but not limited to, any claims that have been or might have been asserted as a result of the establishment ortermination of the employer-employee relationship, hereinafter collectively referred to as claims. It is the intention of the parties hereto to effect a full andfinal general release of all such claims. It is expressly understood and agreed that this release and agreement is intended to cover, and does cover, not only allnow known injuries, losses, and damages, but any future injuries, losses, and damages not now known or anticipated, but which may later develop or bediscovered, including all the effects and consequences thereof.

Company does hereby declare that the Company does understand, covenant, and agree that the Company will not make any claims or demands, or file anylegal proceedings against Executive or join Executive as a party to any claim, demand, or legal proceedings nor shall Company proceed against any otherparty, person, firm, or corporation on the claims described above except as is necessary in order to enforce the terms and conditions of this Release and theSeverance Pay Agreement.

THE FILING OF ANY CLAIM, DEMAND, OR ANY AND ALL OTHER LEGAL PROCEEDINGS, BY THE COMPANY, AGAINST EXECUTIVE,SHALL BE DEEMED TO BE A MATERIAL BREACH OF THE TERMS OF THIS AGREEMENT. SUCH BREACH SHALL, IMMEDIATELY,TERMINATE EXECUTIVE'S DUTY TO COMPLY WITH THE NON-SOLICIATION, NON-INTERFERENCE, AND NON-COMPETITIONCOVENANTS OF THE SEVERANCE PAY AGREEMENT BETWEEN THE PARTIES. ADDITIONALLY,


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COMPANY SHALL INDEMNIFY AND HOLD HARMLESS EXECUTIVE FROM ANY AND ALL JUDGMENTS, COSTS, EXPENSES, ORATTORNEY FEES WHATSOEVER ARISING ON ACCOUNT OF THE FILING OF ANY SUCH CLAIM, DEMAND, OR OTHER LEGALPROCEEDINGS BY THE COMPANY.

It is further understood and agreed that the acceptance of the consideration more fully described in the Employment Agreement between the parties is infull accord and satisfaction of any obligations, claims, and/or disputes that Company may have with Executive.

It is further understood and agreed that this is the full and complete understanding of the parties, that it is the integrated memorial of their agreement andthat there are no other written or oral understandings, agreements, covenants, promises, or arrangements, directly or indirectly connected with this release, thatare not incorporated herein. The terms of this release are contractual and are not mere recitals.

Notwithstanding the foregoing, nothing in this Release shall release either party from obligations resulting from the Employment Agreement nor prohibiteither party from seeking the enforcement of the Employment Agreement.

IN WITNESS WHEREOF, the parties executed this Release as of the Effective Date.

AGREED AND ACCEPTED WRIGHT MEDICAL TECHNOLOGY, INC. EXECUTIVE By:

David D. StevensTitle:


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EXHIBIT B

ADEA RELEASE AND AGREEMENTAs a material inducement to Wright Medical Technology, Inc. (hereinafter referred to as "Wright" or "Employer") to enter into this ADEA Release and

Agreement (the "Release or "Agreement") with David D. Stevens (hereinafter referred to as "Executive") (for Executive, Executive's heirs, executors,administrators and assigns), Executive hereby unconditionally releases and forever discharges Wright and each of the Wright's stockholders, predecessors,successors, assigns, agents, directors, officers, employees, representatives, attorneys, divisions, subsidiaries, affiliates and all persons acting by, through,under, or in concert with any of them from any and all charges, complaints, claims, liabilities, obligations, promises, agreements, controversies, damages,actions, causes of action, suits, rights, demands, costs, losses, debts and expenses (including attorney's fees and costs actually incurred) of any naturewhatsoever, known or unknown, suspected or unsuspected, including, but not limited to, rights, under the Age Discrimination in Employment Act of 1967, asamended from time to time, and other federal, state, or local laws prohibiting discrimination, any claims the employee may have with regard to Executive'shiring, employment, or electing the re-employment program and termination of employment claims growing out of any legal restrictions on Wright's right toterminate its employees ("Claim" or Claims"), which the Executive now has, owns or holds, or claims to have owned or held, or which the Executive at anytime hereinafter may have owned or held or claimed to have owned or held against Wright.

To comply with the Older Workers Benefit Protection Act of 1990, as amended from time to time, the Release and Agreement has advised Executive of the legal requirements of this Act and fully incorporates the legal requirements by reference into this Agreement as follows:

a. This Agreement is written in layman's terms, and the Executive understands and comprehends its terms;

b. Executive has been advised of Executive's rights to consult an attorney to review the Agreement; c. Executive does not waive any rights or claims that may arise after the date the Release is executed;

d. Executive is receiving consideration beyond anything of value to which he already is entitled;

e. Executive has been given a reasonable period of time to consider this Agreement (45 days).


