Document:

EX-10.2

 Exhibit 10.2 

UNITED STATES OF AMERICA 

Before the 
 SECURITIES
AND EXCHANGE COMMISSION 
 SECURITIES EXCHANGE ACT OF 1934 

Release No. 79780 / January 12, 2017 

ACCOUNTING AND AUDITING ENFORCEMENT 
 Release
No. 3843 / January 12, 2017 
 ADMINISTRATIVE PROCEEDING 

File No. 3-17771 
  

			
	  

In the Matter of
  

Biomet, Inc.
  

Respondent.
  
	  	ORDER INSTITUTING CEASE-AND-DESIST PROCEEDINGS PURSUANT TO SECTION 21C OF THE SECURITIES EXCHANGE ACT OF 1934, MAKING FINDINGS, AND IMPOSING A
CEASE-AND-DESIST ORDER

 I. 

The Securities and Exchange Commission (“Commission”) deems it appropriate that cease-and-desist proceedings be, and hereby are, instituted pursuant to Section 21C of the Securities Exchange Act of 1934 (“Exchange Act”), against Biomet, Inc. (“Biomet” or
“Respondent”). 
 II. 

In anticipation of the institution of these proceedings, Respondent has submitted an Offer of Settlement (the “Offer”) which the
Commission has determined to accept. Solely for the purpose of these proceedings and any other proceedings brought by or on behalf of the Commission, or to which the Commission is a party, Respondent admits the Commission’s jurisdiction over it
and the subject matter of these proceedings, and consents to the entry of this Order Instituting Cease-and-Desist Proceedings Pursuant to Section 21C of the Securities
Exchange Act of 1934, Making Findings, and Imposing a Cease-and-Desist Order (“Order”), as set forth below. 

  
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 III. 

On the basis of this Order and Respondent’s Offer, the Commission finds1 that: 

Summary 
 1. These
proceedings arise from violations of the Foreign Corrupt Practices Act of 1977 (the “FCPA”) [15 U.S.C. 78dd] by Respondent Biomet, Inc., a global medical device company with operations around the world. From approximately 2008 through
2013, Biomet, through its subsidiary and third party customs brokers, made unlawful payments to Mexican customs officials to facilitate the importation of Biomet’s unregistered and mislabeled dental products into Mexico. In addition, from 2009
to 2013, Biomet improperly recorded transactions with a known prohibited distributor in Brazil as transactions with another distributor. Biomet had prohibited the use of the distributor after determining the distributor made improper payments to
public doctors in Brazil from 2000 to August 2008 to obtain sales of Biomet products, which was the subject of Biomet’s 2012 settlement with the Commission and criminal authorities for FCPA violations. Biomet could not account for the
prohibited distributor’s use of certain funds nor determine if the prohibited distributor had continued the same improper conduct. Biomet failed to appropriately record the transactions in Mexico and Brazil in its books and records. Biomet also
failed to devise and maintain a sufficient system of internal accounting controls. 
 Respondent 

2. Biomet, Inc. is a medical device company headquartered in Warsaw, Indiana that sells medical device and dental products. Prior to
2008, Biomet’s common stock was registered with the Commission pursuant to Section 12(b) of the Exchange Act. In September 2007, Biomet was acquired by a group of private equity funds and went private. Biomet subsequently filed a Form S-1 that went effective in May 2008 and was therefore required pursuant to Rule 15(d) to file periodic reports with the Commission. 

3. In a March 2012 settlement with the Commission, Biomet consented to a permanent injunction against future violations of Sections 30A,
13(b)(2)(A), and 13(b)(2)(B) of the Exchange Act, as well as the appointment of an independent compliance monitor for a period of three years, for FCPA violations in multiple countries. 

4. In June 2015, Biomet was acquired by Zimmer Holdings, Inc. (“Zimmer”), and the combined companies were renamed Zimmer Biomet
Holdings, Inc. The new company remained headquartered in Warsaw, Indiana. Zimmer Biomet began trading on the New York Stock Exchange and the SIX Swiss Exchange under the ticker symbol “ZBH” on June 29, 2015. Zimmer Biomet operates in
more than 100 countries, has approximately 17,000 employees, and in fiscal year 2015, reported revenue of $ 6 billion. 
  

	1 	The findings herein are made pursuant to Respondent’s Offer of Settlement and are not binding on any other person or entity in this or any other proceeding. 

  
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 Relevant Entities 

5. Biomet 3i LLC (“Biomet 3i”) is a wholly owned subsidiary of Biomet, Inc., located in Palm Beach Gardens, Florida, that
sold dental implants in various countries, including Brazil and Mexico. Biomet 3i’s books and records were consolidated into the books and records of Biomet. 

6. Biomet 3i Mexico (“3i Mexico”) is a Mexico City, Mexico based business operation of Biomet 3i, a U.S. subsidiary of
Biomet, Inc. Biomet 3i conducted all of its sales in Mexico through 3i Mexico. 3i Mexico’s books and records were ultimately consolidated into Biomet’s books and records. 

7. Biomet International Corporation (“Biomet International”) is a Delaware corporation and a wholly-owned subsidiary of
Biomet. Biomet conducts sales of Biomet products in Brazil through Biomet International. Biomet International’s books and records are consolidated into Biomet’s books and records.  

8. Mexican Customs Broker is a private company registered in Mexico that acted as 3i Mexico’s primary customs broker from April
2010 to October 2013. 3i Mexico did not have a written contract or fee schedule with Mexican Customs Broker during this time. 
 9. Texas
Customs Broker is a private company based in Mission, Texas. Texas Customs Broker served as 3i Mexico’s customs broker until mid-2009. Texas Customs Broker was not a licensed customs broker, and 3i
Mexico did not have a written contract or fee schedule with the company. 
 10. Prohibited Brazilian Distributor was the individual
owner of a Brazilian company that served as Biomet’s exclusive authorized distributor for reconstructive products in Brazil until 2008, when Biomet terminated the relationship due to prior FCPA violations. 

Prior Commission Action 

11. In March 2012, the SEC filed a settled injunctive action against Biomet for violations of the anti-bribery, books and records, and
internal controls provisions of the federal securities laws. The complaint alleged that, from 2000 through August 2008, Biomet, through four subsidiaries, paid bribes to public doctors employed by public hospitals and agencies in Argentina, Brazil,
and China. One of the largest schemes involved Biomet’s sales of medical devices in Brazil through its U.S. subsidiary, Biomet International. Biomet International employees engaged in a scheme in which its Brazilian distributor, through his
company, paid bribes to doctors employed by state-owned hospitals in the form of “commissions” of 10-20% of the value of medical devices purchased by the doctors, since as early as 2001. As part of
its settlement with the SEC, Biomet agreed to terminate its relationship with the distributor (“Prohibited Brazilian 

  
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Distributor”). In 2009, Biomet re-entered the Brazilian market and hired new Brazilian distributors to sell its medical implants. Biomet subsequently
notified the Commission staff that sales of Biomet products into Brazil would be done by these new authorized distributors. 
 12. Biomet
paid $5.5 million in disgorgement and prejudgment interest, and was ordered to retain an independent compliance monitor to review its compliance program. At the same time, Biomet entered into a deferred prosecution agreement (“DPA”)
with the Department of Justice that imposed a criminal fine of $17,280,000 and the appointment of a monitor. 
 13. After the settlement and
pursuant to the monitor’s recommendations, Biomet took steps to enhance its compliance program, including conducting trainings, hiring additional compliance resources, and implementing new policies and controls. Biomet reported its remedial
steps to Commission staff and the monitor on a periodic basis. In 2013, Biomet reported to the Commission staff and the monitor suspected instances of continued anti-bribery violations, including conduct in Brazil and Mexico. Biomet retained outside
counsel to conduct an investigation. Subsequently, in June 2015, Biomet was acquired by Zimmer, and Zimmer began a process to fully integrate the legacy Biomet entity into a newly combined compliance program. Despite extending the monitorship by one
year, the monitor ultimately was unable to certify that the legacy Biomet entity had a fully operational and effective compliance program as a result of the acquisition and the recurring compliance issues in Brazil and Mexico. The monitorship
terminated in March 2016. 
 Biomet Continues Use of Prohibited Brazilian Distributor 

14. Despite telling the government that it had terminated its relationship with Prohibited Brazilian Distributor in 2008, Biomet continued to
sell goods into Brazil through Prohibited Brazilian Distributor through 2013. Biomet International recorded the transactions with Prohibited Brazilian Distributor on its books and records as if they were transactions with their authorized
distributor. Biomet did not take any action to stop the conduct until it received a whistleblower complaint at the end of 2013, and initiated an internal investigation. 

15. As early as 2009, Biomet conducted an internal audit of its Brazilian distributors that identified a relationship between its authorized
distributor and Prohibited Brazilian Distributor’s company. The draft audit report recommended that the authorized distributor needed to be fully separated from Prohibited Brazilian Distributor’s company. However, the recommendation and
references to Prohibited Brazilian Distributor’s company were removed from the final report by a member of Biomet’s legal team and the issue was not tracked for follow up by anyone in Biomet’s legal, compliance, or internal audit
departments, thereby allowing the relationship to continue for several more years. 
 16. By at least April 2010, Biomet became aware that
the owner of one of Biomet’s authorized distributors had given over control of the company to Prohibited Brazilian Distributor.2 

 

	2 	At the time that Biomet entered into distribution agreements with the new Brazilian distributors, Biomet was aware that each of these new distributors was owned and operated by former partners of Prohibited Brazilian
Distributor. Biomet failed to appropriately assess the risks posed by the connection between Prohibited Brazilian Distributor and his former partners and did not take steps to monitor changes in the ownership structure of the new distributors.

  
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A Biomet employee even described the relationship in documents as the “[authorized distributor] = [Prohibited Brazilian Distributor]”. Further, in June 2010, Prohibited Brazilian
Distributor entered into a consulting agreement with the authorized distributor. The Prohibited Brazilian Distributor’s compensation under the agreement was tied to increases in Biomet product sales. Certain Biomet senior employees were aware
of this consulting relationship as early as June 2010 and failed to take steps to stop the relationship. 
 17. Thereafter, in July 2010,
the authorized distributor informed Biomet that it faced importation restrictions in Brazil, but suggested a means to work around the restrictions by arranging for Prohibited Brazilian Distributor, which continued to hold Biomet product
registrations, to directly import Biomet products on behalf of the authorized distributor. Biomet approved the proposed importation arrangement. With Biomet’s knowledge and consent, the authorized distributor placed product orders with Biomet
and provided cash to Prohibited Brazilian Distributor to cover the customs, duties, and product costs. Prohibited Brazilian Distributor used a portion of the cash to pay customs and transferred the rest to his personal bank account. Biomet then
received wire transfers from Prohibited Brazilian Distributor’s personal bank account relating to the shipments, but credited the payments to invoices issued to the authorized distributor. 

