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|Wright Medical Group, Inc. Names Robert J. Palmisano President and Chief Executive Officer|
David D. Stevens to Continue as Chairman
Company Temporarily Suspends Guidance as New CEO Transitions into Leadership Role
ARLINGTON, Tenn., Sep 19, 2011 (BUSINESS WIRE) --
Wright Medical Group, Inc. (NASDAQ: WMGI), a global orthopaedic medical device company and a leading provider of surgical solutions for the foot and ankle market, today announced that its Board of Directors has appointed Robert J. Palmisano as President and Chief Executive Officer, effective September 17, 2011. David D. Stevens, who currently serves as interim President and Chief Executive Officer, will remain Chairman of the Board and return to his role as a member of the Nominating, Compliance and Governance Committee.
Mr. Palmisano has significant experience leading publicly traded medical device companies, and he most recently served as President and CEO of ev3, Inc, a global endovascular device company. During his two year tenure, ev3's market capitalization more than tripled, from approximately $800 million in April 2008 to $2.6 billion in July 2010.
Mr. Stevens stated, "Bob is a proven leader with an impressive track record of building shareholder value. His ability to enhance operational and financial results will make him an ideal leader to take Wright Medical to the next level. In recent months, we have taken many positive steps to better position the Company for success, including strengthening our compliance program and implementing a plan to reduce operational costs. We believe Bob is the right person to continue building on this progress, and we are delighted to welcome him to the team."
Mr. Palmisano said, "Wright Medical is a recognized leader in the foot and ankle market, and with a solid portfolio and strong pipeline of new products, the Company is well-positioned for success. I look forward to working together with the Board, management and Wright Medical's talented employees, to help this great company achieve its full potential."
Wright also announced today that in connection with Mr. Palmisano's appointment as President and Chief Executive Officer, and as an inducement to his employment with Wright, the Compensation Committee of its Board of Directors approved the grant of a stock option to Mr. Palmisano to be made on September 17, 2011, to purchase up to 610,000 shares of Wright's common stock at an exercise price of $16.03, which was the closing price of Wright's common stock on the day prior to grant. The stock option vests and becomes exercisable in three equal, annual installments beginning on the first anniversary of the grant, conditioned on Mr. Palmisano's continued employment. In the event of a change in control or the termination of Mr. Palmisano's employment by Wright without "cause," by Mr. Palmisano for "good reason" or on account Mr. Palmisano's death or disability, the stock option will immediately accelerate and become fully vested. The stock option has a ten year term and is subject to the terms and conditions of the stock option agreement pursuant to which the option was granted.
This press release is being made in accordance with NASDAQ Listing Rule 5635(c)(4).
Robert J. Palmisano Bio
Prior to serving as President and CEO of ev3, Mr. Palmisano was President and CEO of IntraLase Corp. and previously he was President and CEO of MacroChem Corporation. Earlier in his career, he served as President and CEO of Summit Technology Inc. until it was acquired by Alcon Inc. From 1984 to 1996, he served in various executive positions at Bausch & Lomb Incorporated.
Mr. Palmisano is currently a Venture Partner of SV Life Sciences and serves on the Board of Directors of Bausch & Lomb and the Providence College Board of Trustees. Mr. Palmisano holds a B.A. degree in Political Science from Providence College.
The Company is temporarily suspending its previously announced outlook for sales and earnings as Mr. Palmisano transitions into the President and CEO position. The Company will provide updated information on its outlook for sales and earnings performance at its upcoming third quarter earnings release conference call.
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. 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. The reader 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, and our subsequently filed quarterly reports, under the heading "Risk Factors" and elsewhere), future actions of the FDA or any other regulatory body or government authority that could delay, limit or suspend product development, manufacturing or sale or result in seizures, injunctions, monetary sanctions or criminal or civil liabilities, the impact of any such future actions of the FDA or any other regulatory body or government authority on our settlement of the federal investigation into our consulting arrangements with orthopaedic surgeons relating to our hip and knee products in the United States, and the impact of such 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 2012 and the Corporate Integrity Agreement through September 2015. Our failure to comply with the Deferred Prosecution Agreement or the Corporate Integrity Agreement could expose us to significant liability including, but not limited to, 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. In addition, a breach of the DPA or the CIA could result in an event of default under the Senior Credit Facility, which in turn could result in an event of default under the Indenture.
Additional risks and uncertainties that could cause our actual results to materially differ from those described in forward-looking statements include the possibility of litigation brought by shareholders, including private securities litigation and shareholder derivative suits, which if initiated, could divert management's attention, harm our business and/or reputation and result in significant liabilities; 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 specializing in the design, manufacture and marketing of devices and biologic products for the extremity, hip and knee repair and reconstruction. Wright Medical is a leading provider of surgical solutions for the foot and ankle market. Wright Medical 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 its website at www.wmt.com.
SOURCE: Wright Medical Group, Inc.
Wright Medical Group, Inc.