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As consideration for this Release, Wright agrees to provide the items listed in the Employment Agreement dated . The Executive enters into this Releasewith full knowledge of its contents and enters into this Agreement voluntarily.

AGREED AND ACCEPTED EXECUTIVE: WRIGHT MEDICAL TECHNOLOGY, INC. I acknowledge that I fully understand and agree that this Agreement may be pleaded by Wright MedicalTechnology, Inc. as a complete defense to any claim which hereafter may be asserted by me or a claim againstWright Medical Technology, Inc. for or on account of any matter or thing whatsoever arising out of theemployment relationship or my termination from active employment.

David D. Stevens By: Title:

NOTE: EXECUTIVE IS HEREBY ADVISED OF HIS OR HER RIGHT TO RESCIND AND NULLIFY THIS AGREEMENT, WHICH RIGHT MUST BEEXERCISED, IF AT ALL, WITHIN SEVEN (7) DAYS OF THE DATE OF EXECUTIVE'S SIGNATURE. EXECUTIVE MUST REVOKE RELEASE BYLETTER TO WRIGHT MEDICAL TECHNOLOGY, INC., ATTENTION: GENERAL COUNSEL, 5677 AIRLINE ROAD, ARLINGTON, TN 38002,WITHIN SEVEN (7) DAYS. NO CONSIDERATION SHALL BE CONVEYED UNTIL SUCH TIME PERIOD HAS EXPIRED.


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Exhibit 99

FOR RELEASE 3:00 P.M. CENTRALThursday, May 5, 2011

Contact: Lance Berry(901) 867-4607

Wright Medical Group, Inc. Reports Results for FirstQuarter Ended March 31, 2011

Operating margin expansion drives 14% adjusted EPS growth

Company upwardly revises 2011 adjusted EPS guidance

Company provides update on status of investigation

ARLINGTON, TN May 5, 2011 Wright Medical Group, Inc. (NASDAQ: WMGI), a global orthopaedic medical device company and a leading providerof surgical solutions for the foot and ankle market, today reported financial results for its first quarter ended March 31, 2011.

Net sales totaled $135.4 million during the first quarter ended March 31, 2011, a 3% increase over net sales of $131.2 million during the first quarter of 2010.Excluding the impact of foreign currency, net sales increased 2% in the first quarter of 2011, as compared to the same period last year.

Net income for the first quarter of 2011 totaled $3.6 million, or $0.09 per diluted share, compared to net loss of $0.5 million, or ($0.01) per diluted share, inthe first quarter of 2010.

Net income for the first quarter of 2011 included the after-tax effects of approximately $2.9 million of non-cash stock-based compensation expense,$2.2 million of expenses associated with the Company's deferred prosecution agreement (DPA), and $4.1 million of deferred financing and transaction costsassociated with the previously announced tender offer for the Company's Convertible Notes. Net loss for the first quarter of 2010 included the after-tax effectsof approximately $8.1 million of expenses related to U.S. governmental inquiries, $3.0 million of non-cash stock-based compensation expense, and $544,000

of restructuring charges.The Company's first quarter net income, as adjusted, increased 11% to $9.4 million in 2011 from $8.5 million in 2010, while diluted earnings per share, asadjusted, increased 14% to $0.24 in the first quarter of 2011 from $0.21 in the first quarter of 2010. A reconciliation of U.S. GAAP to "as adjusted" results isincluded in the attached financial tables.

David D. Stevens, Interim Chief Executive Officer commented, "We are pleased with our solid first quarter financial performance, which included constantcurrency sales growth, operating margin expansion and excellent free cash flow."

Mr. Stevens continued, "Also in the first quarter we successfully completed a tender offer for our Convertible Notes allowing us to extend the maturity of ourdebt, increase our total debt capacity, and increase the flexibility of our capital structure. Further, we continued to execute on our new product introductionplan as we launched both the PRO-TOE VO Hammertoe system and the EVOLVE (R) Elbow Plating System (EPS)."


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Outlook

The Company is reiterating its previously-communicated 2011 net sales outlook of $517 million to $535 million, representing growth of 0% to 3%. This rangeincludes the previously announced license agreement with KCI that is expected to have a negative impact on the Company's 2011 revenue growth rate of approximately 1% to 2%. Excluding this negative impact, Wright Medical expects to achieve annualized revenue growth of approximately 1% to 5%. TheCompany is upwardly revising its 2011 as-adjusted earnings per share outlook to a target range for the full year 2011 of $0.89 to $0.97 per diluted share, from$0.88 to $0.95 per diluted share, which was previously communicated on February 10, 2011. The Company's current outlook for adjusted earnings per sharerepresents annualized growth expectations of -1% to 8%

The Company's earnings target excludes the transaction costs and non-cash deferred financing fees associated with the Convertible Notes tendered, possiblefuture acquisitions, other material future business developments, non-cash stock-based compensation expense, and costs associated with the Company's DPA(including the associated independent monitor).