18. In addition, between July 2012 and September 2013, the authorized distributor paid Prohibited Brazilian Distributor and/or his company
approximately $3 million in product purchases, $2 million for which Biomet could not determine the purpose, and $30,000 for an apartment used by Prohibited Brazilian Distributor in Sao Paulo. Furthermore, despite knowing of the prohibition
against further dealings with Prohibited Brazilian Distributor, certain Biomet employees continued to meet with Prohibited Brazilian Distributor for business purposes, and allowed Prohibited Brazilian Distributor to attend several Biomet sales
events between 2010 and 2013. 
 19. Despite clear knowledge that Prohibited Brazilian Distributor was acting as its distributor since 2009,
Biomet recorded the business transactions as if they were transactions with their authorized distributor. From July 2009 to September 2013, Biomet obtained over $3,168,000 in profits from the transactions involving the Prohibited Brazilian
Distributor. 
 Sale of Unregistered and Mislabeled Products into Mexico 

20. Until mid-2009, both 3i Mexico and another Biomet subsidiary, Biomet Mexico, imported products
into Mexico via Laredo, Texas, using Texas Customs Broker. Texas Customs Broker was an unlicensed customs broker and Biomet did not have a written contract or fee schedule with the broker. In January 2009, Biomet 3i employees received emails
indicating that 3i Mexico planned to import unregistered product into Mexico through Laredo. One such email from the head of 3i Mexico, a Mexican national based in Mexico, stated “In the airport of Mexico, customs are stricter and the importing
is more complicated. At the Texas border, since it is a land border, it is less strict and they do not request all the documents.” 

  
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 21. Subsequently, Biomet investigated the Texas Customs Broker as part of a broader compliance
assessment to be performed by an outside auditing firm. The auditor’s report noted that “Biomet Mexico was found to still be using a certain customs consultant ([Texas Customs Broker]) for expediting Biomet products through the Mexico/US
border that was previously determined by Biomet Corporate to be of higher risk.” The auditor’s report also noted that Biomet lacked “due diligence procedures regarding distributors and custom agents/consultants and a formal process
related to their selection,” causing internal controls risks. The report recommended that Biomet establish formal policies and procedures regarding vendor due diligence. 

22. Biomet Mexico senior management were aware that Texas Customs Broker was able to “import limited quantities of certain instruments
without obtaining a Mexican product license...” and that the Texas Customs Broker would simply “physically cross the border in [his] own vehicles with Biomet’s product.” The Texas Customs Broker was essentially smuggling the
goods over the border. 
 23. Based on the findings in the auditor’s report, which alerted Biomet to significant red flags about the
ongoing use of an unlicensed customs broker circumventing customs requirements for the purpose of importing unregistered products, Biomet instructed Biomet Mexico and 3i Mexico to cease working with Texas Customs Broker. 

24. In April 2010, to replace Texas Customs Broker, 3i Mexico hired Mexican Customs Broker as its primary customs broker, but again did not
enter into a written contract or fee schedule. Mexican Customs Broker served as 3i Mexico’s primary customs broker through October 2013. 

25. In early 2010, 3i Mexico began experiencing problems importing product at the Mexico City International Airport because of missing
registrations and incorrect labels on products. Biomet 3i Mexico senior management suggested shipping such products through Laredo, Texas instead. Senior Biomet and Biomet 3i personnel across multiple departments, including legal, regulatory,
compliance, and finance, were aware of the problems importing goods through Mexico City. Senior Biomet 3i employees approved a proposed solution to ship through Laredo because of its more lax customs procedures. Biomet 3i Mexico began working with
Mexican Customs Broker to import the unregistered and mislabeled products from Biomet 3i’s Palm Beach Gardens location into Mexico through Laredo, Texas. Despite subsequently confirming in July 2012 with its regulatory consultant that it was
illegal both to import into Mexico and sell within Mexico unregistered product, Biomet 3i allowed certain shipments to continue after July 2012, as well as permitted the sale of unregistered product that had already entered Mexico. 

  
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 26. To address these importation issues, with the knowledge of the head of 3i Mexico, Mexican
Customs Broker divided shipment items based on whether they had valid registrations and proper labeling. Mexican Customs Broker imported the registered products through the Mexico City airport, while hiring
sub-agents to smuggle the unregistered and mislabeled product through Laredo by paying bribes to Mexican customs officials at the border. Once the divided items entered Mexico, Mexican Customs Broker would
recombine them and deliver the complete shipment to 3i Mexico. 
 27. Mexican Customs Broker through its
sub-agents made improper payments to Mexican customs officials when necessary to import the sub-agent shipments with the knowledge and approval of the head of 3i Mexico.
To facilitate these payments, Mexican Customs Broker provided separate invoices to Biomet 3i Mexico for services rendered by Mexican Customs Broker and by its sub-agents. A Biomet 3i Mexico employee based in
Mexico omitted references to the sub-agents when entering the payments into Biomet’s accounting system, and recorded the payments to the sub-agents as though they
were payments to Mexican Customs Broker. 
 28. From approximately April 2010 to September 2013, Biomet paid Mexican Customs Broker
approximately $549,000 and its sub-agents $981,000. The payments to Mexican Customs Broker’s sub-agents were unusually large and lacked supporting documentation,
containing only one-line invoices for unspecified “Professional Services” or “Consulting and Logistics.” Mexican Customs Broker’s invoices, which were not supported by any fee schedule
agreed upon between 3i Mexico and Mexican Customs Broker or any other details, included simply line items such as “Servicio Especial” or “Servicio Extraordinario” (Special or Extraordinary Service), “Cruce de Puente”
(Bridge Crossing Fee), or “Cuenta Americana,” (American Account). These unsupported and/or improper charges from Mexican Customs Broker and its sub-agents were improperly recorded under a Costo de
Fletes (Freight Cost) account. 
 29. From 2008 to 2013, Biomet obtained $2,652,100 in profits from the transactions involved in the Mexico
scheme. 
 Anti-Bribery Violations 

30. Biomet subsidiary 3i Mexico engaged Mexican Customs Broker and certain sub-agents to pay bribes to Mexican customs officials for the
purpose of circumventing Mexican customs laws regarding importing unregistered and improperly labeled products into Mexico. Biomet the parent saw numerous red flags indicating that the Mexican subsidiary’s customs agents were using bribes to
resolve the known Mexican customs issues. Biomet had already instructed Biomet Mexico and 3i Mexico to terminate a relationship with Texas Customs Broker after numerous red flags were identified indicating Texas Customs Broker was likely smuggling
unregistered products over the border. 3i Mexico subsequently failed to conduct adequate due diligence in the hiring of Mexican Customs Broker and its sub-agents as a replacement, or to require a written
contract or fee schedule. Further, Biomet employees across multiple levels and departments were aware of importation issues arising in Mexico and failed to question how Mexican Customs Broker was managing to overcome such issues while other Biomet
employees 

  
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based in Mexico knew that bribes were being paid at the border. Biomet was on notice of substantial compliance risks based in part on the outside auditor report since as early as 2008, and failed
to take steps to detect and prevent the ongoing bribery. As a result of the bribery of Mexican customs officials, Biomet violated Section 30A of the Exchange Act. 

Failure to Maintain Accurate Books and Records 

31. In Brazil, over the period July 2009 to September 2013, Biomet improperly recorded in its books and records payments to Prohibited
Brazilian Distributor as payments to another authorized distributor. In Mexico, a Biomet subsidiary engaged two agents, one who was unlicensed, to smuggle goods across the border. One of the agents paid bribes to Mexican customs officials. Biomet
improperly recorded payments to both agents between 2010 and 2013 in excess of $1.5 million, including $981,000 in payments to sub-agents that was actively concealed in Biomet’s books and records.
The payments were recorded as freight cost and as other legitimate costs, which did not reflect the true nature of those payments. Biomet violated Section 13(b)(2)(A) by improperly recording the transactions and payments in Brazil and Mexico in its
accounting books and records. 
 Failure to Maintain Sufficient Internal Accounting Controls 

32. Biomet failed to implement internal accounting controls sufficient to detect or prevent bribery and to ensure the accuracy of its books
and records. Biomet’s ongoing business ties to Prohibited Brazilian Distributor were known to Biomet employees as early as December 2009 and Biomet failed to take appropriate steps to stop the continued prohibited relationship. Biomet
improperly recorded its business transactions with Prohibited Brazilian Distributor as transactions with its authorized distributor. Biomet violated Section 13(b)(2)(B) of the Exchange Act by failing to have internal controls in place to detect
and prevent Biomet’s improper recording of transactions with the Prohibited Brazilian Distributor. 
 33. Biomet further failed to
devise and maintain internal accounting controls to prevent and detect 3i Mexico’s payments to Texas Customs Broker and Mexican Customs Broker to get product without valid registrations or proper labeling into Mexico, including improper
payments to Mexican customs officials made by Mexican Customs Broker. Biomet directed 3i Mexico to terminate its arrangement with Texas Customs Broker and to hire a new broker. However, 3i Mexico failed to conduct due diligence on Mexican Customs
Broker and failed to get a written contract or fee schedule. Biomet failed to address the numerous red flags that bribery was occurring to import its goods into Mexico. Biomet’s internal accounting controls did not prevent and detect the
improper payments totaling approximately $981,000 between 2010 and 2013. 
 Legal Standards and Violations 

34. As a result of the conduct described above, Biomet violated Section 30A of the Exchange Act, which makes it unlawful for an issuer with
securities registered under Section 12 of the Exchange Act or which is required to file reports under Section 15(d) of the Exchange Act, or any employee or agent acting on its behalf, to make use of the mails or any means or

  
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instrumentality of interstate commerce corruptly in furtherance of an effort to pay or offer to pay anything of value to foreign officials for the purpose of influencing their official
decision-making, in order to assist in obtaining or retaining business. 
 35. Further, as a result of the conduct described above, Biomet
violated Section 13(b)(2)(A) of the Exchange Act, which requires issuers to make and keep books, records, and accounts which, in reasonable detail, accurately and fairly reflect their transactions and dispositions of the assets of the issuer. 

36. In addition, as a result of the conduct described above, Biomet violated Section 13(b)(2)(B) of the Exchange Act, which requires issuers
to devise and maintain a system of internal accounting controls sufficient to provide reasonable assurances that (i) transactions are executed in accordance with management’s general or specific authorization; (ii) transactions are
recorded as necessary (I) to permit preparation of financial statements in conformity with generally accepted accounting principles or any other criteria applicable to such statements, and (II) to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate
action is taken with respect to any differences. 
 Remedial Actions and Undertakings 

37. In determining to accept the Offer, the Commission considered Respondent’s cooperation and remedial acts. 

38. Respondent undertakes to engage an Independent Compliance Monitor pursuant to the provisions set forth in Attachment A of the Order. 

