# UNITED	STATES	SECURITIES	AND	EXCHANGE	COMMISSION

(Mark	One)

x ANNUAL	REPORT	PURSUANT	TO	SECTION	13	OR	15(d)	OF	THE	SECURITIES	EXCHANGE	ACT	OF	1934

For	the	fiscal	year	ended	December	31,	2017	or

¨ TRANSITION	REPORT	PURSUANT	TO	SECTION	13	OR	15(d)	OF	THE	SECURITIES	EXCHANGE	ACT	OF

# Commission	file	number	1-5353

# TELEFLEX	INCORPORATED

(Exact	name	of	registrant	as	specified	in	its	charter)

Delaware

(State	or	other	jurisdiction	of incorporation	or	organization)

550	East	Swedesford	Road,	Suite	400,	Wayne,	Pennsylvania (Address	of	principal	executive	offices)

(I.R.S.	employer	identification	no.)

(Zip	Code)

Registrant's	telephone	number,	including	area	code:	(610)	225-6800

# Securities	registered	pursuant	to	Section	12(b)	of	the	Act:

Title	of	Each	Class

Name	of	Each	Exchange	On	Which	Registered

# Securities	registered	pursuant	to	Section	12(g)	of	the	Act:

Indicate	by	check	mark	if	the	registrant	is	a	well-known	seasoned	issuer,	as	defined	in	Rule	405	of	the	Securities	Act.				Yes		ý					No		¨

Indicate	by	check	mark	if	the	registrant	is	not	required	to	file	reports	pursuant	to	Section	13	or	Section	15(d)	of	the	Act.					Yes		¨				No		ý

Indicate	by	check	mark	whether	the	registrant	(1)	has	filed	all	reports	required	to	be	filed	by	Section	13	or	15(d)	of	the	Securities	Exchange	Act	of	1934	during	the	preceding 12	 months (or	 for	 such	 shorter	 period	 that	 the	 registrant	 was	 required	 to	 file	 such	 reports),	 and (2) has	 been	 subject	 to	 such	 filing	 requirements	 for	 the	 past 90	days.				Yes		x				No		¨

Indicate	by	check	mark	whether	the	registrant	has	submitted	electronically	and	posted	on	its	corporate	Web	site,	if	any,	every	Interactive	Data	File	required	to	be	submitted	and posted	 pursuant	 to	 Rule	 405	 of	 Regulation	 S-T	 during	 the	 preceding	 12	 months	 (or	 for	 such	 shorter	 period	 that	 the	 registrant	 was	 required	 to	 submit	 and	 post	 such files).				Yes		x				No		¨

Indicate	by	check	mark	if	disclosure	of	delinquent	filers	pursuant	to	Item	405	of	Regulation	S-K	is	not	contained	herein,	and	will	not	be	contained,	to	the	best	of	the	registrant's knowledge,	in	definitive	proxy	or	information	statements	incorporated	by	reference	in	Part	III	of	this	Form	10-K	or	any	amendment	to	this	Form	10-K.		x

Indicate	by	check	mark	whether	the	registrant	is	a	large	accelerated	filer,	an	accelerated	filer,	a	non-accelerated	filer,	a	smaller	reporting	company	or	an	emerging	growth	company. See	the	definitions	of	"large	accelerated	filer,"	"accelerated	filer,"	"smaller	reporting	company"	and	"emerging	growth	company"	in	Rule	12b-2	of	the	Exchange	Act.

Emerging	growth	company	¨

Large	accelerated	filer	x Accelerated	filer	¨

Non-accelerated	filer	¨

Smaller	reporting	company		¨

If	an	emerging	growth	company,	indicate	by	check	mark	if	the	registrant	has	elected	not	to	use	the	extended	transition	period	for	complying	with	any	new	or	revised	financial accounting	standards	provided	pursuant	to	Section	13(a)	of	the	Exchange	Act.	¨	¨

Indicate	by	check	mark	whether	the	registrant	is	a	shell	company	(as	defined	in	Rule	12b-2	of	the	Act).	Yes		¨			No		x

The	aggregate	market	value	of	the	Common	Stock	of	the	registrant	held	by	non-affiliates	of	the	registrant	(24,350,896	shares)	on	July	2,	2017	(the	last	business	day	of	the registrant's	most	recently	completed	fiscal	second	quarter)	was	$5,059,142,153	(1)	.	The	aggregate	market	value	was	computed	by	reference	to	the	closing	price	of	the	Common Stock	on	such	date,	as	reported	by	the	New	York	Stock	Exchange.

# DOCUMENT	INCORPORATED	BY	REFERENCE:

Certain	provisions	of	the	registrant's	definitive	proxy	statement	in	connection	with	its	2017	Annual	Meeting	of	Stockholders,	to	be	filed	within	120	days	of	the	close	of	the registrant's	fiscal	year,	are	incorporated	by	reference	in	Part	III	hereof.

(1)	For	purposes	of	this	computation	only,	the	registrant	has	defined	"affiliate"	as	including	executive	officers	and	directors	of	the	registrant	and	owners	of	more	than	five percent	of	the	common	stock	of	the	registrant,	without	conceding	that	all	such	persons	are	"affiliates"	for	purposes	of	the	federal	securities	laws.

# ANNUAL	REPORT	ON	FORM	10-K

# TABLE	OF	CONTENTS

# PART	I

|  | PART	I |  |
| :--- | :--- | :--- |
| Item\t1. | BUSINESS | 4 |
| Item\t1A. | RISK\tFACTORS | 16 |
| Item\t1B. | UNRESOLVED\tSTAFF\tCOMMENTS | 29 |
| Item\t2. | PROPERTIES | 30 |
| Item\t3. | LEGAL\tPROCEEDINGS | 31 |
| Item\t4. | MINE\tSAFETY\tDISCLOSURES | 31 |
|  | PART\tII |  |
| Item\t5. | MARKET\tFOR\tREGISTRANT'S\tCOMMON\tEQUITY,\tRELATED\tSTOCKHOLDER\tMATTERS\tAND\tISSUER |  |
|  | PURCHASES\tOF\tEQUITY\tSECURITIES | 32 |
| Item\t6. | SELECTED\tFINANCIAL\tDATA | 34 |
| Item\t7. | MANAGEMENT'S\tDISCUSSION\tAND\tANALYSIS\tOF\tFINANCIAL\tCONDITION\tAND\tRESULTS\tOF |  |
|  | OPERATIONS | 34 |
| Item\t7A. | QUANTITATIVE\tAND\tQUALITATIVE\tDISCLOSURES\tABOUT\tMARKET\tRISK | 60 |
| Item\t8. | FINANCIAL\tSTATEMENTS\tAND\tSUPPLEMENTARY\tDATA | 61 |
| Item\t9. | CHANGES\tIN\tAND\tDISAGREEMENTS\tWITH\tACCOUNTANTS\tON\tACCOUNTING\tAND\tFINANCIAL |  |
|  | DISCLOSURE | 61 |
| Item\t9A. | CONTROLS\tAND\tPROCEDURES | 61 |
| Item\t9B. | OTHER\tINFORMATION | 62 |
|  | PART\tIII |  |
| Item\t10. | DIRECTORS,\tEXECUTIVE\tOFFICERS\tAND\tCORPORATE\tGOVERNANCE | 63 |
| Item\t11. | EXECUTIVE\tCOMPENSATION | 63 |
| Item\t12. | SECURITY\tOWNERSHIP\tOF\tCERTAIN\tBENEFICIAL\tOWNERS\tAND\tMANAGEMENT\tAND\tRELATED |  |
|  | STOCKHOLDER\tMATTERS | 63 |
| Item\t13. | CERTAIN\tRELATIONSHIPS\tAND\tRELATED\tTRANSACTIONS,\tAND\tDIRECTOR\tINDEPENDENCE | 63 |
| Item\t14. | PRINCIPAL\tACCOUNTING\tFEES\tAND\tSERVICES | 63 |
|  | PART\tIV |  |
| Item\t15. | EXHIBITS,\tFINANCIAL\tSTATEMENT\tSCHEDULES | 64 |
| Item\t16. | FORM\t10-K\tSUMMARY | 67 |
| SIGNATURES |  | 68 |

# Information	Concerning	Forward-Looking	Statements

All	statements	made	 in	 this	Annual	Report	on	Form	10-K,	other	 than	statements	of	historical	 fact,	are	 forward-looking	statements.	The	words "anticipate,"	 "believe,"	 "estimate,"	 "expect,"	 "intend,"	 "may,"	 "plan,"	 "will,"	 "would,"	 "should,"	 "guidance,"	 "potential,"	 "continue,"	 "project,"	 "forecast," "confident,"	"prospects"	and	similar	expressions	typically	are	used	to	identify	forward-looking	statements.	Forward-looking	statements	are	based	on	the then-current	expectations,	beliefs,	assumptions,	estimates	and	forecasts	about	our	business	and	the	industry	and	markets	in	which	we	operate.	These statements	are	not	guarantees	of	future	performance	and	are	subject	to	risks	and	uncertainties,	which	are	difficult	to	predict.	Therefore,	actual	outcomes and	results	may	differ	materially	from	what	is	expressed	or	implied	by	these	forward-looking	statements	due	to	a	number	of	factors,	including:

•changes	in	business	relationships	with	and	purchases	by	or	from	major	customers	or	suppliers,	including	delays	or	cancellations	in	shipments;

•demand	for	and	market	acceptance	of	new	and	existing	products;

•our	inability	to	integrate	acquired	businesses	into	our	operations,	realize	planned	synergies	and	operate	such	businesses	profitably	in	accordance with	our	expectations;

•our	inability	to	effectively	execute	our	restructuring	programs;

•our	inability	to	realize	anticipated	savings	resulting	from	restructuring	plans	and	programs;

•the	impact	of	enacted	healthcare	reform	legislation	and	proposals	to	amend	or	replace	the	legislation;

•changes	in	Medicare,	Medicaid	and	third-party	coverage	and	reimbursements;

•the	impact	of	recently	enacted	tax	legislation	and	regulations	to	be	issued	with	respect	to	the	legislation;

•competitive	market	conditions	and	resulting	effects	on	revenues	and	pricing;

•increases	in	raw	material	costs	that	cannot	be	recovered	in	product	pricing;

•global	economic	factors,	including	currency	exchange	rates,	interest	rates,	sovereign	debt	issues	and	the	impact	of	the	United	Kingdom's	vote	to leave	the	European	Union	("Brexit");

•difficulties	entering	new	markets;	and

•general	economic	conditions.

For	a	further	discussion	of	the	risks	relating	to	our	business,	see	Item	1A	"Risk	Factors"	in	this	Annual	Report	on	Form	10-K.	We	expressly	disclaim any	obligation	to	update	these	forward-looking	statements,	except	as	otherwise	specifically	stated	by	us	or	as	required	by	law	or	regulation.

# ITEM	1. BUSINESS

Teleflex	Incorporated	is	referred	to	herein	as	"we,"	"us,"	"our,"	"Teleflex"	and	the	"Company."

# THE	COMPANY

Teleflex	is	a	global	provider	of	medical	technology	products	that	enhance	clinical	benefits,	improve	patient	and	provider	safety	and	reduce	total procedural	costs.	We	primarily	design,	develop,	manufacture	and	supply	single-use	medical	devices	used	by	hospitals	and	healthcare	providers	for common	diagnostic	and	therapeutic	procedures	in	critical	care	and	surgical	applications.	We	market	and	sell	our	products	to	hospitals	and	healthcare providers	worldwide	through	a	combination	of	our	direct	sales	force	and	distributors.	Because	our	products	are	used	in	numerous	markets	and	for	a variety	of	procedures,	we	are	not	dependent	upon	any	one	end-market	or	procedure.	We	manufacture	our	products	at	approximately	35	manufacturing sites,	with	major	manufacturing	operations	located	in	the	Czech	Republic,	Germany,	Malaysia,	Mexico	and	the	United	States	(the	"U.S.").

We	are	focused	on	achieving	consistent,	sustainable	and	profitable	growth	and	improving	our	financial	performance	by	increasing	our	market	share and	improving	our	operating	efficiencies	through:

•development	of	new	products	and	product	line	extensions;

•investment	in	new	technologies	and	broadening	the	application	of	our	existing	technologies;

•expansion	of	the	use	of	our	products	in	existing	markets	and	introduction	of	our	products	into	new	geographic	markets;

•achievement	of	economies	of	scale	as	we	continue	to	expand	by	leveraging	our	direct	sales	force	and	distribution	network	for	new	products,	as	well as	by	increasing	efficiencies	in	our	sales	and	marketing,	research	and	development	structures	and	manufacturing	and	distribution	facilities;	and

•expansion	of	our	product	portfolio	through	select	acquisitions,	licensing	arrangements	and	business	partnerships	that	enhance,	extend	or	expedite our	development	initiatives	or	our	ability	to	increase	our	market	share.

Our	research	and	development	capabilities,	commitment	to	engineering	excellence	and	focus	on	low-cost	manufacturing	enable	us	to	bring	cost effective,	innovative	products	to	market	that	improve	the	safety,	efficacy	and	quality	of	healthcare.	Our	research	and	development	initiatives	focus	on developing	these	products	for	both	existing	and	new	therapeutic	applications,	as	well	as	enhancements	to,	and	product	line	extensions	of,	existing products.	 During	2017	 we	 introduced	 several	 product	 line	 extensions	 and	 10	 new	 products.	 Our	 portfolio	 of	 existing	 products	 and	 products	 under development	consists	primarily	of	Class	I	and	Class	II	devices,	most	of	which	require	510(k)	clearance	by	the	United	States	Food	and	Drug	Administration ("FDA"),	for	sale	in	the	United	States,	and	some	of	which	are	exempt	from	the	requirement	to	obtain	510(k)	clearance.	We	believe	that	510(k)	clearance or	510(k)-exempt	status	reduces	our	research	and	development	costs	and	risks,	and	typically	results	in	a	shorter	timetable	for	new	product	introductions as	compared	to	the	premarket	approval,	or	PMA,	process	that	would	be	required	for	Class	III	devices.	See	"Government	Regulation"	below.

# HISTORY	AND	RECENT	DEVELOPMENTS

Teleflex	was	founded	in	1943	as	a	manufacturer	of	precision	mechanical	push/pull	controls	for	military	aircraft.	From	this	original	single	market, single	product	orientation,	we	expanded	and	evolved	through	entries	into	new	businesses,	development	of	new	products,	introduction	of	products	into new	geographic	or	end-markets	and	acquisitions	and	dispositions	of	businesses.	Throughout	our	history,	we	have	continually	focused	on	providing innovative,	technology-driven,	specialty-engineered	products	that	help	our	customers	meet	their	business	requirements.

Beginning	in	2007,	we	significantly	changed	the	composition	of	our	portfolio	of	businesses,	expanding	our	presence	in	the	medical	device	industry, while	divesting	all	of	our	other	businesses,	which	served	the	aerospace,	automotive,	industrial	and	marine	markets.	Following	the	divestitures	of	our marine	business	and	cargo	container	and	systems	businesses	in	2011,	we	became	exclusively	a	medical	device	company.

We	expect	to	continue	to	increase	the	size	of	our	business	through	a	combination	of	acquisitions	and	organic	growth	initiatives.

# Recent	acquisitions

On	February	17,	2017,	we	acquired	Vascular	Solutions,	Inc.	("Vascular	Solutions"),	a	medical	device	company	that	has	developed	and	marketed products	 for	use	 in	minimally	 invasive	coronary	and	peripheral	vascular	procedures.	The	aggregate	consideration	 that	we	paid	 to	acquire	Vascular Solutions	was	$975.5	million.	Effective	in	the	fourth	quarter	2017,	Vascular	Solutions	financial	information	is	primarily	presented	within	the	"Interventional North	America"	reportable	operating	segment.	See	"Our	Segments"	below.

On	 October	 2,	 2017,	 we	 acquired	 NeoTract,	 Inc.	 ("NeoTract"),	 a	 medical	 device	 company	 that	 has	 developed	 and	 commercialized	 the	 UroLift System,	a	minimally	invasive	medical	device	for	treating	lower	urinary	tract	symptoms	due	to	benign	prostatic	hyperplasia,	or	BPH.	The	estimated	fair value	of	the	consideration	transferred	to	acquire	NeoTract	was	$975.2	million,	which	included	initial	payments	of	$725.6	million	in	cash	less	a	favorable working	capital	adjustment	of	$1.4	million	(for	which	we	had	not	yet	received	payment	as	of	December	31,	2017)	and	$251.0	million	in	estimated	fair value	of	contingent	consideration.	The	contingent	consideration	liability	represents	the	estimated	fair	value	of	up	to	$375	million	we	would	be	required	to pay	if	specified	net	sales	goals	through	the	end	of	2020	are	achieved.	In	connection	with	this	acquisition,	we	created	a	new	operating	segment	entitled Interventional	Urology	North	America,	which	is	included	within	the	"all	other"	category	in	the	presentation	of	segment	information.

See	Note	3	to	the	consolidated	financial	statements	included	in	this	Annual	Report	on	Form	10-K	for	additional	information.

# Distributor-to-direct	sales	conversions	and	restructuring	programs

During	the	past	several	years,	we	have	completed	a	number	of	"distributor	to	direct"	sales	conversions	in	several	countries.	These	transactions generally	involve	the	elimination	of	a	distributor	from	the	sales	channel,	either	by	acquiring	the	distributor	or	terminating	the	distribution	relationship.	In some	instances,	particularly	in	Asia,	the	conversion	involves	the	acquisition	or	termination	of	a	master	distributor	and	the	continued	sale	of	our	products through	third	party	sub-distributors	or	through	new	distributors.	In	2017,	certain	European	countries	were	converted	from	distributor	sales	to	direct	sales in	connection	with	our	elimination	of	former	Vascular	Solutions'	distributors.	Also	during	2017,	we	commenced	a	distributor	to	direct	sales	conversion	in China	as	a	result	of	our	decision	to	eliminate	a	key	distributor	within	that	sales	channel.	See	Item	7	"Management's	Discussion	and	Analysis	of	Financial Condition	and	Results	of	Operations	-	Segment	Results	-	Comparison	of	2017	and	2016	-	Asia"	for	further	information	regarding	this	initiative.	The distributor	to	direct	sales	conversions	generally	enable	us	to	obtain	improved	product	pricing	and	more	direct	access	to	the	end	users	of	our	products within	the	sales	channel.	Additionally,	we	continue	to	execute	restructuring	programs	to	improve	efficiencies	in	our	sales	and	marketing	and	research	and development	organizations	and	in	our	manufacturing	and	distribution	facilities.

# OUR	SEGMENTS

Following	our	acquisition	of	Vascular	Solutions,	we	commenced	an	integration	program	under	which	we	are	combining	the	Vascular	Solutions business	with	certain	of	our	legacy	businesses.	Specifically,	we	are	combining	Vascular	Solutions	North	American	business	with	our	interventional	access business,	which	formerly	was	part	of	the	Vascular	North	America	operating	segment,	and	our	cardiac	business,	which	formerly	was	a	separate	operating segment	included	in	the	"all	other"	category	for	purposes	of	segment	reporting.	These	businesses	are	now	in	our	Interventional	North	America	segment. Additionally,	we	are	combining	 the	Vascular	Solutions	businesses	 in	Europe,	Asia	and	Latin	America	with	our	 legacy	businesses	 in	 the	respective locations,	and	these	Vascular	Solutions	businesses	are	now	part	of	our	EMEA	(Europe,	Middle	East	and	Africa),	Asia	and	Latin	America	operating segments,	respectively.	The	changes	in	our	operating	segments,	which	became	effective	in	the	fourth	quarter	2017,	also	reflect	the	manner	in	which	our new	chief	operating	decision	maker	assesses	business	performance	and	allocation	of	resources.

As	 a	 result	 of	 the	 operating	 segment	 changes	 described	 above,	 we	 have	 the	 following	 seven	 reportable	 segments:	 Vascular	 North	America, Interventional	North	America,	Anesthesia	North	America,	Surgical	North	America,	EMEA,	Asia	and	OEM.	In	connection	with	the	presentation	of	segment information,	we	will	continue	to	present	certain	operating	segments,	which	now	include	Interventional	Urology	North	America	and	Respiratory	North America	as	well	as	Latin	America,	in	the	"all	other"	category	because	they	are	not	material.	All	prior	comparative	periods	presented	in	this	report	have been	restated	to	reflect	these	changes.

The	 following	charts	depict	our	net	revenues	by	reportable	operating	segment	and	by	 the	operating	segments in the	"all	other"	category	as	a percentage	of	our	total	consolidated	net	revenues	for	the	years	ended	December	31,	2017,	2016	and	2015.

# segmentchart2a01.jpg

Vascular	North	America:	Our	Vascular	North	America	segment	is	comprised	of	our	North	American	vascular	access	business,	which	offers	products	that facilitate	a	variety	of	critical	care	therapies	and	other	applications.	These	products	primarily	consist	of	our	Arrow	branded	catheters	and	related	devices, including	catheter	positioning	systems,	that	are	used	in	a	wide	range	of	procedures,	including	the	administration	of	intravenous	medications	and	other therapies,	the	measurement	of	blood	pressure	and	the	withdrawal	of	blood	samples	through	a	single	puncture	site.	The	product	portfolio	principally consists	of	the	following	products:

•Arrow	Central	Venous	Catheters	(CVCs):	Arrow	CVCs	are	inserted	in	the	neck	or	shoulder	area	and	come	in	multiple	lengths	with	up	to	five channels,	or	lumens.	The	Arrow	CVC	has	a	pressure	injectable	option	which	gives	clinicians	who	perform	contrast-enhanced	CT	scans	the	ability	to use	an	indwelling	(in	the	body)	pressure	injectable	Arrow	CVC	to	inject	contrast	dye	for	the	scan	without	having	to	insert	a	second	catheter.

•Arrow	EZ-IO	Intraosseous	Vascular	Access	System:	The	Arrow	EZ-IO	system	provides	vascular	access	for	the	delivery	of	medications	and	fluids via	intraosseous,	or	in	the	bone,	infusion	when	traditional	vascular	access	is	difficult	or	impossible.	Sales	of	the	Arrow	EZ-IO	system	to	our	hospital customers	 are	 included	 in	 our	 Vascular	 North	 America	 segment	 results.	As	 discussed	 below,	 sales	 of	 the	Arrow	 EZ-IO	 to	 pre-hospital	 care customers,	such	as	emergency	medical	service	providers,	are	included	in	our	Anesthesia	North	America	segment	results.

•Arrow	Peripherally	Inserted	Central	Catheters	(PICCs):	Arrow	PICCs	are	soft,	flexible	catheters	that	are	inserted	in	the	upper	arm	and	advanced	into a	vein	that	carries	blood	to	the	heart	to	administer	various	types	of	intravenous	medications	and	therapies.	Arrow	PICCs	have	a	pressure	injectable option	that	can	withstand	the	higher	pressures	required	by	the	injection	of	contrast	media	for	CT	scans.

•Arrow	Jugular	Axillo-subclavian	Central	Catheters	(JACCs):	Arrow	JACCs	are	designed	to	be	inserted	in	the	neck	or	shoulder	area	and	provide	an alternative	to	traditional	CVCs	and	PICCs	for	acute	care.	Arrow	JACCs	may	be	used	for	short	or	long	term	periods	to	treat	patients	who	may	have poor	peripheral	circulation.

•Arrow	Midline	Catheters	(Midlines):	Arrow	Midlines	are	made	of	medical	grade,	flexible	polyurethane	material	and	are	inserted	in	the	upper	arm. Midlines	are	appropriate	when	patients	face	difficult	intravenous	catheter	insertions	or	therapy	will	last	no	longer	than	one	to	four	weeks.

•Arrow	Catheter	Tip	Positioning	Systems:	We	offer	two	distinct	catheter	tip	positioning	systems	that	are	designed	to	facilitate	precise	placement	of catheters	within	the	heart.	The	first	is	our	VPS	G4	Vascular	Positioning	System,	which	is	an	advanced	vascular	positioning	system	designed	to facilitate	precise	placement	of	CVCs	within	the	heart.	Indicated	as	an	alternative	to	chest	x-ray	confirmation	for	CVC	tip	placement	confirmation	in adult	patients,	the	VPS	G4	analyzes	multiple	metrics,	in	real	time,	to	help	clinicians	navigate	through	the	circulatory	system	and	identify	the	correct catheter	tip	placement	in	the	heart.	We	also	offer	the	Arrow	VPS	Rhythm™	System,	which	provides	electrocardiogram	(ECG)-based	tip	confirmation in	a	highly	portable,	lightweight	and	versatile	design.	ECG	technology	facilitates	catheter	tip	placement	and	confirmation	within	the	superior	vena- cava-cavatorial	junction	in	the	heart,	and	can	be	used	with	a	broad	range	of	catheter	types.	When	paired	with	our	VPS	TipTracker

stylet	for	insertion	of	PICCs,	the	Arrow	VPS	Rhythm	System	provides	real-time	visual	navigation	by	tracing	the	catheter	pathway	with	a	blue	line	on a	color	screen.

•Arrow	Arterial	Catheterization	Sets:	Our	Arrow	arterial	catheterization	sets	facilitate	arterial	pressure	monitoring	and	blood	withdrawal	for	glucose, blood-gas	and	electrolyte	measurement	in	a	wide	variety	of	critical	care	and	intensive	care	settings.

•Arrow	Multi-Lumen	Access	Catheters	(MAC):	The	Arrow	MAC	combines	the	access	of	a	sheath	introducer	with	the	high-flow	lumens	of	a	central line.	The	MAC's	hemostasis	valve	allows	for	easy	access	for	additional	devices,	such	as	a	thermodilution	catheter	or	ARROW	MAC	Companion Catheter,	adding	up	to	three	additional	lumens.

•Arrow	Percutaneous	Sheath	Introducers:	Our	Arrow	percutaneous	sheath	introducers	are	used	to	insert	cardiovascular	and	other	catheterization devices	into	the	vascular	system	during	critical	care	procedures.

•Arrow	Endurance	Extended	Dwell	Peripheral	Catheter	System:	The	Arrow	Endurance	enables	the	provision	of	continuous	intravenous	therapy	for the	entire	length	of	stay.	It	permits	access	to	the	patient's	peripheral	vascular	system	to	sample	blood,	monitor	blood	pressure,	or	administer	fluids.

The	large	majority	of	our	CVCs	are	treated	with	solutions	based	on	our	ARROWg+ard	or	ARROWg+ard	Blue	Plus	antimicrobial	technology,	which have	been	shown	to	reduce	the	risk	of	catheter	related	bloodstream	infection.	Our	Arrow	Chlorag+ard	technology,	available	on	our	PICCs,	JACCs	and Midlines,	provides	antimicrobial	and	antithrombogenic	protection	on	inner	and	outer	catheter	surfaces	as	well	as	the	entire	fluid	pathway	of	the	catheter.	It has	been	shown	to	be	effective	in	reducing	microbial	colonization	and	thrombus	accumulation	on	catheter	surfaces.

We	also	offer	many	of	our	vascular	access	catheters	in	Maximal	Barrier	Precautions	trays,	which	are	designed	to	assist	healthcare	providers	in complying	with	clinical	guidelines	for	reducing	catheter-related	bloodstream	infections.	These	trays	are	available	for	CVCs,	PICCs	and	multi	access catheters	and	include	a	full	body	drape,	coated	or	non-coated	catheters	and	other	accessories.	In	addition,	our	ErgoPACK	system	offers	clinicians	a broad	range	of	tray	configurations	with	components	packaged	in	the	tray	in	the	order	in	which	they	will	be	needed	during	the	procedure,	and	incorporates features	designed	to	promote	ease	of	use	and	patient	and	provider	safety.

Interventional	North	America:	Our	Interventional	North	America	segment	is	comprised	of	the	North	American	component	of	our	Vascular	Solutions business,	which	we	acquired	in	February	2017,	as	well	as	our	interventional	access	and	cardiac	care	businesses.	Our	portfolio	consists	of	products	used by	interventional	cardiologists,	interventional	radiologists,	vascular	surgeons	and	vein	practices.

# Vascular	Solutions	product	portfolio

Our	Vascular	Solutions	portfolio	consists	of	clinically	advanced	devices for treating	coronary	and	peripheral	vascular	disease	and includes the following:

•GuideLiner	guide	extension	catheters:	Our	GuideLiner	family	is	designed	to	increase	guide	catheter	support	and	stability	to	allow	deep-seating	of the	guide	catheter	for	distal	device	delivery	and	selective	delivery	of	contrast.	The	device	can	also	be	utilized	in	assisting	complex	cardiac	catheter interventions.

•Micro-introducers:	 These	 products	 are	used to	gain	percutaneous	access to the	vasculature for	performing	arterial	and	venous	catheterization procedures.

•Turnpike	catheters:	These	catheters	may	be	used	to	facilitate	placement	and	exchange	of	guidewires	and	to	deliver	diagnostic	and	therapeutic agents	to	discrete	regions	of	the	coronary	and	peripheral	vasculature.

•Trapliner:	In	2017,	we	launched	the	TrapLiner	catheter,	which	is	intended	for	use	in	conjunction	with	guide	catheters	to	access	discrete	regions	of the	coronary	and/or	peripheral	vasculature,	to	facilitate	placement	of	interventional	devices	and	to	facilitate	the	exchange	of	interventional	devices while	maintaining	the	position	of	the	guidewire	within	the	vasculature.	The	TrapLiner	catheter	is	similar	in	design	to	the	GuideLiner	guide	extension catheter,	with	the	added	feature	of	an	integrated	balloon	for	trapping	a	standard	0.014"	guidewire	within	a	guide	catheter.	The	TrapLiner	catheter can	be	used	as	an	alternative	method	to	the	trapping	technique	that	requires	the	use	of	a	percutaneous	transluminal	coronary	angioplasty	(PTCA) balloon	 to	 exchange	 an	 existing	 over-the-wire	 catheter	 while	 maintaining	 guidewire	 position.	 The	 technique	 of	 guidewire	 trapping	 for	 catheter exchange	is	most	commonly	performed	in	complex	interventional	procedures.

•TwinPass	Torque:	In	2017,	we	launched	the	TwinPass	Torque,	which	is	designed	for	procedures	that	call	for	the	delivery	of	two	interventional guidewires	from	a	single	catheter	in	clinical	situations	where	catheter	delivery	and	turning	control	are	important.