While the amount of the non-cash stock-based compensation charges will vary depending upon a number of factors, the Company currently estimates that theafter-tax impact of those expenses will be approximately $0.19 per diluted share for the full year 2011. Therefore, the Company anticipates full year 2011 as-adjusted earnings per share including stock-based compensation to be in the range of $0.70 to $0.78 per diluted share, which represents annualized growthexpectations of 0% to 11%.

The Company's anticipated ranges for net sales, adjusted earnings per share, and non-cash stock-based compensation charges are forward-looking statements.They are subject to various risks and uncertainties that could cause the Company's actual results to differ materially from the anticipated targets. Theanticipated targets are not predictions of the Company's actual performance. See the cautionary information about forward-looking statements in the "Safe-Harbor Statement" section of this press release.

Update on Status of Investigation

The Company also announced today that it received a letter from the United States Attorney's Office for the District of New Jersey (USAO) pursuant toParagraph 50 of the Deferred Prosecution Agreement (DPA) stating that the USAO believes that the Company has knowingly and willfully breached materialprovisions of the DPA. As required by the terms of the DPA, the letter provides the Company an opportunity to make a presentation within three weeks of receipt of the letter. The Company intends to make a presentation in response to the letter. The Company's presentation could address whether any breach hasoccurred, whether any breach was knowing or willful, materiality, and whether any breach has been cured. Pursuant to the DPA, the Company expects that theUSAO will not take any further action until consideration of the Company's presentation.Conference Call

As previously announced, the Company will host a conference call starting at 3:30 p.m. (Central Time) today. The live dial-in number for the call is866-788-0538 (domestic) or 85 7-350-1676 (international). The participant passcode for the call is "Wright." To access a simultaneous webcast of theconference call via the internet, go to the "Corporate Investor Information" section of the Company's website located at www.wmt.com. A replay of theconference call by telephone will be available starting at 6:30 p.m. (Central Time) today and continuing until May 12, 2011. To hear this replay, dial888-286-8010 (domestic) or 617-801-6888 (international) and enter the passcode 52022847. A replay of the conference call will also be available via theinternet starting today and continuing for at least 12 months. To access a replay of the conference call via the internet, go to the "Corporate InvestorInformation Audio Archives" section of the Company's website located at www.wmt.com.

The conference call may include a discussion of non-GAAP financial measures. Reference is made to the most directly comparable GAAP financial measures,the reconciliation of the differences between the two financial measures, and the other information included in this press release, our Form 8-K filed with theSEC today, or otherwise available in the "Corporate Investor Information Supplemental Financial Information" section of the Company's websitelocated at www.wmt.com.

The conference call may include forward-looking statements. See the cautionary information about forward-looking statements in the "Safe-HarborStatement" section of this press release.

Non-GAAP Financial Measures

The Company uses non-GAAP financial measures, such as net sales, excluding the impact of foreign currency; operating income, as adjusted; net income, asadjusted; net income, as adjusted, per diluted share; effective tax rate, as adjusted; and free cash flow. The Company's management believes that thepresentation of these measures provides useful information to investors. These measures may assist investors in evaluating the Company's operations, periodover period. The measures exclude such items as costs related to the U.S. governmental inquiries and the DPA, restructuring charges, transaction costs andnon-cash deferred financing fees associated

(Page 2 of 8)


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with the Convertible Notes tendered and non-cash stock-based expense, all of which may be highly variable, difficult to predict and of a size that could havesubstantial impact on the Company's reported results of operations for a period. Management uses these measures internally for evaluation of the performanceof the business, including the allocation of resources and the evaluation of results relative to employee performance compensation targets. Investors shouldconsider these non-GAAP measures only as a supplement to, not as a substitute for or as superior to, measures of financial performance prepared inaccordance with GAAP.