39. Respondent undertakes to require the Independent Compliance Monitor to enter into an agreement that provides that for the period of
engagement and for a period of two years from completion of the engagement, the Independent Compliance Monitor shall not enter into any employment, consultant, attorney-client, auditing or other professional relationship with Respondent, or any of
its present or former affiliates, directors, officers, employees, or agents acting in their capacity. The agreement will also provide that the Independent Compliance Monitor will require that any firm with which he/she is affiliated or of which
he/she is a member, and any person engaged to assist the Independent Compliance Monitor in performance of his/her duties under this Order shall not, without prior written consent of the Division of Enforcement, enter into any employment, consultant,
attorney-client, auditing or other professional relationship with Respondent, or any of its present or former affiliates, directors, officers, employees, or agents acting in their capacity as such for the period of the engagement and for a period of
two years after the engagement. 
 40. Certify, in writing, compliance with the undertaking(s) set forth above. The certification shall
identify the undertaking(s), provide written evidence of compliance in the form of a narrative, and be supported by exhibits sufficient to demonstrate compliance. The 

  
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Commission staff may make reasonable requests for further evidence of compliance, and Respondent agrees to provide such evidence. The certification and supporting material shall be submitted to
Kara Novaco Brockmeyer, FCPA Unit Chief, Division of Enforcement, U.S. Securities and Exchange Commission, 100 F Street, N.E., Mail Stop 5631, Washington, D.C. 20549, with a copy to the Office of Chief Counsel of the Enforcement Division, no later
than sixty (60) days from the date of the completion of the undertakings. 
 41. Respondent undertakes to do the following: in
connection with this action and any related judicial or administrative proceeding or investigation commenced by the Commission or to which the Commission is a party, Respondent (i) agrees to appear and be interviewed by Commission staff at such
times and places as the staff requests upon reasonable notice; (ii) will accept service by mail or facsimile transmission of notices or subpoenas issued by the Commission for documents or testimony at depositions, hearings, or trials, or in
connection with any related investigation by Commission staff; (iii) appoints Respondent’s undersigned attorney as agent to receive service of such notices and subpoenas; (iv) with respect to such notices and subpoenas, waives the
territorial limits on service contained in Rule 45 of the Federal Rules of Civil Procedure and any applicable local rules, provided that the party requesting the testimony reimburses Respondent’s travel, lodging, and subsistence expenses at the
then-prevailing U.S. Government per diem rates; and (v) consents to personal jurisdiction over Respondent in any United States District Court for purposes of enforcing any such subpoena. 

Deferred Prosecution Agreement 

42. Zimmer Biomet will enter into a deferred prosecution agreement with the Department of Justice that acknowledges responsibility for
criminal conduct relating to the findings in the Order. Specifically, Zimmer Biomet acknowledges responsibility for Biomet’s violations of the internal controls provisions of the Foreign Corrupt Practices Act of 1977 (“FCPA”), as
amended, 15 U.S.C. §§ 78m(b)(2)(B), 78m(b)(5), and 78ff(a). Further, Jerds Luxembourg Holding, S.AR.L., the direct parent company of Biomet 3i Mexico, will enter into a guilty plea for causing violations of the FCPA’s books and
records provisions, 15 U.S.C. §§ 78m(b)(2)(A). Zimmer Biomet has agreed to pay a criminal fine of $17,460,300 in connection with the deferred prosecution agreement. 

IV. 
 In view of the
foregoing, the Commission deems it appropriate to impose the sanctions agreed to in Respondent Biomet’s Offer. 
 Accordingly, it is
hereby ORDERED that: 
 A. Pursuant to Section 21C of the Exchange Act, Respondent Biomet cease and desist from committing or
causing any violations and any future violations of Sections 13(b)(2)(A), 13(b)(2)(B) and 30A of the Exchange Act [15 U.S.C. §§ 78m(b)(2)(A), 78m(b)(2)(B), and 78dd-1]. 

  
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 B. Respondent will comply with its Undertakings as enumerated in paragraphs 38 to 41 above. 

C. Respondent shall, within fourteen days of the entry of this Order, pay disgorgement of $5,820,100, prejudgment interest of $702,705, and a
civil penalty of $6,500,000, for total payment of $13,022,805 to the Securities and Exchange Commission for transfer to the general fund of the United States Treasury, subject to Exchange Act Section 21F(g)(3). If payment of disgorgement and
prejudgment interest is not made by the date the payment is required by this Order, additional interest shall accrue pursuant to SEC Rule of Practice 600, and if payment of the civil penalty is not made by the date the payment is required by this
Order, additional interest shall accrue pursuant to 31 U.S.C. § 3717. Payment must be made in one of the following ways: 
  

	 	(1)	Respondent may transmit payment electronically to the Commission, which will provide detailed ACH transfer/Fedwire instructions upon request; 

 

	 	(2)	Respondent may make direct payment from a bank account via Pay.gov through the SEC website at http://www.sec.gov/about/offices/ofm.htm; or 

 

	 	(3)	Respondent may pay by certified check, bank cashier’s check, or United States postal money order, made payable to the Securities and Exchange Commission and hand-delivered or mailed to: 

Enterprise Services Center 

Accounts Receivable Branch 
 HQ
Bldg., Room 181, AMZ-341 
 6500 South MacArthur Boulevard 

Oklahoma City, OK 73169 

Payments by check or money order must be accompanied by a cover letter identifying Biomet as a Respondent in these proceedings, and the file
number of these proceedings; a copy of the cover letter and check or money order must be sent to Tracy L. Price, Assistant Director, Division of Enforcement, Securities and Exchange Commission, 100 F St., NE, Washington, DC 20549-5631. 

By the Commission. 
  

	
	Brent J. Fields
	Secretary

  
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 Attachment A 

Independent Compliance Monitor 

Retention of Monitor and Term of Engagement 

1. Zimmer Biomet (“Company”) shall engage an independent compliance monitor (the “Monitor”) not unacceptable to the staff
of the Commission within sixty (60) calendar days of the issuance of the Order. The Monitor shall have, at a minimum, the following qualifications: (i) demonstrated expertise with respect to the FCPA and other applicable anti-corruption
laws, including experience counseling on FCPA issues; (ii) experience designing or reviewing corporate compliance policies, procedures, and internal accounting controls, including FCPA and anti-corruption policies and procedures; (iii) the
ability to access and deploy resources as necessary to discharge the Monitor’s duties; and (iv) sufficient independence from the Company to ensure effective and impartial performance of the Monitor’s duties. The Commission staff may
extend the Company’s time period to retain the Monitor, in its sole discretion. If the Monitor resigns or is otherwise unable to fulfill the obligations herein, the Company shall within forty-five (45) days retain a successor Monitor that
has the same minimum qualifications as the original monitor and that is not unacceptable to the Commission staff. 
 2. The Company shall
retain the Monitor for a period of not less than thirty-six (36) months, unless the Commission staff finds, in its sole discretion, that there exists a change in circumstances sufficient to eliminate the
need for the Monitor, in which case the Monitorship may be terminated early (the “Term of the Monitorship”). The term of the Monitorship can be extended as set forth in Paragraph 26, below. The Company shall provide the Commission staff
with a copy of the agreement detailing the scope of the Monitor’s responsibilities within thirty (30) days after the Monitor is engaged. 

  
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 3. During the Term of the Monitorship and for a period of two years from the conclusion of the
Monitorship, neither the Company nor any of its then-current or former affiliates, subsidiaries, directors, officers, employees, or agents acting in their capacity as such shall enter into, or discuss the possibility of, any employment, consultant,
attorney-client, auditing, or other professional relationship with the Monitor. 
 Company’s Obligations 

4. The Company shall cooperate fully with the Monitor and provide the Monitor with access to all
non-privileged information, documents, books, records, facilities, and personnel as reasonably requested by the Monitor; such access shall be provided consistent with the Company’s and the Monitor’s
obligations under applicable local laws and regulations, including but not limited to, applicable data privacy and national security laws and regulations. The Company shall use its best efforts, to the extent reasonably requested, to provide the
Monitor with access to the Company’s former employees, third party vendors, agents, and consultants. The Company does not intend to waive the protection of the attorney work product doctrine, attorney-client privilege, or any other privilege
applicable as to third parties. 
 5. The parties agree that no attorney-client relationship shall be formed between the Company and the
Monitor. In the event that the Company seeks to withhold from the Monitor access to information, documents, books, records, facilities, current or former personnel of the Company, its third-party vendors, agents, or consultants that may be subject
to a claim of attorney-client privilege or to the attorney work-product doctrine, or where the Company reasonably 

  
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believes production would otherwise be inconsistent with the applicable law, the Company shall work cooperatively with the Monitor to resolve the matter to the satisfaction of the Monitor. If,
during the Term of the Monitorship, the Monitor believes that the Company is unreasonably withholding access on the basis of a claim of attorney-client privilege, attorney work-product doctrine, or other asserted applicable law, the Monitor shall
notify the Commission staff. 
 6. Upon entry of this Order and during the Term of the Monitorship, should the Company learn of credible
evidence or allegations of corrupt payments, false books, records, or accounts, or the failure to implement adequate internal accounting controls, the Company shall promptly report such evidence or allegations to the Commission staff. Any disclosure
by the Company to the Monitor concerning potential corrupt payments, false books and records, or internal accounting control issues shall not relieve the Company of any otherwise applicable obligation to truthfully disclose such matters to the
Commission staff. 
 Monitor’s Mandate 

7. The Monitor shall review and evaluate the effectiveness of the Company’s policies, procedures, practices, internal accounting
controls, recordkeeping, and financial reporting (collectively, “Policies and Procedures”), with a focus on the Company’s legacy Biomet operations as integrated into Zimmer Biomet, as they relate to the Company’s current and
ongoing compliance with the anti-bribery, books and records, and internal accounting controls provisions of the FCPA and other applicable anti-corruption laws (collectively, “Anti-corruption Laws”), and make recommendations reasonably
designed to improve the effectiveness of the Company’s internal accounting controls and FCPA corporate compliance program (the “Mandate”). This Mandate shall include an assessment of the Board of Directors’ and senior
management’s 

  
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commitment to, and effective implementation of, the FCPA corporate compliance program. In carrying out the Mandate, to the extent appropriate under the circumstances, the Monitor may coordinate
with the Company personnel, including in-house counsel, compliance personnel, and internal auditors. To the extent the Monitor deems appropriate, it may rely on the Company’s processes, and on sampling
and testing methodologies. The Monitor is not expected to conduct a comprehensive review of all business lines, all business activities, and all markets. Any disputes between the Company and the Monitor with respect to the Work Plan shall be decided
by the Commission staff in its sole discretion. 
 8. During the term of the Monitorship, the Monitor shall conduct three reviews (First
Review, Second Review, and Third Review), issue a report following each review (First Review Report, Second Review Report, and Third Review Report), and issue a Final Certification Report, as described below. The Monitor’s Work Plan for the
First Review shall include such steps as are reasonably necessary to conduct an effective First Review. It is not intended that the Monitor will conduct its own inquiry into historical events. In developing each Work Plan and in carrying out the
reviews pursuant to such plans, the Monitor is encouraged to coordinate with the Company’s personnel, including auditors and compliance personnel. 

First Review and Report 

9. The Monitor shall commence the First Review no later than one hundred twenty (120) calendar days from the date of the engagement of
the Monitor (unless otherwise agreed by the Company, the Monitor, and the Commission staff). Promptly upon being retained, the Monitor shall prepare a written Work Plan, which shall be submitted to the Company and the Commission staff for comment no
later than sixty (60) days after being retained. 

  
 4 

 10. In order to conduct an effective First Review and to understand fully any existing
deficiencies in the Company’s internal accounting controls and FCPA corporate compliance program, the Monitor’s Work Plan shall include such steps as are reasonably necessary to understand the Company’s business and its global
anti-corruption risks. The steps shall include: 
  

	 	(a)	inspection of relevant documents, including the internal accounting controls, recordkeeping, and financial reporting policies and procedures as they relate to the Company’s compliance with the books and records,
internal accounting controls, and anti-bribery provisions of the FCPA and other applicable anti-corruption laws; 

  

	 	(b)	onsite observation of selected systems and procedures comprising the Company’s FCPA corporate compliance program, including anti- corruption compliance procedures, internal accounting controls, recordkeeping, due
diligence, and internal audit procedures, including at sample sites; 

  

	 	(c)	meetings with, and interviews of, as relevant, the Company employees, officers, directors, and, where appropriate and feasible, its third-party vendors, agents, or consultants and other persons at mutually convenient
times and places; and 

  

	 	(d)	risk-based analyses, studies, and testing of the Company’s FCPA corporate compliance program. 