•Spectre	 Guidewire:	 Designed	 for	 premium	 guidewire	 performance in	 coronary	 and	 peripheral interventions, the	 Spectre	 Guideware	 provides enhanced	trackability	and	torque	control.

# Interventional	access	product	portfolio

Our	interventional	access	products	are	used	in	a	wide	range	of	applications,	including	dialysis,	oncology	and	critical	care	therapies.	Our	interventional access	portfolio	also	includes	Arrow	branded	products,	such	as	diagnostic	and	drainage	kits,	embolectomy	balloons,	and	reinforced	percutaneous	sheath introducers.	Our	interventional	access	products	include	the	following:

•Arrow	OnControl	Powered	Bone	Marrow	/	Bone	Access	System:	The	Arrow	OnControl	powered	bone	access	system	is	used	to	obtain	bone	marrow samples,	bone	aspirate	and	access	bone	lesions	for	hematology	and	in	ontological	diagnostic	procedures.

•Arrow	 Trerotola	 Percutaneous	 Thrombectomy	 Device	 ("PTD"):	The	Arrow	 Trerotola	 PTD	 is	 used for	 declotting	 of	 dialysis	 grafts	 and fistulas, respectively	indirect	and	direct	connections	between	an	artery	and	a	vein	for	hemodialysis	access.

•Arrow	Chronic	Hemodialysis	Catheters:	The	Arrow	chronic	hemodialysis	catheters	include	both	antegrade	and	retrograde	insertion	options	for	split, step	and	symmetrical	tip	configurations.

•ARROW-Clark	 VectorFlow	 Hemodialysis	 Catheter:	The	 Arrow-Clark	 VectorFlow	 catheter	 is	 a	 symmetrical	 tip	 tunneled	 hemodialysis	 catheter designed	to	reduce	loss	of	lock	solution	(which	is	used	on	catheters	to	reduce	the	risk	of	thrombosis),	give	sustained	high	flows	and	reduce	the	risk of	thrombus	accumulation	due	to	platelet	activation.	Additionally,	the	specially	designed	catheter	tip	allows	for	placement	flexibility	with	minimal impact	on	recirculation.

•Arrow	Polysite	Low	Profile	Hybrid	Ports:	The	Arrow	Polysite	Low	Profile	Hybrid	Port	is	used	for	long-term	access	to	the	central	venous	system	and	to facilitate	repeated	vascular	access.	It	is	available	in	multiple	standard	French	sizes.	The	hybrid	design	provides	a	strong	titanium	reservoir	and lightweight	plastic	body	delivering	the	strength	and	the	comfort	needed	for	long-term	treatment	in	patients	of	all	sizes.

# Cardiac	care	product	portfolio

Products	in	the	cardiac	care	portfolio	include	diagnostic	catheters,	intra-aortic	balloon	catheters	and	capital	equipment.	Diagnostic	catheters	include thermodilution	and	wedge	pressure	catheters.	Our	Berman	and	Reverse	Berman	catheters	are	used	during	the	x-ray	examination	of	blood	vessels	and our	temporary	pacing	catheters	are	often	used	in	common	interventional	procedures	such	as	transcatheter	aortic	valve	replacement,	or	TAVR.	We	also manufacture	sheaths	for	femoral	and	trans-radial	aortic	access	used	in	diagnostic	and	therapeutic	procedures.	Our	capital	equipment	offering	includes our	intra-aortic	balloon	pump,	or	IABP.	When	combined	with	our	intra	aortic	balloon	catheter,	our	intra	aortic	balloon	pumps	are	used	to	augment	oxygen delivery	to	the	cardiac	muscle	and	reduce	the	oxygen	demand	after	cardiac	surgery,	heart	attack	or	interventional	procedures.	We	recently	launched	the Autocat	3	Optimus,	our	third	generation	intra-aortic	balloon	pump.	This	device	helps	a	weakened	heart	pump	blood	and	can	deliver	IABP	therapy	to	a broad	range	of	patients,	even	those	not	previously	considered	candidates	for	IABP	therapy.	Clinicians	may	use	the	Autocat	3	Optimus	on	patients	with the	most	severe	arrhythmias	or	heart	rates	as	high	as	200	beats	per	minute.

Anesthesia	North	America:	Our	Anesthesia	North	America	segment	is	comprised	of	our	North	American	pain	management	and	airway	management products	and	other	products	that,	like	our	airway	management	products,	provide	pre-hospital	emergency	applications.

# Pain	management	products

Our	pain	management	products,	which	are	designed	for	use	in	a	broad	range	of	surgical	and	obstetric	procedures,	consist	principally	of	the	following:

•Arrow	Epidural	Catheters,	Needles	and	Kits:	We	offer	a	broad	range	of	Arrow	epidural	products,	including	the	Arrow	FlexTip	Plus	epidural	catheter, to	facilitate	epidural	analgesia.	Epidural	analgesia	may	be	used	separately	for	pain	management,	as	an	adjunct	to	general	anesthesia,	as	a	sole technique	for	surgical	anesthesia	and	for	post-operative	pain	management.

•Arrow	 Peripheral	 Nerve	 Block	 ("PNB")	 Catheters,	 Pumps,	 Needles	 and	 Kits:	Our	 portfolio	 of	Arrow	 PNB	 products,	 which	 includes	 the	Arrow Stimucath	 and	 FlexBlock	 catheters,	 are	 designed	 to	 be	 used	 by	 anesthesiologists	 to	 provide	 localized	 pain	 relief	 by	 injecting	 anesthetics	 to deliberately	interrupt	the	signals	traveling	along	a	nerve.	Nerve	blocks	are	used	in	a	variety	of	different	procedures,	including	orthopedics.

•AutoFuser	 Disposable	 Pain	 Pumps:	Our	 AutoFuser	 Disposable	 Pain	 Pumps	 are	 designed	 for	 general	 infusion	 use,	 which	 includes	 regional anesthesia	and	pain	management.	Routes	of	administration	include	percutaneous,	subcutaneous	and	epidural,	and	into	the	intra-operative	(soft tissue/body	cavity)	sites.	The	AutoFuser	offers	multiple	reservoir	sizes	and	configurations	to	meet	a	variety	of	clinical	demands.

# Airway	management	products

Our	airway	management	products	and	related	devices,	which	are	designed	for	use	in	both	pre-hospital	emergency	and	hospital	settings,	consist principally	of	the	following:

•LMA	Airways:	Our	LMA	laryngeal	masks	are	used	by	anesthesiologists	and	emergency	responders	to	establish	an	airway	to	channel	anesthesia	gas or	oxygen	to	a	patient's	lungs	during	surgery	or	trauma.	The	LMA	Gastro	Airway,	our	latest	airway	management	device,	is	the	first	single-use laryngeal	 mask	 with	 a	 gastric	 channel.	Designed	 for	 use	 in	 upper	 endoscopy	 procedures,	 this	 device	 offers	 an	 increased	 level	 of	 airway management	for	clinicians.	The	LMA	Gastro	Airway	also	includes	our	Cuff	Pilot™	technology,	which	enables	clinicians	to	confirm	that	the	inserted cuff	is	properly	inflated	and	to	monitor	pressure	levels.

•LMA	Atomization:	Our	LMA	atomization	portfolio	includes	products	designed	to	facilitate	atomized	delivery	of	certain	medications.	Included	in	the portfolio	is	our	LMA	MAD	Nasal,	an	intranasal	mucosal	atomization	device	that	is	designed	to	provide	a	safe	and	painless	way	to	deliver	medications approved	for	intranasal	delivery	to	a	patient's	blood	stream	without	an	intravenous	line	or	needle.

•RUSCH	 Endotracheal	 Tubes	 and	 Laryngoscopes:	We	 offer	 a	 broad	 portfolio	 of	 products	 to	 facilitate	 and	 support	 endotracheal	 intubation	 to administer	oxygen,	and	anesthetic	gases	in	multiple	settings	(surgery,	critical	care	and	emergency	settings).	We	also	provide	a	broad	range	of products	for	laryngoscopy,	a	procedure	that	is	primarily	used	to	obtain	a	view	of	the	airway	to	facilitate	tracheal	intubation	during	general	anesthesia or	cardiopulmonary	resuscitation	("CPR").	Among	these	products	is	the	Rusch	DispoLED™	Laryngoscope	Handle	and	Green	Rusch	Lite	Blade,	a single-use	system	designed	to	help	facilities	comply	with	standards	designed	to	reduce	the	potential	for	patient	cross-contamination	associated	with reusable	devices	during	intubation.

# Pre-hospital	emergency	products

As	noted	above,	our	airway	management	products	can	be	used	in	pre-hospital	emergency	settings.	We	offer	other	products	designed	for	use	in	pre- hospital	emergency	settings,	including	the	Arrow	EZ-IO	System,	which	is	described	in	the	Vascular	North	America	segment	summary	above.	 The	EZ-IO System	offers	a	method	for	vascular	access	that	can	be	administered	quickly	and	effectively	in	emergency	situations.

Surgical	North	America:	Our	surgical	products	are	designed	to	provide	surgeons	with	a	comprehensive	range	of	devices	for	use	in	a	variety	of surgical	procedures.	Our	portfolio	consists	of	single-use	and	reusable	products,	including	the	following:

•Weck	Ligation	Systems:	Our	Weck	Ligation	Systems	feature	the	Weck	Metal	Ligating	Clips	and	Hem-o-lok	Polymer	Ligating	Clips.	Weck	Metal Ligating	Clips	are	intended	for	use	in	procedures	involving	vessels	or	anatomic

structures	and	are	sold	in	various	sizes,	types	and	materials.	Our	Hem-o-lok	Polymer	Ligating	Clips	are	intended	for	use	in	procedures	involving ligation	of	vessels	or	tissue	structures	and	are	sold	in	various	sizes.

•Weck	EFx	Fascial	Closure	Systems:	Our	Weck	fascial	closure	systems	are	used	in	laparoscopic	surgical	procedures	and	are	intended	to	facilitate placement	of	sutures	used	to	repair	laparoscopic	defects	and	minimize	complications	and	costs	associated	with	port-site	herniation.		We	offer	a	full portfolio	of	fascial	closure	devices,	which	provides	a	wide	range	of	clinical	options.

•Percutaneous	 Surgical	 Systems:	 Our	 Mini-Lap	 surgical	 instruments	 are	 designed	 to	 be	 inserted	 percutaneously	 (through	 the	 skin)	 to	 enable surgeons	 to	 perform	 laparoscopic	 surgery	 without	 the	 need	 for	 an	 insertion	 trocar.	 The	 MiniLap	 family	 of	 surgical	 instruments	 consists	 of	 a ThumbGrip	option	on	a	2.3mm	shaft	or	a	pistol	design	called	MiniGrip	option	on	a	2.4mm	shaft.	In	addition,	we	have	developed	the	Percuvance percutaneous	surgical	system	-	2.9mm	device	shaft	with	5	mm	operating	tips.	The	Percuvance	system	is	used	to	penetrate	soft	tissue	to	access certain	areas	of	the	human	abdomen	and	to	grasp,	hold	and	manipulate	tissue,	and,	like	our	Mini-Lap	surgical	instruments,	enables	surgeons	to access	the	abdominal	cavity	without	the	need	for	access	ports.

Our	 other	 branded	 surgical	 products include	 our	 Weck	 Vista	 bladeless	 access	 ports,	 Deknatel	 sutures	 and	 our	 Pilling	 and	 Kmedic	 surgical instruments.

Europe,	the	Middle	East	and	Africa	("EMEA"):	Our	EMEA	segment	designs,	manufactures	and	distributes	medical	devices	primarily	used	in critical	care,	surgical	applications	and	cardiac	care	and	generally	serves	two	end	markets:	hospitals/	healthcare	providers,	and	home	health.	The	products offered	by	our	EMEA	segment	are	most	widely	used	in	acute	care	settings	for	a	range	of	diagnostic	and	therapeutic	procedures	and	in	general	and specialty	surgical	applications,	such	as	urology.

Asia:	Our	Asia	segment,	like	our	EMEA	segment,	designs,	manufactures	and	distributes	medical	devices	primarily	used	in	critical	care,	surgical applications	and	cardiac	care	and	generally	serves	hospitals	and	healthcare	providers.	The	products	offered	by	our	Asia	segment	are	most	widely	used	in acute	care	settings	for	a	range	of	diagnostic	and	therapeutic	procedures	and	in	general	and	specialty	surgical	applications.

Original	Equipment	Manufacturer	and	Development	Services	("OEM"):	Our	OEM	segment	designs,	manufactures	and	supplies	devices	and instruments	for	other	medical	device	manufacturers.	Our	OEM	division,	which	includes	the	TFX	OEM	and	Deknatel	OEM	 brands,	 provides	 custom- engineered	 extrusions,	 diagnostic	 and	 interventional	 catheters,	 balloon	 sheath/dilator	 sets	 (introducers)	 and	 kits,	 sutures,	 performance	 fibers,	 and bioresorbable	resins	and	fibers.	We	offer	an	extensive	portfolio	of	integrated	capabilities,	including	engineering,	material	selection,	regulatory	affairs, prototyping,	testing	and	validation,	manufacturing,	assembly	and	packing.

Other	businesses:	Our	other	operating	segments	do	not	meet	the	threshold	for	separate	disclosure	under	applicable	accounting	guidance	and	are therefore	included	in	the	"all	other"	line	item	in	tabular	presentations	of	segment	information.	Products	offered	by	these	operating	segments	include single-use	respiratory,	urology	and	interventional	urology	products.	We	also	have	an	operating	segment	encompassing	our	Latin	American	business.

# Respiratory/urology	North	America

In	2015,	we	combined	our	respiratory	and	urology	businesses.	Our	respiratory	products	are	used	in	a	variety	of	care	settings	and	include	oxygen therapy	products,	aerosol	therapy	products,	spirometry	products,	and	ventilation	management	products.	Our	Hudson	RCI	brand	has	been	a	prominent name	in	respiratory	care	for	over	65	years.

Our	urology	product	portfolio	provides	bladder	management	 for	patients	 in	 the	hospital	and	 individuals	 in	 the	home	care	markets.	The	product portfolio	 consists	 principally	 of	 a	 wide	 range	 of	 catheters	 (including	 Foley,	 intermittent,	 external	 and	 suprapubic),	 urine	 collectors,	 catheterization accessories	and	products	for	operative	endourology	marketed	under	the	Rusch	brand	name.

# Interventional	urology	North	America

As	a	result	of	our	acquisition	of	NeoTract	in	2017,	we	now	offer	the	UroLift	System,	a	minimally	invasive	technology	for	treating	lower	urinary	tract symptoms	 due	 to	 benign	 prostatic	 hyperplasia,	 or	 BPH.	 The	 UroLift	 System	 involves	 the	 placement	 of	 permanent	 implants,	 typically	 through	 a transurethral	outpatient	procedure,	that	hold	the	prostate	lobes	apart	to	relieve	compression	on	the	urethra	without	cutting,	heating	or	removing	prostate tissue.

# Latin	America

Our	Latin	America	business	generally	engages	in	the	same	type	of	operations,	and	serves	the	same	type	of	end	markets,	as	the	EMEA	and	Asia segments.

# OUR	MARKETS

We	 generally	 serve	 three	 end-markets:	 hospitals	 and	 healthcare	 providers,	 medical	 device	 manufacturers	 and	 home	 care.	These	 markets	 are affected	by	a	number	of	 factors,	 including	demographics,	utilization	and	reimbursement	patterns.	The	 following	charts	depict	 the	percentage	of	net revenues	for	the	years	ended	December	31,	2017,	2016	and	2015	derived	from	each	of	our	end	markets.

# marketscharta01.jpg

# GOVERNMENT	REGULATION

We	are	subject	 to	comprehensive	government	regulation	both	within	and	outside the	U.S.	relating to the	development,	manufacture,	sale	and distribution	of	our	products.

# Regulation	of	Medical	Devices	in	the	United	States

All	of	our	medical	devices	manufactured	or	sold	in	the	United	States	are	subject	to	the	Federal	Food,	Drug,	and	Cosmetic	Act	("FDC	Act"),	and	its implementing	regulations,	which	are	enforced	by	the	FDA.	The	FDA	and,	in	some	cases,	other	government	agencies	administer	requirements	for	the design,	testing,	safety,	effectiveness,	manufacturing,	labeling,	storage,	record	keeping,	clearance,	approval,	advertising	and	promotion,	distribution,	post- market	surveillance,	import	and	export	of	our	medical	devices.

Unless	an	exemption	or	pre-amendment	grandfather	status	applies,	each	medical	device	that	we	market	must	first	receive	either	clearance	as	a Class	I	or	Class	II	device	(by	submitting	a	premarket	notification	("510(k)")	or	approval	as	a	Class	III	device	(by	filing	a	premarket	approval	application ("PMA"))	from	the	FDA	pursuant	to	the	FDC	Act.	To	obtain	510(k)	clearance,	a	manufacturer	must	demonstrate	that	the	proposed	device	is	substantially equivalent	to	a	legally	marketed	510(k)-cleared	device	(or	pre-amendment	device	for	which	FDA	has	not	called	for	PMAs),	referred	to	as	the	"predicate device."	Substantial	equivalence	is	established	by	the	applicant	showing	that	the	proposed	device	has	the	same	intended	use	as	the	predicate	device, and	it	either	has	the	same	technological	characteristics	or	has	been	shown	to	be	equally	safe	and	effective	and	does	not	raise	different	questions	of safety	and	effectiveness	as	compared	to	the	predicate	device.		The	FDA's	510(k)	clearance	process	usually	takes	from	four	to	twelve	months,	but	it	can last	longer.	A	device	that	is	not	eligible	for	the	510(k)	process	because	there	is	no	predicate	device	may	be	reviewed	through	the	de	novo	process	(the process	for	approval	when	no	substantially	equivalent	device	exists)	if	the	FDA	agrees	it	is	a	low	to	moderate	risk	device.	A	device	not	eligible	for	510(k) clearance	 or	 de	 novo	 clearance	 is	 categorized	 as	 Class	 III	 and	 must	 follow	 the	 PMA	 approval	 pathway,	 which	 requires	 proof	 of	 the	 safety	 and effectiveness	of	the	device	to	the	FDA's	satisfaction.		The	process	of	obtaining	PMA	approval	is	much	more	costly,	lengthy	and	uncertain	than	the	510(k) process.	It	generally	takes	from	one	to	three	years	or	even	longer.	Our	portfolio	of	existing	products	and	pipeline	of	potential	new	products	consist primarily	of	Class	I	and	Class	II	devices	that	require	510(k)	clearance,	although	a	few	are	510(k)	exempt.		In	addition,	modifications	made	to	devices	after they	receive	clearance

or	approval	may	require	a	new	510(k)	clearance	or	approval	of	a	PMA	or	PMA	supplement.	We	cannot	be	sure	that	510(k)	clearance	or	PMA	approval	will be	obtained	in	a	timely	matter	if	at	all	for	any	device	that	we	propose	to	market.

A	clinical	trial	is	almost	always	required	to	support	a	PMA	application	and	is	sometimes	required	for	a	510(k)	clearance.		The	sponsor	of	a	clinical study	must	comply	with	and	conduct	the	study	in	accordance	with	the	applicable	federal	regulations,	including	FDA's	investigational	device	exemption ("IDE")	requirements,	and	good	clinical	practice	("GCP").		Clinical	trials	must	also	be	approved	by	an	institutional	review	board	("IRB"),	which	is	an appropriately	constituted	group	that	has	been	formally	designated	to	review	biomedical	research	involving	human	subjects	and	which	has	the	authority	to approve,	require	modifications	in,	or	disapprove	research	to	protect	the	rights,	safety,	and	welfare	of	the	human	research	subject.		The	FDA	may	order	the temporary,	or	permanent,	discontinuation	of	a	clinical	trial	at	any	time,	or	impose	other	sanctions,	if	it	believes	that	the	clinical	trial	either	is	not	being conducted	in	accordance	with	FDA	requirements	or	presents	an	unacceptable	risk	to	the	clinical	trial	patients.		An	IRB	may	also	require	the	clinical	trial	at the	site	to	be	halted	for	failure	to	comply	with	the	IRB's	requirements,	or	may	impose	other	conditions.

A	device	placed	on	the	market	must	comply	with	numerous	regulatory	requirements.	Those	regulatory	requirements	include	the	following:

•device	listing	and	establishment	registration;

•adherence	to	the	Quality	System	Regulation	("QSR")	which	requires	stringent	design,	testing,	control,	documentation,	complaint	handling	and	other quality	assurance	procedures;

•labeling	requirements;

•FDA	prohibitions	against	the	promotion	of	off-label	uses	or	indications;

•adverse	event	and	malfunction	reporting;

•post-approval	restrictions	or	conditions,	potentially	including	post-approval	clinical	trials	or	other	required	testing;

•post-market	surveillance	requirements;

•the	FDA's	recall	authority,	whereby	it	can	require	or	ask	for	the	recall	of	products	from	the	market;	and

•voluntary	corrections	or	removals	reporting	and	documentation.

The	FDA	has	 issued	 final	regulations	regarding	 the	Unique	Device	 Identification	("UDI")	System,	which	requires	manufacturers	 to	mark	certain medical	devices	with	unique	identifiers.	While	the	FDA	expects	that	the	UDI	System	will	help	track	products	during	recalls	and	improve	patient	safety,	it has	required	us	to	make	changes	to	our	manufacturing	and	labeling,	which	could	increase	our	costs.		The	UDI	System	is	being	implemented	in	stages based	on	device	risk,	with	the	first	requirements	having	taken	effect	in	September	2014	and	the	last	taking	effect	in	September	2020.

Certain	of	our	medical	devices	are	sold	in	convenience	kits	that	include	a	drug	component,	such	as	lidocaine.	These	types	of	kits	are	generally regulated	as	combination	products	within	the	Center	for	Devices	and	Radiological	Health	(or	"CDRH")	under	the	device	regulations	because	the	device provides	the	primary	mode	of	action	of	the	kit.	Although	the	kit	as	a	whole	is	regulated	as	a	medical	device,	it	may	be	subject	to	certain	drug	requirements such	as	current	good	manufacturing	practices	("cGMPs")	to	the	extent	applicable	to	the	drug-component	repackaging	activities	and	subject	to	inspection to	verify	compliance	with	cGMPs	as	well	as	other	regulatory	requirements.

Our	manufacturing	facilities,	as	well	as	those	of	certain	of	our	suppliers,	are	subject	to	periodic	and	for-cause	inspections	to	verify	compliance	with	the QSR	as	well	as	other	regulatory	requirements.	If	the	FDA	were	to	find	that	we	or	certain	of	our	suppliers	have	failed	to	comply	with	applicable	regulations, it	could	institute	a	wide	variety	of	enforcement	actions,	ranging	from	issuance	of	a	warning	or	untitled	letter	to	more	severe	sanctions,	such	as	product recalls	or	seizures,	civil	penalties,	consent	decrees,	 injunctions,	criminal	prosecution,	operating	restrictions,	partial	suspension	or	 total	shutdown	of production,	refusal	to	permit	importation	or	exportation,	refusal	to	grant,	or	delays	in	granting,	clearances	or	approvals	or	withdrawal	or	suspension	of existing	clearances	or	approvals.	The	FDA	also	has	the	authority	under	certain	circumstances	to	request	repair,	replacement	or	refund	of	the	cost	of	any medical	device	manufactured	or	distributed	by	us.		Any	of	these	actions	could	have	an	adverse	effect	on	our	business.

# Regulation	of	Medical	Devices	Outside	of	the	United	States

Medical	device	 laws	also	are	 in	effect	 in	many	of	 the	markets	outside	of	 the	United	States	 in	which	we	do	business.	These	 laws	range	 from comprehensive	device	approval	requirements	for	some	or	all	of	our	products	to	requests	for	product	data	or	certifications.	Inspection	of	and	controls	over manufacturing,	as	well	as	monitoring	of	device-related	adverse	events,	are	components	of	most	of	these	regulatory	systems.

# Healthcare	Laws

We	are	subject	to	various	federal,	state	and	local	laws	in	the	United	States	targeting	fraud	and	abuse	in	the	healthcare	industry.		These	laws	prohibit us	from,	among	other	things,	soliciting,	offering,	receiving	or	paying	any	remuneration	to	induce	the	referral	or	use	of	any	item	or	service	reimbursable under	Medicare,	Medicaid	or	other	federally	or	state	financed	healthcare	programs.		Violations	of	these	laws	are	punishable	by	imprisonment,	criminal fines,	civil	monetary	penalties	and	exclusion	from	participation	in	federal	healthcare	programs.		In	addition,	we	are	subject	to	federal	and	state	false claims	 laws	 in	 the	United	States	 that	prohibit	 the	submission	of	 false	payment	claims	under	Medicare,	Medicaid	or	other	 federally	or	state	 funded programs.		Certain	marketing	practices,	such	as	off-label	promotion,	and	violations	of	federal	anti-kickback	laws	may	also	constitute	violations	of	these laws.

We	are	also	subject	to	various	federal	and	state	reporting	and	disclosure	requirements	related	to	the	healthcare	industry.		Rules	issued	by	the Centers	for	Medicare	&	Medicaid	Services	("CMS")	require	us	to	collect	and	report	information	on	payments	or	transfers	of	value	to	physicians	and teaching	hospitals,	as	well	as	investment	interests	held	by	physicians	and	their	immediate	family	members.	The	reported	data	is	available	to	the	public	on the	CMS	website.	Failure	to	submit	required	information	may	result	in	civil	monetary	penalties.		In	addition,	several	states	now	require	medical	device companies	to	report	expenses	relating	to	the	marketing	and	promotion	of	device	products	and	to	report	gifts	and	payments	to	individual	physicians	in these	states.		Other	states	prohibit	various	other	marketing-related	activities.		The	federal	government	and	certain	other	states	require	the	posting	of information	relating	to	clinical	studies	and	their	outcomes.	The	shifting	commercial	compliance	environment	and	the	need	to	build	and	maintain	robust	and expandable	systems	to	comply	with	the	different	compliance	and/or	reporting	requirements	among	a	number	of	jurisdictions	increases	the	possibility	that a	healthcare	company	may	violate	one	or	more	of	the	requirements,	resulting	in	increased	compliance	costs	that	could	adversely	impact	our	results	of operations.

# Other	Regulatory	Requirements

We	are	also	subject	to	the	United	States	Foreign	Corrupt	Practices	Act	and	similar	anti-bribery	laws	applicable	in	jurisdictions	outside	the	United State	that	generally	prohibit	companies	and	their	intermediaries	from	improperly	offering	or	paying	anything	of	value	to	non-United	States	government officials	for	the	purpose	of	obtaining	or	retaining	business.	Because	of	the	predominance	of	government-sponsored	healthcare	systems	around	the	world, most	of	our	customer	relationships	outside	of	the	United	States	are	with	government	entities	and	are	therefore	subject	to	such	anti-bribery	laws.	Our policies	mandate	compliance	with	these	anti-bribery	laws.	We	operate	in	many	parts	of	the	world	that	have	experienced	government	corruption	to	some degree,	and	in	certain	circumstances	strict	compliance	with	anti-bribery	laws	may	conflict	with	local	customs	and	practices.	In	the	sale,	delivery	and servicing	of	our	medical	devices	and	software	outside	of	the	United	States,	we	must	also	comply	with	various	export	control	and	trade	embargo	laws	and regulations,	including	those	administered	by	the	Department	of	Treasury's	Office	of	Foreign	Assets	Control	("OFAC")	and	the	Department	of	Commerce's Bureau	of	Industry	and	Security	("BIS")	which	may	require	licenses	or	other	authorizations	for	transactions	relating	to	certain	countries	and/or	with	certain individuals	identified	by	the	United	States	government.	Despite	our	global	trade	and	compliance	program,	our	internal	control	policies	and	procedures may	not	always	protect	us	from	reckless	or	criminal	acts	committed	by	our	employees,	distributors	or	other	agents.	Violations	of	these	requirements	are punishable	by	criminal	or	civil	sanctions,	including	substantial	fines	and	imprisonment.

# COMPETITION

The	medical	device	industry	is	highly	competitive.	We	compete	with	many	companies,	ranging	from	small	start-up	enterprises	to	companies	that	are larger	 and	 more	 established	 than	 us	 and	 have	 access	 to	 significantly	 greater	 financial	 resources.	 Furthermore,	 extensive	 product	 research	 and development	and	rapid	technological	advances	characterize	the	market	in	which	we	compete.	We	must	continue	to	develop	and	acquire	new	products and	technologies	for	our	businesses	to	remain	competitive.	We	believe	that	we	compete	primarily	on	the	basis	of	clinical	superiority	and	innovative features	that	enhance	patient	benefit,	product	reliability,	performance,	customer	and	sales	support,	and	cost-effectiveness.	Our	major	competitors	include Medtronic	plc	and	Becton,	Dickinson	and	Company.

# SALES	AND	MARKETING

Our	product	sales	are	made	directly	to	hospitals,	healthcare	providers,	distributors	and	to	original	equipment	manufacturers	of	medical	devices through	our	own	sales	forces,	independent	representatives	and	independent	distributor	networks.

# BACKLOG

Most	of	our	products	are	sold	to	hospitals	or	healthcare	providers	on	orders	calling	for	delivery	within	a	few	days	or	weeks,	with	longer	order	times	for products	sold	to	medical	device	manufacturers.	Therefore,	our	backlog	of	orders	is	not	indicative	of	revenues	to	be	anticipated	in	any	future	12-month period.

# PATENTS	AND	TRADEMARKS

We	own	a	portfolio	of	patents,	patents	pending	and	trademarks.	We	also	license	various	patents	and	trademarks.	Patents	for	individual	products extend	for	varying	periods	based	upon	the	date	of	patent	filing	or	grant	and	the	legal	term	of	patents	in	the	various	countries	where	patent	protection	is obtained.	Trademark	rights	may	potentially	extend	for	longer	periods	of	time	and	are	dependent	upon	national	laws	and	use	of	the	marks.	All	product names	throughout	this	document	are	trademarks	owned	by,	or	licensed	to,	us	or	our	subsidiaries.	Although	these	have	been	of	value	and	are	expected	to continue	to	be	of	value	in	the	future,	we	do	not	consider	any	single	patent	or	trademark,	except	for	the	Teleflex	and	Arrow	brands,	to	be	essential	to	the operation	of	our	business.