Cautionary Note Regarding Forward-Looking Statements

This press release contains "forward-looking statements" as defined under U.S. federal securities laws, including statements regarding potential actions by the USAO, independent monitor, OIG and other agencies or their potential impact, and statements about financial results for the quarter ended March 31, 2011. These statements reflect management's current knowledge, assumptions, beliefs, estimates, and expectations and express management's current views of future performance, results, and trends and may be identified by their use of terms such as anticipate, believe, could, estimate, expect,intend, may, plan, predict, project, will, and other similar terms. Forward-looking statements are subject to a number of risks and uncertainties that could

cause our actual results to materially differ from those described in the forward-looking statements. You should not place undue reliance on forward looking statements. Such statements are made as of the date of this press release, and we undertake no obligation to update such statements after this

date. Risks and uncertainties that could cause our actual results to materially differ from those described in forward-looking statements include those discussed in our filings with the Securities and Exchange Commission (including those described in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2010, under the heading "Risk Factors" and elsewhere), and the impact of our settlement of the federal investigation into our consulting arrangements with orthopaedic surgeons relating to our hip and knee products in the United States, including our compliance with the Deferred Prosecution Agreement through September 2011 (which could, by its terms, be extended for a further six months) and the Corporate Integrity Agreement through September 2015. Our failure to comply with the Deferred Prosecution Agreement or the Corporate Integrity Agreement could exposeus to significant liability including, but not limited to, extension of the term of the DPA by up to 6 months, exclusion from federal healthcare program

participation, including Medicaid and Medicare, which would have a material adverse effect on our financial condition, results of operations and cash flows, potential prosecution, including under the previously-filed criminal complaint, civil and criminal fines or penalties, and additional litigation cost and expense.

Additional risks and uncertainties that could cause our actual results to materially differ from those described in forward-looking statements include demand for and market acceptance of our new and existing products; future actions of governmental authorities and other third parties; tax measures; business development and growth opportunities; product quality or patient safety issues; products liability claims; enforcement of our intellectual property rights; the geographic and product mix impact on our sales; retention of sales representatives and independent distributors; inventory reductions or fluctuations in buying patterns by wholesalers or distributors; ability to realize the anticipated benefits of restructuring initiatives; and impact of the commercial and credit environment on us and our customers and suppliers.

Wright Medical Group, Inc. is a global orthopaedic medical device company and a leading provider of surgical solutions for the foot and ankle market. TheCompany specializes in the design, manufacture and marketing of devices and biologic products for extremity, hip and knee repair and reconstruction. TheCompany has been in business for more than 60 years and markets its products in over 60 countries worldwide. For more information about Wright Medical,visit the Company's website at www.wmt.com.

Tables Follow(Page 3 of 8)


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Wright Medical Group, Inc.Condensed Consolidated Statements of Operations

(in thousands, except per share dataunaudited)

Three Months Ended March 31, March 31,

2011 2010 Net sales $ 135,386 $ 131,244

Cost of sales 38,768 40,141Gross profit 96,618 91,103

Operating expenses:Selling, general and administrative 74,825 76,438Research and development 9,207 9,835Amortization of intangible assets 690 649Restructuring charges 544

Total operating expenses 84,722 87,466Operating income 11,896 3,637

Interest expense, net 1,835 1,508Other expense, net 4,459 132

Income before income taxes 5,602 1,997Provision for income taxes 2,010 2,522

Net income (loss) $ 3,592 $ (525)

Net income (loss) per share, basic $ 0.09 $ (0.01)

Net income (loss) per share, diluted $ 0.09 $ (0.01)

Weighted-average number of common shares outstanding, basic 38,033 37,540Weighted-average number of common shares outstanding, diluted 38,327 37,540

Wright Medical Group, Inc.Consolidated Sales Analysis

(dollars in thousandsunaudited)

Three Months Ended March 31, March 31, %

2011 2010 change Geographic Domestic $ 77,942 $ 77,725 0.3%International 57,444 53,519 7.3% Total net sales $ 135,386 $ 131,244 3.2%

Product Line Hip products $ 45,897 $ 46,285 (0.8%)Knee products 32,833 32,418 1.3%Extremity products 34,273 30,104 13.8%Biologics products 19,307 19,792 (2.5%)Other 3,076 2,645 16.3%

Total net sales $ 135,386 $ 131,244 3.2%

(Page 4 of 8)


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Wright Medical Group, Inc.Supplemental Sales Information

(unaudited)

First Quarter 2011 Sales Growth Domestic Int'l Int'l Total Total

As Constant As Constant As Reported Currency Reported Currency Reported

Hips (15%) 5% 9% (3%) (1%)Knees 0% 0% 2% 0% 1%Extremities 12% 18% 21% 13% 14%Biologics (2%) (5%) (3%) (3%) (2%)Total 0% 4% 7% 2% 3%

Sales as a % of Total Sales Three months ended March 31, 2011

Domestic International Total Hips 12% 22% 34%Knees 13% 11% 24%Extremities 20% 5% 25%Biologics 12% 3% 14%Total 58% 42% 100%