11. The Monitor may take steps as reasonably necessary to develop an understanding of the facts and circumstances surrounding prior FCPA
violations that gave rise to this action or violations of other applicable anti-corruption laws, but shall not conduct his or her own inquiry into those historical events. 

  
 5 

 12. After receiving the First Review Work Plan, the Company and Commission staff shall provide
any comments concerning the First Review Work Plan within thirty (30) days to the Monitor. Any disputes between the Company and the Monitor with respect to the First Review Work Plan shall be decided by the Commission staff in its sole
discretion. Following comments by the Company and Commission staff, the Monitor will have fifteen (15) days to submit a Final First Review Work Plan. 

13. The First Review shall commence no later than one hundred twenty (120) days from the date of the engagement of the Monitor (unless
otherwise agreed by the Company, the Monitor, and the Commission staff). The Monitor shall issue a written report within one hundred fifty (150) days of commencing the First Review, setting forth the Monitor’s assessment and, if necessary,
making recommendations reasonably designed to improve the effectiveness of the Company’s internal accounting controls and FCPA corporate compliance program as they relate to the Company’s compliance with the FCPA and other applicable
anti-corruption laws. The Monitor should consult with the Company concerning his or her findings and recommendations on an ongoing basis and should consider the Company’s comments and input to the extent the Monitor deems appropriate. The
Monitor may also choose to share a draft of his or her report with the Company and Commission staff prior to finalizing it. The Monitor shall provide the report to the Board of Directors of the Company and contemporaneously transmit a copy to
Commission staff. 

  
 6 

 14. Within one hundred fifty (150) days after receiving the Monitor’s First Review
Report, the Company shall adopt and implement all recommendations in the report, provided, however, that as to any recommendation that the Company considers unduly burdensome, impractical, costly, or inconsistent with applicable law or regulation,
the Company need not adopt that recommendation at that time, but may submit in writing to the Monitor and the Commission staff within sixty (60) days of receiving the report, an alternative policy, procedure, or system designed to achieve the
same objective or purpose. 
 15. In the event the Company and the Monitor are unable to agree on an acceptable alternative proposal, the
Company shall promptly consult with the Commission staff. Any disputes between the Company and the Monitor with respect to the recommendations shall be decided by the Commission staff in its sole discretion. The Commission staff shall consider the
Monitor’s recommendation and the Company’s reasons for not adopting the recommendation in determining whether the Company has fully complied with its obligations. Pending such determination, the Company shall not be required to implement
any contested recommendation(s). 
 16. With respect to any recommendation that the Monitor determines cannot reasonably be implemented
within one hundred and fifty (150) days after receiving the report, the Monitor may extend the time period for implementation with prior written approval of the Commission staff. 

Second Review 
 17. Within
one hundred twenty (120) days after the issuance of the First Review Report, the Monitor shall submit a written Work Plan for the Second Review to the Company and Commission staff. the Company and Commission staff shall provide any comments
concerning 

  
 7 

 
the Work Plan within thirty (30) days in writing to the Monitor. Any disputes between the Company and the Monitor with respect to the written Work Plan shall be decided by the Commission
staff in its sole discretion. Following comments by the Company and Commission staff, the Monitor will have fifteen (15) days to submit a Final Second Review Work Plan. 

18. The Second Review shall commence no later than one hundred eighty (180) days after the issuance of the First Review Report (unless
otherwise agreed by the Company, the Monitor, and the Commission staff). The Monitor shall issue a written Second Review Report within one hundred twenty (120) days of commencing the Second Review. The Second Review Report shall set forth the
Monitor’s assessment of, and any additional recommendations regarding, the Company’s internal accounting controls and FCPA corporate compliance program as they relate to the Company’s compliance with the FCPA and other applicable
anti-corruption laws; the Monitor’s assessment of the implementation by the Company of any recommendations made in the First Review Report; and the Monitor’s assessment of the commitment of the Company’s Board of Directors and senior
management to compliance with anti-corruption laws. 
 19. Within one hundred twenty (120) days after receiving the Monitor’s
Second Review Report, the Company shall adopt and implement all recommendations in the report, provided, however, that as to any recommendation that the Company considers unduly burdensome, impractical, costly, or inconsistent with applicable law or
regulation, the Company need not adopt that recommendation at that time, but may submit in writing to the Monitor and the Commission staff within thirty (30) days of receiving the report, an alternative policy, procedure, or system designed to
achieve the same objective or purpose. 

  
 8 

 20. In the event the Company and the Monitor are unable to agree on an acceptable alternative
proposal within thirty (30) days, the Company shall promptly consult with the Commission staff. Any disputes between the Company and the Monitor with respect to the recommendations shall be decided by the Commission staff in its sole
discretion. The Commission staff shall consider the Monitor’s recommendation and the Company’s reasons for not adopting the recommendation in determining whether the Company has fully complied with its obligations. Pending such
determination, the Company shall not be required to implement any contested recommendation(s). 
 Third Review 

21. The Monitor shall commence a Third Review no later than one hundred fifty (150) days after the issuance of the Second Review Report
(unless otherwise agreed by the Company, the Monitor, and the Commission staff). The monitor shall issue a written Third Review Report within one hundred twenty (120) days of commencing the Third Review, setting forth the Monitor’s
assessment and, if necessary, making recommendations in the same fashion as with the prior reviews. 
 22. Within one hundred twenty
(120) days after receiving the Monitor’s Third Review Report, the Company shall adopt and implement all recommendations in the report, provided, however, that as to any recommendation that the Company considers unduly burdensome,
impractical, costly, or inconsistent with applicable law or regulation, the Company need not adopt that recommendation at that time, but may submit in writing to the Monitor and the Commission staff within thirty (30) days of receiving the
report, an alternative policy, procedure, or system designed to achieve the same objective or purpose. 

  
 9 

 23. In the event the Company and the Monitor are unable to agree on an acceptable alternative
proposal within thirty (30) days, the Company shall promptly consult with the Commission staff. Any disputes between the Company and the Monitor with respect to the recommendations shall be decided by the Commission staff in its sole
discretion. The Commission staff shall consider the Monitor’s recommendation and the Company’s reasons for not adopting the recommendation in determining whether the Company has fully complied with its obligations. Pending such
determination, the Company shall not be required to implement any contested recommendation(s). 
 Certification 

24. No later than sixty (60) days after implementation of the recommendations in the Monitor’s Third Review Report, the Monitor
shall certify whether the Company’s compliance program, including its policies and procedures, is reasonably designed and implemented to prevent and detect violations of the FCPA and is functioning effectively. Such certification shall be
supported by a written Final Certification Report that certifies the Company’s compliance with its obligations under the Final Judgment, and which shall set forth an assessment of the sustainability of the Company’s remediation efforts and
may also recommend areas for further follow-up by the Company. 
 25. The monitor shall orally
notify the Commission staff at least fourteen (14) days prior to the issuance of the Final Certification Report whether he or she expects to be able to certify as provided herein. In the event the Monitor is unable to certify within the three
year term of the monitor period, the following extension provisions shall be in effect. 

  
 10 

 Extension of Monitor Period 

26. If, as informed by the Monitor’s inability to certify that the Company’s compliance program, including its policies and
procedures, is reasonably designed and implemented to prevent and detect violations of the FCPA and is functioning effectively, the Commission staff concludes that the Company has not successfully satisfied its obligations under the Monitorship, the
Monitor Period shall be extended for a reasonable time. 
 27. Under such circumstances, the Monitor shall commence a Fourth Review no later
than sixty (60) days after the Commission staff concludes that the Company has not successfully satisfied its compliance obligations under the Final Judgment (unless otherwise agreed by the Company, the Monitor, and the Commission staff). The
Monitor shall issue a written Fourth Review Report within ninety (90) days of commencing the Fourth Review in the same fashion as set forth in Paragraph 13 with respect to the First Review and in accordance with the procedures for follow-up reports set forth in Paragraphs 17 to 21. A determination to terminate the Monitorship shall then be made in accordance with Paragraph 24. 

28. If, after completing the Fourth Review the Monitor is unable to certify, the Monitorship shall be extended, and the Monitor shall commence
a Fifth Review (unless otherwise agreed by the Company, the Monitor, and the Commission staff). The Monitor shall issue a written Fifth Review Report within ninety (90) days of commencing the Fifth Review in the same fashion as set forth in
Paragraph 13 with respect to the First Review and in accordance with the procedures for follow-up reports set forth in Paragraphs 17 to 21. These reviews shall continue until the Monitor is able to certify, or
unless as otherwise agreed by the Company and Commission staff. 

  
 11 

 Discovery of Potential or Actual Misconduct 

29. Throughout the Term of the Monitorship, the Monitor shall disclose to the Commission staff any credible evidence that corrupt or otherwise
suspicious transactions occurred, or payments or things of value were offered, promised, made, or authorized by any entity or person within the Company, or any entity or person working directly or indirectly for or on behalf of the Company, or that
related false books and records may have been maintained by or on behalf of the Company or that relevant internal accounting controls were circumvented or were not reasonably designed or implemented. The Monitor shall contemporaneously notify the
Company’s General Counsel, Chief Compliance Officer, or Audit Committee for further action unless at the Monitor’s discretion he or she believes disclosure to the Company would be inappropriate under the circumstances. The Monitor shall
address in his or her reports the appropriateness of the Company’s response to all improper activities, whether previously disclosed to the Commission staff or not. 

Certification of Completion 

30. No later than sixty (60) days from date of the completion of the undertakings with respect to the Monitorship, the Company shall
certify, in writing, compliance with the undertakings set forth above. The certification shall identify the undertakings, provide written evidence of compliance in the form of a narrative, and be supported by exhibits sufficient to demonstrate
compliance. The Commission staff may make reasonable requests for further evidence of compliance, and the Company agrees to provide such evidence. 

  
 12 

 Extensions of Time 

31. Upon request by the Monitor or the Company, the Commission staff may extend any procedural time period set forth above for good cause
shown. 
 Confidentiality of Reports 

32. The reports submitted by the Monitor and the periodic reviews and reports submitted by the Company will likely include confidential
financial, proprietary, competitive business, or commercial information. Public disclosure of the reports could discourage cooperation, impede pending or potential government investigations, or undermine the objective of the reporting requirement.
For these reasons, among others, the reports and the contents thereof are intended to remain and shall remain non-public, except (i) pursuant to court order, (ii) as agreed to by the parties in
writing, (iii) to the extent that the Commission determines in its sole discretion that disclosure would be in furtherance of the Commission’s discharge of its duties and responsibilities, or (iv) as is otherwise required by law. 

Address for All Written Communications and Reports 

33. All reports or other written communications by the Monitor or the Company directed to the Commission staff shall be transmitted to Tracy
L. Price, Assistant Director, FCPA Unit, Division of Enforcement, U.S. Securities and Exchange Commission, 100 F Street NE, Washington D.C. 20549. 

  
 13EX-10.3

 Exhibit 10.3 
  

					
		  	RECEIVED
		 	 UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA
	  	 JAN 12 2017

Clerk, U.S. District & Bankruptcy

		 		  	Courts for the District of Columbia

  

							
	  
	 	:	 	
	UNITED STATES OF AMERICA,	 	:	 	         CRIMINAL NO. 