# SUPPLIERS	AND	MATERIALS

Materials	used	in	the	manufacture	of	our	products	are	purchased	from	a	large	number	of	suppliers	in	diverse	geographic	locations.	We	are	not dependent	on	any	single	supplier	for	a	substantial	amount	of	the	materials	used	or	components	supplied	for	our	overall	operations.	Most	of	the	materials and	components	we	use	are	available	from	multiple	sources,	and	where	practical,	we	attempt	to	identify	alternative	suppliers.	Volatility	in	commodity prices,	particularly	with	respect	to	aluminum,	steel	and	plastic	resins,	can	have	a	significant	impact	on	the	cost	of	producing	certain	of	our	products.	We may	not	be	able	to	successfully	pass	cost	increases	through	to	all	of	our	customers,	particularly	original	equipment	manufacturers.

# RESEARCH	AND	DEVELOPMENT

We	are	engaged	in	both	internal	and	external	research	and	development.	Our	research	and	development	costs	principally	relate	to	our	efforts	to	bring innovative	new	products	to	the	markets	we	serve,	and	our	efforts	to	enhance	the	clinical	value,	ease	of	use,	safety	and	reliability	of	our	existing	product lines.	Our	research	and	development	efforts	support	our	strategic	objectives	to	provide	safe	and	effective	products	that	reduce	infections,	improve	patient and	clinician	safety,	enhance	patient	outcomes	and	enable	less	invasive	procedures.	Our	research	and	development	expenditures	were	$84.8	million, $58.6	million	and	$52.1	million	for	the	years	ended	December	31,	2017,	2016	and	2015,	respectively.

We	also	acquire	or	license	products	and	technologies	that	are	consistent	with	our	strategic	objectives	and	enhance	our	ability	to	provide	a	full	range of	product	and	service	options	to	our	customers.

# SEASONALITY

Portions	of	our	revenues	are	subject	to	seasonal	fluctuations.	Incidence	of	flu	and	other	disease	patterns	as	well	as	the	frequency	of	elective	medical procedures	affect	revenues	related	to	single-use	products.		Historically,	we	have	experienced	higher	sales	in	the	fourth	quarter	as	a	result	of	these factors.

# EMPLOYEES

We	employed	approximately	14,400	full-time	and	temporary	employees	at	 December	31,	2017.	Of	these	employees,	approximately	 3,600	were employed	in	the	United	States	and	10,800	in	countries	other	than	the	United	States.	Approximately	 10%	of	our	employees	in	the	United	States	and	in other	countries	were	covered	by	union	contracts	or	collective-bargaining	arrangements.	We	believe	we	have	good	relationships	with	our	employees.

# ENVIRONMENTAL

We	are	subject	to	various	environmental	laws	and	regulations	both	within	and	outside	the	United	States.	Our	operations,	like	those	of	other	medical device	companies,	involve	the	use	of	substances	regulated	under	environmental	laws,	primarily	in	manufacturing	and	sterilization	processes.	While	we continue	to	make	capital	and	operational	expenditures	relating	to	compliance	with	existing	environmental	laws	and	regulations,	we	cannot	ensure	that	our costs	of	complying	with	current	or	future	environmental	protection,	health	and	safety	laws	and	regulations	will	not	exceed	our	estimates	or	will	not	have	a material	adverse	effect	on	our	business,	financial	condition,	results	of	operations	and	cash	flows.	Further,	we	cannot	ensure	that	we	will	not	be	subject	to environmental	claims	for	personal	injury	or	cleanup	in	the	future	based	on	our	past,	present	or	future	business	activities.

# INVESTOR	INFORMATION

We	are	subject	to	the	reporting	requirements	of	the	Securities	Exchange	Act	of	1934,	as	amended	(the	"Exchange	Act").	Therefore,	we	file	reports, proxy	statements	and	other	information	with	the	Securities	and	Exchange	Commission	(SEC).	Copies	of	these	reports,	proxy	statements,	and	other information	may	be	obtained	by	visiting	the	Public	Reference	Room	of	the	SEC	at	100	F	Street,	NE,	Washington,	DC	20549	or	by	calling	the	SEC	at	1- 800-SEC-0330.	 In	 addition,	 the	 SEC	 maintains	 a	 website	 (http://www.sec.gov)	 that	 contains	 reports,	 proxy	 and	 information	 statements	 and	 other information	regarding	issuers	that	file	electronically	with	the	SEC.

You	can	access	financial	and	other	information	about	us	in	the	Investors	section	of	our	website,	which	can	be	accessed	at	www.teleflex.com.	We make	available	through	our	website,	free	of	charge,	copies	of	our	annual	report	on	Form	10-K,	quarterly	reports	on	Form	10-Q,	current	reports	on	Form	8- K	and	amendments	 to	 those	reports	 filed	with	or	 furnished	 to	 the	SEC	under	Section	13(a)	or	15(d)	of	 the	Exchange	Act	as	soon	as	reasonably practicable	after	electronically	filing	or	furnishing	such	material	to	the	SEC.	The	information	on	our	website	is	not	part	of	this	Annual	Report	on	Form	10-K. The	reference	to	our	website	address	is	intended	to	be	an	inactive	textual	reference	only.

We	are	a	Delaware	corporation	incorporated	in	1943.	Our	executive	offices	are	located	at	550	East	Swedesford	Road,	Suite	400,	Wayne,	PA	19087.

# EXECUTIVE	OFFICERS

The	names	and	ages	of	our	executive	officers	and	the	positions	and	offices	held	by	each	such	officer	are	as	follows:

Mr.	Kelly	became	our	President	and	Chief	Executive	Officer	on	January	1,	2018.	From	May	2016	to	December	31,	2017,	Mr.	Kelly	served	as	our President	and	Chief	Operating	Officer.	From	April	2015	to	April	2016,	he	served	as	Executive	Vice	President	and	Chief	Operating	Officer.	From	April	2014 to	April	2015,	Mr.	Kelly	served	as	Executive	Vice	President	and	President,	Americas.	From	June	2012	to	April	2014	Mr.	Kelly	served	as	Executive	Vice President	and	President,	 International.	He	also	has	held	several	positions	with	regard	to	our	EMEA	segment,	including	President	from	June	2011	to June	2012,	Executive	Vice	President	from	November	2009	to	June	2011,	and	Vice	President	of	Marketing	from	April	2009	to	November	2009.	Prior	to joining	Teleflex,	Mr.	Kelly	held	various	senior	level	positions	with	Hill-Rom	Holdings,	Inc.,	a	medical	device	company,	from	October	2002	to	April	2009, serving	as	its	Vice	President	of	International	Marketing	and	R&D	from	August	2006	to	February	2009.

Mr.	Powell	has	been	our	Executive	Vice	President	and	Chief	Financial	Officer	since	February	2013.	From	March	2012	to	February	2013,	Mr.	Powell was	Senior	Vice	President	and	Chief	Financial	Officer.	He	joined	Teleflex	in	August	2011	as	Senior	Vice	President,	Global	Finance.	Prior	to	joining Teleflex,	Mr.	Powell	served	as	Chief	Financial

Officer	and	Treasurer	of	Tomotherapy	Incorporated,	a	medical	device	company,	from	June	2009	until	June	2011.	In	2008,	he	served	as	Chief	Financial Officer	of	Textura	Corporation,	a	software	provider.	From	April	2001	until	January	2008,	Mr.	Powell	was	employed	by	Midway	Games,	Inc.,	a	software provider,	serving	as	its	Executive	Vice	President,	Chief	Financial	Officer	and	Treasurer	from	September	2001	until	January	2008.	Mr.	Powell	has	also held	leadership	positions	with	Dade	Behring,	Inc.	(now	Siemens	Healthcare	Diagnostics),	PepsiCo,	Bain	&	Company,	Tenneco	Inc.	and	Arthur	Andersen &	Company.

Mr.	Kennedy	has	been	our	Senior	Vice	President,	Global	Operations	since	May	2013.	He	previously	held	the	position	of	Vice	President,	International Operations	from	December	2012	to	May	2013.	From	July	2007	to	December	2012,	he	held	the	position	of	Vice	President,	EMEA	Operations.	Prior	to joining	Teleflex,	Mr.	Kennedy	was	a	managing	director	for	Saint	Gobain	Performance	Plastics,	a	producer	of	engineered,	high-performance	polymer products,	from	September	2004	to	May	2007.	Mr.	Kennedy	also	has	held	leadership	positions	with	Bio-Medical	Research	Limited,	Marconi	Plc,	Fore Systems,	Inc.	and	American	Power	Conversion	Corporation.

Ms.	Boylan	has	been	our	Vice	President,	Global	RA/QA	since	August	2014.	She	joined	Teleflex	in	January	2013	as	Vice	President,	International RA/QA.	Prior	to	joining	Teleflex,	Ms.	Boylan	served	as	QA	Vice	President,	Corporate	Quality	Systems	for	Boston	Scientific	Corporation,	a	developer, manufacturer	and	marketer	of	medical	devices,	from	April	1996	to	December	2012.

Mr.	Hicks	has	been	our	Vice	President,	Global	Human	Resources	since	April	2013.	Prior	to	joining	Teleflex,	Mr.	Hicks	served	as	Executive	Vice President	of	Human	Resources	&	Organizational	Effectiveness	for	Harlan	Laboratories,	Inc.,	a	private	global	provider	of	pre-clinical	and	non-clinical research	services,	from	July	2010	to	March	2013.	From	April	1990	to	January	2010,	Mr.	Hicks	held	various	leadership	roles	with	MDS	Inc.,	a	provider	of products	and	services	for	the	development	of	drugs	and	the	diagnosis	and	treatment	of	disease,	including	Senior	Vice	President	of	Human	Resources	for MDS'	global	Pharma	Services	division	from	November	2000	to	January	2010.

Mr.	Leyden	has	been	our	Vice	President,	General	Counsel	and	Secretary	since	February	2014.	He	previously	held	the	positions	of	Acting	General Counsel	from	November	2013	to	February	2014,	Deputy	General	Counsel	from	February	2013	to	November	2013	and	Associate	General	Counsel	from December	2004	to	February	2013.	Prior	to	joining	Teleflex,	Mr.	Leyden	served	as	general	counsel	of	InfraSource	Services,	Inc.,	a	utility	infrastructure construction	company,	from	April	2004	to	December	2004.	From	February	2002	to	April	2004,	he	served	as	Associate	General	Counsel	of	Aramark Corporation,	a	provider	of	food,	facility	and	uniform	services.

Our	officers	are	elected	annually	by	our	board	of	directors.	Each	officer	serves	at	the	discretion	of	the	board.

# ITEM	1A.				RISK	FACTORS

In	addition	to	the	other	information	set	forth	in	this	Annual	Report	on	Form	10-K,	you	should	carefully	consider	the	following	factors	which	could	have a	material	adverse	effect	on	our	business,	 financial	condition,	results	of	operations	or	stock	price.	The	risks	below	are	not	 the	only	risks	we	 face. Additional	risks	and	uncertainties	not	currently	known	to	us	or	that	we	currently	deem	to	be	immaterial	may	also	adversely	affect	our	business,	financial condition,	results	of	operations	or	stock	price.

# We	face	strong	competition.	Our	failure	to	successfully	develop	and	market	new	products	could	adversely	affect	our	business.

The	medical	device	industry	is	highly	competitive.	We	compete	with	many	domestic	and	foreign	medical	device	companies	ranging	from	small	start- up	enterprises	that	might	sell	only	a	single	or	limited	number	of	competitive	products	or	compete	only	in	a	specific	market	segment,	to	companies	that	are larger	and	more	established	than	us,	have	a	broad	range	of	competitive	products,	participate	in	numerous	markets	and	have	access	to	significantly greater	financial	and	marketing	resources	than	we	do.

In	addition,	the	medical	device	industry	is	characterized	by	extensive	product	research	and	development	and	rapid	technological	advances.	The future	success	of	our	business	will	depend,	in	part,	on	our	ability	to	design	and	manufacture	new	competitive	products	and	enhance	existing	products. Our	product	development	efforts	may	require	us	to	make	substantial	investments.	There	can	be	no	assurance	that	we	will	be	able	to	successfully	develop new	products,	enhance	existing	products	or	achieve	market	acceptance	of	our	products,	due	to,	among	other	things,	our	inability	to:

•identify	viable	new	products;

•maintain	sufficient	liquidity	to	fund	our	investments	in	research	and	development	and	product	acquisitions;

•obtain	adequate	intellectual	property	protection;

•gain	market	acceptance	of	new	products;	or

•successfully	obtain	regulatory	approvals.

In	addition,	our	competitors	currently	may	be	developing,	or	may	develop	in	the	future,	products	that	provide	better	features,	clinical	outcomes	or economic	value	than	those	that	we	currently	offer	or	subsequently	develop.	Our	failure	to	successfully	develop	and	market	new	products	or	enhance existing	products	could	have	a	material	adverse	effect	on	our	business,	financial	condition	and	results	of	operations.

# Our	customers	depend	on	third	party	coverage	and	reimbursements,	and	the	failure	of	healthcare	programs	to	provide	sufficient	coverage and	reimbursement	for	our	medical	products	could	adversely	affect	us.

The	ability	of	our	customers	to	obtain	coverage	and	reimbursement	for	our	products	is	important	to	our	business.	Demand	for	many	of	our	existing and	new	medical	products	is,	and	will	continue	to	be,	affected	by	the	extent	to	which	government	healthcare	programs	and	private	health	insurers reimburse	our	customers	for	patients'	medical	expenses	in	the	countries	where	we	do	business.	Even	when	we	develop	or	acquire	a	promising	new product,	 demand	 for	 the	 product	 may	 be	 limited	 unless	 reimbursement	 approval	 is	 obtained	 from	 private	 and	 government	 third	 party	 payors. Internationally,	healthcare	reimbursement	systems	vary	significantly.	In	some	countries,	medical	centers	are	constrained	by	fixed	budgets,	regardless	of the	volume	and	nature	of	patient	treatment.	Other	countries	require	application	for,	and	approval	of,	government	or	third	party	reimbursement.	Without both	favorable	coverage	determinations	by,	and	the	financial	support	of,	government	and	third	party	insurers,	the	market	for	many	of	our	medical	products would	be	adversely	affected.	In	this	regard,	we	cannot	be	sure	that	third	party	payors	will	maintain	the	current	level	of	coverage	and	reimbursement	to	our customers	for	use	of	our	existing	products.	Adverse	coverage	determinations,	including	reductions	in	the	amount	of	reimbursement,	could	harm	our business	by	discouraging	customers'	selection	of	our	products	and	reducing	the	prices	they	are	willing	to	pay.

In	addition,	as	a	result	of	their	purchasing	power,	third	party	payors	are	implementing	cost	cutting	measures	such	as	seeking	discounts,	price reductions	or	other	incentives	from	medical	products	suppliers	and	imposing	limitations	on	coverage	and	reimbursement	for	medical	technologies	and procedures.	These	trends	could	compel	us	to	reduce	prices	for	our	products	and	could	cause	a	decrease	in	the	size	of	the	market	or	a	potential	increase in	competition	that	could	negatively	affect	our	business,	financial	condition	and	results	of	operations.

# We	may	not	be	successful	in	achieving	expected	operating	efficiencies	and	sustaining	or	improving	operating	expense	reductions,	and may	experience	business	disruptions	associated	with	restructuring,	facility	consolidations,	realignment,	cost	reduction	and	other	strategic initiatives.

Over	 the	 past	 several	 years	 we	 have	 implemented	 a	 number	 of	 restructuring,	 realignment	 and	 cost	 reduction	 initiatives,	 including	 facility consolidations,	organizational	realignments	and	reductions	in	our	workforce,	and	we	may	engage	in	similar	efforts	in	the	future.	While	we	have	realized some	efficiencies	from	these	initiatives,	we	may	not	realize	the	benefits	of	these	or	future	initiatives	to	the	extent	we	anticipated.	Further,	such	benefits may	be	realized	later	than	expected,	and	the	ongoing	difficulties	in	implementing	these	measures	may	be	greater	than	anticipated,	which	could	cause	us to	incur	additional	costs	or	result	in	business	disruptions.	In	addition,	if	these	measures	are	not	successful	or	sustainable,	we	may	be	compelled	to undertake	 additional	 restructuring,	 realignment	 and	 cost	 reduction	 efforts,	 which	 could	 result	 in	 significant	 additional	 charges.	 Moreover,	 if	 our restructuring,	realignment	and	cost	reduction	efforts	prove	ineffective,	our	ability	to	achieve	our	other	strategic	and	business	plan	goals	may	be	adversely affected.

In	addition,	as	part	of	our	efforts	to	increase	operating	efficiencies,	we	have	implemented	a	number	of	initiatives	over	the	past	several	years	to consolidate	 our	 enterprise	 resource	 planning,	 or	 ERP,	 systems.	To	 date,	 we	 have	 not	 experienced	 any	 significant	 disruptions	 to	 our	 business	 or operations	 in	 connection	 with	 these	 initiatives.	However,	 as	 we	 continue	 our	 efforts	 to	 further	 consolidate	 our	 ERP	 systems,	 we	 could	 experience business	disruptions,	which	could	adversely	affect	customer	relationships	and	divert	the	attention	of	management	away	from	daily	operations.	In	addition, any	delays	in	the	implementation	of	these	initiatives	could	cause	us	to	incur	additional	unexpected	costs.	Should	we	experience	such	difficulties,	our business,	cash	flows	and	results	of	operations	could	be	adversely	affected.

# A	significant	portion	of	our	United	States	revenues	is	derived	from	sales	to	distributors,	and	"destocking"	activity	by	these	distributors can	adversely	affect	our	revenues	and	results	of	operations.

A	significant	portion	of	our	revenues	in	the	United	States	is	derived	from	sales	to	distributors,	who,	in	turn,	sell	our	products	to	hospitals	and	other health	care	 institutions.	From	time	to	time,	these	distributors	may	decide	to	reduce	their	levels	of	inventory	with	regard	to	certain	of	our	products,	a practice	we	refer	to	as	"destocking."	A	distributor's	decision	to	reduce	inventory	levels	with	respect	to	our	products	may	be	based	on	a	number	of	factors, such	as	distributor	expectations	regarding	demand	 for	a	particular	product,	distributor	buying	decisions	(including	decisions	 to	purchase	competing products),	changes	in	distributor	policies	regarding	the	maintenance	of	inventory	levels,	economic	conditions	and	other	factors.	For	example,	during	the third	quarter	of	2016,	we	experienced	a	decline	 in	purchases	by	our	United	States	distributors	 that	adversely	affected	our	revenues	and	results	of operations.	We	believe	the	reduction	resulted	from	the	distributors'	expectations	of	a	less	severe	2016-2017	flu	season,	which	resulted	in	reduced	levels of	purchasing	with	respect	to	certain	of	our	products	that	are	used	for	treatment	of	hospitalized	patients	suffering	from	the	flu.	Following	such	instances	of reduced	 purchases,	 distributors	 may	 revert	 to	 previous	 purchasing	 levels;	 nevertheless,	 we	 cannot	 assure	 that	 distributors	 will,	 in	 fact,	 increase purchases	of	our	products	in	this	manner.	A	decline	in	the	level	of	product	purchases	by	our	United	States	distributors	in	the	future	could	have	a	material adverse	effect	on	our	revenues	and	results	of	operations	during	a	reporting	period,	and	an	extended	decline	in	such	product	purchases	could	have	a longer	term	material	adverse	effect.

# We	are	subject	to	extensive	government	regulation,	which	may	require	us	to	incur	significant	expenses	to	ensure	compliance.	Our	failure to	comply	with	those	regulations	could	have	a	material	adverse	effect	on	our	business,	results	of	operations,	financial	condition	and	cash flows.

Our	 products	 are	 classified	 as	 medical	 devices	 and	 are	 subject	 to	 extensive	 regulation	 in	 the	 United	 States	 by	 the	 FDA	 and	 by	 comparable government	 agencies	 in	 other	 countries.	The	 regulations	 govern,	 among	 other	 things,	 the	 development,	 design,	 approval,	 manufacturing,	 labeling, importing	and	exporting	and	sale	and	marketing	of	many	of	our	products.	Moreover,	these	regulations	are	subject	to	future	change.

In	the	United	States,	before	we	can	market	a	new	medical	device,	or	a	new	use	of,	or	claim	for,	or	significant	modification	to,	an	existing	product,	we generally	must	first	receive	either	510(k)	or	de	novo	clearance	or	approval	of	a	premarket	approval	application,	or	PMA,	from	the	FDA.	Similarly,	most major	markets	for	medical	devices	outside	the	United	States	also	require	clearance,	approval	or	compliance	with	certain	standards	before	a	product	can be	commercially	marketed.	The	process	of	obtaining	regulatory	clearances	and	approvals	to	market	a	medical	device,	particularly	from	the	FDA	and certain	foreign	government	authorities,	can	be	costly	and	time	consuming,	and	clearances	and	approvals	might	not	be	granted	for	new	products	on	a timely	basis,	if	at	all.	In	addition,	once	a	device	has	been	cleared	or	approved,	a	new	clearance	or	approval	may	be	required	before	the	device	may	be modified	or	its	labeling	changed.	Furthermore,	the	FDA	or	a	foreign	government	authority	may	make	its	review	and	clearance	or	approval	process	more rigorous,	which	could	require	us	to	generate	additional	clinical	or	other	data,	and	expend	more	time	and	effort,	in	obtaining	future	product	clearances	or approvals.	The	 regulatory	 clearance	 and	 approval	 process	 may	 result	 in,	 among	 other	 things,	 delayed	 realization	 of	 product	 revenues,	 substantial additional	costs	or	limitations	on	indicated	uses	of	products,	any	one	of	which	could	have	a	material	adverse	effect	on	our	financial	condition	and	results of	operations.	Even	after	a	product	has	received	marketing	approval	or	clearance,	such	product	approval	or	clearance	can	be	withdrawn	or	limited	due	to unforeseen	problems	with	the	device	or	issues	relating	to	its	application.

Failure	to	comply	with	applicable	regulations	could	lead	to	adverse	effects	on	our	business,	which	could	include:

•partial	suspension	or	total	shutdown	of	manufacturing;

•product	shortages;

•delays	in	product	manufacturing;

•warning	or	untitled	letters;

•fines	or	civil	penalties;

•delays	in	obtaining	new	regulatory	clearances	or	approvals;

•withdrawal	or	suspension	of	required	clearances,	approvals	or	licenses;

•product	seizures	or	recalls;

•injunctions;

•criminal	prosecution;

•advisories	or	other	field	actions;

# •operating	restrictions;	and

•prohibitions	against	exporting	of	products	to,	or	importing	products	from,	countries	outside	the	United	States.

We	could	be	required	to	expend	significant	financial	and	human	resources	to	remediate	failures	to	comply	with	applicable	regulations	and	quality assurance	guidelines.	In	addition,	civil	and	criminal	penalties,	including	exclusion	under	Medicaid	or	Medicare,	could	result	from	regulatory	violations.	Any one	or	more	of	these	events	could	have	a	material	adverse	effect	on	our	business,	financial	condition	and	results	of	operations.

Medical	 devices	 are	 cleared	 or	 approved	 for	 one	 or	 more	 specific	 intended	 uses	 and	 performance	 claims	 must	 be	 adequately	 substantiated. Promoting	a	device	for	an	off-label	use	or	making	misleading	or	unsubstantiated	claims	could	result	in	government	enforcement	action.

Furthermore,	our	facilities	are	subject	to	periodic	inspection	by	the	FDA	and	other	federal,	state	and	foreign	government	authorities,	which	require manufacturers	of	medical	devices	to	adhere	to	certain	regulations,	including	the	FDA's	Quality	System	Regulation,	which	requires	periodic	audits,	design controls,	quality	control	testing	and	documentation	procedures,	as	well	as	complaint	evaluations	and	investigation.	In	addition,	any	facilities	assembling convenience	kits	that	include	drug	components	and	are	registered	as	drug	repackaging	establishments	are	also	subject	to	current	good	manufacturing practices	requirements	for	drugs.	The	FDA	also	requires	the	reporting	of	certain	adverse	events	and	product	malfunctions	and	may	require	the	reporting of	recalls	or	other	field	safety	corrective	actions.	Issues	identified	through	such	inspections	and	reports	may	result	in	FDA	enforcement	action	through	any of	the	actions	discussed	above.	Moreover,	issues	identified	through	such	inspections	and	reports	may	require	significant	resources	to	resolve.

# We	are	subject	to	healthcare	fraud	and	abuse	laws,	regulation	and	enforcement;	our	failure	to	comply	with	those	laws	could	have	a material	adverse	effect	on	our	results	of	operations	and	financial	condition.

We	are	subject	to	healthcare	fraud	and	abuse	regulation	and	enforcement	by	the	federal	government	and	the	governments	of	those	states	and foreign	countries	in	which	we	conduct	our	business.	The	laws	that	may	affect	our	ability	to	operate	include:

•the	 federal	 healthcare	 anti-kickback	 statute,	 which,	 among	 other	 things,	 prohibits	 persons	 from	 knowingly	 and	 willfully	 offering	 or	 paying remuneration	to	induce	either	the	referral	of	an	individual	for,	or	the	purchase,	order	or	recommendation	of,	any	good	or	service	for	which	payment may	be	made	under	federal	healthcare	programs	such	as	Medicare	and	Medicaid,	or	soliciting	payment	for	such	referrals,	purchases,	orders	and recommendations;

•federal	false	claims	laws	which,	among	other	things,	prohibit	individuals	or	entities	from	knowingly	presenting,	or	causing	to	be	presented,	false	or fraudulent	claims	for	payment	from	the	federal	government,	including	Medicare,	Medicaid	or	other	third-party	payors;

•the	 federal	 Health	 Insurance	 Portability	 and	Accountability	Act	 of	 1996	 ("HIPAA"),	 which	 prohibits	 schemes to	 defraud	 any	 healthcare	 benefit program	and	false	statements	relating	to	healthcare	matters;	and

•state	 law	 equivalents	 of	 each	 of	 the	 above	 federal	 laws,	 such	 as	 anti-kickback	 and false	 claims laws	 which	 may	 apply to items	 or	 services reimbursed	by	any	third-party	payor,	including	commercial	insurers.

If	our	operations	are	found	to	be	in	violation	of	any	of	these	laws	or	any	other	government	regulations,	we	may	be	subject	to	penalties,	including	civil and	criminal	penalties,	damages,	fines,	the	curtailment	or	restructuring	of	our	operations,	the	exclusion	from	participation	in	federal	and	state	healthcare programs	and	imprisonment	of	personnel,	any	of	which	could	adversely	affect	our	ability	to	operate	our	business	and	our	financial	results.	The	risk	of	our being	found	to	have	violated	these	laws	is	increased	by	the	fact	that	many	of	them	have	not	been	fully	interpreted	by	the	regulatory	authorities	or	the courts,	and	their	provisions	are	open	to	a	variety	of	interpretations.

Further,	 the	 Patient	 Protection	 and	Affordable	 Care	Act,	 as	 amended	 by	 the	 Health	 Care	 and	 Education	 Reconciliation	Act	 (collectively,	 the "Affordable	Care	Act"),	imposed	annual	reporting	and	disclosure	requirements	on	device	manufacturers	for	any	"transfer	of	value"	made	or	distributed	to physicians	or	 teaching	hospitals.	The	reported	 information	 is	made	publicly	available	 in	a	searchable	 format.	 In	addition,	device	manufacturers	are required	to	report	and	disclose	any	investment	interests	held	by	physicians	and	their	immediate	family	members	during	the	preceding	calendar	year. Failure	to	submit	required	information	may	result	in	civil	monetary	penalties	for	each	payment,	transfer

of	value	or	ownership	or	investment	interests	not	reported	in	an	annual	submission,	up	to	an	aggregate	of	$150,000	per	year	(and	up	to	an	aggregate	of $1	million	per	year	for	"knowing	failures").

In	addition,	there	has	been	a	recent	trend	of	increased	federal	and	state	regulation	of	payments	made	to	healthcare	providers.	Some	states,	such	as California,	Connecticut,	Nevada	and	Massachusetts,	mandate	implementation	of	compliance	programs	that	include	the	tracking	and	reporting	of	gifts, compensation	for	consulting	and	other	services,	and	other	remuneration	to	healthcare	providers.	The	shifting	commercial	compliance	environment	and the	need	to	build	and	maintain	robust	and	expandable	systems	to	comply	with	the	different	compliance	and/or	reporting	requirements	among	a	number	of jurisdictions	increases	the	possibility	that	we	may	inadvertently	violate	one	or	more	of	the	requirements,	resulting	in	increased	compliance	costs	that	could adversely	impact	our	results	of	operations.

# We	may	incur	material	losses	and	costs	as	a	result	of	product	liability	and	warranty	claims,	as	well	as	product	recalls,	any	of	which	may adversely	affect	our	results	of	operations	and	financial	condition.	Furthermore,	our	reputation	as	a	medical	device	company	may	be	damaged if	one	or	more	of	our	products	are,	or	are	alleged	to	be,	defective.

Our	businesses	expose	us	to	potential	product	liability	risks	that	are	inherent	in	the	design,	manufacture	and	marketing	of	our	products.	In	particular, our	medical	device	products	are	often	used	in	surgical	and	intensive	care	settings	for	procedures	involving	seriously	ill	patients.	In	addition,	many	of	our products	are	designed	to	be	implanted	in	the	human	body	for	varying	periods	of	time.	Product	defects	or	inadequate	disclosure	of	product-related	risks with	respect	to	products	we	manufacture	or	sell	could	result	in	patient	injury	or	death.	In	addition,	in	connection	with	the	divestitures	of	our	former	non- medical	 businesses,	 we	 agreed	 to	 retain	 certain	 liabilities	 related	 to	 those	 businesses,	 which	 include,	 among	 other	 things,	 liability	 for	 products manufactured	 prior	 to	 the	 date	 on	 which	 we	 completed	 the	 sale	 of	 the	 business.	Product	 liability	 and	 warranty	 claims	 often	 involve	 very	 large	 or indeterminate	amounts,	including	punitive	damages.	The	magnitude	of	potential	losses	from	product	liability	lawsuits	may	remain	unknown	for	substantial periods	of	time,	and	the	related	legal	defense	costs	may	be	significant.	We	could	experience	material	warranty	or	product	liability	losses	in	the	future	and incur	significant	costs	to	defend	these	claims.