Wright Medical Group, Inc.Reconciliation of Net Sales to Net Sales Excluding the Impact of Foreign Currency


Three Months Ended March 31, 2011

International Total Net Sales Net Sales

Net sales, as reported $ 57,444 $ 135,386

Currency impact as compared to prior period (1,742) (1,742)

Net sales, excluding the impact of foreign currency $ 55,702 $ 133,644

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Wright Medical Group, Inc.Reconciliation of As Reported Results to Non-GAAP Financial Measures

(in thousands, except per share dataunaudited)


2011 2010 Operating Income

Operating income, as reported $ 11,896 $ 3,637

Reconciling items impacting Gross Profit: Non-cash, stock-based compensation 347 340

Reconciling items impacting Selling, General and Administrative expenses: Non-cash, stock-based compensation 2,068 2,267U.S. governmental inquiries/DPA related 2,182 8,071

Total 4,250 10,338

Reconciling items impacting Research and Development expenses: Non-cash, stock-based compensation 445 398

Other Reconciling Items: Restructuring charges 544

Operating income, as adjusted $ 16,938 $ 15,257Operating income, as adjusted, as a percentage of net sales 12.5% 11.6%

(Page 6 of 8)


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Wright Medical Group, Inc.Reconciliation of As Reported Results to Non-GAAP Financial Measures

(continued)


2011 2010 Net Income

Income before income taxes, as reported $ 5,602 $ 1,997

U.S. governmental inquiries/DPA related 2,182 8,071Non-cash, stock-based compensation 2,860 3,005Restructuring charges 544Deferred financing fees and transaction costs associated with Convertible Notes Tender Offer 4,099

Income before income taxes, as adjusted 14,743 13,617

Provision for income taxes, as reported 2,010 2,522U.S. governmental inquiries/DPA related 852 1,580Non-cash, stock-based compensation 847 836Restructuring charges 211Deferred financing fees and transaction costs associated with Convertible Notes Tender Offer 1,599

Provision for income taxes, as adjusted 5,308 5,149

Effective tax rate, as adjusted 36.0% 37.8%

Net income, as adjusted $ 9,435 $ 8,468

Three Months Ended Three Months Ended March 31, 2011 March 31, 2010

As Reported As Adjusted As Reported As Adjusted Basic net income (loss) $ 3,592 $ 9,435 $ (525) $ 8,468Interest expense on convertible notes N/A 787 N/A 935Diluted net income (loss) $ 3,592 $ 10,222 $ (525) $ 9,403

Basic shares 38,033 38,033 37,540 37,540Dilutive effect of stock options and restricted shares 294 294 N/A 283Dilutive effect of convertible notes N/A 4,962 N/A 6,126Diluted shares 38,327 43,289 37,540 43,949

Net income (loss) per share, diluted $ 0.09 $ 0.24 $ (0.01) $ 0.21


2011 2010 Net Income per Diluted Share

Net income (loss), as reported, per diluted share $ 0.09 $ (0.01)Interest expense on convertible notes 0.02 0.02Dilutive effect of convertible notes (0.01) 0.00U.S. governmental inquiries/DPA related 0.03 0.15Non-cash, stock-based compensation 0.05 0.05Restructuring charges 0.01Deferred financing fees and transaction costs associated with Convertible Notes Tender Offer 0.06 Net income, as adjusted, per diluted share $ 0.24 $ 0.21

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Wright Medical Group, Inc.Condensed Consolidated Balance Sheets


March 31, December 31, 2011 2010

Assets Current assets:

Cash and cash equivalents $ 154,839 $ 153,261Marketable securities 14,840 19,152Accounts receivable, net 107,622 105,336Inventories 171,738 166,339Prepaid expenses and other current assets 57,110 53,502

Total current assets 506,149 497,590

Property, plant and equipment, net 161,430 158,247Goodwill and intangible assets, net 70,460 70,673Marketable securities 10,071 17,193Other assets 11,707 11,536

Total assets $ 759,817 $ 755,239

Liabilities and stockholders' equity Current liabilities:

Accounts payable $ 22,081 $ 15,862Accrued expenses and other current liabilities 58,760 54,409

Current portion of long-term obligations 8,617 1,033Total current liabilities 89,458 71,304Long-term obligations 173,269 201,766Other liabilities 17,157 11,197

Total liabilities 279,884 284,267

Stockholders' equity 479,933 470,972Total liabilities and stockholders' equity $ 759,817 $ 755,239

(Page 8 of 8)

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Wright Medical Group, Inc. 8-K Filed May 5, 2011

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