		 	:	 		  	
	Plaintiff,	 	:	 		  	
		 	:	 	        PLEA AGREEMENT
	 v.
	 	:	 		  	
		 	:	 		  	
	JERDS LUXEMBOURG HOLDING S.ÀR.L.	 	:	 		  	
		 	:	 		  	
	Defendant.	 	:	 		  	
	  
	 	:	 		  	

 PLEA AGREEMENT 

The United States of America, by and through the Department of Justice, Criminal Division, Fraud Section, (the “Fraud Section”), and
the Defendant, JERDS Luxembourg Holding (“JERDS” or the “Defendant”), by and through its undersigned attorneys, and through its authorized representative, pursuant to authority granted by the Defendant’s Board of Directors,
hereby submit and enter into this plea agreement (the “Agreement”), pursuant to Rule 11(c)(1)(C) of the Federal Rules of Criminal Procedure. The terms and conditions of this Agreement are as follows: 

The Defendant’s Agreement 

1. Pursuant to Fed. R. Crim. P. 11(c)(1)(C), the Defendant agrees to waive its right to grand jury indictment and its right to challenge venue
in the District Court for the District of Columbia and to plead guilty to a one count criminal Information charging the Defendant with causing a violation of the books and records provisions of the Foreign Corrupt Practices Act of 1977
(“FCPA”), in violation of Title 15, United States Code, Sections 78m(b)(2)(A) and Title 18,  

  
 1 

 
United States Code, Section 2. The Defendant further agrees to persist in that plea through sentencing and, as set forth below, to cooperate fully with the Fraud Section in its investigation
into the conduct described in this Agreement and other conduct related to corrupt payments, related false books and records, and failure to implement internal accounting controls. 

2. Since February 2012, Defendant has been the parent company of Biomet 3i Mexico SA de CV (“3i Mexico”) and an indirect,
wholly-owned subsidiary of Biomet, Inc. (“Biomet”) which was an issuer of securities registered pursuant to Title 15, United States Code, Section 781. 3i Mexico no longer sells products and is in the process of winding down, and the
Defendant is the successor-in-interest to 3i Mexico and is therefore responsible for 3i Mexico’s conduct, including the conduct described in the Statement of Facts.
The Defendant understands that, to be guilty of the offense charged in the Information, the following essential elements of the offense must be satisfied: 

a. The Defendant’s parent company, Biomet, was an issuer of securities registered pursuant to Title 15, United States
Code, Section 781 during the relevant time period; 
 b. The Defendant did knowingly cause Biomet to maintain false
books, records, or accounts such that Biomet’s books, records, or accounts did not fairly reflect the transactions and dispositions of Biomet’s assets. 

3. The Defendant understands and agrees that this Agreement is between the Fraud Section and the Defendant and does not bind any other
division or section of the Department of Justice or any other federal, state, or local prosecuting, administrative, or regulatory authority. Nevertheless, the Fraud Section will bring this Agreement and the nature and quality of the conduct,
cooperation and remediation of the Defendant, its direct or indirect affiliates, subsidiaries, 

  
 2 

 
and joint ventures, to the attention of other prosecuting authorities or other agencies, as well as debarment authorities and Multilateral Development Banks (“MDBs”), if requested by
the Defendant. 
 4. The Defendant agrees that this Agreement will be executed by an authorized corporate representative. The Defendant
further agrees that a resolution duly adopted by the Defendant’s Board of Directors in the form attached to this Agreement as Exhibit 1, authorizes the Defendant to enter into this Agreement and take all necessary steps to effectuate this
Agreement, and that the signatures on this Agreement by the Defendant and its counsel are authorized by the Defendant’s Board of Directors, on behalf of the Defendant. 

5. The Defendant agrees that it has the full legal right, power, and authority to enter into and perform all of its obligations under this
Agreement. 
 6. The Fraud Section enters into this Agreement based on the individual facts and circumstances presented by this case and the
Defendant. Among the factors considered were those stated in the Deferred Prosecution Agreement signed by Zimmer Biomet Holdings, Inc. and the Fraud Section and filed concurrently (the “Zimmer Biomet DPA”). 

7. The Defendant agrees to abide by all terms and obligations of this Agreement as described herein, including, but not limited to, the
following: 
 a. to plead guilty as set forth in this Agreement; 

b. to abide by all sentencing stipulations contained in this Agreement; 

c. to appear, through its duly appointed representatives, as ordered for all court appearances, and obey any other ongoing court order in this
matter, consistent with all applicable U.S. and foreign laws, procedures, and regulations; 
 d. to commit no further crimes; 

  
 3 

 e. to be truthful at all times with the Court; 

f. to pay the applicable fine and special assessment; and 

g. to work with its ultimate parent corporation in fulfilling the obligations of the Zimmer Biomet DPA. 

8. The Defendant shall cooperate fully with the Fraud Section in any and all matters relating to the conduct described in this Agreement, the
Statement of Facts, the Information filed pursuant to this Agreement, and other conduct related to corrupt payments, false books, records, and accounts, and the failure to implement adequate internal accounting controls, subject to applicable law
and regulations, until the later of the date upon which all investigations and prosecutions arising out of such conduct are concluded, or the end of the term of the Zimmer Biomet DPA. At the request of the Fraud Section, the Defendant shall also
cooperate fully with other domestic or foreign law enforcement and regulatory authorities and agencies, as well as the Multilateral Development Banks (“MDBs”), in any investigation of the Defendant, its parent company or its affiliates, or
any of its present or former officers, directors, employees, agents, and consultants, or any other party, in any and all matters relating to the conduct described in this Agreement, the Statement of Facts, the Information filed pursuant to this
Agreement, and other conduct related to corrupt payments, false books, records, and accounts, and the failure to implement adequate internal accounting controls. The Defendant agrees that its cooperation pursuant to this paragraph shall include, but
not be limited to, the following: 
 a. The Defendant shall truthfully disclose all factual information not protected by a valid claim of
attorney-client privilege or work product doctrine with respect to its activities, those of its parent company and affiliates, and those of its present and former directors, officers, employees, agents, and consultants, including any evidence or
allegations and internal 

  
 4 

 
or external investigations, about which the Defendant has any knowledge or about which the Fraud Section may inquire. This obligation of truthful disclosure includes, but is not limited to, the
obligation of the Defendant to provide to the Fraud Section, upon request, any document, record or other tangible evidence about which the Fraud Section may inquire of the Defendant. 

b. Upon request of the Fraud Section, the Defendant shall designate knowledgeable employees, agents or attorneys to provide to the Fraud
Section the information and materials described in Paragraph 10(a) above on behalf of the Defendant. It is further understood that the Defendant must at all times provide complete, truthful, and accurate information. 

c. The Defendant shall use its best efforts to make available for interviews or testimony, as requested by the Fraud Section, present or
former officers, directors, employees, agents and consultants of the Defendant. This obligation includes, but is not limited to, sworn testimony before a federal grand jury or in federal trials, as well as interviews with domestic or foreign law
enforcement and regulatory authorities. Cooperation under this Paragraph shall include identification of witnesses who, to the knowledge of the Defendant, may have material information regarding the matters under investigation. 

d. With respect to any information, testimony, documents, records or other tangible evidence provided to the Fraud Section pursuant to this
Agreement, the Defendant consents to any and all disclosures, subject to applicable law and regulations, to other governmental authorities, including United States authorities and those of a foreign government as well as the MDBs, of such materials
as the Fraud Section, in its sole discretion, shall deem appropriate. 

  
 5 

 9. During the term of the Zimmer Biomet DPA, should the Company learn of any evidence or
allegations of conduct that may constitute a violation of the FCPA anti-bribery or accounting provisions had the conduct occurred within the jurisdiction of the United States, the Company shall promptly report such evidence or allegations to the
Fraud Section. 
 10. The Defendant agrees that any fine or restitution imposed by the Court will be due and payable in full at the time of
the entry of judgment following such sentencing hearing, and the Defendant will not attempt to avoid or delay payment. The Defendant further agrees to pay the Clerk of the Court for the United States District Court for the District of Columbia the
mandatory special assessment of $400 per count within ten business days from the date of sentencing. 
 The United States’
Agreement 
 11. In exchange for the guilty plea of the Defendant and the complete fulfillment of all of its obligations under this
Agreement, and in exchange for the agreement of the defendant’s ultimate parent corporation, Zimmer Biomet Holdings, Inc. (“Zimmer Biomet”), to assume all of the obligations set forth in the Zimmer Biomet DPA, the Fraud Section agrees
that it will not file additional criminal charges against the Defendant or any of its direct or indirect affiliates, subsidiaries, joint ventures, or parent corporations relating to (a) any of the conduct described in the Statement of Facts, or
(b) information made known to the Fraud Section prior to the date of this Agreement, except for the charges specified in the Zimmer Biomet DPA. This Agreement does not provide any protection against prosecution for any future conduct by the
Company. In addition, this Agreement does not provide any protection against prosecution of any individuals, regardless of their affiliation with the Company. The Defendant agrees that nothing in this Agreement is intended to release the Defendant
from any and all of the Defendant’s excise and income tax liabilities and reporting obligations for any and all income not properly reported and/or legally or illegally obtained or derived. 

  
 6 

 Factual Basis 

12. The Defendant is pleading guilty because it is guilty of the charges contained in the Information. The Defendant admits, agrees, and
stipulates that the factual allegations set forth in the Information and the Statement of Facts are true and correct, that it is responsible for the acts of its and its subsidiaries’ officers, directors, employees, and agents described in the
Information and the Statement of Facts, and that the Information and the Statement of Facts accurately reflect the Defendant’s criminal conduct. 

The Defendant’s Waiver of Rights, Including the Right to Appeal 

13. Federal Rule of Criminal Procedure 11(f) and Federal Rule of Evidence 410 limit the admissibility of statements made in the course of plea
proceedings or plea discussions in both civil and criminal proceedings, if the guilty plea is later withdrawn. The Defendant expressly warrants that it has discussed these rules with its counsel and understands them. Solely to the extent set forth
below, the Defendant voluntarily waives and gives up the rights enumerated in Federal Rule of Criminal Procedure 11(f) and Federal Rule of Evidence 410. Specifically, the Defendant understands and agrees that any statements that it makes in the
course of its guilty plea or in connection with the Agreement are admissible against it for any purpose in any U.S. federal criminal proceeding if, even though the Fraud Section has fulfilled all of its obligations under this Agreement and the Court
has imposed the agreed-upon sentence, the Defendant nevertheless withdraws its guilty plea. 
 14. The Defendant is satisfied that the
Defendant’s attorneys have rendered effective assistance. The Defendant understands that by entering into this agreement, the Defendant surrenders certain rights as provided in this agreement. The Defendant understands that the rights of
criminal defendants include the following: 
 a. the right to plead not guilty and to persist in that plea; 