In	addition,	if	any	of	our	products	are,	or	are	alleged	to	be,	defective,	we	may	voluntarily	participate,	or	be	required	by	regulatory	authorities	to participate,	in	a	recall	of	that	product.	In	the	event	of	a	recall,	we	may	lose	sales	and	be	exposed	to	individual	or	class-action	litigation	claims.	Moreover, negative	publicity	regarding	a	quality	or	safety	issue,	whether	accurate	or	inaccurate,	could	harm	our	reputation,	decrease	demand	for	our	products,	lead to	product	withdrawals	or	impair	our	ability	to	successfully	launch	and	market	our	products	in	the	future.	Product	liability,	warranty	and	recall	costs	may have	a	material	adverse	effect	on	our	business,	financial	condition,	results	of	operations	and	cash	flows.

# The	ongoing	volatility	in	the	domestic	and	global	financial	markets, 	combined	with	a	continuation	of	constrained	global	credit	markets could	adversely	impact	our	results	of	operations,	financial	condition	and	liquidity.

We	are	subject	to	risks	arising	from	adverse	changes	in	general	domestic	and	global	economic	conditions.	The	economic	slowdown	and	disruption	of credit	markets	that	occurred	in	recent	years	led	to	recessionary	conditions	and	depressed	levels	of	consumer	and	commercial	spending,	resulting	in reductions,	delays	or	cancellations	of	purchases	of	our	products	and	services.	Despite	some	improvements	in	recent	years,	economic	conditions	continue to	cause	disruption	in	some	financial	markets,	resulting	in,	among	other	things,	diminished	liquidity	and	credit	availability.	We	cannot	predict	the	duration or	extent	of	any	economic	recovery	or	the	extent	to	which	our	customers	will	return	to	more	typical	spending	behaviors.	The	continuation	of	the	present broadly	applicable	economic	trends	of	weak	economic	growth,	constricted	credit,	public	sector	austerity	measures	in	response	to	public	budget	deficits and	foreign	currency	volatility,	particularly	with	respect	to	the	euro,	could	have	a	material	adverse	effect	on	our	results	of	operations,	financial	condition and	liquidity.

Additionally,	our	customers,	particularly	in	Italy,	Spain,	Portugal	and	Greece,	have	extended	or	delayed	payments	for	products	and	services	already provided,	 which	 has	 increased	 our	 focus	 on	 collectability	 with	 respect	 to	 our	 accounts	 receivable	 from	 these	 customers.	 To	 date,	 we	 have	 not experienced	an	inordinate	amount	of	payment	defaults	by	our	customers,	and	we	have	sufficient	lending	commitments	in	place	to	enable	us	to	fund	our foreseeable	additional	operating	needs.	However,	the	ongoing	uncertainty	in	the	European	financial	markets,	combined	with	a	continuation	of	constrained European	credit	markets	creates	a	risk	that	some	of	our	European	customers	and	suppliers	may	be	unable	to	access	liquidity.	As	of	December	31,	2017 and	2016,	our	aggregate	net	current	and	long	term	trade	accounts	receivable	in	Italy,	Spain,	Portugal	and	Greece	were	 $49.1	million	and	$51.1	million, respectively.	In	2017,	2016	and

2015,	net	revenues	from	these	countries	were	approximately	 6%,	 7%	 and	7%	of	total	net	revenues,	respectively,	and	average	days	that	accounts receivable	from	these	countries	were	outstanding	were	154,	182	and	204	days,	respectively.	Although	we	maintain	allowances	for	doubtful	accounts	to cover	the	estimated	losses	which	may	occur	when	customers	cannot	make	their	required	payments,	we	cannot	assure	that	the	loss	rate	will	not	increase in	the	future	given	the	volatility	in	the	worldwide	economy.	If	our	allowance	for	doubtful	accounts	is	insufficient	to	address	receivables	we	ultimately determine	are	uncollectible,	we	would	be	required	to	incur	additional	charges,	which	could	materially	adversely	affect	our	results	of	operations.	Moreover, our	inability	to	collect	outstanding	receivables	could	adversely	affect	our	financial	condition	and	cash	flow	from	operations.

In	 addition,	 adverse	 economic	 and	 financial	 market	 conditions	 may	 result	 in	 future	 impairment	 charges	 with	 respect	 to	 our	 goodwill	 and	 other intangible	assets,	which	would	not	directly	affect	our	liquidity	but	could	have	a	material	adverse	effect	on	our	reported	financial	results.

# Our	strategic	initiatives,	including	acquisitions,	may	not	produce	the	intended	growth	in	revenue	and	operating	income	and	may	have material	impacts	on	our	operating	results.

Our	strategic	initiatives	include	making	significant	investments	designed	to	achieve	revenue	growth	and	to	enable	us	to	meet	or	exceed	margin improvement	targets.	If	we	do	not	achieve	the	expected	benefits	from	these	investments	or	otherwise	fail	to	execute	on	our	strategic	initiatives,	we	may not	achieve	the	growth	improvement	we	are	targeting	and	our	results	of	operations	may	be	adversely	affected.

In	addition,	as	part	of	our	strategy	for	growth,	we	have	made,	and	may	continue	to	make,	acquisitions	and	divestitures	and	enter	into	strategic alliances	such	as	joint	ventures	and	joint	development	agreements.	However,	we	may	not	be	able	to	identify	suitable	acquisition	candidates,	complete acquisitions	or	integrate	acquisitions	successfully,	and	our	joint	ventures	or	strategic	alliances	may	not	prove	to	be	successful.	In	this	regard,	acquisitions involve	 numerous	 risks,	 including	 difficulties	 in	 the	 integration	 of	 acquired	 operations,	 technologies,	 services	 and	 products	 and	 the	 diversion	 of management's	attention	from	other	business	concerns.	Moreover,	the	products	and	technologies	that	we	acquire	may	not	be	successful	or	may	require	us to	devote	significantly	greater	development,	marketing	and	other	resources,	as	well	as	significantly	greater	investments,	than	we	anticipated.	We	could also	experience	negative	effects	on	our	results	of	operations	and	financial	condition	from	acquisition-related	charges,	amortization	of	intangible	assets, asset	impairment	charges	and	other	matters	that	could	arise	in	connection	with	the	acquisition	of	a	company	or	business,	including	matters	related	to internal	control	over	financial	reporting	and	regulatory	compliance,	as	well	as	the	short-term	effects	of	increased	costs	on	results	of	operations.		Although our	management	will	endeavor	to	evaluate	the	risks	inherent	in	any	particular	transaction,	there	can	be	no	assurance	that	we	will	identify	all	such	risks	or the	magnitude	of	the	risks.	In	addition,	prior	acquisitions	have	resulted,	and	future	acquisitions	could	result,	in	the	incurrence	of	substantial	additional indebtedness	and	expenditures.	Future	acquisitions	may	also	result	in	potentially	dilutive	issuances	of	equity	securities.	There	can	be	no	assurance	that difficulties	 encountered	 in	 connection	 with	 acquisitions	 will	 not	 have	 a	 material	 adverse	 effect	 on	 our	 business,	 financial	 condition	 and	 results	 of operations.

In	connection	with	certain	of	our	completed	acquisitions,	we	have	agreed	to	pay	consideration	that	is	contingent	upon	the	achievement	of	specified objectives,	such	as	receipt	of	regulatory	approval,	commercialization	of	a	product	or	achievement	of	sales	targets.	As	of	the	acquisition	date,	we	record	a contingent	liability	representing	the	estimated	fair	value	of	the	contingent	consideration	we	expect	to	pay.	As	of	December	31,	2017,	we	accrued	$272.1 million	of	contingent	consideration,	of	which,	the	vast	majority	related	to	our	acquisition	of	NeoTract.	On	a	quarterly	basis,	we	revalue	these	obligations and	record	increases	or	decreases	in	their	fair	value	as	an	adjustment	to	operating	earnings,	which	could	have	a	material	impact	on	our	results	of operations.	In	addition,	actual	payments	may	differ	materially	from	the	amount	of	the	contingent	liability	we	have	recorded,	which	could	have	a	material impact	on	our	cash	flows	and	liquidity.	For	information	regarding	assumptions	related	to	our	contingent	consideration	liabilities,	see	"Critical	Accounting Policies	and	Estimates"	under	Item	7,	Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations	included	in	this	Annual Report	on	Form	10-K.	For	additional	information	regarding	our	acquisitions,	see	Note	10	to	the	consolidated	financial	statements	included	in	this	Annual Report	on	Form	10-K.

# Health	care	reform	may	have	a	material	adverse	effect	on	our	industry	and	our	business.

Political,	 economic	 and	 regulatory	 developments	 have	 effected	 fundamental	 changes	 in	 the	 healthcare	 industry.	 The	 Affordable	 Care	 Act substantially	changed	the	way	health	care	is	financed	by	both	government	and	private	insurers.	It	also	encourages	improvements	in	the	quality	of	health care	products	and	services	and	significantly	impacts	the	United	States	pharmaceutical	and	medical	device	industries.	Among	other	things,	the	Affordable Care	Act:

•established	a	2.3%	excise	tax	on	sales	of	medical	devices	with	respect	to	any	entity	that	manufactures	or	imports	specified	medical	devices	offered for	sale	in	the	United	States,	although	this	tax	was	suspended	for	2016	and	2017	as	a	result	of	the	enactment	of	the	Consolidated	Appropriations	Act of	2016	and	has	been	further	suspended	for	2018	and	2019	as	a	result	of	the	enactment	of	the	Consolidated	Appropriations	Act	of	2018;

•established	a	new	Patient-Centered	Outcomes	Research	Institute	to	oversee,	identify	priorities	in	and	conduct	comparative	clinical	effectiveness research;

•implemented	payment	system	reforms,	including	a	national	pilot	program	to	encourage	hospitals,	physicians	and	other	providers	to	improve	the coordination,	quality	and	efficiency	of	certain	health	care	services	through	bundled	payment	models;	and

•created	an	independent	payment	advisory	board	that	will	submit	recommendations	to	reduce	Medicare	spending	if	projected	Medicare	spending exceeds	a	specified	growth	rate.

In	2015,	we	recorded	an	expense	of	$10.2	million	with	respect	to	the	medical	device	excise	tax.	While,	as	noted	above,	the	excise	tax	has	been suspended	through	2019,we	will	again	be	subject	to	the	excise	tax	in	2020	unless	the	suspension	is	extended	further.	We	cannot	predict	at	this	time	the full	impact	of	the	Affordable	Care	Act	or	other	healthcare	reform	measures	that	may	be	adopted	in	the	future	on	our	financial	condition,	results	of operations	and	cash	flows.	In	this	regard,	several	legislative	initiatives	to	repeal	and	replace	the	Affordable	Care	Act	were	proposed,	but	not	adopted	in 2017.	However,	the	recently	adopted	Tax	Cuts	and	Jobs	Act	eliminated	the	individual	mandate	under	the	Affordable	Care	Act,	which	has	resulted	in increased	uncertainty	regarding	insurance	premium	prices	for	participants	in	insurance	exchanges	under	the	act,	and	may	have	other	effects.	The	longer- term	viability	of,	or	the	nature	of	any	modification	of,	or	legislative	substitution	for,	the	Affordable	Care	Act	is	highly	uncertain,	and	we	cannot	predict	the effect	that	any	of	these	events	would	have	on	our	financial	condition,	results	of	operations	or	cash	flows.

# We	are	subject	to	risks	associated	with	our	non-United	States	operations.

We	have	significant	manufacturing	and	distribution	facilities,	research	and	development	facilities,	sales	personnel	and	customer	support	operations	in a	number	of	countries	outside	the	United	States,	including	Belgium,	the	Czech	Republic,	Germany,	Ireland,	Malaysia	and	Mexico.	In	addition,	a	significant portion	of	our	non-United	States	revenues	are	derived	from	sales	to	third	party	distributors.	As	of	December	31,	2017,	75%	of	our	full-time	and	temporary employees	were	employed	in	countries	outside	of	the	United	States,	and	approximately	45%	of	our	net	property,	plant	and	equipment	was	located	outside the	United	States.	In	addition,	for	the	years	ended	December	31,	2017,	2016	 and	2015	 approximately	42%,	 46%	 and	47%,	respectively,	of	our	net revenues	(based	on	the	Teleflex	entity	generating	the	sale)	were	derived	from	operations	outside	the	United	States.

Our	international	operations	are	subject	to	risks	inherent	in	doing	business	outside	the	United	States,	including:

•exchange	controls,	currency	restrictions	and	fluctuations	in	currency	values;

•trade	protection	measures;

•potentially	costly	and	burdensome	import	or	export	requirements;

•laws	and	business	practices	that	favor	local	companies;

•changes	in	foreign	medical	reimbursement	policies	and	procedures;

•subsidies	or	increased	access	to	capital	for	firms	that	currently	are	or	may	emerge	as	competitors	in	countries	in	which	we	have	operations;

•substantial	foreign	tax	liabilities,	including	potentially	negative	consequences	resulting	from	changes	in	tax	laws;

•restrictions	and	taxes	related	to	the	repatriation	of	foreign	earnings;

•differing	labor	regulations;

•additional	United	States	and	foreign	government	controls	or	regulations;

•difficulties	in	the	protection	of	intellectual	property;	and

•unsettled	political	and	economic	conditions	and	possible	terrorist	attacks	against	American	interests.

In	addition,	the	United	States	Foreign	Corrupt	Practices	Act	(the	"FCPA")	and	similar	worldwide	anti-bribery	laws	in	non-United	States	jurisdictions generally	prohibit	companies	and	their	intermediaries	from	making	improper

payments	 to	 non-United	 States	 officials	 for	 the	 purpose	 of	 obtaining	 or	 retaining	 business.	 The	 FCPA	 also	 imposes	 accounting	 standards	 and requirements	on	publicly	traded	United	States	corporations	and	their	foreign	affiliates,	which,	among	other	things,	are	intended	to	prevent	the	diversion	of corporate	funds	to	the	payment	of	bribes	and	other	improper	payments	to	government	officials,	and	to	prevent	the	establishment	of	"off	the	books"	slush funds	from	which	such	improper	payments	can	be	made.	Because	of	the	predominance	of	government-sponsored	health	care	systems	around	the	world, many	of	our	customer	relationships	outside	of	the	United	States	are	with	government	entities	and	are	therefore	subject	to	such	anti-bribery	laws.	Our policies	mandate	compliance	with	these	anti-bribery	laws.	However,	we	operate	in	many	parts	of	the	world	that	have	experienced	government	corruption to	some	degree.		Despite	meaningful	measures	that	we	undertake	to	facilitate	lawful	conduct,	which	include	training	and	compliance	programs	and internal	control	policies	and	procedures,	we	may	not	always	prevent	reckless	or	criminal	acts	by	our	employees,	distributors	or	other	agents.	In	addition, we	 may	 be	 exposed	 to	 liability	 due	 to	 pre-acquisition	 conduct	 of	 employees,	 distributors	 or	 other	 agents	 of	 businesses	 or	 operations	 we	 acquire. Violations	of	anti-bribery	laws,	or	allegations	of	such	violations,	could	disrupt	our	operations,	involve	significant	management	distraction	and	have	a material	adverse	effect	on	our	business,	financial	condition,	results	of	operations	and	cash	flows.	We	also	could	be	subject	to	severe	penalties	and	other adverse	consequences,	including	criminal	and	civil	penalties,	disgorgement,	substantial	expenditures	related	to	further	enhancements	to	our	procedures, policies	and	controls,	personnel	changes	and	other	remedial	actions,	as	well	as	harm	to	our	reputation.

Furthermore,	 we	 are	 subject	 to	 the	 export	 controls	 and	 economic	 embargo	 rules	 and	 regulations	 of	 the	 United	 States,	 including	 the	 Export Administration	Regulations	and	trade	sanctions	against	embargoed	countries,	which	are	administered	by	the	Office	of	Foreign	Assets	Control	within	the Department	of	the	Treasury,	as	well	as	other	laws	and	regulations	administered	by	the	Department	of	Commerce.	These	regulations	limit	our	ability	to market,	sell,	distribute	or	otherwise	transfer	our	products	or	technology	to	prohibited	countries	or	persons.	While	we	train	our	employees	and	contractually obligate	our	distributors	to	comply	with	these	regulations,	we	cannot	assure	that	a	violation	will	not	occur,	whether	knowingly	or	inadvertently.	Failure	to comply	 with	 these	 rules	 and	 regulations	 may	 result	 in	 substantial	 civil	 and	 criminal	 penalties,	 including	 fines	 and	 the	 disgorgement	 of	 profits,	 the imposition	of	a	court-appointed	monitor,	the	denial	of	export	privileges	and	debarment	from	participation	in	United	States	government	contracts,	any	of which	could	have	a	material	adverse	effect	on	our	international	operations	or	on	our	business,	results	of	operations,	financial	condition	and	cash	flows.

# Foreign	currency	exchange	rate,	commodity	price	and	interest	rate	fluctuations	may	adversely	affect	our	results.

We	are	exposed	to	a	variety	of	market	risks,	including	the	effects	of	changes	in	foreign	currency	exchange	rates,	commodity	prices	and	interest	rates. Products	manufactured	in,	and	sold	into,	foreign	markets	represent	a	significant	portion	of	our	operations.	Our	consolidated	financial	statements	reflect translation	of	financial	statements	denominated	in	non-United	States	currencies	to	United	States	dollars,	our	reporting	currency,	as	well	as	the	foreign currency	exchange	gains	and	losses	resulting	from	the	remeasurement	of	assets	and	liabilities	and	from	transactions	denominated	in	currencies	other than	the	primary	currency	of	the	country	in	which	the	entity	operates,	which	we	refer	to	as	"non-functional	currencies."	A	strengthening	or	weakening	of the	United	States	dollar	in	relation	to	the	foreign	currencies	of	the	countries	in	which	we	sell	or	manufacture	our	products,	such	as	the	euro,	will	affect	our United	States	dollar-reported	revenue	and	income.	Although	we	have	entered	into	forward	contracts	with	several	major	financial	institutions	to	hedge	a portion	of	our	monetary	assets	and	liabilities	and	projected	cash	flows	denominated	in	non-functional	currencies	in	order	to	reduce	the	effects	of	currency rate	fluctuations,	changes	in	the	relative	values	of	currencies	may,	in	some	instances,	have	a	significant	effect	on	our	results	of	operations.

Many	of	our	products	have	significant	plastic	resin	content.	We	also	use	quantities	of	other	commodities,	such	as	aluminum	and	steel.	Increases	in the	prices	of	these	commodities	could	increase	the	costs	of	our	products	and	services.	We	may	not	be	able	to	pass	on	these	costs	to	our	customers, particularly	with	respect	to	those	products	we	sell	under	group	purchase	agreements,	which	could	have	a	material	adverse	effect	on	our	results	of operations	and	cash	flows.

Increases	in	interest	rates	may	adversely	affect	the	financial	health	of	our	customers	and	suppliers,	thereby	adversely	affecting	their	ability	to	buy	our products	and	supply	the	components	or	raw	materials	we	need.	In	addition,	our	borrowing	costs	could	be	adversely	affected	if	interest	rates	increase.	Any of	these	events	could	have	a	material	adverse	effect	on	our	financial	condition,	results	of	operations	and	cash	flows.

# Fluctuations	in	our	effective	tax	rate	and	changes	to	tax	laws	may	adversely	affect	us.

As	a	global	company,	we	are	subject	to	taxation	in	numerous	countries,	states	and	other	jurisdictions.	Our	effective	tax	rate	is	derived	from	a combination	of	applicable	tax	rates	in	the	various	countries,	states	and	other	jurisdictions	in	which	we	operate.	In	preparing	our	financial	statements,	we estimate	the	amount	of	tax	that	will	become	payable	in	each	of	these	jurisdictions.	Our	effective	tax	rate	may,	however,	differ	from	the	estimated	amount due	to	numerous	factors,	including	a	change	in	the	mix	of	our	profitability	from	country	to	country	and	changes	in	tax	laws	(including	the	impact	of	recently enacted	United	States	tax	legislation	as	discussed	immediately	below).	Any	of	these	factors	could	cause	us	to	experience	an	effective	tax	rate	significantly different	 from	previous	periods	or	our	current	expectations,	which	could	have	an	adverse	effect	on	our	business,	 financial	condition	and	results	of operations	and	cash	flows.

The	Tax	Cuts	and	Jobs	Act	(the	"TCJA")	was	enacted	on	December	22,	2017.	The	TCJA	permanently	reduces	the	United	States	corporate	income tax	rate	from	a	maximum	of	35%	to	21%;	puts	into	effect	a	territorial	tax	system,	generally	providing	for,	among	other	things,	a	dividends	received deduction	on	the	foreign	source	portion	of	dividends	received	from	a	foreign	corporation	if	specified	conditions	are	met;	imposes	a	one-time	repatriation tax	on	undistributed	post-1986	earnings	and	profits	of	foreign	subsidiaries,	which	are	deemed	repatriated	for	purposes	of	the	tax;	and	creates,	modifies	or repeals	many	other	statutory	and	regulatory	provisions.	Our	consolidated	financial	statements	as	of,	and	for	the	year	ended	December	31,	2017,	include provisional	amounts	with	respect	to	the	deemed	repatriated	earnings	and	the	revaluation	of	deferred	tax	assets	and	liabilities.	While	we	believe	that	the provisional	amounts	constitute	reasonable	estimates,	we	continue	to	examine	the	impact	the	TCJA	may	have	on	our	business.	Once	our	accounting	for the	income	tax	effects	of	the	TCJA	is	complete,	the	amounts	with	respect	to	the	income	tax	effects	of	the	TCJA	may	differ	from	the	provisional	amounts, possibly	materially,	due	to,	among	other	things,	additional	analysis,	changes	in	interpretations	and	assumptions	we	have	made,	additional	regulatory guidance	that	may	be	issued,	and	actions	we	may	take	as	a	result	of	the	TCJA.

# An	interruption	in	our	manufacturing	or	distribution	operations	or	our	supply	of	raw	materials	may	adversely	affect	our	business.

Many	of	our	key	products	are	manufactured	at	or	distributed	from	single	locations,	and	the	availability	of	alternate	facilities	is	limited.	If	operations	at one	or	more	of	our	facilities	is	suspended	due	to	natural	disasters	or	other	events,	we	may	not	be	able	to	timely	manufacture	or	distribute	one	or	more	of our	products	at	previous	levels	or	at	all.	Furthermore,	our	ability	to	establish	replacement	facilities	or	to	substitute	suppliers	may	be	delayed	due	to regulations	and	requirements	of	the	FDA	and	other	regulatory	authorities	regarding	the	manufacture	of	our	products.	In	addition,	in	the	event	of	delays	or cancellations	in	shipments	of	raw	materials	by	our	suppliers,	we	may	not	be	able	to	timely	manufacture	or	supply	the	affected	products	at	previous	levels or	at	all.	The	manufacture	of	our	products	is	highly	exacting	and	complex,	due	in	part	to	strict	regulatory	requirements.	Problems	in	the	manufacturing process,	including	equipment	malfunction,	failure	to	follow	specific	protocols	and	procedures,	defective	raw	materials	and	environmental	factors,	could lead	 to	 launch	 delays,	 product	 shortages,	 unanticipated	 costs,	 lost	 revenues	 and	 damage	 to	 our	 reputation.	 A	 failure	 to	 identify	 and	 address manufacturing	problems	prior	to	the	release	of	products	to	our	customers	may	also	result	in	quality	or	safety	issues.		A	reduction	or	interruption	in manufacturing	or	distribution,	or	our	inability	to	secure	suitable	alternative	sources	of	raw	materials	or	components,	could	have	a	material	adverse	effect on	our	business,	results	of	operations,	financial	condition	and	cash	flows.

# Our	ability	to	attract,	train,	develop	and	retain	key	employees	is	important	to	our	success.

Our	success	depends,	in	part,	on	our	ability	to	continue	to	retain	our	key	personnel,	including	our	executive	officers	and	other	members	of	our	senior management	team.	Our	success	also	depends,	in	part,	on	our	ability	to	attract,	train,	develop	and	retain	other	key	employees,	including	research	and development,	sales,	marketing	and	operations	personnel.	We	may	experience	difficulties	in	retaining	executives	and	other	employees	due	to	many factors,	including:

•the	intense	competition	for	skilled	personnel	in	our	industry;

•fluctuations	in	global	economic	and	industry	conditions;

•changes	in	our	organizational	structure;

•our	restructuring	initiatives;

•competitors'	hiring	practices;	and

•the	effectiveness	of	our	compensation	programs.

Our	 inability	 to	attract, train,	develop	and	retain	such	personnel	could	have	an	adverse	effect	on	our	business,	results	of	operations, financial condition	and	cash	flows.

# We	depend	upon	relationships	with	physicians	and	other	health	care	professionals.

We	depend	on	our	ability	to	maintain	strong	working	relationships	with	physicians	and	other	healthcare	professionals	in	connection	with	research	and development	for	some	of	our	products.	We	rely	on	these	professionals	to	provide	us	with	considerable	knowledge	and	advice	regarding	the	development and	use	of	these	products.	Physicians	assist	us	as	researchers,	product	consultants,	inventors	and	public	speakers.	If	we	fail	to	maintain	our	working relationships	with	physicians	and,	as	a	result,	no	longer	have	the	benefit	of	their	knowledge	and	advice,	our	products	may	not	be	developed	in	a	manner that	is	responsive	to	the	needs	and	expectations	of	the	professionals	who	use	and	support	our	products,	which	could	have	a	material	adverse	effect	on our	business,	financial	condition,	results	of	operations	and	cash	flows.

# Our	technology is important	to	our	success,	and	our	failure	to	protect	our intellectual	property	rights	could	put	us	at	a	competitive disadvantage.

We	rely	on	the	patent,	trademark,	copyright	and	trade	secret	laws	of	the	United	States	and	other	countries	to	protect	our	proprietary	rights.	Although we	own	numerous	United	States	and	foreign	patents	and	have	submitted	numerous	patent	applications,	we	cannot	be	assured	that	any	pending	patent applications	will	issue,	or	that	any	patents,	issued	or	pending,	will	provide	us	with	any	competitive	advantage	or	will	not	be	challenged,	invalidated	or circumvented	by	third	parties.	In	addition,	we	rely	on	confidentiality	and	non-disclosure	agreements	with	employees	and	take	other	measures	to	protect our	know-how	and	trade	secrets.	The	steps	we	have	taken	may	not	prevent	unauthorized	use	of	our	technology	by	competitors	or	other	persons	who	may copy	or	otherwise	obtain	and	use	these	products	or	technology,	particularly	in	foreign	countries	where	the	laws	may	not	protect	our	proprietary	rights	to the	same	extent	as	in	the	United	States.	We	cannot	assure	that	current	and	 former	employees,	contractors	and	other	parties	will	not	breach	 their confidentiality	agreements	with	us,	misappropriate	proprietary	information,	copy	or	otherwise	obtain	and	use	our	information	and	proprietary	technology without	authorization	or	otherwise	infringe	on	our	intellectual	property	rights.	Our	inability	to	protect	our	proprietary	technology	could	adversely	affect	our business,	financial	condition,	results	of	operations	and	cash	flows.	Moreover,	there	can	be	no	assurance	that	others	will	not	independently	develop	know- how	and	trade	secrets	comparable	to	ours	or	develop	better	technology	than	our	own,	which	could	reduce	or	eliminate	any	competitive	advantage	we have	developed.

# Our	products	or	processes	may	infringe	the	intellectual	property	rights	of	others,	which	may	cause	us	to	pay	unexpected	litigation	costs or	damages	or	prevent	us	from	selling	our	products.

We	cannot	be	certain	that	our	products	do	not	and	will	not	infringe	issued	patents	or	other	intellectual	property	rights	of	third	parties.	We	may	be subject	to	legal	proceedings	and	claims	in	the	ordinary	course	of	our	business,	including	claims	of	alleged	infringement	of	the	intellectual	property	rights	of third	parties.	Any	such	claims,	whether	or	not	meritorious,	could	result	in	litigation	and	divert	the	efforts	of	our	personnel.	If	we	are	found	liable	for infringement,	we	may	be	compelled	to	enter	into	licensing	agreements	(which	may	not	be	available	on	acceptable	terms	or	at	all)	or	to	pay	damages	or cease	making	or	selling	certain	products.	We	may	need	to	redesign	some	of	our	products	or	processes	to	avoid	future	infringement	liability.	Any	of	the foregoing	events	could	be	detrimental	to	our	business.

# Other	pending	and	future	litigation	may	involve	significant	costs	and	adversely	affect	our	business.

We	are	party	to	various	lawsuits	and	claims	arising	in	the	normal	course	of	business	involving,	among	other	things,	contracts,	intellectual	property, import	and	export	regulations,	employment	and	environmental	matters.	The	defense	of	these	lawsuits	may	divert	our	management's	attention,	and	we may	incur	significant	expenses	in	defending	these	lawsuits.	In	addition,	we	may	be	required	to	pay	damage	awards	or	settlements,	or	become	subject	to injunctions	or	other	equitable	remedies,	that	could	have	a	material	adverse	effect	on	our	financial	condition	and	results	of	operations.	While	we	do	not believe	that	any	litigation	in	which	we	are	currently	engaged	would	have	such	an	adverse	effect,	the	outcome	of	litigation,	including	regulatory	matters,	is often	difficult	to	predict,	and	we	cannot	assure	that	the	outcome	of	pending	or	future	litigation	will	not	have	a	material	adverse	effect	on	our	business, financial	condition,	results	of	operations	or	cash	flows.

# Our	substantial	indebtedness	could	adversely	affect	our	business,	financial	condition	or	results	of	operations.

As	of	December	31,	2017,	we	had	total	consolidated	indebtedness	of	 2.3	billion.