  
 7 

 b. the right to a jury trial; 

c. the right to be represented by counsel – and if necessary have the court appoint counsel – at trial and at every other stage of
the proceedings; 
 d. the right at trial to confront and cross-examine adverse witnesses, to be protected from compelled
self-incrimination, to testify and present evidence, and to compel the attendance of witnesses; and 
 e. pursuant to Title 18, United
States Code, Section 3742, the right to appeal the sentence imposed. 
 Nonetheless, the Defendant knowingly waives the right to appeal
or collaterally attack the conviction and any sentence within the statutory maximum described below (or the manner in which that sentence was determined) on the grounds set forth in Title 18, United States Code, Section 3742, or on any
ground whatsoever except those specifically excluded in this Paragraph, in exchange for the concessions made by the United States in this plea agreement. This agreement does not affect the rights or obligations of the United States as set forth in
Title 18, United States Code, Section 3742(b). The Defendant also knowingly waives the right to bring any collateral challenge challenging either the conviction, or the sentence imposed in this case. The Defendant hereby waives all rights, whether
asserted directly or by a representative, to request or receive from any department or agency of the United States any records pertaining to the investigation or prosecution of this case, including without limitation any records that may be sought
under the Freedom of Information Act, Title 5, United States Code, Section 552, or the Privacy Act, Title 5, 

  
 8 

 
United States Code, Section 552a. The Defendant waives all defenses based on the statute of limitations and venue with respect to any prosecution related to the conduct described in the Statement
of Facts or the Information, including any prosecution that is not time-barred on the date that this Agreement is signed in the event that: (a) the conviction is later vacated for any reason; (b) the Defendant violates this Agreement; or
(c) the plea is later withdrawn, provided such prosecution is brought within one year of any such vacation of conviction, violation of agreement, or withdrawal of plea plus the remaining time period of the statute of limitations as of the date
that this Agreement is signed. The Fraud Section is free to take any position on appeal or any other post-judgment matter. The parties agree that any challenge to the Defendant’s sentence that is not foreclosed by this Paragraph will be limited
to that portion of the sentencing calculation that is inconsistent with (or not addressed by) this waiver. Nothing in the foregoing waiver of appellate and collateral review rights shall preclude the Defendant from raising a claim of ineffective
assistance of counsel in an appropriate forum. 
 Penalty 

15. The statutory maximum sentence that the Court can impose for a violation of Title 15, United States Code, Section 78m(b)(2)(A) is a
fine of $25,000,000 or twice the gross pecuniary gain or gross pecuniary loss resulting from the offense, whichever is greatest, Title 15, United States Code, Section 78ff(a) and Title 18, United States Code, Section 3571(c), (d); five
years’ probation, Title 18, United States Code, Section 3561(c)(1); and a mandatory special assessment of $400 per count, Title 18, United States Code, Section 3013(a)(2)(B). In this case, the parties agree that the gross pecuniary
gain resulting from the offense is $2,402,100. Therefore, pursuant to 18 U.S.C. § 3571(d), the maximum fine that may be imposed is $4,804,200. 

  
 9 

 Sentencing Recommendation 

16. The parties agree that pursuant to United States v. Booker, 543 U.S. 220 (2005), the Court must determine an advisory sentencing
guideline range pursuant to the United States Sentencing Guidelines. The Court will then determine a reasonable sentence within the statutory range after considering the advisory sentencing guideline range and the factors listed in Title 18,
United States Code, Section 3553(a). The parties’ agreement herein to any guideline sentencing factors constitutes proof of those factors sufficient to satisfy the applicable burden of proof The Defendant also understands that if the Court
accepts this Agreement, the Court is bound by the sentencing provisions in Paragraph 17. 
 17. The Fraud Section and the Defendant agree
that a faithful application of the United States Sentencing Guidelines (U.S.S.G.) to determine the applicable fine range yields the following analysis: 
  

	 	a.	The 2014 U.S.S.G. are applicable to this matter. 

  

	 	b.	Offense Level. Based upon U.S.S.G. § 2B1.1, the total offense level is 25, calculated as follows: 

  

							
	(a)(1)	  	Base Offense Level	  	 	7	  
			
	(b)(1)	  	Amount of Loss/Gain	  	 	+16	  
			
	(b)(10)	  	Substantial Part of Scheme Committed from Outside the United States	  	 	+2	  
		  		  	  
	  
	 
			
	TOTAL	  		  	 	25	  

  

	 	c.	Base Fine. Based upon U.S.S.G. § 8C2.4(a)(2), the base fine is $2,800,000 

  
 10 

	 	d.	Culpability Score. Based upon U.S.S.G. § 8C2.5, the culpability score is 4, calculated as follows: 

  

							
	(a)	  	Base Culpability Score	  	 	5	  
			
	(b)(5)	  	the unit of the organization within which the offense was committed had 10 or more employees and an individual with substantial authority personnel participated in, condoned, or was willfully ignorant of the offense	  	 	+1	  
			
	(g)(2)	  	The organization cooperated in the investigation and clearly demonstrated recognition and affirmative acceptance of responsibility for its criminal conduct	  	 	-2	  
		  		  	  
	  
	 
			
	TOTAL	  		  	 	4	  

  

			
	Calculation of Fine Range:	  	
		
	Base Fine	  	$2,800,000
		
	Multipliers	  	.8(min)/1.60 (max)
		
	Fine Range	  	$2,240,000 (min)/$4,480,000 (max)

 18. Pursuant to Rule 11(c)(1)(C) of the Federal Rules of Criminal Procedure, the Fraud Section and the
Defendant agree that the following represents the appropriate disposition of the case: 
 a. Disposition. The parties agree that, in
light of the Zimmer Biomet DPA, which requires Zimmer Biomet to pay a total monetary penalty of $17,460,300 as a result of the misconduct committed by Zimmer Biomet’s predecessors, affiliates and subsidiaries, including JERDS, no fine should be
imposed on the Defendant, and if the Court imposes any fine, the Fraud Section agrees to credit the criminal penalty paid by Zimmer Biomet Holdings, Inc. in connection with Zimmer Biomet’s DPA to any penalty imposed on JERDS. 

  
 11 

 b. Mandatory Special Assessment. The Defendant shall pay to the Clerk of the Court for the
United States District Court for the District of Columbia within ten days of the time of sentencing the mandatory special assessment of $400 per count. 

19. This Agreement is presented to the Court pursuant to Fed. R. Crim. P. 11(c)(1)(C). The Defendant understands that, if the Court rejects
this Agreement, the Court must: (a) inform the parties that the Court rejects the Agreement; (b) advise the Defendant’s counsel that the Court is not required to follow the Agreement and afford the Defendant the opportunity to withdraw its
plea; and (c) advise the Defendant that if the plea is not withdrawn, the Court may dispose of the case less favorably toward the Defendant than the Agreement contemplated. The Defendant further understands that if the Court refuses to accept any
provision of this Agreement, neither party shall be bound by the provisions of the Agreement. 
 20. In the event the Court directs the
preparation of a Presentence Investigation Report, the Fraud Section will fully inform the preparer of the Presentence Investigation Report and the Court of the facts and law related to the Defendant’s case. At the time of the plea hearing, the
parties will suggest mutually agreeable and convenient dates for the sentencing hearing with adequate time for (a) any objections to the Presentence Report, and (b) consideration by the Court of the Presentence Report and the parties’
sentencing submissions. 
 Breach of Agreement 

21. If during the term of Zimmer Biomet DPA the Defendant (a) commits any felony under U.S. federal law; (b) provides in connection with
this Agreement deliberately false, incomplete, or misleading information, including in connection with its disclosure of information about individual culpability; (c) fails to cooperate as set forth in Paragraphs 8 and 9 of this Agreement; (d)
commits any acts that, had they occurred within the jurisdictional reach of the 

  
 12 

 
FCPA, would be a violation of the FCPA; or (e) otherwise fails specifically to perform or to fulfill completely each of the Defendant’s obligations under the Agreement, regardless of
whether the Fraud Section becomes aware of such a breach after the term of the Zimmer Biomet DPA, the Defendant shall thereafter be subject to prosecution for any federal criminal violation of which the Fraud Section has knowledge, including, but
not limited to, the charges in the Information described in Paragraph 1, which may be pursued by the Fraud Section in the U.S. District Court for the District of Columbia or any other appropriate venue. Determination of whether the Defendant has
breached the Agreement and whether to pursue prosecution of the Defendant shall be in the Fraud Section’s sole discretion. Any such prosecution may be premised on information provided by the Defendant. Any such prosecution relating to the
conduct described in the attached Statement of Facts or relating to conduct known to the Fraud Section prior to the date on which this Agreement was signed that is not time-barred by the applicable statute of limitations on the date of the signing
of this Agreement may be commenced against the Defendant, notwithstanding the expiration of the statute of limitations, between the signing of this Agreement and the expiration of the term of the Zimmer Biomet DPA plus one year. Thus, by signing
this Agreement, the Defendant agrees that the statute of limitations with respect to any such prosecution that is not time-barred on the date of the signing of this Agreement shall be tolled for the term of the Zimmer Biomet DPA plus one year. The
Defendant gives up all defenses based on the statute of limitations, any claim of pre-indictment delay, or any speedy trial claim with respect to any such prosecution or action, except to the extent that such
defenses existed as of the date of the signing of this Agreement. In addition, the Defendant agrees that the statute of limitations as to any violation of federal law that occurs during the term of the cooperation obligations provided for in
Paragraph 8 of the Agreement or during the term of the Zimmer Biomet DPA will be tolled from the date upon 

  
 13 

 
which the violation occurs until the earlier of the date upon which the Fraud Section is made aware of the violation or the duration of the term of the Zimmer Biomet DPA plus five years, and that
this period shall be excluded from any calculation of time for purposes of the application of the statute of limitations. 
 22. In the
event the Fraud Section determines that the Defendant has breached this Agreement, the Fraud Section agrees to provide the Defendant with written notice of such breach prior to instituting any prosecution resulting from such breach. Within thirty
days of receipt of such notice, the Defendant shall have the opportunity to respond to the Fraud Section in writing to explain the nature and circumstances of such breach, as well as the actions the Defendant has taken to address and remediate the
situation, which explanation the Fraud Section shall consider in determining whether to pursue prosecution of the Defendant. 
 23. In the
event that the Fraud Section determines that the Defendant has breached this Agreement: (a) all statements made by or on behalf of the Defendant to the Fraud Section or to the Court, including the attached Statement of Facts, and any testimony
given by the Defendant before a grand jury, a court, or any tribunal, or at any legislative hearings, whether prior or subsequent to this Agreement, and any leads derived from such statements or testimony, shall be admissible in evidence in any and
all criminal proceedings brought by the Fraud Section against the Defendant; and (b) the Defendant shall not assert any claim under the United States Constitution, Rule 11(f) of the Federal Rules of Criminal Procedure, Rule 410 of the Federal
Rules of Evidence, or any other federal rule that any such statements or testimony made by or on behalf of the Defendant prior or subsequent to this Agreement, or any leads derived therefrom, should be suppressed or are otherwise inadmissible. The
decision whether conduct or statements of any current director, officer or employee, or any person acting on behalf of, or at the direction of, the Defendant, will be imputed to the Defendant for the purpose of determining whether the Defendant has
violated any provision of this Agreement shall be in the sole discretion of the Fraud Section. 