Our	substantial	level	of	indebtedness	increases	the	risk	that	we	may	be	unable	to	generate	cash	sufficient	to	satisfy	our	debt	obligations.	It	could	also have	significant	effects	on	our	business.	For	example,	it	could:

•increase	our	vulnerability	to	general	adverse	economic	and	industry	conditions;

•require	us	to	dedicate	a	substantial	portion	of	our	cash	flow	from	operations	to	payments	on	our	indebtedness,	thereby	reducing	the	availability	of	our cash	flow	to	fund	working	capital,	capital	expenditures,	research	and	development	efforts	and	other	general	corporate	purposes;

•limit	our	ability	to	borrow	additional	funds	for	such	general	corporate	purposes;

•limit	our	flexibility	in	planning	for,	or	reacting	to,	changes	in	our	business	and	the	industry	in	which	we	operate;

•restrict	us	from	pursuing	business	opportunities;	and

•place	us	at	a	competitive	disadvantage	compared	to	our	competitors	that	have	less	indebtedness.

If	 we	 do	 not	 generate	 sufficient	 cash	 flow	 from	 operations	 or	 if	 future	 borrowings	 are	 not	 available to	 us in	 an	 amount	 sufficient to	 pay	 our indebtedness	when	due	or	to	fund	our	other	liquidity	needs,	we	may	be	forced	to:

•refinance	all	or	a	portion	of	our	indebtedness;

•sell	assets;

•reduce	or	delay	capital	expenditures;	or

•seek	to	raise	additional	capital.

We	may	not	be	able	to	effect	any	of	these	actions	on	commercially	reasonable	terms	or	at	all.	Our	ability	to	refinance	our	indebtedness	will	depend	on our	 financial	 condition	 at	 the	 time,	 the	 restrictions	 in	 the	 instruments	 governing	 our	 outstanding	 indebtedness	 and	 other	 factors,	 including	 market conditions.

Our	inability	to	generate	sufficient	cash	flow	to	satisfy	our	debt	service	obligations,	or	to	refinance	or	restructure	our	obligations	on	commercially reasonable	terms	or	at	all,	could	have	a	material	adverse	effect	on	our	business,	financial	condition	and	results	of	operations.

# Our	debt	agreements	impose	restrictions	on	our	business,	which	could	prevent	us	from	capitalizing	on	business	opportunities	and	taking some	corporate	actions	and	may	adversely	affect	our	ability	to	respond	to	changes	in	our	business	and	manage	our	operations.

Our	senior	credit	agreement	and	the	indentures	governing	our	5.25%	senior	notes	due	2024	(the	"2024	Notes"),	our	4.875%	senior	notes	due	2026 (the	"2026	Notes")	and	our	4.625%	senior	notes	due	2027	(the	"2027	Notes"	and,	together	with	the	2024	Notes,	the	"Senior	Notes")	contain	covenants that,	among	other	things,	impose	significant	restrictions	on	our	business.	The	restrictions	that	these	covenants	place	on	us	and	our	restricted	subsidiaries include	limitations	on	our	and	their	ability	to,	among	other	things:

•incur	additional	indebtedness	or	issue	preferred	stock	or	otherwise	disqualified	stock;

•create	liens;

•pay	dividends,	make	investments	or	make	other	restricted	payments;

•use	the	proceeds	of	permitted	sales	of	our	assets;

•merge,	consolidate,	sell	or	otherwise	dispose	of	all	or	substantially	all	of	our	assets;	and

•enter	into	transactions	with	our	affiliates.

In	addition,	our	senior	credit	agreement	also	contains	financial	covenants,	including	covenants	requiring	maintenance	of	a	consolidated	leverage ratio,	a	secured	leverage	ratio	and	a	consolidated	interest	coverage	ratio,	calculated	in	accordance	with	the	terms	of	the	senior	credit	agreement.	A breach	of	any	covenants	under	any	one	or

more	of	our	debt	agreements	could	result	in	a	default,	which	if	not	cured	or	waived,	could	result	in	the	acceleration	of	all	of	our	debt.	In	addition,	any	debt agreements	we	enter	into	in	the	future	may	further	limit	our	ability	to	enter	into	certain	types	of	transactions.

# The	warrant	transactions	entered	into	in	connection	with	the	issuance	of	our	Convertible	Notes	may	adversely	affect	the	value	of	our common	stock.

In	connection	with	the	issuance	of	our	3.875%	convertible	senior	subordinated	notes	due	2017	(the	"Convertible	Notes"),	we	entered	into	privately negotiated	hedge	transactions	with	two	counterparties,	which	we	refer	to	as	the	"hedge	counterparties."	The	hedge	transactions	involved	the	issuance	to us	of	call	options	that	covered	the	number	of	shares	of	our	common	stock	underlying	the	Convertible	Notes.	The	call	options	were	designed	to	reduce	the dilution	with	respect	to	our	common	stock	we	were	required	to	issue	and/or	cash	payments	we	were	required	to	make	upon	conversion	of	the	Convertible Notes.	Separately,	we	also	entered	into	privately	negotiated	warrant	transactions	with	the	hedge	counterparties	under	which	we	have	issued	shares	of our	common	stock,	and	very	likely	will	be	obligated	to	issue	additional	shares	of	our	common	stock	on	various	warrant	expiration	dates	that	occur	through August	31,	2018,	at	an	exercise	price	of	$74.65,	subject	to	customary	anti-dilution	adjustments.	When	Convertible	Notes	were	converted	in	accordance with	their	terms,	the	hedge	transactions	were	effected	through	our	exercise	of	call	options;	when	we	purchased	Convertible	Notes	from	the	holders	in exchange	for	cash	and	our	common	stock,	the	call	options	with	respect	to	shares	underlying	those	Convertible	Notes	were	canceled,	and	the	number	of outstanding	warrants	was	reduced.	Following	the	maturity	of	the	Convertible	Notes	on	August	1,	2017,	no	further	call	options	were	outstanding,	and warrants	to	purchase	724,648	shares	of	our	common	stock	remained	outstanding.	Subsequent	warrant	exercises	have	had,	and	based	on	recent	market prices	of	our	common	stock,	will	continue	to	have,	a	dilutive	effect	with	respect	to	our	common	stock.	Between	November	1,	2017	and	December	31, 2017,	warrants	to	purchase	165,034	shares	were	exercised	and,	after	retaining	43,251	shares	to	cover	payment	of	the	exercise	price	and	paying	cash	in lieu	of	fractional	shares,	we	delivered	105,638	shares	to	the	hedge	counterparties.	As	of	December	31,	2017,	warrants	to	purchase	559,614	shares	of	our common	stock	remained	outstanding.	If	we	so	elect,	in	lieu	of	delivering	our	common	stock	upon	exercise	of	the	warrants,	we	may	make	cash	payments to	the	extent	that	the	market	price	per	share	of	our	common	stock	exceeds	the	exercise	price	of	the	warrants	on	any	expiration	date	of	the	warrants.	In addition,	under	applicable	accounting	guidance,	changes	in	the	share	price	of	our	common	stock	can	have	a	significant	impact	on	the	number	of	shares that	we	must	include	in	the	fully	diluted	earnings	per	share	calculation	with	respect	to	the	warrants,	which,	in	turn,	could	impact	our	reported	financial results.	Based	on	the	average	market	price	of	our	common	stock	during	2017,	0.5	million	shares	issuable	upon	exercise	of	the	warrants	were	included	in the	total	diluted	shares	outstanding	for	the	year	ended	December	31,	2017.	For	additional	information,	see	"Financing	Arrangements"	under	Item	7, Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations	included	in	this	Annual	Report	on	Form	10-K.

In	connection	with	establishing	their	positions	under	the	convertible	note	hedge	transactions	and	the	warrant	transactions,	the	hedge	counterparties (and/or	their	affiliates)	entered	into	various	cash-settled	over-the-counter	derivative	transactions	with	respect	to	our	common	stock	concurrently	with,	or shortly	following,	the	pricing	of	the	Convertible	Notes.	The	hedge	counterparties	(and/or	their	affiliates)	may,	in	their	sole	discretion,	with	or	without	notice, modify	their	hedge	positions	from	time	to	time	by	entering	into	or	unwinding	various	over-the-counter	derivative	transactions	with	respect	to	shares	of	our common	stock,	and/or	by	purchasing	or	selling	shares	of	our	common	stock	in	privately	negotiated	transactions	and/or	open	market	transactions.	The effect,	if	any,	of	these	transactions	and	activities	on	the	market	price	of	our	common	stock	will	depend	in	part	on	market	conditions	and	cannot	be ascertained	at	this	time,	but	any	of	these	activities	could	adversely	affect	the	value	of	our	common	stock.

# We	may	issue	additional	shares	of	our	common	stock	or	instruments	convertible	into	our	common	stock,	which	could	lower	the	price	of our	common	stock.

We	 are	 not	 restricted	 from	 issuing	 additional	 shares	 of	 our	 common	 stock	 or	 other	 instruments	 convertible	 into	 our	 common	 stock.	 As	 of December	31,	2017,	we	had	outstanding	approximately	 45.2	million	shares	of	our	common	stock,	options	to	purchase	approximately	 1.7	million	shares	of our	common	stock	(of	which	approximately	1.2	million	were	vested	as	of	that	date),	restricted	stock	units	covering	approximately	 0.2	million	shares	of	our common	stock	(which	are	expected	to	vest	over	the	next	three	years)	and	approximately	9,600	shares	of	our	common	stock	to	be	distributed	from	our deferred	compensation	plan.	As	of	December	31,	2017,	4.5	million	shares	of	our	common	stock	are	reserved	for	issuance	upon	the	exercise	of	stock options	and	upon	the	exercise	of	the	warrants	issued	in	connection	with	the	Convertible	Notes.	We	cannot	predict	the	size	of	future	issuances	or	the effect,	if	any,	that	they	may	have	on	the	market	price	for	our	common	stock.

If	we	issue	additional	shares	of	our	common	stock	or	instruments	convertible	into	our	common	stock,	such	issuances	may	materially	and	adversely affect	the	price	of	our	common	stock.	Furthermore,	our	issuance	of	shares	following	the	exercise	of	some	or	all	of	the	outstanding	stock	options	and warrants,	as	well	as	the	vesting	of	restricted	stock	units	will	dilute	the	ownership	interests	of	existing	stockholders,	and	any	sales	in	the	public	market	of such	shares	of	our	common	stock	could	adversely	affect	prevailing	market	prices	of	our	common	stock.	In	addition,	the	issuance	and	sale	of	substantial amounts	of	our	common	stock,	including	common	stock	issued	as	a	result	of	the	exercise	of	stock	options	and	warrants	and	vesting	of	restricted	stock units	could	depress	the	price	of	our	common	stock.

# Disruption	of	critical	information	systems	or	material	breaches	in	the	security	of	our	systems	may	adversely	affect	our	business	and customer	relationships.

We	rely	on	information	technology	systems	to	process,	transmit,	and	store	electronic	information	in	our	day-to-day	operations.	We	also	rely	on	our technology	infrastructure,	among	other	functions,	to	enable	us	to	interact	with	customers	and	suppliers,	fulfill	orders,	generate	invoices,	collect	and	make payments,	ship	products,	provide	support	to	customers,	fulfill	contractual	obligations	and	otherwise	conduct	business.	Our	internal	information	technology systems,	as	well	as	those	systems	maintained	by	third-party	providers,	may	be	subjected	to	computer	viruses	or	other	malicious	codes,	unauthorized access	attempts,	and	cyber-attacks,	any	of	which	could	result	in	data	leaks	or	otherwise	compromise	our	confidential	or	proprietary	information	and disrupt	our	operations.	Cyber-attacks	are	becoming	more	sophisticated	and	frequent,	and	in	some	cases	have	caused	significant	harm.	Although	we	have taken	numerous	measures	to	protect	our	information	systems	and	enhance	data	security,	we	cannot	assure	that	these	measures	will	prevent	security breaches	that	could	have	a	significant	impact	on	our	business,	reputation	and	financial	results.	If	we	fail	to	monitor,	maintain	or	protect	our	information technology	systems	and	data	integrity	effectively	or	fail	to	anticipate,	plan	for	or	manage	significant	disruptions	to	these	systems,	we	could,	among	other things,	lose	customers,	have	difficulty	preventing	fraud,	have	disputes	with	customers,	physicians	and	other	health	care	professionals,	be	subject	to regulatory	sanctions	or	penalties,	incur	expenses,	lose	revenues	or	suffer	other	adverse	consequences.		Any	of	these	events	could	have	a	material adverse	effect	on	our	business,	results	of	operations,	financial	condition	or	cash	flows.

# Regulations	related	to	conflict	minerals	may	increase	our	costs	and	adversely	affect	our	business.

In	2012,	the	SEC	promulgated	rules	under	the	Dodd-Frank	Wall	Street	Reform	and	Consumer	Protection	Act	regarding	disclosure	of	the	use	of	tin, tantalum,	tungsten	and	gold,	known	as	"conflict	minerals,"	included	in	components	of	products	either	manufactured	by	public	companies	or	for	which public	companies	have	contracted	to	manufacture.	These	rules	require	that	we	undertake	due	diligence	efforts	to	determine	whether	such	minerals originated	from	the	Democratic	Republic	of	Congo	(the	"DRC")	or	an	adjoining	country	and,	if	so,	whether	such	minerals	helped	finance	armed	conflict	in the	DRC	or	an	adjoining	country.	In	accordance	with	applicable	regulations,	we	have	filed	conflict	minerals	reports	annually,	beginning	in	2014.	As discussed	in	these	reports,	we	have	determined	that	certain	of	our	products	contain	the	specified	minerals,	and	we	have	undertaken,	and	continue	to undertake,	efforts	to	identify	where	such	minerals	originated.		We	have	incurred,	and	expect	to	continue	to	incur,	costs	associated	with	complying	with these	disclosure	requirements,	including	costs	related	to	determining	the	sources	of	the	specified	minerals	used	in	our	products.	These	rules	could adversely	affect	the	sourcing,	supply	and	pricing	of	materials	used	in	our	products.	Our	customers	may	require	that	our	products	be	free	of	conflict minerals,	and	our	revenues	and	margins	may	be	adversely	affected	if	we	are	unable	to	provide	assurances	to	our	customers	that	our	products	are	"DRC conflict	free"	(generally,	the	product	does	not	contain	conflict	minerals	originating	in	the	DRC	or	an	adjoining	country	that	directly	or	indirectly	finance	or benefit	specified	armed	groups)	due	to,	among	other	things,	our	inability	to	procure	conflict	free	minerals	at	a	reasonable	price,	or	at	all.	Moreover,	we may	be	adversely	affected	if	we	are	unable	to	pass	through	any	increased	costs	associated	with	meeting	customer	demands	that	we	provide	products that	are	DRC	conflict	free.		We	also	may	face	reputational	challenges	if	our	due	diligence	efforts	do	not	enable	us	to	verify	the	origins	of	all	conflict minerals	or	to	determine	that	any	conflict	minerals	used	in	products	we	manufacture	or	in	products	manufactured	by	others	for	us	are	DRC	conflict-free.

# Our	operations	expose	us	to	the	risk	of	material	environmental	and	health	and	safety	liabilities.

We	are	subject	to	numerous	foreign,	federal,	state	and	local	environmental	protection	and	health	and	safety	laws	governing,	among	other	things:

•the	generation,	storage,	use	and	transportation	of	hazardous	materials;

•emissions	or	discharges	of	substances	into	the	environment;	and

# •the	health	and	safety	of	our	employees.

These	laws	and	regulations	are	complex,	change	frequently	and	have	tended	to	become	more	stringent	over	time.	We	cannot	provide	assurance	that our	costs	of	complying	with	current	or	future	environmental	protection	and	health	and	safety	laws,	or	our	liabilities	arising	from	past	or	future	releases	of, or	exposures	to,	hazardous	substances,	which	may	include	claims	for	personal	injury	or	cleanup,	will	not	exceed	our	estimates	or	will	not	adversely	affect our	financial	condition	and	results	of	operations.

# Our	 workforce	 covered	 by	 collective	 bargaining	 and	 similar	 agreements	 could	 cause interruptions in	 our	 provision	 of	 products	 and services.

As	of	December	31,	2017,	 approximately	10%	of	our	employees	in	the	United	States	and	in	other	countries	were	covered	by	union	contracts	or collective	bargaining	arrangements.	It	is	likely	that	a	portion	of	our	workforce	will	remain	covered	by	collective	bargaining	and	similar	agreements	for	the foreseeable	future.	Strikes	or	work	stoppages	could	occur	that	would	adversely	impact	our	relationships	with	our	customers	and	our	ability	to	conduct	our business.

# We	may	not	pay	dividends	on	our	common	stock	in	the	future.

Holders	of	our	common	stock	are	entitled	to	receive	dividends	only	as	our	board	of	directors	may	declare	out	of	funds	legally	available	for	such payments.	The	declaration	and	payment	of	future	dividends	to	holders	of	our	common	stock	will	be	at	the	discretion	of	our	board	of	directors	and	will depend	upon	many	factors,	including	our	financial	condition,	earnings,	requirements	under	covenants	in	our	debt	instruments,	legal	requirements	and other	factors	as	our	board	of	directors	deems	relevant.	We	cannot	assure	that	our	cash	dividend	will	not	be	reduced,	or	eliminated,	in	the	future.

# Certain	provisions	of	our	corporate	governing	documents,	Delaware law	and	our	senior	notes	could	discourage,	delay,	or	prevent	a merger	or	acquisition.

Provisions	of	our	certificate	of	incorporation	and	bylaws	could	impede	a	merger,	takeover	or	other	business	combination	involving	us	or	discourage	a potential	acquirer	from	making	a	tender	offer	for	our	common	stock.	For	example,	our	certificate	of	incorporation	authorizes	our	board	of	directors	to determine	the	number	of	shares	in	a	series,	the	consideration,	dividend	rights,	liquidation	preferences,	terms	of	redemption,	conversion	or	exchange rights	and	voting	rights,	if	any,	of	unissued	series	of	preferred	stock,	without	any	vote	or	action	by	our	stockholders.	Thus,	our	board	of	directors	can authorize	and	issue	shares	of	preferred	stock	with	voting	or	conversion	rights	that	could	adversely	affect	the	voting	or	other	rights	of	holders	of	our common	stock.	We	are	also	subject	to	Section	203	of	the	Delaware	General	Corporation	Law,	which	imposes	restrictions	on	mergers	and	other	business combinations	between	us	and	any	holder	of	15%	or	more	of	our	common	stock.	These	provisions	could	have	the	effect	of	delaying	or	deterring	a	third party	from	acquiring	us	even	if	an	acquisition	might	be	in	the	best	interest	of	our	stockholders,	and	accordingly	could	reduce	the	market	price	of	our common	stock.

Certain	provisions	in	the	indentures	governing	the	Senior	Notes	could	make	it	more	difficult	or	more	expensive	for	a	third	party	to	acquire	us.	If	an acquisition	event	constitutes	a	"change	of	control,"	as	defined	in	the	indentures	governing	the	Senior	Notes,	holders	of	such	notes	will	have	the	right	to require	us	to	purchase	their	notes	in	cash	(in	the	case	of	the	2027	Notes,	the	right	will	apply	if	the	change	in	control	is	coupled	with	a	ratings	downgrade). Our	obligations	under	the	Senior	Notes	could	increase	the	cost	of	acquiring	us	or	otherwise	discourage	a	third	party	from	acquiring	us	or	removing incumbent	management,	and	accordingly	could	cause	a	reduction	in	the	market	price	of	our	common	stock.

# ITEM	1B. UNRESOLVED	STAFF	COMMENTS

Not	applicable.

# ITEM	2. PROPERTIES

We	own	or	lease	approximately	95	properties	consisting	of	plants,	engineering	and	research	centers,	distribution	warehouses,	offices	and	other facilities.	We	believe	that	the	properties	are	maintained	in	good	operating	condition	and	are	suitable	for	their	intended	use.	In	general,	our	facilities	meet current	operating	requirements	for	the	activities	currently	conducted	within	the	facilities.

Our	major	facilities	(those	with	50,000	or	greater	square	feet)	at	 December	31,	2017	are	as	follows:

Operations	in	each	of	our	business	segments	are	conducted	at	locations	both	in	and	outside	of	the	United	States.	Of	the	facilities	listed	above,	with the	exception	of	Jaffrey,	NH	and	Limerick,	Ireland,	which	are	used	solely	for	the	OEM	segment,	our	facilities	generally	serve	more	than	one	business segment	and	are	often	used	for	multiple	purposes,	such	as	administrative/sales,	manufacturing	and/or	warehousing/distribution.

In	addition	to	the	properties	listed	above,	we	own	or	lease	approximately	740,000	square	feet	of	additional	warehousing,	manufacturing	and	office space	in	the	North	America,	South	America,	Europe,	Asia	and	Africa.

# ITEM	3. LEGAL	PROCEEDINGS

We	are	party	to	various	lawsuits	and	claims	arising	in	the	normal	course	of	business.	These	lawsuits	and	claims	include	actions	involving	product liability	and	product	warranty,	intellectual	property,	contracts,	employment	and	environmental	matters.	As	of	 December	31,	2017	 and	2016,	we	have accrued	liabilities	of	$3.8	million	and	$2.5	million	respectively,	in	connection	with	these	matters,	representing	our	best	estimate	of	the	cost	within	the range	of	estimated	possible	loss	that	will	be	incurred	to	resolve	these	matters.	Based	on	information	currently	available,	advice	of	counsel,	established reserves	and	other	resources,	we	do	not	believe	that	any	such	actions	are	likely	to	be,	individually	or	in	the	aggregate,	material	to	our	business,	financial condition,	results	of	operations	or	liquidity.	However,	in	the	event	of	unexpected	further	developments,	it	is	possible	that	the	ultimate	resolution	of	these matters,	or	other	similar	matters,	if	unfavorable,	may	be	materially	adverse	to	our	business,	financial	condition,	results	of	operations	or	cash	flows.	See Note	15	to	the	consolidated	financial	statements	included	in	this	Annual	Report	on	Form	10-K	for	additional	information.

# ITEM	4. MINE	SAFETY	DISCLOSURES

# PART	II

# ITEM	5. MARKET	FOR	REGISTRANT'S	COMMON	EQUITY,	RELATED	STOCKHOLDER	MATTERS	AND	ISSUER	PURCHASES	OF	EQUITY SECURITIES

Our	common	stock	is	listed	on	the	New	York	Stock	Exchange	under	the	symbol	"TFX."	Our	quarterly	high	and	low	stock	prices	and	dividends	for 2017	and	2016	are	shown	below.

# Price	Range	and	Dividends	of	Common	Stock

| 2017 | High | Low | Dividends |
| :--- | :--- | :--- | :--- |
| First\tQuarter | $198.89 | $157.80 | $0.34 |
| Second\tQuarter | $211.22 | $191.04 | $0.34 |
| Third\tQuarter | $243.85 | $197.72 | $0.34 |
| Fourth\tQuarter | $271.23 | $235.29 | $0.34 |

| 2016 | High | Low | Dividends |
| :--- | :--- | :--- | :--- |
| First\tQuarter | $155.05 | $125.28 | $0.34 |
| Second\tQuarter | $176.84 | $154.22 | $0.34 |
| Third\tQuarter | $188.79 | $168.00 | $0.34 |
| Fourth\tQuarter | $170.92 | $136.53 | $0.34 |

The	terms	of	our	senior	credit	facility	and	our	2024	Notes	and	2026	Notes	limit 	our	ability	to	repurchase	shares	of	our	stock	and	pay	cash	dividends. Under	the	most	restrictive	of	these	provisions,	as	of	December	31,	2017,	$1.0	billion	of	retained	earnings	could	be	used	to	pay	dividends	on	an	annual basis.	On	February	20,	2018,	 the	Board	of	Directors	declared	a	quarterly	dividend	of	$0.34	per	share	on	our	common	stock,	which	 is	payable	on March	15,	2018	to	holders	of	record	on	March	2,	2018.	As	of	February	20,	2018,	we	had	approximately	507	holders	of	record	of	our	common	stock.	A substantially	greater	number	of	holders	of	our	common	stock	are	beneficial	owners	whose	shares	are	held	by	brokers	and	other	financial	institutions	for the	accounts	of	the	beneficial	owners.

# Stock	Performance	Graph

The	following	graph	provides	a	comparison	of	five	year	cumulative	total	stockholder	returns	of	Teleflex	common	stock,	the	Standard	&	Poor's	(S&P) 500	Stock	Index	and	the	S&P	500	Healthcare	Equipment	&	Supply	Index.	The	annual	changes	for	the	five-year	period	shown	on	the	graph	are	based	on the	assumption	that	$100	had	been	invested	in	Teleflex	common	stock	and	each	index	on	December	31,	2012	and	that	all	dividends	were	reinvested.

# chart.jpg

| Company	/	Index | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Teleflex\tIncorporated | 100 | 134 | 166 | 192 | 237 | 368 |
| S&P\t500\tIndex | 100 | 132 | 151 | 153 | 171 | 208 |
| S&P\t500\tHealthcare\tEquipment\t&\tSupply\tIndex | 100 | 128 | 161 | 171 | 181 | 238 |

# ITEM	6. SELECTED	FINANCIAL	DATA

|  | 2017(1) | 2016(1) | 2015(1) | 2014(1) | 2013(1) |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  |  | (Dollars\tin\tthousands,\texcept\tper\tshare) | (Dollars\tin\tthousands,\texcept\tper\tshare) | (Dollars\tin\tthousands,\texcept\tper\tshare) |  |
| Statement\tof\tIncome\tData: |  |  |  |  |  |
| Net\trevenues | $2,146,303 | $1,868,027 | $1,809,690 | $1,839,832 | $1,696,271 |
| Income\tfrom\tcontinuing\toperations\tbefore\tinterest,\tloss\ton\nextinguishment\tof\tdebt\tand\ttaxes | $372,279 | $319,453 | $315,891 | $284,862 | $233,261 |
| Income\tfrom\tcontinuing\toperations | $155,263 | $237,651 | $236,808 | $191,460 | $152,183 |
| Amounts\tattributable\tto\tcommon\tshareholders\tfor\tincome\tfrom\ncontinuing\toperations | $155,263 | $237,187 | $235,958 | $190,388 | $151,316 |
| Per\tShare\tData: |  |  |  |  |  |
| Income\tfrom\tcontinuing\toperations\t—\tbasic | $3.45 | $5.47 | $5.68 | $4.60 | $3.68 |
| Income\tfrom\tcontinuing\toperations\t—\tdiluted | $3.33 | $4.98 | $4.91 | $4.10 | $3.46 |
| Cash\tdividends | $1.36 | $1.36 | $1.36 | $1.36 | $1.36 |
| Balance\tSheet\tData: |  |  |  |  |  |
| Total\tassets | $6,181,492 | $3,891,213 | $3,871,774 | $3,912,431 | $4,151,193 |
| Long-term\tborrowings | $2,162,927 | $850,252 | $641,850 | $693,720 | $927,496 |
| Shareholders'\tequity | $2,430,531 | $2,137,517 | $2,009,272 | $1,911,309 | $1,913,527 |
| Statement\tof\tCash\tFlows\tData: |  |  |  |  |  |
| Net\tcash\tprovided\tby\toperating\tactivities\tfrom\tcontinuing\toperations | $426,301 | $410,590 | $303,446 | $290,241 | $231,299 |
| Net\tcash\tused\tin\tinvesting\tactivities\tfrom\tcontinuing\toperations | $(1,832,855) | $(56,974) | $(154,848) | $(108,137) | $(372,638) |
| Net\tcash\tprovided\tby\t(used\tin)\tfinancing\tactivities\tfrom\tcontinuing\noperations | $1,141,259 | $(118,692) | $(85,583) | $(287,703) | $231,170 |
| Supplemental\tData: |  |  |  |  |  |
| Free\tcash\tflow(2) | $355,398 | $357,455 | $241,998 | $222,670 | $167,719 |

Certain	financial	information	is	presented	on	a	rounded	basis,	which	may	cause	minor	differences.

(1) Amounts	include	the	impact	of	businesses	acquired	during	the	period	commencing	on	the	respective	acquisition	dates.	See	Note	3	to	the	consolidated	financial	statements included	in	this	Annual	Report	on	Form	10-K	for	additional	information.

(2) Free	cash	flow	is	calculated	by	subtracting	capital	expenditures	from	cash	provided	by	operating	activities	from	continuing	operations.	Free	cash	flow	is	considered	a	non- GAAP	financial	measure.	This	financial	measure	is	used	in	addition	to	and	in	conjunction	with	results	presented	in	accordance	with	generally	accepted	accounting	principles in	the	United	States,	or	GAAP,	and	should	not	be	considered	a	substitute	for	net	cash	provided	by	operating	activities	from	continuing	operations,	the	most	comparable GAAP	financial	measure.	Management	believes	that	free	cash	flow	is	a	useful	measure	to	investors	because	it	facilitates	an	assessment	of	funds	available	to	satisfy	current and	 future	 obligations,	 pay	 dividends	 and	 fund	 acquisitions.	 We	 also	 use	 this	 financial	 measure	 for	 internal	 managerial	 purposes	 and	 to	 evaluate	 period-to-period comparisons.	Free	cash	flow	is	not	a	measure	of	cash	available	for	discretionary	expenditures	since	we	have	certain	non-discretionary	obligations,	such	as	debt	service,	that are	not	deducted	from	the	measure.	We	strongly	encourage	investors	to	review	our	financial	statements	and	publicly-filed	reports	in	their	entirety	and	not	to	rely	on	any	single financial	measure.	The	following	is	a	reconciliation	of	free	cash	flow	to	the	most	comparable	GAAP	measure.

|  | 2017 | 2016 | 2015 | 2014 | 2013 |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  |  |  | (Dollars\tin\tthousands) |  |  |
| Net\tcash\tprovided\tby\toperating\tactivities\tfrom\tcontinuing\toperations | $426,301 | $410,590 | $303,446 | $290,241 | $231,299 |
| Less:\tCapital\texpenditures | 70,903 | 53,135 | 61,448 | 67,571 | 63,580 |
| Free\tcash\tflow | $355,398 | $357,455 | $241,998 | $222,670 | $167,719 |

# ITEM	7. MANAGEMENT'S	DISCUSSION	AND	ANALYSIS	OF	FINANCIAL	CONDITION	AND	RESULTS	OF	OPERATIONS

# Overview

We	 are	 a	 global	 provider	 of	 medical	 technology	 products	 that	 enhance	 clinical	 benefits,	 improve	 patient	 and	 provider	 safety	 and	 reduce	 total procedural	costs.	We	primarily	design,	develop,	manufacture	and	supply	single-use	medical	devices	used	by	hospitals	and	healthcare	providers	for common	 diagnostic	 and	 therapeutic	 procedures	 in	 critical	 care	 and	 surgical	 applications.	 We	 market	 and	 sell	 our	 products	 worldwide	 through	 a combination	of	our	direct	sales	force	and	distributors.	Because	our	products	are	used	in	numerous	markets	and	for	a	variety	of	procedures,	we	are	not dependent	upon	any	one	end-market	or	procedure.	We	are	focused	on	achieving	consistent,	sustainable	and	profitable	growth	by	increasing	our	market share	and	improving	our	operating	efficiencies.