  
 14 

 24. The Defendant acknowledges that the Fraud Section has made no representations, assurances, or
promises concerning what sentence may be imposed by the Court if the Defendant breaches this Agreement and this matter proceeds to judgment. The Defendant further acknowledges that any such sentence is solely within the discretion of the Court and
that nothing in this Agreement binds or restricts the Court in the exercise of such discretion. 
 Sale, Merger, or Other Change in
Corporate Form of Company 
 25. Except as may otherwise be agreed by the parties in connection with a particular transaction, the
Company agrees that in the event that, during the Term of the Agreement or the term of the Zimmer Biomet DPA, it undertakes any change in corporate form, including if it sells, merges, or transfers business operations that are material to the
Company’s consolidated operations, or to the operations of any subsidiaries or affiliates involved in the conduct described in the Statement of Facts, as they exist as of the date of this Agreement, whether such sale is structured as a sale,
asset sale, merger, transfer, or other change in corporate form, it shall include in any contract for sale, merger, transfer, or other change in corporate form a provision binding the purchaser, or any successor in interest thereto, to the
obligations described in this Agreement. The purchaser or successor in interest must also agree in writing that the Fraud Section’s ability to declare a breach under this Agreement is applicable in full force to that entity. The Company agrees
that the failure to include these provisions in the transaction will make any such transaction null and void. The Company shall provide notice to the Fraud Section at least thirty days prior to undertaking any such sale, merger, transfer, or other
change in corporate form. If the Fraud Section notifies the Company prior to such transaction (or series of transactions) that it has determined that 

  
 15 

 
the transaction(s) has the effect of circumventing or frustrating the enforcement purposes of this Agreement, as determined in the sole discretion of the Fraud Section, the Company agrees that
such transaction(s) will not be consummated. In addition, if at any time during the term of the Agreement the Fraud Section determines in its sole discretion that the Company has engaged in a transaction(s) that has the effect of circumventing or
frustrating the enforcement purposes of this Agreement, it may deem it a breach of this Agreement pursuant to Paragraphs 21 through 24 of this Agreement. Nothing herein shall restrict the Company from indemnifying (or otherwise holding harmless) the
purchaser or successor in interest for penalties or other costs arising from any conduct that may have occurred prior to the date of the transaction, so long as such indemnification does not have the effect of circumventing or frustrating the
enforcement purposes of this Agreement, as determined by the Fraud Section and the Office. 
 Public Statements by the Defendant

 26. The Defendant expressly agrees that it shall not, through present or future attorneys, officers, directors, employees, agents
or any other person authorized to speak for the Defendant make any public statement, in litigation or otherwise, contradicting the acceptance of responsibility by the Defendant set forth above or the facts described in the Information and the
Statement of Facts. Any such contradictory statement shall, subject to cure rights of the Defendant described below, constitute a breach of this Agreement, and the Defendant thereafter shall be subject to prosecution as set forth in Paragraphs 21
through 24 of this Agreement. The decision whether any public statement by any such person contradicting a fact contained in the Information or the Statement of Facts will be imputed to the Defendant for the purpose of determining whether it has
breached this Agreement shall be at the sole discretion of the Fraud Section. If the Fraud Section determines that a public statement by any such person contradicts in whole or in part a 

  
 16 

 
statement contained in the Information or the Statement of Facts, the Fraud Section shall so notify the Defendant, and the Defendant may avoid a breach of this Agreement by publicly repudiating
such statement(s) within five business days after notification. The Defendant shall be permitted to raise defenses and to assert affirmative claims in other proceedings relating to the matters set forth in the Information and the Statement of Facts
provided that such defenses and claims do not contradict, in whole or in part, a statement contained in the Information or the Statement of Facts. This Paragraph does not apply to any statement made by any present or former officer, director,
employee, or agent of the Defendant in the course of any criminal, regulatory, or civil case initiated against such individual, unless such individual is speaking on behalf of the Defendant. 

27. The Defendant agrees that if it or any of its direct or indirect subsidiaries or affiliates issues a press release or holds any press
conference in connection with this Agreement, the Defendant shall first consult the Fraud Section to determine (a) whether the text of the release or proposed statements at the press conference are true and accurate with respect to matters
between the Fraud Section and the Defendant; and (b) whether the Fraud Section has any objection to the release or statement. 

  
 17 

 Complete Agreement 

28. This document states the full extent of the Agreement between the parties. There are no other promises or agreements, express or implied.
Any modification of this Agreement shall be valid only if set forth in writing in a supplemental or revised plea agreement signed by all parties. 
  

							
	AGREED:
	
	FOR JERDS LUXEMBOURG HOLDING S.ÀR.L.:
				
	Date: 01/11 /17	 		 	By:	 	

		 		 		 	CHAD F. PHIPPS, ESQ.
		 		 		 	Authorized Signatory for JERDS
		 		 		 	Luxembourg Holding S.àr.l.
				
	Date: 01/11/17	 		 	By:	 	

		 		 		 	GUY D. SINGER
		 		 		 	ANNE ELKINS MURRAY
		 		 		 	Orrick, Herrington & Sutcliffe LLP
				
		 		 		 	RYAN ROHLFSEN
		 		 		 	Ropes & Gray LLP
				
		 		 		 	Outside counsel for JERDS Luxembourg
		 		 		 	Holding S.àr.l.
	
	FOR THE DEPARTMENT OF JUSTICE:
				
		 		 		 	ANDREW WEISSMANN
		 		 		 	Chief, Fraud Section
		 		 		 	Criminal Division
		 		 		 	U.S. Department of Justice
				
		 		 		 	

		 		 		 	TAREK J. HELOP
		 		 		 	ASSISTANT CHIEF

  
 18 

 EXHIBIT 1 

CERTIFICATE OF CORPORATE RESOLUTIONS 

A copy of the executed Certificate of Corporate Resolutions is annexed hereto as “Exhibit 1.” 

  
 B-1 

 EXHIBIT 1 

Certificate of Corporate Resolutions 

I, Jitender Sahni, hereby certify that I am a Class A Manager for JERDS Luxembourg Holding S.à r.l (“JERDS” or the
“Company”) and that the following are true, complete, and correct copies of resolutions adopted by the Board of Managers of the Company on January 11, 2017. I further certify that such resolutions have not been amended, modified,
rescinded, or revoked, and are in full force and effect on the date hereof. 
 RESOLVED THAT: 

The JERDS Board of Managers has been fully informed by counsel of the proposed settlement with the Fraud Section, Criminal Division, United
States Department of Justice (“Department”) in connection with the Department’s investigation into a criminal violation of the Foreign Corrupt Practices Act (“FCPA”), and the key terms of the proposed settlement have been
explained or distributed to the JERDS Board of Managers. 
 Pursuant to the Plea Agreement between the Company and the Department:
(1) the Company will, through an authorized agent, plead guilty to one count of violating the books and records provisions of the FCPA; (2) in light of the disposition with the Company’s ultimate parent corporation, Zimmer Biomet
Holdings, Inc. (“Zimmer Biomet”), the Company will not pay a fine; and (3) the Company will agree to the other commitments set out in the Plea Agreement. The JERDS Board of Managers has been fully advised by counsel of its rights,
possible defenses, the Sentencing Guidelines’ provisions, and the consequences of entering into the Plea Agreement. 
 The JERDS Board
of Managers hereby approves the proposed settlement related to the completion of the proceeding against the Company, and approves and authorizes the Company, through its authorized agent, to enter into the Plea Agreement in substantially such form
as reviewed by the JERDS Board of Managers, and the actions contemplated thereby, including the entry by the Company of a guilty plea. The JERDS Board of Managers hereby empowers and obliges Chad F. Phipps, Esq., Senior Vice President, General
Counsel and Secretary of Zimmer Biomet, acting on the basis of the power of attorney issued by the Company (the “Authorized Signatory”), to: (1) execute and deliver the Plea Agreement and any other documents necessary to enter into
the proposed settlement with the Department; and (2) enter a guilty plea before the United States District Court for the District of Columbia and accept the sentence of said court on behalf of the Company. 

IN WITNESS HEREOF, the undersigned has executed this on January 11, 2017. 
  

			
	By:	 	

		
		 	Jitender Sahni
		 	Class A Manager
		 	JERDS Luxembourg Holding S.à r.1

 EXHIBIT 2 

STATEMENT OF FACTS 

The following Statement of Facts is incorporated by reference as part of the Plea Agreement between the United States Department of Justice,
Criminal Division, Fraud Section (the “Fraud Section”) and JERDS LUXEMBOURG HOLDING S.AR.L. (“JERDS” or the “Company”), and the parties hereby agree and stipulate that the following information is true and accurate.
JERDS admits, accepts, and acknowledges that it is responsible for the acts of its officers, directors, employees, and agents, including as the successor-in-interest of
Biomet 3i Mexico S.A. de C.V., as set forth below. Had this matter proceeded to trial, JERDS acknowledges that the Fraud Section would have proven beyond a reasonable doubt, by admissible evidence, the facts alleged below and set forth in the
criminal Information: 
 Relevant Entities and Individuals 

1. Biomet, Inc. (“Biomet”) was an orthopedic medical and dental device manufacturer incorporated in Indiana. Biomet sold its
products worldwide. At all times material to this Statement of Facts, Biomet was an “issuer” within the meaning of the FCPA, 15 U.S.C. §§ 78dd-1 and 78m. 

2. On or about March 26, 2012, Biomet entered into a deferred prosecution agreement with the Fraud Section (the “2012 DPA”)
arising out of Biomet’s FCPA violations in Brazil, China, and Argentina. 
 3. In June 2015, Zimmer Holdings, Inc. (“Zimmer”)
acquired LVB Acquisition, Inc., which owned all of Biomet, Inc. (“Biomet”). The combined entities and their subsidiaries became defendant ZIMMER BIOMET, headquartered in Warsaw, Indiana and incorporated in Delaware. Thus, ZIMMER BIOMET
knowingly assumed all the rights and obligations of Biomet under the 2012 DPA, including under the compliance monitorship that was part of the 2012 DPA. 

  
 1 

 4. As the result of the acquisition that occurred in June 2015, ZIMMER BIOMET assumed the
obligations of Biomet under the 2012 DPA and became Biomet’s successor-in-interest for purposes of the 2012 DPA and Biomet’s conduct described below. 

5. Implant Innovations Holdings, LLC (“IIH”), a wholly-owned subsidiary of Biomet, owned several subsidiaries, including Biomet 3i,
LLC (“Biomet 3i”), which was incorporated in Florida. Biomet 3i marketed and sold dental implants and related products. Biomet 3i was Biomet’s fourth-largest subsidiary by revenues. Biomet 3i’s financial statements were
consolidated into IIH’s financial statements, which were consolidated into Biomet’s financial statements. 
 6. JERDS was a
wholly-owned subsidiary of IIH, which in turn was a subsidiary of Biomet. JERDS had its headquarters in Luxembourg, and owned several subsidiaries, including Biomet 3i Mexico S.A. de C.V. (“3i Mexico”), that marketed and sold Biomet
3i’s products overseas. 
 7. 3i Mexico, which was incorporated in Mexico, was owned by JERDS. 3i Mexico marketed and sold Biomet
3i’s products in Mexico. 3i Mexico’s financial statements were consolidated into JERDS’s financial statements, which were eventually consolidated into Biomet’s financial statements. 3i Mexico no longer sells products and is in
the process of winding down, arid the Defendant is the successor-in-interest to 3i Mexico and is therefore responsible for 3i Mexico’s conduct, including the
conduct described herein. Thus, JERDS is the successor-in-interest of 3i Mexico for the conduct described herein. 

  
 2 

 8. “Mexico Customs Broker,” a company whose identity is known to the United States and
JERDS, is a customs broker that 3i Mexico hired to import products from the United States to Mexico. 
 9. “Shipping Company,” a
company whose identity is known to the United States and JERDS, is a shipping company in Texas that worked with Mexico Customs Broker to export Biomet 3i’s products from the United States to Mexico. 