We	evaluate	our	portfolio	of	products	and	businesses	on	an	ongoing	basis	to	ensure	alignment	with	our	overall	objectives.	Based	on	our	evaluation, we	 may	 identify	 opportunities	 to	 expand	 our	 margins	 through	 strategic	 divestitures	 of	 existing	 businesses	 and	 product	 lines	 that	 do	 not	 meet	 our objectives.	In	addition,	we	may	seek	to	optimize	utilization	of	our	facilities	through	restructuring	initiatives	designed	to	further	reduce	our	cost	base	and enhance	our	competitive	position.	For	a	discussion	of	our	ongoing	restructuring	programs,	see	"Restructuring	and	impairment	charges"	under	"Results	of Operations"	below.	Finally,	we	may	continue	to	explore	opportunities	to	expand	the	size	of	our	business	and	improve	our	margins	through	a	combination of	acquisitions	and	distributor	 to	direct	sales	conversions,	which	generally	 involve	our	elimination	of	a	distributor	 from	 the	sales	channel,	either	by acquiring	the	distributor	or	terminating	the	distributor	relationship	(in	some	instances,	particularly	in	Asia,	the	conversions	involve	our	acquisition	or termination	of	a	master	distributor	and	 the	continued	sale	of	our	products	 through	sub-distributors).	Our	distributor	 to	direct	sales	conversions	are designed	to	facilitate	improved	product	pricing	and	more	direct	access	to	the	end	users	of	our	products	within	the	sales	channel.

On	February	17,	2017,	we	acquired	Vascular	Solutions,	Inc.	("Vascular	Solutions"),	a	medical	device	company	that	developed	and	marketed	clinical products	for	use	in	minimally	invasive	coronary	and	peripheral	vascular	procedures,	for	an	aggregate	purchase	price	of	$975.5	million.	The	acquisition	is expected	to	meaningfully	accelerate	the	growth	of	our	vascular	and	interventional	access	product	portfolios	by	facilitating	our	further	expansion	into	the coronary	and	peripheral	vascular	market,	and	by	generating	increased	cross-portfolio	selling	opportunities	to	both	our	and	Vascular	Solutions'	customer bases.	We	 financed	 the	 acquisition	 through	 a	 combination	 of	 term	 loan	 and	 revolving	 credit	 borrowings	 under	 our	 amended	 and	 restated	 credit agreement	 (the	 "Credit	 Agreement").	The	 Credit	 Agreement	 is	 described	 in	 more	 detail	 below	 under "Borrowings"	 within "Liquidity	 and	 Capital Resources".

On	October	2,	2017,	we	completed	the	acquisition	of	NeoTract,	Inc.	("NeoTract"),	a	medical	device	company	that	developed	and	commercialized the	UroLift	System,	a	minimally	invasive	medical	device	for	treating	lower	urinary	tract	symptoms	due	to	benign	prostatic	hyperplasia,	or	BPH.	The estimated	fair	value	of	the	consideration	transferred	to	acquire	NeoTract	was	$975.2	million,	which	included	initial	payments	of	$725.6	million	in	cash	less a	favorable	working	capital	adjustment	of	$1.4	million	(for	which	we	had	not	yet	received	payment	as	of	December	31,	2017)	and	$251.0	million	in estimated	fair	value	of	contingent	consideration.	The	contingent	consideration	liability	represents	the	estimated	fair	value	of	additional	consideration	of	up to	$375	million	we	would	be	required	to	pay	if	specified	net	sales	goals	through	the	end	of	2020	are	achieved.	The	acquisition	of	NeoTract	was	financed with	revolving	credit	borrowings	under	our	Credit	Agreement.	See	Note	8	to	the	consolidated	financial	statements	included	in	this	report	for	additional information.

During	 the	 year	 ended	 December	 31,	 2017,	 we	 also	 completed	 acquisitions	 related	 to	 our	 anesthesia	 and	 respiratory	 product	 portfolios	 and distributor	to	direct	sales	conversions.	The	total	fair	value	of	the	consideration	related	to	these	acquisitions	was	$80.1	million.

During	2016,	we	completed	acquisitions	of	businesses	that	are	included	in	our	OEM	and	Asia	reportable	operating	segments.	In	addition,	during 2016,	 we	 acquired	 the	 remaining	 26%	 ownership	 interest	 in	 an	 Indian	 affiliate	 from	 the	 noncontrolling	 shareholders;	 we	 already	 owned	 the	 74% controlling	interest.	The	total	fair	value	of	the	consideration	paid	in	these	transactions	was	$22.8	million.

# Change	in	Reporting	Segments

Following	 our	 acquisition	 of	 Vascular	 Solutions,	 we	 commenced	 an integration	 program	 under	 which	 we	 are	 combining	 Vascular	 Solutions' businesses	with	certain	of	our	legacy	businesses.	Specifically,	we	are	combining

Vascular	Solutions'	North	American	business	with	our	interventional	access	business,	which	formerly	was	part	of	our	Vascular	North	America	operating segment,	and	our	cardiac	business,	which	formerly	was	a	separate	operating	segment	included	in	the	"all	other"	category	for	purposes	of	segment reporting.	These	businesses	are	now	in	our	Interventional	North	American	segment.	Additionally,	we	are	combining	the	Vascular	Solutions	businesses	in Europe,	Asia	and	Latin	America	with	our	legacy	businesses	in	the	respective	locations,	and	these	Vascular	Solutions	businesses	are	now	part	of	our EMEA	(Europe,	Middle	East	and	Africa),	Asia	and	Latin	America	operating	segments,	respectively.	 The	changes	 in	our	operating	segments,	which became	effective	in	the	fourth	quarter	2017,	also	reflect	the	manner	in	which	our	new	chief	operating	decision	maker	assesses	business	performance and	allocation	of	resources.

As	 a	 result	 of	 the	 operating	 segment	 changes	 described	 above,	 we	 have	 the	 following	 seven	 reportable	 segments:	 Vascular	 North	America, Interventional	North	America,	Anesthesia	North	America,	Surgical	North	America,	EMEA,	Asia	and	OEM.	In	connection	with	the	presentation	of	segment information,	we	will	continue	to	present	certain	operating	segments,	which	now	include	Interventional	Urology	and	Respiratory	North	America	as	well	as Latin	America,	in	the	"all	other"	category	because	they	are	not	material.	All	prior	comparative	periods	presented	in	this	report	have	been	restated	to	reflect these	changes.	Additionally,	because	these	changes	affected	certain	of	our	reporting	units,	we	reallocated	the	goodwill	balances	based	on	the	relative fair	values	of	the	reporting	units	and	performed	goodwill	impairment	analyses	on	the	affected	reporting	units.	We	did	not	record	any	goodwill	impairment charges	as	a	result	of	these	analyses.

# Recently	Enacted	U.S.	Tax	Legislation

The	Tax	Cuts	and	Jobs	Act	(the	"TCJA")	was	enacted	on	December	22,	2017.	The	legislation	significantly	changes	United	States	(or	"U.S.")	tax	law by,	among	other	things,	reducing	the	U.S.	corporate	income	tax	rate	from	a	maximum	of	35%	to	21%;	implementing	a	territorial	tax	system,	generally providing	 for,	among	other	 things,	a	dividends	received	deduction	on	 the	 foreign	source	portion	of	dividends	received	 from	a	 foreign	corporation	 if specified	conditions	are	met;	and	imposing	a	one-time	repatriation	tax	on	undistributed	post-1986	earnings	and	profits	of	foreign	subsidiaries,	which	will be	deemed	repatriated	for	purposes	of	the	tax.

On	December	22,	2017,	the	SEC	staff	issued	Staff	Accounting	Bulletin	No.	118	("SAB	118")	to	address	the	application	of	U.S.	GAAP	in	situations where	a	company	does	not	have	the	necessary	information	available,	prepared,	or	analyzed	(including	computations)	in	reasonable	detail	to	complete	the accounting	for	certain	income	tax	effects	of	the	TCJA.	SAB	118	states	that	in	these	circumstances,	if	the	Company	can	determine	a	reasonable	estimate for	the	income	tax	effects,	the	SEC	staff	would	not	object	if	the	company	includes	in	its	financial	statements	the	reasonable	estimate	it	has	determined (and	the	SEC	staff	also	expressed	its	belief	that	it	would	not	be	appropriate	for	a	company	to	exclude	a	reasonable	estimate	from	its	financial	statements to	the	extent	a	reasonable	estimate	has	been	determined).	We	have	included	provisional	amounts	related	to	deemed	repatriated	earnings	and	the revaluation	of	deferred	tax	assets	and	liabilities	and	included	these	amounts	in	our	consolidated	financial	statements	for	the	year	ended	December	31, 2017.	While	we	believe	that	the	provisional	amounts	constitute	reasonable	estimates,	we	continue	to	examine	the	impact	the	TCJA	may	have	on	our business.	Once	our	accounting	for	the	income	tax	effects	of	the	TCJA	is	complete,	the	amounts	with	respect	to	the	income	tax	effects	of	the	TCJA	may differ	from	the	provisional	amounts,	possibly	materially,	due	to,	among	other	things,	additional	analysis,	changes	in	interpretations	and	assumptions	we have	made,	additional	regulatory	guidance	that	may	be	issued,	and	actions	we	may	take	as	a	result	of	the	TCJA.

In	2017,	we	recognized	a	$107.9	million	net	tax	expense	as	a	result	of	the	TCJA.	Additional	information	on	the	impacts	of	the	TCJA	is	included	below and	in	Note	13	to	our	consolidated	financial	statements	included	in	this	Annual	Report	on	Form	10-K.

# Health	Care	Reform

In	2010,	the	Patient	Protection	and	Affordable	Care	Act	(as	amended,	the	"Affordable	Care	Act")	was	signed	into	law.	The	legislation	is	far-reaching and	 is	 intended	 to	 expand	 access	 to	 health	 insurance	 coverage	 and	 improve	 the	 quality	 and	 reduce	 the	 costs	 of	 healthcare.	 For	 medical	 device companies	such	as	Teleflex,	the	expansion	of	medical	insurance	coverage	should	lead	to	greater	utilization	of	the	products	we	manufacture,	but	the provisions	of	the	legislation	designed	to	contain	the	cost	of	healthcare	could	negatively	affect	pricing	of	our	products	and	encourage	patient	outcome driven	results.	The	overall	impact	of	the	Affordable	Care	Act	on	our	business	is	yet	to	be	determined,	mainly	due	to	uncertainties	around	future	customer behaviors,	which	we	believe	will	be	affected	by	reimbursement	factors	such	as	insurance	coverage,	statistics,	patient	outcomes	and	patient	satisfaction. Several	legislative	initiatives	to	repeal	the	Affordable	Care	Act	and	adopt	a	form	of	replacement	legislation	were	proposed,	but	not	adopted,	in	2017. However,	the	recently	adopted	Tax	Cuts	and	Jobs	Act	eliminated	the	individual	mandate	under	the	Affordable	Care	Act,	which	generally	required	most Americans	to	maintain	a	minimum	level	of	health	insurance	coverage.	As	a	result,	the	level	of	insurance	premium	prices	for	participants	in	insurance exchanges	under	the	Affordable	Care	Act	is	subject	to

increased	uncertainty.	The	nature	and	effect	of	any	modification	of,	or	legislative	substitution	for,	the	Affordable	Care	Act,	as	well	as	the	longer-term viability	of	the	act,	is	uncertain.

The	Affordable	Care	Act	imposed	a	2.3%	excise	tax	on	sales	of	medical	devices,	beginning	in	2013.	Although	the	excise	tax	has	been	suspended through	2019,	its	status	remains	unclear	for	subsequent	years.	For	the	year	ended	December	31,	2015,	we	recorded	medical	device	excise	taxes	of $10.2	million,	which	was	included	in	selling,	general	and	administrative	expenses.

# Global	Economic	Conditions

Global	economic	conditions	 in	 the	past	decade	have	had	adverse	 impacts	on	market	activities	due	 to,	among	other	 things,	 failure	of	 financial institutions,	falling	asset	values,	diminished	liquidity,	reduced	demand	for	products	and	services	and	significant	fluctuations	in	foreign	currency	exchange rates.	In	response,	we	adjusted	production	levels	and	engaged	in	new	restructuring	activities.	We	continue	to	review	and	evaluate	our	manufacturing, warehousing	and	distribution	processes	to	maximize	efficiencies	through	the	elimination	of	redundancies	in	our	operations	and	the	consolidation	of facilities.	Although,	on	a	consolidated	basis,	the	consequences	of	economic	conditions,	other	than	fluctuations	in	foreign	currency	exchange	rates,	have not	had	a	significant	adverse	impact	on	our	financial	position,	results	of	operations	or	liquidity,	healthcare	policies	and	practice	trends	vary	by	country,	and the	impact	of	the	global	economic	downturn	was	felt	to	varying	degrees	in	each	of	our	regional	markets	over	the	last	several	years.	While	there	has	been some	degree	of	improvement	in	economic	conditions	recently,	the	continuation	of	economic	trends	of	uncertain	economic	growth,	constricted	credit, public	sector	austerity	measures	in	response	to	public	budget	deficits	and	foreign	currency	volatility,	particularly	with	respect	to	the	euro,	could	have	a material	adverse	effect	on	our	results	of	operations	and	our	liquidity.

In	recent	years,	hospitals	in	some	regions	of	the	United	States	experienced	a	decline	in	admissions,	a	weaker	payor	mix,	and	a	reduction	in	elective procedures.		Consequently,	hospitals	took	actions	to	reduce	their	costs,	including	limiting	their	capital	spending.	Despite	recent	improvements	in	the economic	environment,	challenges	persist,	particularly	in	some	European	countries,	as	discussed	below.	Approximately	95%	of	our	net	revenues	come from	single-use	products	primarily	used	in	critical	care	and	surgical	applications,	and	our	sales	volume	could	be	negatively	impacted	if	hospital	admission rates	or	payor	mix	change.	Conversely,	our	sales	volume	could	increase	due	to	the	greater	number	of	insured	individuals	as	a	result	of	the	Affordable Care	Act,	which	has	had	the	effect	of	facilitating	medical	insurance	coverage	for	many	persons	who	previously	were	not	covered,	although,	as	noted above,	the	Affordable	Care	Act	may	be	subject	to	repeal,	further	modification	or	replacement,	and	its	longer-term	viability	is	uncertain.

A	number	of	European	countries	continue	to	contend	with	considerable	government	debt,	annual	deficits	and	high	levels	of	unemployment.	Despite some	indications	of	a	more	positive	economic	outlook	in	Europe,	the	healthcare	sector	remains	weak.	In	particular,	budgetary	restraints	among	European countries	have	led	to	cost	control	measures,	such	as	delays	in	approvals	for	elective	surgeries.The	public	healthcare	systems	in	certain	countries	in Western	Europe,	most	notably	Greece,	Spain,	Portugal	and	Italy,	have	experienced	significantly	reduced	liquidity	due	to	recessionary	conditions,	which continues	to	result	in	delays	in	payments	to	us	by	customers	in	these	countries.	Moreover,	the	impact	of	Brexit,	economic	and	trade	policies	of	the	Trump administration	and	political	developments	in	European	nations	could	have	a	profound	economic	effect	in	Europe	and	elsewhere.

In	Asia,	we	are	experiencing	an	increasing	trend	of	government-implemented	price	management	and	reimbursement	controls,	particularly	in	China and	Australia.	There	also	has	been	an	increase	in	government	initiatives	to	help	local	manufacturers	access	a	bigger	share	of	the	local	market.	Moreover, many	countries	in	the	region	have	become	more	proactive	with	respect	to	regulatory	requirements,	and	as	a	result,	we	expect	longer,	costlier	and	more complicated	regulatory	approval	processes	in	these	countries.

In	Latin	America,	some	highly	regulated	economies	such	as	Argentina	and	Venezuela	have	experienced	unusually	high	inflation	rates	and	weakening currencies.	This	has	impacted	the	budgets	of	the	public	healthcare	systems	resulting	in	delays	in	the	importation	of	medical	devices.	Although	Latin America	does	not	represent	a	significant	portion	of	our	business,	our	operations	in	this	region	may	be	adversely	affected	by	these	factors.

# Results	of	Operations

As	used	in	this	discussion,	"new	products"	are	products	for	which	commercial	sales	have	commenced	within	the	past	36	months,	and	"existing products"	are	products	for	which	commercial	sales	commenced	more	than	36	months

ago.	Discussion	of	results	of	operations	items	that	reference	the	effect	of	one	or	more	acquired	businesses	(except	as	noted	below	with	respect	to acquired	distributors)	generally	reflects	 the	 impact	of	 the	acquisitions	within	 the	 first	12	months	 following	 the	date	of	 the	acquisition.	 In	addition	 to increases	and	decreases	in	the	per	unit	selling	prices	of	our	products	to	our	customers,	our	discussion	of	the	impact	of	product	price	increases	and decreases	also	reflects,	for	the	first	12	months	following	the	acquisition	or	termination	of	a	distributor,	the	impact	on	the	pricing	of	our	products	resulting from	the	elimination	of	the	distributor	from	the	sales	channel.	To	the	extent	an	acquired	distributor	had	pre-acquisition	sales	of	products	other	than	ours, the	 impact	 of	 the	 post-acquisition	 sales	 of	 those	 products	 on	 our	 results	 of	 operations	 is	 included	 within	 our	 discussion	 of	 the	 impact	 of	 acquired businesses.

# Revenues

Net	revenues	for	the	year	ended	December	31,	2017	increased	 14.9%,	 or	$278.3	million,	compared	to	the	prior	year.	The	increase	is	primarily attributable	to	net	revenues	of	$205.8	million	generated	by	acquired	businesses,	primarily	Vascular	Solutions	and	NeoTract	and,	to	a	lesser	extent,	an increase	in	new	product	sales.

Net	revenues	 for	 the	year	ended	December	31,	2016	 increased	 3.2%,	 or	$58.3	million,	 compared	 to	 the	 prior	 year.	The	 increase	 is	 primarily attributable	to	an	increase	in	sales	volumes	of	existing	products	of	$37.3	million	and	an	increase	in	new	product	sales	of	$24.2	million,	both	across	all	of our	segments.	The	increase	was	partially	offset	by	unfavorable	fluctuations	in	foreign	currency	exchange	rates.

# Gross	profit

|  | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
|  |  | (Dollars\tin\tmillions) |  |
| Gross\tprofit | $1,171.8 | $996.2 | $944.4 |
| Percentage\tof\trevenues | 54.6% | 53.3% | 52.2% |

For	the	year	ended	December	31,	2017,	gross	margin	increased	130	basis	points,	or	 2.4%,	compared	to	the	prior	year.	The	increase	in	gross	margin is	primarily	attributable	to	gross	margin	generated	by	acquired	businesses,	a	more	favorable	mix	of	products	sold,	cost	improvement	initiatives,	including the	 2016	 and	 2014	 footprint	 realignment	 plans	 described	 below	 and	 the	 impact	 of	 price	 increases.	These	 increases	 were	 partially	 offset	 by	 the unfavorable	$10.4	million	 impact	of	 the	step-up	 in	carrying	value	of	 inventory	recognized	 in	connection	with	 the	Vascular	Solutions	acquisition	 that adversely	affected	cost	of	goods	sold	upon	sale	of	such	inventory	during	2017,	as	well	as	higher	logistics	and	distributions	costs.

For	the	year	ended	December	31,	2016,	gross	margin	increased	110	basis	points,	or	2.1%,	compared	to	the	prior	year.	The	increase	in	gross	margin is	primarily	attributable	to	the	impact	of	an	increase	in	sales	of	higher	margin	products,	primarily	in	the	Anesthesia	North	America	and	EMEA	segments, as	well	as	lower	manufacturing	costs	resulting	from	cost	improvement	initiatives,	including	the	2014	Manufacturing	Footprint	Realignment	Plan.

# Selling,	general	and	administrative

|  | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
|  |  | (Dollars\tin\tmillions) |  |
| Selling,\tgeneral\tand\tadministrative | $700.0 | $563.3 | $569.0 |
| Percentage\tof\trevenues | 32.6% | 30.2% | 31.4% |

Selling,	general	and	administrative	expenses	increased	 $136.7	million	during	the	year	ended	December	31,	2017	compared	to	the	prior	year.	The increase	is	primarily	attributable	to	$108.3	million	in	expenses	related	to	acquired	businesses	and	distributor	to	direct	conversions,	the	unfavorable	impact of	increases	in	the	fair	value	of	contingent	consideration	liabilities	and	unfavorable	fluctuations	in	foreign	currency	exchange	rates.

Selling,	general	and	administrative	expenses	decreased	$5.7	million	during	the	year	ended	December	31,	2016	compared	to	the	prior	year.	The decrease	is	primarily	attributable	to	the	favorable	impact	of	the	suspension	of	the	excise	tax	on	medical	devices	under	the	Affordable	Care	Act	of	$10.2 million	and	the	favorable	impact	of	fluctuations	in	foreign	currency	exchange	rates	of	$2.7	million,	partially	offset	by	an	increase	in	selling	and	marketing expenses	of	$7.5	million.

|  | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
|  |  | (Dollars\tin\tmillions) |  |
| Research\tand\tdevelopment | $84.8 | $58.6 | $52.1 |
| Percentage\tof\trevenues | 3.9% | 3.1% | 2.9% |

The	 increase	 in	research	and	development	expenses	 for	 the	year	ended	December	31,	2017	 is	primarily	attributable	 to	expenses	 incurred	by acquired	businesses,	primarily	Vascular	Solutions,	and	 to	a	 lesser	extent,	NeoTract.	Additionally,	2017	research	and	development	expenses	reflect increased	spending	on	new	product	development	with	respect	to	several	of	our	segments.

The	increase	in	research	and	development	expenses	for	the	year	ended	December	31,	2016	is	primarily	attributable	to	increased	spending	on	new product	development	with	respect	to	several	of	our	segments.

# Restructuring	and	impairment	charges

The	following	table	provides	information	regarding	restructuring	charges	we	have	incurred	with	respect	to	each	of	our	ongoing	restructuring	plans	and programs,	as	well	as	impairment	charges,	for	the	years	ended	December	31,	2017,	2016	and	2015.	The	restructuring	charges	listed	in	the	table	primarily consist	of	termination	benefits.

| 2017	Vascular	Solutions	integration	program | $5.5 | $— | $— |
| :--- | :--- | :--- | :--- |
| 2017\tEMEA\trestructuring\tprogram | 5.2 | — | — |
| Other\t2016\trestructuring\tprograms | 0.9 | 3.2 | — |
| 2016\tManufacturing\tfootprint\trealignment\tplan | 2.1 | 12.5 | — |
| 2014\tManufacturing\tfootprint\trealignment\tplan | 0.7 | 0.1 | 1.7 |
| Other\trestructuring\tprograms | 0.4 | — | 6.1 |
| Impairment\tcharges\t(1) | — | 43.4 | — |
| Total | $14.8 | $59.2 | $7.8 |

(1) Impairment	charges	recognized	in	2016	included	$41.0	million	related	to	a	discontinued	intellectual	property	research	and	development	(IPR&D)	project	and	two	properties that	were	sold	during	the	first	quarter	of	2017.

# Anticipated	charges	and	pre-tax	savings	related	to	restructuring	plans	and	programs

With	respect	to	our	restructuring	plans	and	programs	that	were	ongoing	at	December	31,	2017,	the	table	below	summarizes	(1)	the	estimated	total charges	 that	will	be	 incurred	and	 the	estimated	annual	pre-tax	savings	once	 the	plans	and	programs	are	completed;	(2)	 the	charges	 incurred	and estimated	pre-tax	savings	realized	through	December	31,	2017;	and	(3)	the	estimated	charges	to	be	incurred	and	the	estimated	incremental	pre-tax savings	to	be	realized	for	these	plans	and	programs	from	January	1,	2018	through	their	respective	anticipated	completion	dates.

Estimated	charges	and	pre-tax	savings	are	subject	to	change	based	on,	among	other	things,	the	nature	and	timing	of	restructuring	activities,	changes in	the	scope	of	restructuring	plans	and	programs,	unanticipated	expenditures	and	other	developments,	the	effect	of	additional	acquisitions	or	dispositions and	other	 factors	 that	were	not	reflected	 in	 the	assumptions	made	by	management	 in	previously	estimating	restructuring	and	restructuring	 related charges	and	estimated	pre-tax	savings.	Moreover,	estimated	pre-tax	savings	relating	to	programs	involving	the	integration	of	acquired	businesses	are particularly	difficult	to	forecast	because	the	estimate	of	pre-tax	savings,	to	a	considerable	extent,	involves	assumptions	regarding	operation	of	businesses during	periods	when	those	businesses	were	not	administered	by	our	management.	It	is	likely	that	estimates	of	charges	and	pre-tax	savings	will	change from	time	to	time,	and	the	table	below	reflects	changes	from	amounts	previously	estimated.	In	addition,	the	table	below	has	been	updated	to	remove estimated	charges	and	pre-tax	savings	related	to	completed	programs.	Estimated	charges	and	pre-tax	savings	are	described	in	more	detail	below,	within the	discussions	of	the	specific	restructuring	plans	and	programs.

# Ongoing	Restructuring	Plans	and	Programs

|  | Estimated	Total | Through<br>December	31,	2017 | Estimated	Remaining	from<br>January	1,	2018	through<br>December	31,	2022 |
| :--- | :--- | :--- | :--- |
|  |  | (Dollars\tin\tmillions) |  |
| Restructuring\tcharges | $44\t-\t$51 | $42 | $2\t-\t$9 |
| Restructuring\trelated\tcharges\t(1) | 56\t-\t68 | 44 | 12\t-\t24 |
| Total\tcharges | $100\t-\t$119 | $86 | $14\t-\t33 |
| Pre-tax\tsavings\t(2)\t(3) | $76\t-\t$90 | $45 | $31\t-\t45 |

(1) Restructuring	related	charges	principally	constitute	accelerated	depreciation	and	other	costs	primarily	related	to	the	transfer	of	manufacturing	operations	to	new	locations and	are	expected	to	be	recognized	primarily	in	cost	of	goods	sold.

(2) Approximately	55%	of	the	pre-tax	savings	are	expected	to	result	in	reductions	to	cost	of	goods	sold.	As	previously	disclosed,	during	2016,	in	connection	with	our	execution of	the	2014	Manufacturing	Footprint	Realignment	Plan,	we	implemented	changes	to	medication	delivery	devices	included	in	certain	of	our	kits,	which	are	expected	to	result in	increased	product	costs	(and	therefore	reduced	the	annual	savings	we	anticipated	at	the	inception	of	the	program).	However,	we	also	expect	to	achieve	improved	pricing on	these	kits	to	offset	the	cost,	which	is	expected	to	result	in	estimated	annual	increased	revenues	of	$5	million	to	$6	million,	which	is	not	reflected	in	the	table	above.	We realized	a	$1.0	million	benefit	resulting	from	this	incremental	pricing	in	2017.	More	recently,	during	the	fourth	quarter	of	2017,	we	entered	into	an	agreement	with	an alternate	provider	for	the	development	and	supply	of	a	component	to	be	included	in	certain	kits	sold	by	our	Vascular	and	Anesthesia	North	America	operating	segments. The	agreement	will	result	in	increased	development	costs,	but	is	expected	to	reduce	the	cost	of	the	component	supply,	once	the	supply	becomes	commercially	available, as	compared	to	the	costs

incurred	with	respect	to	our	current	suppliers.	Therefore,	we	anticipate	a	net	savings	from	the	agreement,	which	is	reflected	in	the	table	above.	See	"2014	Manufacturing Footprint	Realignment	Plan"	below	for	additional	information.

(3) While	pre-tax	savings	address	anticipated	cost	savings	to	be	realized	with	respect	to	our	historical	expense	items,	they	also	reflect	anticipated	efficiencies	to	be	realized with	respect	to	increased	costs	that	otherwise	would	have	resulted	from	our	acquisition	of	Vascular	Solutions	and	Pyng	Medical	Corp.	("Pyng"),	which	we	acquired	in	2017. In	this	regard,	the	pre-tax	savings	are	expected	to	result	from	the	elimination	of	redundancies	between	our	operations	and	Vascular	Solutions'	and	Pyng's	operations, principally	through	the	elimination	of	personnel	redundancies.

The	following	provides	additional	details	with	respect	to	our	ongoing	restructuring	plans	and	programs:

# 2017	Vascular	Solutions	Integration	Program

During	the	first	quarter	2017,	we	committed	to	a	restructuring	program	related	to	the	integration	of	Vascular	Solutions'	operations	into	our	operations. We	initiated	the	program	in	the	first	quarter	2017	and	expect	the	program	to	be	substantially	completed	by	the	end	of	the	second	quarter	2018.	We estimate	that	we	will	record	aggregate	pre-tax	restructuring	charges	of	$6.5	million	to	$8.0	million	related	to	this	program	as	compared	to	the	prior estimate	of	$6.0	million	to	$7.5	million.	We	expect	$5.5	million	to	$6.2	million	of	the	total	restructuring	charges	will	constitute	termination	benefits,	and	$1.0 million	to	$1.8	million	will	relate	to	other	exit	costs,	including	employee	relocation	and	outplacement	costs.	Additionally,	we	expect	to	incur	$2.5	million	to $3.0	million	of	restructuring	related	charges,	consisting	primarily	of	retention	bonuses	offered	to	certain	employees	expected	to	remain	with	our	company after	completion	of	the	program.	All	of	these	charges	will	result	in	future	cash	outlays.	We	began	realizing	program-related	savings	in	the	first	quarter 2017	and	expect	to	achieve	annual	pre-tax	savings	of	$25	million	to	$30	million	once	the	program	is	fully	implemented.	This	is	an	increase	as	compared to	the	prior	estimate	of	$20	million	to	$25	million.	The	increase	in	the	estimated	restructuring	charges	and	annual	pre-tax	savings	ranges	as	compared	to the	prior	estimates	were	the	result	of	an	increase	in	the	headcount	reduction	initially	contemplated	under	the	program.

# 2017	EMEA	Restructuring	Program

During	 the	 first	 quarter	 2017,	 we	 committed	 to	 a	 restructuring	 program	 to	 centralize	 certain	 administrative	 functions	 in	 Europe.	The	 program commenced	in	the	second	quarter	2017	and	is	expected	to	be	substantially	completed	by	the	end	of	2018.	We	estimate	that	we	will	record	aggregate	pre- tax	restructuring	charges	of	approximately	$5.0	million	related	to	this	program,	almost	all	of	which	constitute	termination	benefits,	and	all	of	which	will result	in	future	cash	outlays.	This	represents	a	decrease	as	compared	to	the	prior	estimate	of	aggregate	pre-tax	restructuring	charges	of	$7.1	million	to $8.5	million.	We	expect	to	achieve	annual	pre-tax	savings	of	approximately	$2.5	million	once	the	program	is	fully	implemented	and	will	begin	realizing program	related	savings	in	the	first	quarter	2018.	This	represents	a	decrease	as	compared	to	the	prior	estimate	of	annual	pre-tax	savings	of	$2.7	million to	$3.3	million.	The	reduction	in	expected	charges	and	annual	pre-tax	savings	is	the	result	of	a	decrease	in	the	headcount	reduction	initially	contemplated under	the	program.

# 2016	Manufacturing	Footprint	Realignment	Plan

In	2016,	we	 initiated	a	restructuring	plan	 involving	 the	relocation	of	certain	manufacturing	operations,	 the	relocation	and	outsourcing	of	certain distribution	operations	and	a	related	workforce	reduction	at	certain	of	our	facilities.	(the	"2016	Manufacturing	Footprint	Realignment	Plan").	These	actions commenced	in	the	first	quarter	2016	and	are	expected	to	be	substantially	completed	by	the	end	of	2018.	We	estimate	that	we	will	incur	aggregate	pre-tax charges	in	connection	with	these	restructuring	activities	of	approximately	$34	million	to	$44	million,	of	which	we	estimate	$27	million	to	$31	million	will result	in	future	cash	outlays.	Additionally,	we	expect	to	incur	aggregate	capital	expenditures	of	approximately	$17	million	to	$19	million	in	connection	with the	2016	Manufacturing	Footprint	Realignment	Plan.	We	began	realizing	plan-related	savings	in	2017	and	expect	to	achieve	annual	pre-tax	savings	of $12	million	to	$16	million	once	the	plan	is	fully	implemented.

In	April	2014,	we	initiated	a	restructuring	plan	(the	"2014	Manufacturing	Footprint	Realignment	Plan")	involving	the	consolidation	of	operations	and	a related	reduction	in	workforce	at	certain	facilities,	and	the	relocation	of	manufacturing	operations	from	certain	higher-cost	locations	to	existing	lower-cost locations.	These	actions	commenced	in	the	second	quarter	2014.

During	the	fourth	quarter	2017,	we	executed	an	agreement	with	an	alternate	provider	for	the	development	and	supply	of	a	component	to	be	included in	certain	kits	primarily	sold	by	our	Vascular	North	America	and	Anesthesia	North	America	operating	segments.	 This	will	result	in	increased	development costs,	but	also	is	expected	to	reduce	the	cost

of	 the	 component	 supply	 once	 it	 becomes	 commercially	 available,	 as	 compared	 to	 costs	 incurred	 with	 respect	 to	 current	 suppliers.	Therefore,	 we anticipate	a	net	savings	as	a	result	of	this	agreement.	As	a	result,	we	revised	our	cost	,	annual	pre-tax	savings	and	timing	estimates	with	respect	to	the 2014	Manufacturing	Footprint	Realignment	Plan.	We	estimate	that	we	will	incur	aggregate	pre-tax	charges	in	connection	with	the	2014	Manufacturing Footprint	Realignment	Plan	of	approximately	$46	million	to	$51	million,	compared	to	our	most	recent	prior	estimate	of	approximately	$43	million	to	$48 million.	Additionally,	we	estimate	that	we	will	achieve	annual	pre-tax	savings	of	$26	million	to	$29	million	as	compared	to	our	most	recent	prior	estimate	of $23	million	to	$27	million.	As	a	result	of	the	changes	to	the	plan	described	above,	we	now	expect	the	plan	will	be	substantially	complete	by	the	end	of 2021,	as	compared	to	our	prior	estimate	of	the	second	half	of	2020.

We	continue	to	anticipate	an	increase	in	annual	revenues	resulting	from	improved	pricing	on	our	Vascular	kits	as	a	result	of	changes	made	to	our medication	delivery	devices.	We	anticipate	that	this	projected	increase	in	annual	revenues,	taken	together	with	the	projected	annual	savings	we	expect	to realize	under	the	2014	Manufacturing	Footprint	Realignment	Plan,	should	enable	us	to	improve	our	pre-tax	income	on	an	annual	basis	by	approximately $31	million	to	$35	million	once	the	plan	has	been	completed.

We	expect	aggregate	cash	outlays	associated	with	the	plan	to	be	in	the	range	of	$38	million	to	$43	million,	compared	to	our	most	recent	prior estimate	of	approximately	$33	million	to	$38	million.	Additionally,	we	continue	to	expect	that	we	will	incur	$24	million	to	$30	million	in	aggregate	capital expenditures	under	the	plan.

# 2016	Other	Restructuring	Programs

During	 the	 second	 half	 of	 2016,	 we	 commenced	 restructuring	 activities	 involving	 the	 consolidation	 of	 global	 administrative	 functions	 and manufacturing	operations.	These	programs	are	expected	to	be	substantially	complete	by	the	end	of	the	first	quarter	of	2018.	We	estimate	that	we	will record	aggregate	pre-tax	charges	of	$3.8	million	to	$4.7	million	related	to	these	programs,	which	constitute	termination	benefits	and	contract	termination costs	that	will	result	in	future	cash	outlays.	Additionally,	we	expect	to	incur	approximately	$1.5	million	of	accelerated	depreciation	and	other	costs	directly related	to	the	programs,	which	we	anticipate	will	be	recognized	in	cost	of	goods	sold;	we	anticipate	that	approximately	$1.0	million	of	this	amount	will result	in	cash	outlays.	As	of	December	31,	2017,	we	expect	to	achieve	annual	pre-tax	savings	of	$9.0	million	to	$10.0	million	once	this	program	is	fully implemented,	which	is	an	increase	to	the	prior	estimate	of	$6.9	million	to	$8.5	million.	The	increase	in	the	estimated	annual	pre-tax	savings	is	due	to	an increase	in	the	headcount	reduction	initially	contemplated	under	the	program.

For	additional	information	regarding	our	restructuring	programs	and	impairment	charges,	see	 Note	4	to	the	consolidated	financial	statements	included in	this	Annual	Report	on	Form	10-K.

# Interest	expense

|  | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
|  |  | (Dollars\tin\tmillions) |  |
| Interest\texpense | $82.5 | $54.9 | $61.3 |
| Average\tinterest\trate\ton\tdebt\tduring\tthe\tyear | 3.70% | 3.80% | 3.84% |

The	increase	in	interest	expense	for	the	year	ended	December	31,	2017	compared	to	the	prior	year	was	primarily	due	to	an	increase	in	average	debt outstanding,	mainly	attributable	to	borrowings	under	the	Credit	Agreement	that	were	utilized	to	fund	the	Vascular	Solutions	and	NeoTract	acquisitions, offset	by	a	slight	decline	in	the	average	interest	rate	on	debt.

The	decrease	in	interest	expense	for	the	year	ended	December	31,	2016	compared	to	the	prior	year	was	primarily	due	to	our	repurchase	of	our 3.875%	Convertible	Senior	Subordinated	Notes	due	2017	(the	"Convertible	Notes")	from	certain	holders	of	those	notes	in	exchange	for	cash	and	shares of	our	common	stock	(which	transactions	are	referred	to	below	as	"exchange	transactions")	and	conversions	of	the	Convertible	Notes,	resulting	in	lower average	amounts	of	debt	outstanding	compared	to	the	prior	period.	The	decrease	was	also	the	result	of	a	lower	average	interest	rate	due	to	our	June	1, 2015	redemption	of	our	6.875%	Senior	Subordinated	Notes	due	2019	(the	"2019	Notes"),	which	were	replaced	by	borrowings	under	our	previous revolving	credit	facility	and	subsequently	by	our	issuance	of	4.875%

Senior	Notes	due	2026	(the	"2026	Notes").	The	interest	rates	on	both	the	revolving	credit	facility	and	the	2026	Notes	are	lower	than	the	interest	rate	on the	2019	Notes.	The	decrease	in	interest	expense	was	partially	offset	by	financing	fees	of	$3.4	million	incurred	for	the	year	ended	December	31,	2016	to secure	bridge	financing	commitments	related	to	our	acquisition	of	Vascular	Solutions.

# Loss	on	extinguishment	of	debt

For	the	year	ended	December	31,	2017,	we	recognized	a	$5.6	million	loss	on	the	extinguishment	of	debt,	of	which	$5.2	million	related	to	our repurchase,	on	January	5,	2017,	of	$91.7	million	in	aggregate	principal	amount	of	Convertible	Notes	through	exchange	transactions	with	certain	holders of	the	Convertible	Notes,	and	$0.4	million	related	to	the	amendment	and	restatement	of	our	previous	credit	agreement,	which	was	considered	a	partial extinguishment	of	debt.	See	Note	8	to	the	consolidated	financial	statements	included	in	this	Annual	Report	on	Form	10-K	for	additional	information.

For	the	year	ended	December	31,	2016,	we	recognized	a	loss	on	the	extinguishment	of	debt	of	$19.3	million,	of	which,	$16.3	million	related	to	our repurchase	of	$219.2	million	in	aggregate	principal	amount	of	Convertible	Notes	through	exchange	transactions	with	certain	holders	of	the	Convertible Notes	and	$3.0	million	related	to	the	conversions	of	$44.4	million	in	aggregate	principal	amount	of	the	Convertible	Notes.

# Gain	on	sale	of	assets

|  | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
|  |  | (Dollars\tin\tmillions) |  |
| Gain\ton\tsale\tof\tassets | $— | $4.4 | $0.4 |

During	the	year	ended	December	31,	2016,	we	recognized	a	gain	of	$4.4	million,	primarily	as	a	result	of	the	sale,	for	$8.9	million,	of	two	buildings, one	of	which	was	previously	classified	as	held	for	sale.

# Taxes	on	income	from	continuing	operations

|  | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
| Effective\tincome\ttax\trate | 45.5% | 3.3% | 3.2% |

We	generate	substantial	earnings	from	our	international	operations.	Most	of	the	international	jurisdictions	in	which	we	file	tax	returns	historically	have had	statutory	tax	rates	that	are	lower	than	the	United	States	statutory	tax	rate;	as	a	result,	our	consolidated	effective	income	tax	rate	for	2017	(excluding the	impact	of	the	TCJA)	and	earlier	years	has	been	substantially	below	the	United	States	statutory	tax	rate.	The	principal	international	jurisdictions	in which	the	statutory	tax	rate	in	2017	and	earlier	years	is	lower	than	the	United	States	statutory	tax	rate	and	from	which	we	derive	substantial	earnings include	Ireland,	Bermuda,	Luxembourg,	Germany	and	Italy.

Despite	the	TCJA's	reduction	of	the	United	States	corporate	income	tax	rate,	we	anticipate	that	we	will	continue	to	have	a	consolidated	effective income	tax	rate	that	is	below	the	newly	enacted	statutory	tax	rate	due	to	the	lower	tax	rates	applicable	to	our	foreign	operations	in	many	of	the	relevant international	jurisdictions.	However,	changes	to	either	the	currently	enacted	United	States	tax	rates	or	international	statutory	tax	rates	could	affect	our effective	income	tax	rate	in	the	future.

Excluding	the	impact	of	any	discrete	items,	the	provisions	of	the	TCJA	are	expected	to	be	neutral	or	to	reduce	somewhat	our	effective	tax	rate	in	2018 compared	to	what	the	rate	would	have	been	prior	to	the	adoption	of	the	TCJA	.	The	ultimate	impact	on	our	effective	tax	rate	will	largely	depend	on	a variety	of	factors,	including	the	portion	of	pretax	earnings	that	we	generate	in	various	taxing	jurisdictions.

The	effective	income	tax	rate	for	2017	was	45.5%	compared	to	3.3%	for	2016.	Taxes	on	income	from	continuing	operations	in	2017	were $129.6 million	compared	to	$8.1	million	in	2016.	The	effective	income	tax	rate	for	2017	was	impacted	by	a	net	tax	expense	of	$107.9	million	resulting	from	the enactment	of	the	TCJA.	The	$107.9	million	net	tax	expense	reflects	a	tax	expense	of	$154.0	million	for	the	deemed	repatriation	of	undistributed	foreign earnings,	partially	offset	by	a	$46.1	million	tax	benefit	resulting	from	the	reassessment	and	revaluation	of	the	net	deferred	tax	liabilities.	Additionally,	the effective	tax	rate	for	2017	was	impacted	by	a	net	excess	tax	benefit	related	to	share-based	compensation	and	a	benefit	resulting	from	the	expiration	of various	statutes	of	limitation.	See	Note	13	to	the	consolidated	financial	statements	included	in	this	Annual	Report	on	Form	10-K	for	additional	information.

The	effective	income	tax	rate	in	2016	was	3.3%	compared	to	3.2%	in	2015.	Taxes	on	income	from	continuing	operations	in	2016	were $8.1	million compared	to	$7.8	million	in	2015.	The	effective	income	tax	rate	for	2016	was	impacted	by	a	tax	benefit	associated	with	U.S.	federal	tax	return	filings,	a benefit	resulting	from	the	reduction	of	German	tax	reserves	as	a	result	of	the	conclusion	of	an	audit,	a	benefit	resulting	from	the	expiration	of	various statutes	of	limitation	and	a	benefit	associated	with	an	IPR&D	asset	impairment.

# Segment	Results

# Segment	Net	Revenues

|  |  | Year	Ended	December	31 |  | %	Increase/(Decrease) | %	Increase/(Decrease) |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  | 2017 | 2016 | 2015 | 2017\tvs\t2016 | 2016\tvs\t2015 |
|  |  | (Dollars\tin\tmillions) |  |  |  |
| Vascular\tNorth\tAmerica | $313.6 | $295.2 | $284.1 | 6.2 | 3.9 |
| Interventional\tNorth\tAmerica | 220.6 | 82.4 | 75.2 | 167.6 | 9.6 |
| Anesthesia\tNorth\tAmerica | 198.0 | 198.8 | 189.2 | (0.4) | 5.0 |
| Surgical\tNorth\tAmerica | 175.2 | 172.2 | 161.3 | 1.7 | 6.8 |
| EMEA | 552.7 | 510.9 | 514.5 | 8.2 | (0.7) |
| Asia | 269.2 | 249.4 | 241.7 | 7.9 | 3.2 |
| OEM | 183.0 | 161.0 | 149.4 | 13.7 | 7.8 |
| All\tother | 234.0 | 198.1 | 194.3 | 18.1 | 1.9 |
| Segment\tNet\tRevenues | $2,146.3 | $1,868.0 | $1,809.7 | 14.9 | 3.2 |

# Segment	Operating	Profit

|  |  | Year	Ended	December	31, |  | %	Increase/(Decrease) | %	Increase/(Decrease) |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  | 2017 | 2016 | 2015 | 2017\tvs\t2016 | 2016\tvs\t2015 |
|  |  | (Dollars\tin\tmillions) |  |  |  |
| Vascular\tNorth\tAmerica | $77.0 | $77.1 | $59.5 | (0.1) | 29.7 |
| Interventional\tNorth\tAmerica | 26.0 | 13.3 | 5.8 | 95.8 | 128.7 |
| Anesthesia\tNorth\tAmerica | 62.9 | 55.6 | 48.3 | 13.2 | 15.0 |
| Surgical\tNorth\tAmerica | 63.9 | 56.6 | 52.5 | 12.9 | 7.8 |
| EMEA | 92.4 | 84.4 | 92.3 | 9.5 | (8.6) |
| Asia | 75.6 | 75.7 | 67.9 | (0.2) | 11.6 |
| OEM | 41.6 | 33.6 | 33.2 | 23.6 | 1.4 |
| All\tother | 11.2 | 26.5 | 28.4 | (57.9) | (6.7) |
| Segment\tOperating\tProfit(1) | $450.6 | $422.8 | $387.9 | 6.6 | 9.0 |

(1) See	Note	16	to	the	consolidated	financial	statements	included	in	this	Annual	Report	on	Form	10-K	for	a	reconciliation	of	segment	operating	profit	to	our	consolidated	income from	continuing	operations	before	interest,	loss	on	extinguishment	of	debt	and	taxes.

# Vascular	North	America

Vascular	North	America	net	revenues	for	the	year	ended	 December	31,	2017	increased	$18.4	million,	 or	6.2%,	compared	to	the	prior	year.	The increase	is	primarily	attributable	to	a	$7.9	million	net	increase	in	sales	volumes	of	existing	products,	a	$6.7	million	increase	in	new	product	sales	and price	increases.

Vascular	North	America	operating	profit	for	the	year	ended	 December	31,	2017	decreased	$0.1	million,	or	0.1%,	compared	to	the	prior	year.	The decrease	is	primarily	attributable	to	higher	general	and	administrative	expenses	as	well	as	higher	research	and	development	expenses.	In	addition, operating	profit	in	2016	reflected	a	benefit	resulting	from	the	reversal	of	contingent	consideration	liabilities.	The	decreases	were	partially	offset	by	an increase	in	gross	profit	resulting	from	an	increase	in	sales	volumes,	lower	manufacturing	costs	and	increases	in	prices	and	new	product	sales.

# Interventional	North	America

Interventional	North	America	net	revenues	for	the	year	ended	 December	31,	2017	increased	$138.2	million,	or	167.6%,	compared	to	the	prior	year. The	increase	is	primarily	attributable	to	net	revenues	of	$127.9	million	generated	by	Vascular	Solutions.

Interventional	North	America	operating	profit	for	the	year	ended	 December	31,	2017	increased	$12.7	million,	or	95.8%,	compared	to	the	prior	year. The	increase	is	primarily	attributable	to	gross	profit	generated	by	Vascular	Solutions,	which	was	partially	offset	by	higher	operating	expenses,	including expenses	incurred	in	connection	with	the	acquisition	and	ongoing	operations	of	Vascular	Solutions.

# Anesthesia	North	America

Anesthesia	North	America	net	revenues	for	the	year	ended	 December	31,	2017	decreased	$0.8	million,	or	0.4%,	compared	to	the	prior	year.	The decrease	is	primarily	attributable	to	a	$10.1	million	decrease	in	sales	volumes	of	existing	products	partially	offset	by	net	revenues	generated	by	an acquired	business	and	an	increase	in	new	product	sales.

Anesthesia	North	America	operating	profit	for	the	year	ended	 December	31,	2017	increased	$7.3	million,	or	13.2%,	compared	to	the	prior	year.	The increase	is	primarily	attributable	to	a	gain	of	$6.4	million	resulting	from	a	favorable	ruling	in	a	lawsuit	involving	an	insurance	provider.

# Surgical	North	America

Surgical	North	America	net	revenues	for	the	year	ended	 December	31,	2017	increased	$3.0	million,	 or	1.7%,	compared	 to	 the	prior	year.	The increase	is	primarily	attributable	to	a	$3.0	million	increase	in	new	product	sales	and	price	increases	of	$2.6	million	partially	offset	by	a	$2.8	million decrease	in	sales	volumes	of	existing	products.

Surgical	North	America	operating	profit	for	the	year	ended	 December	31,	2017	increased	$7.3	million,	or	12.9%,	compared	to	the	prior	year.	The increase	is	primarily	attributable	to	an	increase	in	gross	profit	resulting	from	lower	manufacturing	costs	and	increases	in	prices	and	new	product	sales, partially	 offset	 by	 sales	 volume	 decreases.	The	 increase	 in	operating	profit	 is	also	attributable	 to	 lower	expense	associated	with	 the	revaluation	of contingent	consideration	liabilities.

EMEA	net	revenues	for	the	year	ended	 December	31,	2017	increased	$41.8	million,	or	8.2%,	compared	to	the	prior	year.	The	increase	is	primarily attributable	to	net	revenues	of	$20.5	million	generated	by	acquired	businesses	(primarily	Vascular	Solutions),	favorable	fluctuations	in	foreign	currency exchange	rates	and	an	increase	in	new	product	sales.

EMEA	operating	profit	for	the	year	ended	 December	31,	2017	increased	$8.0	million,	or	9.5%,	compared	to	the	prior	year.	The	increase	is	primarily attributable	to	gross	profit	generated	by	the	acquired	businesses,	primarily	Vascular	Solutions,	as	well	as	an	increase	in	gross	profit	resulting	from	higher sales	volumes.	These	increases	were	partially	offset	by	the	impact	of	unfavorable	fluctuations	in	foreign	currency	exchange	rates	and	higher	operating expenses,	primarily	resulting	from	costs	incurred	by	Vascular	Solutions.

Asia	net	revenues	for	the	year	ended	December	31,	2017	increased	$19.8	million,	or	7.9%,	compared	to	the	prior	year.	The	increase	was	primarily attributable	to	net	revenues	of	$7.5	million	generated	by	acquired	businesses	(primarily	Vascular	Solutions),	as	well	as	increases	in	sales	volumes	of existing	products,	new	product	sales	and	price	increases.	We	experienced	a	decline	in	sales	of	certain	product	lines	in	China	during	2017	as	a	result	of	a distributor	to	direct	sales	conversion,	as	we	implemented	a	new	structure	to	support	product	sales.	However,	this	decline	was	more	than	offset	by	a	net increase	in	sales	volumes	in	the	remainder	of	the	Asia	segment.	During	the	first	quarter	2017,	the	distributor	in	China	that	we	terminated	in	connection with	the	distributor	to	direct	sales	conversion	commenced	an	arbitration	proceeding	against	us,	seeking,	among	other	things,	to	compel	our	repurchase	of Teleflex	products	that	the	distributor	held	in	its	inventory.	In	February	2018,	we	entered	into	a	settlement	agreement	with	the	distributor	with	respect	to the	outstanding	arbitration	claims.	See	Note	15	to	the	consolidated	financial	statements	included	in	this	Annual	Report	on	Form	10-K	for	additional information.

Asia	operating	profit	for	the	year	ended	December	31,	2017	decreased	$0.1	million,	or	0.2%,	compared	to	the	prior	year.	The	decrease	was	primarily attributable	to	higher	selling,	general	and	administrative	expenses,	including	those	incurred	in	connection	with	the	distributor	to	direct	sales	conversion and	related	arbitration	in	China	referenced	above,	costs	incurred	by	Vascular	Solutions	and	unfavorable	fluctuations	in	foreign	currency	exchange	rates. The	decreases	were	partially	offset	by	an	increase	in	gross	profit	generated	by	acquired	businesses	(primarily	Vascular	Solutions)	as	well	as	an	increase in	gross	profit	resulting	from	price	increases.

OEM	net	revenues	for	the	year	ended	December	31,	2017	increased	$22.0	million,	or	13.7%,	compared	to	the	prior	year.	The	increase	is	primarily attributable	to	a	$10.4	million	increase	in	sales	volumes	of	existing	products,	net	revenues	of	$7.7	million	generated	by	an	acquired	business	and	to	a lesser	extent,	an	increase	in	new	product	sales.

OEM	operating	profit	for	the	year	ended	 December	31,	2017	increased	$8.0	million,	or	23.6%,	compared	to	the	prior	year.	The	increase	is	primarily attributable	to	an	increase	in	gross	profit	resulting	from	higher	sales	volumes	and	gross	profit	generated	by	an	acquired	business.	This	increase	was partially	offset	by	higher	operating	expenses	including	those	incurred	by	the	acquired	business	as	well	as	selling	expenses.

# All	other

Net	revenues	for	the	other	businesses	for	the	year	ended	 December	31,	2017	increased	$35.9	million,	or	18.1%,	compared	to	the	prior	year.	The increase	is	primarily	attributable	to	net	revenues	of	$37.1	million	generated	by	NeoTract.

Operating	profit	for	the	other	businesses	for	the	year	ended	 December	31,	2017	decreased	$15.3	million,	or	57.9%,	compared	to	the	prior	year.	The decrease	is	primarily	attributable	to	higher	operating	expenses	resulting	from	the	NeoTract	acquisition,	including	transaction	fees	and	related	expenses, which	were	partially	offset	by	gross	profit	generated	by	the	NeoTract	acquisition.

Vascular	North	America	net	revenues	for	the	year	ended	December	31,	2016	increased	$11.1	million,	or	3.9%,	compared	to	the	prior	year.	The increase	is	primarily	attributable	to	an	increase	in	sales	volumes	of	existing	products	of	$6.3	million,	new	product	sales	of	$3.0	million	and,	to	a	lesser extent,	price	increases.

Vascular	North	America	operating	profit	for	the	year	ended	December	31,	2016	increased	$17.6	million,	or	29.7%,	compared	to	the	prior	year.	The increase	is	primarily	attributable	to	a	benefit	resulting	from	the	reversal	of	contingent	consideration	liabilities,	as	well	as	an	increase	in	gross	profit, reflecting	the	impact	of	an	increase	in	sales	volumes	of	existing	products	and	price	increases,	lower	administrative	expenses	and	the	favorable	impact	of the	suspension	of	the	excise	tax	on	medical	devices	under	the	Affordable	Care	Act.

Interventional	North	America	net	revenues	for	the	year	ended	December	31,	2016	increased	$7.2	million	or	9.6%,	compared	to	the	prior	year.	The increase	is	primarily	attributable	to	an	increase	in	sales	volumes	of	existing	products	of	$5.2	million	and	price	increases	of	$1.9	million.

Interventional	North	America	operating	profit	for	the	year	ended	December	31,	2016	increased	$7.5	million,	or	128.7%,	compared	to	the	prior	year. The	increase	is	primarily	attributable	to	an	increase	in	gross	profit,	mainly	due	to	the	impact	of	higher	sales	volumes	of	existing	products,	price	increases and	increased	sales	of	higher	margin	products.

Anesthesia	North	America	net	revenues	for	the	year	ended	December	31,	2016	increased	$9.6	million,	or	5.0%,	compared	to	the	prior	year.	The increase	is	primarily	attributable	to	an	increase	in	sales	volumes	of	existing	products	of	$5.8	million	and	an	increase	in	new	product	sales	of	$3.5	million.

Anesthesia	North	America	operating	profit	for	the	year	ended	December	31,	2016	increased	$7.3	million,	or	15.0%,	compared	to	the	prior	year.	The increase	is	primarily	attributable	to	an	increase	in	gross	profit,	mainly	due	to	the	impact	of	an	increase	in	sales	of	higher	margin	products	and	an	increase in	sales	volumes	of	existing	products.	The	increase	in	operating	profit	was	also	attributable	to	the	favorable	impact	of	the	suspension	of	the	excise	tax	on medical	devices	under	the	Affordable	Care	Act.	The	impact	of	these	factors	was	partially	offset	by	higher	amortization	and	marketing	expenses,	as	well as	unfavorable	fluctuations	in	foreign	currency	exchange	rates.

Surgical	North	America	net	revenues	for	the	year	ended	December	31,	2016	increased	$10.9	million,	or	6.8%,	compared	to	the	prior	year.	The increase	is	primarily	attributable	to	an	increase	in	new	product	sales	of	$6.7	million	and	price	increases	of	$3.9	million.

Surgical	North	America	operating	profit	for	the	year	ended	December	31,	2016	increased	$4.1	million,	or	7.8%,	compared	to	the	prior	year.	The increase	is	primarily	attributable	to	an	increase	in	gross	profit	principally	reflecting	increased	new	product	sales.	The	increase	in	operating	profit	was	also attributable	to	lower	amortization	expense	and	the	favorable	impact	of	the	suspension	of	the	excise	tax	on	medical	devices	under	the	Affordable	Care	Act. The	impact	of	these	factors	was	partially	offset	by	higher	selling	expense,	primarily	related	to	new	product	sales,	the	unfavorable	effect	of	an	increase	in contingent	consideration	liabilities	and	unfavorable	fluctuations	in	foreign	currency	exchange	rates.

EMEA	net	revenues	for	the	year	ended	December	31,	2016	decreased	$3.6	million,	or	0.7%,	compared	to	the	prior	year.	The	decrease	is	primarily attributable	to	unfavorable	fluctuations	in	foreign	currency	exchange	rates	of	$9.3	million,	partially	offset	by	an	increase	in	sales	volumes	of	existing products	and	an	increase	in	new	products	sales.

EMEA	operating	profit	for	the	year	ended	December	31,	2016	decreased	$7.9	million,	or	8.6%,	compared	to	the	prior	year.	The	decrease	is	primarily attributable	to	a	decrease	in	gross	profit	principally	due	to	unfavorable	fluctuations	in	foreign	currency	exchange	rates.	The	decrease	in	operating	profit was	also	attributable	to	higher	operating	expenses,	across	most	categories,	despite	the	favorable	impact	of	fluctuations	in	foreign	currency	exchanges rates	on	these	expenses.

Asia	net	revenues	for	the	year	ended	December	31,	2016	increased	$7.7	million,	or	3.2%,	compared	to	the	prior	year.	The	increase	was	primarily attributable	 to	 price	 increases	 of	 $4.0	 million	 and	 an	 increase	 in	 sales	 volumes	 of	 existing	 products	 of	 $3.6	 million,	 which	 were	 partially	 offset	 by unfavorable	fluctuations	in	foreign	currency	exchange	rates.

Asia	operating	profit	for	the	year	ended	December	31,	2016	increased	$7.8	million,	or	11.6%,	compared	to	the	prior	year.	The	increase	is	primarily attributable	 to	 an	 increase	 in	 gross	 profit,	 primarily	 reflecting	 price	 increases.	The	 increase	 in	 operating	 profit	 was	 also	 attributable	 to	 favorable fluctuations	in	foreign	currency	exchange	rates,	partially	offset	by	an	increase	in	marketing	expense.