10. “Biomet Executive,” an individual whose identity is known to the United States and ZIMMER BIOMET, was an attorney at Biomet and
Biomet International during the relevant period and became a high-level attorney during that period. Biomet Executive’s responsibilities included ensuring that Biomet had effective internal accounting controls, such as third-party due
diligence, and implementing Biomet’s internal accounting controls. Biomet Executive was also responsible for addressing the requirements of Biomet’s FCPA monitor with respect to Biomet International. 

11. “3i Mexico Managing Director,” an individual whose identity is known to the United States and JERDS, was an employee of 3i
Mexico. 
 12. “3i Mexico Employee,” an individual whose identity is known to the United States and JERDS, was an employee of 3i
Mexico. 
 The Unlawful Scheme 

13. At all relevant times, Biomet exported products to, and sold those products in, countries with a high risk of corruption, including
Mexico. From in or around 2010 to in or around 2013, 3i Mexico used a customs broker and subagents to pay bribes to Mexican customs officials to smuggle unregistered and improperly-labeled dental products into Mexico. 3i Mexico falsely recorded
payments to its customs broker’s subagents as payments to its customs 

  
 3 

 
broker and payments that included bribes as payments for customs services, causing JERDS, IIH, and, ultimately, Biomet, to falsify their books and records. Between in or around 2010 and 2013,
Biomet’s subsidiaries paid $980,774 to the customs broker’s subagents knowing that at least part of this amount would be passed on to customs officials, and disguised the bribe payments. 

14. 3i Mexico sold Biomet 3i’s dental products in Mexico, which were regulated under Mexican law; Mexican law required proper labeling,
identification of the product’s country of origin, and a valid product registration issued by Mexican regulatory authorities. 
 15. In
or about January 2009, 3i Mexico began having difficulty importing some of Biomet 3i’s membrane products into Mexico because of problems with their product registrations. At one point, customs authorities at the Mexico City Airport detained
shipments destined for 3i Mexico due to product registration problems. 
 16. On or about January 7, 2009, several individuals at
Biomet 3i’s headquarters in Florida received an email from the then-general manager of 3i Mexico who proposed that 31 Mexico use a Texas-based customs agent to bring unregistered membrane products into Mexico through Texas. 

17. On or about January 19, 2009, soon after 3i Mexico learned that the registration for a specific type of membrane was not current, a
senior manager in Biomet 31’s regulatory affairs department – the head of Latin American regulatory affairs – requested that all shipments of membranes to Mexico be placed on hold until further notice. 

18. On or about January 28, 2009, the managing director of a Biomet subsidiary in Mexico advised the senior manager and head of Biomet
31’s regulatory affairs department for Latin America in an email message that importing dental implants without a valid registration from Mexico’s Secretary of Health was a crime. 

  
 4 

 19. In or around February 2009, Biomet Executive undertook a compliance assessment of another
Biomet subsidiary in Mexico. One of the findings in that compliance assessment was that the subsidiary had used a third-party “consultant” to expedite customs shipments at the border. The subsidiary had used the consultant to import
products that would have been delayed in customs due to problems with the products’ licenses if they had been shipped via the Mexico City Airport. The consultant did not have the requisite credentials to carry out import and export activities.
The assessment stated that using the consultant was a risk and noted that Biomet Corporate had labelled the consultant “higher risk.” In response to the assessment, the subsidiary terminated its relationship with the consultant, but Biomet
did not implement controls to ensure that 3i Mexico did not use third parties who engaged in similar high risk activities. Prior to this time, both Biomet’s subsidiary and 3i Mexico had used the consultant to import products. 

20. In or around 2010, 3i Mexico began having difficulty importing its products into Mexico from the United States via the airport in Mexico
City. Some of the shipments were stopped by Mexican customs officials because the products were mislabeled, lacked proper country of origin markings, and did not have valid product registrations with the Mexican government. 

21. In response to these issues, 3i Mexico’s agents and employees developed a scheme to avoid those problems: first, Biomet 3i would ship
certain Biomet 3i products to an address in Texas provided by Mexico Customs Broker; second, Mexico Customs Broker would segregate the products into two sets of products – those products that were properly labeled and registered under Mexican
law, and those products that were not properly labeled and registered and thus contraband; third, Mexico Customs Broker would transport all of the compliant 

  
 5 

 
products across the border to Mexico, but one of Mexico Customs Broker’s subagents would bribe Mexican customs officials so that the contraband dental products could cross the border
illegally. 
 22. 3i Mexico did not have a written contract with Mexico Customs Broker or its subagents even though they were providing
services in a country and industry with high corruption risks. 3i Mexico also did not receive anticorruption representations from Mexico Customs Broker or its subagents. 

23. Biomet did not implement internal accounting controls to ensure that 3i Mexico would undertake those tasks. In addition, 3i Mexico knew
that Mexico Customs Broker’s subagents would pay bribes and that there was no legitimate reason to use subagents when it had retained Mexico Customs Broker as its customs broker. 

24. On or about March 17, 2010, an employee at Mexico Customs Broker sent an email message to 3i Mexico Managing Director and 3i Mexico
Employee which read as follows: “here is the procedure that will be followed to release shipments through [Texas] customs: Deliver the shipment to [Shipping Company’s address], Attn: [an employee at Shipping Company]. The person
responsible for carrying out this step, will go to our warehouse and afterwards will send us the quotation.” 3i Mexico Employee knew that Mexico Customs Broker’s subagents would bribe Mexican customs officials to ensure that the mislabeled
products would be imported into Mexico. 
 25. On or about April 8, 2010, 3i Mexico Managing Director wrote an email to five other
Biomet 3i and 3i Mexico employees and stated that they had problems getting shipments through customs at Mexico City’s airport because some product labels indicated that they were manufactured in countries other than the United States, while
the product registrations stated that 

  
 6 

 
they were manufactured in the United States. 3i Mexico Managing Director recommended that Biomet 3i ship the products to Shipping Company’s office because at “the border they have more
flexibility to access and import the products according to the right procedures. The details of the broker are: [Shipping Company’s address], Attn: [an employee at Shipping Company].” 

26. On or about April 9, 2010, 3i Mexico Managing Director wrote the following in an email to a 3i Mexico employee and two other Biomet
3i employees: “Ok lets [sic] do the following... lets [sic] return all previous shipment[s] to [Biomet 3i’s office] and you send us 1 new shipment with all the [back order items] to Texas, then
we normalize the inventory and return to weekly shipments using only items made in USA and the rest special shipments using [Texas].” The 3i Mexico employee knew that Mexico Customs Broker’s subagents were being paid large amounts of money
to smuggle the mislabeled products into Mexico. 
 27. On or about April 9, 2010, 3i Mexico Managing Director sent an email to the
senior manager who was the head of Biomet 3i’s regulatory affairs department for Latin America, stating, as translated from Spanish to English, that because of problems with illegal drugs being smuggled into Mexico City’s airport, Mexican
authorities had reinforced border controls over health products. 3i Mexico Managing Director wrote that customs agents had recommended “that we use the border and in this case [Texas] because at this entry point the authorities are not as
strict since from the US to Mexico there is no problem with prohibited substances, indeed it is the reverse.” 
 28. On or about
April 9, 2010, the senior manager who was the head of Biomet 3i’s regulatory affairs department for Latin America, responded to 3i Mexico Managing Director by email and stated, as translated from Spanish to English: “I understand
completely—how do we set this up so that the product enters through [Texas]?” 

  
 7 

 29. On or about April 9, 2010, 3i Mexico Managing Director responded to the senior manager
who was the head of Biomet 31’s regulatory department for Latin America by email, stating, as translated from Spanish to English: “[two employees] are already working to send this Friday’s shipment to [Texas].” 

30. On or about March 26, 2012, Biomet entered into the 2012 DPA. 

31. On or about April 27, 2012, an employee in Biomet 3i’s regulatory department sent 3i Mexico Managing Director an email message
and said that Biomet 3i could not import a particular ceramic dental cement into Mexico because it did not have the necessary importation license. 3i Mexico Managing Director responded that customs officials at Mexico City’s airport would
require the importation license, so Biomet 3i was instead using Mexico Customs Broker to ship the products through the border at Texas. 

32. On or about July 27, 2012, an employee at Mexico Customs Broker sent an email to 3i Mexico Employee and another employee at Mexico
Customs Broker and stated, as translated from Spanish to English: “I attached the prepayment request and proforma of this week’s shipment. Taxes on models with registry [MX]$26,900.00. American account, deliver, digitization and fees
MX$18,009.00 (vat included). Taxes on models without registry MX$115860.00 (vat included).” 
 33. On or about July 30, 2012, one
of Mexico Customs Broker’s subagents sent an invoice to 3i Mexico requesting payment of approximately MX$115,860 for “servicios profesionales” with no further description of the services provided. 

34. On or about July 30, 2012, 3i Mexico Managing Director caused a wire transfer in the amount of approximately MX$44,909 (the amount of
the taxes and fees in the prepayment request identified in Paragraph 32) to be made from a 3i Mexico bank account in Mexico to 

  
 8 

 
Mexico Customs Broker’s bank account in Mexico. That same day, 3i Mexico Managing Director caused a wire transfer in the amount of approximately MX$115,860 (the same amount as one of the
prepayment requests identified in Paragraph 32 and the invoice identified in Paragraph 33 that one of Mexico Customs Broker’s subagents sent to 31 Mexico) to be made from the same 3i Mexico bank account in Mexico to the bank account of Mexico
Customs Broker’s subagent in Mexico. 
 35. On or about July 30, 2012, 3i Mexico Employee sent an email to an employee at Mexico
Customs Broker, stating, as translated from Spanish to English: “I attach copies of the deposits, will you know [sic] something about the merchandise.” Wire transfer records reflecting the two wire transfers authorized
that same day by 31 Mexico Managing Director were attached to that email. 
 36. On or about July 31, 2012, Mexico Customs Broker sent
an invoice to 3i Mexico requesting payment of approximately MX$44,909 for Mexico Customs Broker’s services in transporting a shipment of dental implants to 31 Mexico’s address in Mexico City, Mexico. The invoice was supported by a shipping
record explaining the items that Mexico Customs Broker had imported on behalf of 3i Mexico. 
 37. On or about July 31, 2012, 3i Mexico
Employee recorded the two wire transfers from the previous day in 31 Mexico’s accounting system as three payments to Mexico Customs Broker totaling approximately MX$160,769, which was equal to the combined amount of the invoices sent on
July 30, 2012 and July 31, 2012. 3i Mexico Employee recorded each of the wire transfers as payments to Mexico Customs Broker even though 3i Mexico made one of those payments to Mexico Customs Broker’s subagent instead of Mexico
Customs Broker. 3i Mexico Employee made no separate record of any payment to Mexico Customs Broker’s subagent. The 

  
 9 

 
payments were then recorded in the general ledger for 3i Mexico as payments to Mexico Customs Broker for customs services and later consolidated into JERDS’s financial statements, which were
consolidated into Biomet’s financial statements. 
 38. Between in or around 2010 and 2013, 3i Mexico paid approximately $980,774 to
Mexico Customs Broker in connection with clearing Biomet 3i products. 
 39. Between in or around 2010 and 2013, 3i Mexico earned $2,402,100
in profits from sales of products in Mexico that were shipped through Texas. 

  
 10

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