OEM	net	revenues	for	the	year	ended	December	31,	2016	increased	$11.6	million,	or	7.8%,	compared	to	the	prior	year.	The	increase	is	primarily attributable	to	an	increase	in	sales	volumes	of	existing	products	of	$6.1	million	and	net	revenues	generated	by	the	acquired	businesses	of	$3.6	million.

OEM	operating	profit	for	the	year	ended	December	31,	2016	increased	$0.4	million,	or	1.4%,	compared	to	the	prior	year.	The	increase	is	primarily attributable	to	an	increase	in	gross	profit,	reflecting	increased	sales	volumes	of	existing	products,	which	was	partially	offset	by	higher	selling,	general	and administrative	expenses.

Net	revenues	for	the	other	businesses	for	the	year	ended	December	31,	2016	increased	$3.8	million,	or	1.9%,	compared	to	the	prior	year.	The increase	is	principally	attributable	to	an	increase	in	sales	volumes	of	existing	products	of	$4.7	million	and	an	increase	in	new	product	sales	of	$3.5	million, partially	offset	by	unfavorable	fluctuations	in	foreign	currency	exchange	rates.

Operating	profit	for	the	other	businesses	for	the	year	ended	December	31,	2016	decreased	$1.9	million,	or	6.7%,	compared	to	the	prior	year.	The decrease	is	principally	attributable	to	a	decrease	in	gross	profit,	primarily	reflecting	higher	manufacturing	costs	and	the	impact	of	unfavorable	fluctuations in	foreign	currency	exchange	rates.	The	decreases	in	operating	profit	were	partially	offset	by	the	favorable	impact	of	the	suspension	of	the	excise	tax	on medical	devices	under	the	Affordable	Care	Act	and	lower	research	and	development	expenses.

# Liquidity	and	Capital	Resources

We	assess	our	liquidity	in	terms	of	our	ability	to	generate	cash	to	fund	our	operating,	investing	and	financing	activities.	Our	principal	source	of	liquidity is	operating	cash	 flows.	 In	addition	 to	operating	cash	 flows,	other	significant	 factors	 that	affect	our	overall	management	of	 liquidity	 include:	capital expenditures,	 acquisitions,	 pension	 funding,	 dividends,	 taxes,	 scheduled	 principal	 and	 interest	 payments	 with	 respect	 to	 outstanding	 indebtedness, adequacy	of	available	bank	lines	of	credit	and	access	to	capital	markets.

We	believe	our	cash	flow	from	operations,	available	cash	and	cash	equivalents	and	borrowings	under	our	revolving	credit	facility	(which	is	provided for	under	our	Credit	Agreement)	and	accounts	receivable	securitization	facility	will	enable	us	to	fund	our	operating	requirements,	capital	expenditures	and debt	obligations	for	the	next	12	months	and	the	foreseeable	future.

Of	our	$333.6	million	of	cash	and	cash	equivalents	at	 December	31,	2017,	$286.3	million	was	held	at	foreign	subsidiaries.	We	manage	our	worldwide cash	requirements	by	monitoring	the	funds	available	among	our	subsidiaries	and	determining	the	extent	to	which	we	can	access	those	funds	on	a	cost effective	basis.

The	TCJA	significantly	changes	U.S.	tax	law	by,	among	other	things,	imposing	a	one-time	repatriation	tax	on	undistributed	post-1986	earnings	and profits	of	foreign	subsidiaries.	Previously,	we	were	not	taxed	on	foreign	earnings	deemed	to	be	permanently	invested	overseas.	Under	the	TCJA,	we	will have	to	pay	$154.0	million	over	eight	years	for	the	deemed	repatriation	of	foreign	earnings,	regardless	of	whether	such	earnings	are	actually	repatriated. See	Note	13	to	the	consolidated	financial	statements	included	in	this	Annual	Report	on	Form	10-K	for	additional	information.	As	a	result	of	the	repatriation tax	provisions	of	the	TCJA,	we	anticipate	that,	generally,	we	will	be	able	to	access	cash	located	at	our	foreign	subsidiaries	without	incurring	any	additional U.S.	federal	income	tax	liabilities.	We	are	not	aware	of	any	other	restrictions	on	repatriation	of	these	funds	and,	subject	to	cash	payment	of	additional foreign	withholding	taxes,	these	funds	could	be	repatriated,	if	necessary.

We	have	not	experienced	significant	payment	defaults	by	our	customers	and	we	have	sufficient	lending	commitments	in	place	to	enable	us	to	fund our	anticipated	operating	needs.	However,	as	discussed	above	in	"Global	Economic	Conditions",	although	there	have	been	recent	improvements	in certain	countries,	global	financial	markets	remain	volatile	and	the	global	credit	markets	are	constrained,	which	creates	risk	 that	our	customers	and suppliers	may	be	unable	to	access	liquidity.	Consequently,	we	continue	to	monitor	our	credit	risk,	particularly	with	respect	to	customers	in	Greece,	Italy, Portugal	and	Spain,	as	well	as	consider	other	risk	mitigation	strategies.	In	January	2017,	we	sold	$16.1	million	of	receivables	payable	from	publicly	funded hospitals	in	Italy	for	$16.0	million.

As	 of	December	31,	2017	 and	2016,	our	net	trade	accounts	receivable	from	publicly	funded	hospitals	in	Greece,	Italy,	Portugal	and	Spain	were $24.7	million	and	$29.2	million,	respectively.	For	the	years	ended	 December	31,	2017,	2016	and	2015,	net	revenues	from	customers	in	these	countries were	approximately	6%,	7%	and	7%,	respectively,	of	our	total	net	revenues,	and	average	days	that	current	and	long-term	trade	accounts	receivable	with respect	to	these	customers	were	outstanding	were	154,	182	and	204	days,	respectively.	As	of	 December	31,	2017	and	2016,	net	current	and	long-term trade	accounts	receivable	from	these	countries	were	approximately	15%	 and	19%,	respectively,	of	our	consolidated	net	current	and	long-term	trade accounts	receivable.	If	economic	conditions	in	these	countries	deteriorate,	we	may	experience	significant	credit	losses	related	to	the	public	hospital systems	in	these	countries.	Moreover,	if	global	economic	conditions	generally	deteriorate,	we	may	experience	further	delays	in	customer	payments, reductions	in	our	customers'	purchases	and	higher	credit	losses,	which	could	have	a	material	adverse	effect	on	our	results	of	operations	and	cash	flows in	2018	and	future	years.	See	"Critical	Accounting	Policies	and	Estimates"	below	for	additional	information	regarding	the	critical	accounting	estimates related	to	our	accounts	receivable.

The	aggregate	total	fair	value	of	consideration	we	provided	for	the	acquisitions	we	made	in	 2017	 and	2016	 was	$2.0	billion	 and	$22.8	million, respectively.	The	 most	 significant	 acquisitions	 completed	 in	 2017	 were	 Vascular	 Solutions	 and	 NeoTract.	 See	Note	3	 to	 the	 consolidated	 financial statements	included	in	this	Annual	Report	on	Form	10-K	for	additional	information	regarding	our	acquisitions.

In	January	2017,	we	entered	into	the	Credit	Agreement,	which	provides	for	a	five-year	revolving	credit	facility	of	$1.0	billion	and	a	term	loan	facility	of $750.0	million.	We	used	the	term	loan	facility	to	finance	most	of	the	consideration	for	the	Vascular	Solutions	acquisition	(the	remaining	consideration	was provided	through	borrowings	under	the	revolving	credit	facility).	The	revolving	credit	facility	provides	us	with	significant	flexibility	to	meet	our	foreseeable working	capital	and	other	liquidity	needs.	In	addition,	during	2017,	we	reacquired,	through	conversion	or	exchange,	and	retired	our	3.875%	convertible senior	subordinated	notes,	which	matured	on	August	1,	2017	("Convertible	Notes"),	using	available	funds	under	the	revolving	credit	facility.	We	also	used $725	million	in	borrowings	under	our	revolving	credit	facility	to	finance,	in	part,	our	acquisition	of	NeoTract.	Additionally,	in	November	2017,	we	sold $500.0	million	in	principal	amount	of	4.625%	senior	notes	due	2027	(the	"2027	Notes"),	the	net	proceeds	of	which	were	used	to	repay	borrowings	under the	revolving	credit	facility.

In	connection	with	the	original	issuance	of	the	Convertible	Notes	in	2010,	we	entered	into	a	convertible	note	hedge	transaction	to	purchase	call options.	The	call	options	enabled	the	Company	to	economically	hedge	the	dilutive	impact	of	the	Convertible	Notes	conversions	on	the	weighted	average number	of	diluted	shares	outstanding.	In	connection	with	Convertible	Note	conversions	and	exchanges,	we	exercised	or	unwound	these	related	call options.	We	also	entered	into	warrant	transactions	in	connection	with	issuance	of	the	Convertible	Notes.	Counterparties	continue	to	hold	warrants	to purchase	 our	 common	 stock	 that	 they	 acquired	 at	 the	 time	 of	 the	 initial	 issuance	 of	 the	 Convertible	 Notes.	At	 December	 31,	 2017,	 warrants	 to purchase	559,614	shares	at	an	exercise	price	of	$74.65	per	share	remained	outstanding.	The	remaining	warrants	expire	ratably	over	a	period	ending	on August	31,	2018.	At	December	31,	2017,	the	intrinsic	value	of	the	warrants	(i.e.	the	excess	of	the	aggregate	market	price	of	the	underlying	shares	over the	aggregate	exercise	price	of	the	warrants)	was	$98.0	million.

We	may	at	any	time,	from	time	to	time,	repurchase	our	outstanding	debt	securities	in	open	market	purchases,	via	tender	offers	or	in	privately negotiated	transactions,	exchange	transactions	or	otherwise,	at	such	price	or	prices	as	we	deem	appropriate.	Such	purchases	or	exchanges,	if	any,	will depend	on	prevailing	market	conditions,	our	liquidity	requirements,	contractual	restrictions	and	other	factors	and	may	be	commenced	or	suspended	at	any time.

See	"Financing	Arrangements"	below	as	well	as	Note	8	to	the	consolidated	financial	statements	included	in	this	Annual	Report	on	Form	10-K	for further	information	related	to	our	borrowings.

# Cash	Flows

The	following	table	provides	a	summary	of	our	cash	flows	for	the	periods	presented:

| Operating	activities | $426.3 | $410.6 | $303.4 |
| :--- | :--- | :--- | :--- |
| Investing\tactivities | (1,832.9) | (57.0) | (154.8) |
| Financing\tactivities | 1,141.3 | (118.7) | (85.6) |
| Cash\tflows\tused\tin\tdiscontinued\toperations | (6.4) | (2.1) | (2.6) |
| Effect\tof\texchange\trate\tchanges\ton\tcash\tand\tcash\tequivalents | 61.5 | (27.4) | (25.3) |
| Increase\t(decrease)\tin\tcash\tand\tcash\tequivalents | $(210.2) | $205.4 | $35.1 |

# Cash	Flow	from	Operating	Activities

Net	cash	provided	by	operating	activities	from	continuing	operations	was	 $426.3	million	during	2017	and	$410.6	million	 during	 2016.	The	$15.7 million	increase	is	attributable	to	favorable	operating	results	partially	offset	by	a	net	cash	outflow	for	income	taxes	resulting	primarily	from	a	tax	refund received	in	2016.	Excluding	income	taxes,	the	net	impact	of	the	working	capital	changes	was	consistent	in	2017	as	compared	to	2016;	an	increase	in inventories	was	offset	by	an	increase	in	accounts	payable	and	accrued	expenses,	and	to	a	lesser	extent,	a	net	decrease	in	prepaid	expenses	and	other current	assets.	The	increase	in	inventories	for	the	year	ended	December	31,	2017	was	$22.4	million	compared	to	a	decrease	of	$6.4	million	for	the	year ended	December	31,	2016.	The	increase	is	attributable	to	inventory	purchases	to	achieve	desired	safety	stock	levels	as	well	as	inventory	from	a	former Chinese	distributor	that	was	returned	to	us	during	2017	as	part	of	an	arbitration	proceeding.	See	Note	15	to	the	consolidated	financial	statements	included in	this	Annual	Report	on	Form	10-K	for	additional	information	regarding	this	arbitration	proceeding.	The	net	increase	in	accounts	payable	and	accrued expenses	was	$39.0	million	for	the	year	ended	December	31,	2017	as	compared	to	an	increase	of	$15.4	million	for	the	year	ended	December	31,	2016; the	increase	is	primarily	attributable	to	an	increase	in	payroll	and	benefit	related	accruals.

# Cash	Flow	from	Investing	Activities

Net	cash	used	in	investing	activities	from	continuing	operations	was	 $1.8	billion	during	2017,	primarily	resulting	from	$1.8	billion	in	payments	for businesses	acquired,	principally	Vascular	Solutions	and	NeoTract;	and	capital	expenditures	of	$70.9	million,	which	were	partially	offset	by	proceeds	of $6.3	million	from	the	sale	of	two	properties,	one	of	which	was	a	building	that	had	been	previously	classified	as	held	for	sale.

# Cash	Flow	from	Financing	Activities

Net	 cash	 provided	 by	 financing	 activities	 from	 continuing	 operations	 was	 $1.1	 billion	 during	 2017,	 primarily	 resulting	from	 a	 net	 increase	 in borrowings	of	$1.2	billion.	Our	borrowings	under	the	Credit	Agreement	included	$1.0	billion	to	finance	the	Vascular	Solutions	acquisition,	together	with related	fees	and	expenses,	and	$725	million	to	finance	the	NeoTract	acquisition.	In	addition,	we	sold	$500	million	in	principal	amount	of	the	2027	Notes. These	increases	were	partially	offset	by	our	repayments	of	1.1	billion	of	borrowings	under	the	Credit	Agreement.	Additionally,	we	had	a	$136.1	million reduction	 in	 borrowings	 under	 our	 3.875%	 Convertible	 Senior	 Subordinated	 Notes	 due	 2017	 (the	 "Convertible	 Notes")	 resulting	 from	 exchange transactions,	and	payment	upon	maturity	of	all	remaining	Convertible	Notes	outstanding,	each	of	which	is	discussed	below	under	"Borrowings."

Net	cash	provided	by	financing	activities	from	continuing	operations	was	also	impacted	by	dividend	payments	of	$61.2	million	and	debt	issuance and	amendment	fees	of	$26.7	million,	which	included	fees	paid	in	connection	with	our	entry	into	the	Credit	Agreement,	the	issuance	of	the	2027	Notes and	a	bridge	facility	and	backstop	commitment	that	was	put	in	place	to	assist	with	the	financing	of	the	Vascular	Solutions	acquisition,	but	was	never utilized	because	the	required	financing	was	provided	under	the	Credit	Agreement.

Net	cash	provided	by	operating	activities	from	continuing	operations	was	$410.6	million	during	2016	and	$303.4	million	during	2015.	The	$107.2 million	increase	is	primarily	attributable	to	improved	operating	results,	a	net	favorable	impact	from	changes	in	working	capital	and	a	reduction	in	income tax	payments.

The	 net	 cash	 inflow	 from	 working	 capital	 is	 primarily	 the	 result	 of	 an	 increase	 in	 accounts	 payable	 and	 accrued	 expenses	 and	 a	 decrease	 in inventories	partially	offset	by	an	increase	in	accounts	receivable.	The	cash	inflow	for	accounts	payable	and	accrued	expenses	was	$15.4	million	for	the year	ended	December	31,	2016	as	compared	to	a	cash	outflow	of	$0.1	million	for	the	year	ended	December	31,	2015.	The	cash	inflow	for	accounts payable	and	accrued	expenses,	excluding	the	impact	of	the	net	increase	in	the	restructuring	reserve,	is	attributable	to	certain	non-recurring	accrued expense	payments	made	during	the	year	ended	December	31,	2015.	The	cash	inflow	for	inventories	was	$6.4	million	in	2016	as	compared	to	a	$8.4 million	net	cash	outflow	in	2015.	The	lower	inventory	levels	in	2016	are	primarily	the	result	of	higher	than	expected	net	revenues	in	the	fourth	quarter	and fewer	inventory	builds	in	support	of	distributor	to	direct	sales	conversions.	The	cash	outflow	related	to	accounts	receivable	was	$11.0	million	in	2016	as compared	to	a	cash	inflow	of	$0.4	million	in	2015.	The	increase	in	accounts	receivable	for	the	year	ended	December	31,	2016	is	attributable	to	higher fourth	quarter	net	revenues	as	compared	to	2015,	partially	offset	by	stronger	collections,	particularly	in	Europe.

Net	cash	used	in	investing	activities	from	continuing	operations	was	$57.0	million	during	2016,	primarily	resulting	from	capital	expenditures	of	$53.1 million	and	payments	for	businesses	and	intangibles	acquired	of	$14.0	million.	The	acquired	business	and	intangibles	included	certain	assets	of	CarTika Medical,	Inc.	and	certain	distributors	in	New	Zealand,	which	were	comprised	primarily	of	intangible	assets,	including	goodwill,	and	inventory.	These payments	were	partially	offset	by	proceeds	from	asset	sales	of	$10.2	million,	primarily	related	to	two	buildings.

Net	cash	used	in	financing	activities	from	continuing	operations	was	$118.7	million	during	2016,	primarily	resulting	from	dividends	paid	of	$59.0 million	and	a	net	reduction	in	borrowings	of	$42.9	million.	The	net	reduction	in	borrowings	included	reductions	of	$263.6	million	resulting	from	exchange transactions	and	conversions	related	to	Convertible	Notes	and	the	net	reduction	of	$186.0	million	in	the	outstanding	balance	of	our	revolving	credit	facility, partially	offset	by	our	issuance	of	$400.0	million	in	principal	amount	of	the	2026	Notes	and	increased	borrowings	of	$6.7	million	under	our	securitization program.	Net	cash	used	in	financing	activities	also	reflected	a	$9.2	million	payment	for	our	acquisition	of	the	remaining	26%	noncontrolling	interest	of Teleflex	Medical	Private	Limited,	our	Indian	affiliate	in	which	we	already	owned	the	74%	controlling	interest,	$9.0	million	in	debt	extinguishment,	issuance and	amendment	fees,	including	transaction	fees	associated	with	the	issuance	of	the	2026	Notes	and	$7.3	million	in	contingent	consideration	payments. These	cash	payments	were	partially	offset	by	$9.1	million	of	net	proceeds	from	share-based	compensation	plans	and	the	related	tax	benefits,	primarily related	to	stock	option	exercises.

# Financing	Arrangements

The	following	table	provides	our	net	debt	to	total	capital	ratio:

| Current	borrowings | $86.6 | $183.1 |
| :--- | :--- | :--- |
| Long-term\tborrowings | 2,162.9 | 850.3 |
| Unamortized\tdebt\tdiscount | — | 2.7 |
| Unamortized\tdebt\tissuance\tcosts | 20.5 | 10.0 |
| Total\tdebt | 2,270.0 | 1,046.1 |
| Less:\tCash\tand\tcash\tequivalents | 333.6 | 543.8 |
| Net\tdebt | 1,936.4 | 502.3 |
| Total\tcapital\tincludes: |  |  |
| Net\tdebt | 1,936.4 | 502.3 |
| Shareholders'\tequity | 2,430.5 | 2,137.5 |
| Total\tcapital | $4,366.9 | $2,639.8 |
| Percent\tof\tnet\tdebt\tto\ttotal\tcapital | 44.3% | 19.0% |

Fixed	rate	debt	comprised	50.7%	and	75.1%	of	total	debt	at	December	31,	2017	and	2016,	respectively.	The	decrease	in	fixed	rate	borrowings	as	a percentage	of	total	borrowings	at	December	31,	2017	compared	to	the	fixed	rate	borrowings	as	a	percentage	of	total	borrowings	at	December	31,	2016	is primarily	due	to	variable	rate	borrowings	under	our	amended	and	restated	senior	credit	facility	(described	below)	offset	by	the	increase	in	fixed	rate borrowings	as	a	result	of	the	issuance	of	the	2027	Notes.

# Amended	and	restated	senior	credit	facility

On	 January	 20,	 2017,	 we	 amended	 and	 restated	 our	 then-existing	 senior	 credit	 agreement	 by	 entering	 into	 an	 amended	 and	 restated	 credit agreement	(the	"Credit	Agreement").	As	noted	above,	the	Credit	Agreement	provides	for	a	five-year	revolving	credit	facility	of	$1.0	billion	and	a	term	loan facility	of	$750.0	million.	The	term	loan	facility	and	borrowings	under	the	revolving	credit	facility	were	used	to	finance	the	acquisition	of	Vascular	Solutions. The	obligations	under	the	Credit	Agreement	are	guaranteed	(subject	to	certain	exceptions	and	limitations)	by	substantially	all	of	our	material	domestic subsidiaries	and	are	secured	by	a	lien	on	substantially	all	of	our	and	each	guarantor's	owned	assets.	The	revolving	credit	facility	and	the	term	loan	facility will	mature	on	January	20,	2022	and	February	17,	2022,	respectively.	At	December	31,	2017,	we	had	$349.0	million	in	borrowings	outstanding	and approximately	$3.2	million	in	outstanding	standby	letters	of	credit	under	our	$1.0	billion	revolving	credit	facility.

The	Credit	Agreement	contains	customary	representations	and	warranties	and	covenants	that,	among	other	things	and	subject	to	certain	exceptions, qualifications	and	thresholds,	place	limitations	on	our	ability,	and	the	ability	of	our	subsidiaries,	to	incur	additional	indebtedness,	create	additional	liens, enter	into	a	merger,	consolidation	or	amalgamation,	dispose	of	certain	assets,	make	certain	investments	or	acquisitions,	pay	dividends	on,	repurchase	or make	distributions	 in	respect	of	capital	stock	and	enter	 into	swap	agreements.	Additionally,	 the	Credit	Agreement	contains	 financial	covenants	 that require	us	to	maintain	a	consolidated	total	leverage	ratio	(generally,	Consolidated	Total	Funded	Indebtedness,	as	defined	in	the	Credit	Agreement,	on	the determination	date	to	Consolidated	EBITDA,	as	defined	in	the	Credit	Agreement,	for	the	four	most	recent	fiscal	quarters	ending	on	or	preceding	the determination	date)	of	not	more	than	4.50	to	1,	a	secured	leverage	ratio	(generally,	Consolidated	Senior	Secured	Funded	Indebtedness,	as	defined	in	the Credit	Agreement,	on	the	determination	date	to	Consolidated	EBITDA,	as	defined	in	the	2017	Credit	Agreement,	for	the	four	most	recent	fiscal	quarters ending	on	or	preceding	the	determination	date)	of	not	more	than	3.50	to	1	and	a	consolidated	interest	coverage	ratio	(generally,	Consolidated	EBITDA	for the	four	most	recent	quarters	ending	on	or	preceding	the	determination	date	to	Consolidated	Interest	Expense,	as	defined	in	the	Credit	Agreement,	paid in	cash	for	such	period)	of	not	less	than	3.50	to	1.

See	Note	8	to	the	consolidated	financial	statements	included	in	this	Annual	Report	on	Form	10-K	for	additional	information	regarding	the	Credit Agreement.

As	of	December	31,	2017,	the	outstanding	principal	amount	of	the	2024	Notes,	2026	Notes	and	2027	Notes	was	$250.0,	$400.0	million	and	$500.0 million,	respectively.	The	indentures	governing	the	2024	Notes	and	2026	Notes	contain	covenants	that,	among	other	things,	limit	or	restrict	our	ability,	and the	 ability	 of	 our	 subsidiaries,	 to	 incur	 debt,	 create	 liens,	 consolidate,	 merge	 or	 dispose	 of	 certain	 assets,	 make	 certain	 investments,	 engage	 in acquisitions,	and	pay	dividends	on,	repurchase	or	make	distributions	in	respect	of	capital	stock,	subject	to	specified	conditions.	The	indenture	governing the	2027	Notes	contains	covenants	that,	among	other	things,	limit	or	restrict	our	ability,	and	the	ability	of	our	subsidiaries,	to	create	liens;	consolidate, merge	or	dispose	of	certain	assets;	and	enter	into	sale	leaseback	transactions.	The	obligations	under	the	Senior	Notes	are	fully	and	unconditionally guaranteed,	jointly	and	severally,	by	each	of	our	existing	and	future	100%	owned	domestic	subsidiaries	that	are	a	guarantor	or	other	obligor	under	the Credit	Agreement	and	by	certain	of	our	other	100%	owned	domestic	subsidiaries.	As	of	December	31,	2017,	we	were	in	compliance	with	all	of	the	terms of	our	Senior	Notes.

# Accounts	receivable	securitization

We	have	an	accounts	receivable	securitization	facility	under	which	we	sell	an	undivided	interest	in	domestic	accounts	receivable	for	consideration	of up	to	$50.0	million	to	a	commercial	paper	conduit.	As	of	December	31,	2017,	we	borrowed	the	maximum	amount	available	of	 $50.0	million	under	this facility.	This	facility	is	utilized	to	provide	increased	flexibility	in	funding	short	term	working	capital	requirements.	The	agreement	governing	the	accounts receivable	securitization	facility	contains	certain	covenants	and	termination	events.	An	occurrence	of	an	event	of	default	or	a	termination	event	under	this facility	may	give	rise	to	the	right	of	our	counterparty	to	terminate	this	facility.	As	of	December	31,	2017,	we	were	in	compliance	with	the	covenants	and none	of	the	termination	events	had	occurred.	As	of	December	31,	2016,	we	had	$50.0	million	of	outstanding	borrowings	under	our	accounts	receivable securitization	facility.

# Convertible	notes

Our	Convertible	Notes	matured	on	August	1,	2017	(the	"Maturity	Date").	The	Convertible	Notes	were	convertible	under	certain	circumstances, including	the	attainment	of	at	least	a	specified	last	reported	sales	price	per	share	of	our	common	stock	during	a	specified	period.	Since	the	fourth	quarter 2013,	our	closing	stock	price	exceeded	the	threshold	for	conversion.	Moreover,	commencing	on	May	1,	2017	and	through	July	28,	2017,	the	Convertible Notes	were	convertible	regardless	of	the	closing	price	of	our	stock.	We	elected	a	net	settlement	method	to	satisfy	our	conversion	obligations,	under	which we	settled	the	conversion	of	Convertible	Notes	by	paying	the	principal	amount	of	the	Convertible	Notes	in	cash	and	providing	shares	having	a	value equal	to	the	excess	of	the	conversion	value	of	the	Convertible	Notes	over	the	principal	amount	of	the	notes;	however,	cash	was	paid	in	lieu	of	fractional shares.

In	January	2017,	we	acquired	$91.7	million	aggregate	outstanding	principal	amount	of	the	Convertible	Notes	in	exchange	for	an	aggregate	of	$93.2 million	in	cash	(including	approximately	$1.5	million	in	accrued	and	previously	unpaid	interest)	and	approximately	0.93	million	shares	of	our	common stock	(the	"Exchange	Transactions").	We	funded	the	cash	portion	of	the	consideration	paid	through	borrowings	under	our	revolving	credit	facility.	In advance	of	the	maturity	of	the	Convertible	Notes,	$44.2	million	in	aggregate	principal	amount	of	the	Convertible	Notes	(the	"Converted	Notes")	were tendered	to	us	for	conversion.	On	the	Maturity	Date,	we	repaid	the	remaining	$44.3	million	in	aggregate	principal	amount	of	the	Convertible	Notes outstanding,	together	with	unpaid	interest	due	and	owing	on	the	Convertible	Notes	(the	"Cash	Payment").	In	addition	to	the	Cash	Payment,	on	the Maturity	Date,	we	delivered	to	the	holders	of	the	Converted	Notes,	in	the	aggregate,	0.5	million	shares	of	our	common	stock.	We	funded	the	Cash Payment	through	borrowings	under	our	revolving	credit	facility.

For	additional	information	regarding	our	indebtedness,	see	 Note	8	to	the	consolidated	financial	statements	included	in	this	Annual	Report	on	Form 10-K.

# Contractual	Obligations

Contractual	obligations	at	December	31,	2017	are	as	follows:

|  |  |  | Payments	due	by	period | Payments	due	by	period |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  |  | Less\tthan | 1-3 | 3-5 | More\tthan |
|  | Total | 1\tyear | years | years | 5\tyears |
|  |  |  | (Dollars\tin\tthousands) | (Dollars\tin\tthousands) |  |
| Total\tborrowings | $2,270,001 | $86,625 | $89,063 | $944,313 | $1,150,000 |
| Interest\tobligations(1) | 632,627 | 96,682 | 187,547 | 149,898 | 198,500 |
| Operating\tlease\tobligations | 139,275 | 30,262 | 47,886 | 33,960 | 27,167 |
| Purchase\tand\tother\tobligations (2) | 178,792 | 177,538 | 1,254 | — | — |
| Tax\ton\tdeemed\trepatriation\tof\tforeign\tearnings |  |  |  |  |  |
| (3) | 153,981 | 12,887 | 24,538 | 24,538 | 92,018 |
| Pension\tand\tother\tpostretirement\tbenefits | 54,792 | 5,073 | 10,419 | 10,912 | 28,388 |
| Total\tcontractual\tobligations | $3,429,468 | $409,067 | $360,707 | $1,163,621 | $1,496,073 |

(1) Interest	payments	on	floating	rate	debt	are	based	on	the	interest	rate	in	effect	on	December	31,	2017.

(2) Purchase	and	other	obligations	are	defined	as	an	unconditional	commitments	to	purchase	goods	or	services	that	are	legally	binding	and	that	specify	all	significant	terms, including:	quantities	to	be	purchased;	price	provisions;	and	the	approximate	timing	of	the	transaction.	The	amounts	include	commitments	for	inventory	purchases	and	capital expenditures	that	do	not	exceed	our	projected	requirements	in	the	normal	course	of	business	and	penalties	due	upon	cancellation	of	cancellable	agreements;	the	amounts exclude	operating	lease	obligations.

(3) Pursuant	to	the	provisions	of	the	TCJA,	we	recognized	tax	expense	of	$154.0	million	for	the	deemed	repatriation	of	foreign	earnings,	which	we	have	elected	to	pay	in	annual installments	over	eight	years	(as	prescribed	by	the	TCJA).

We	recorded	a	noncurrent	liability	for	uncertain	tax	positions	of	$12.3	million	and	$17.5	million	as	of	December	31,	2017	and	2016,	respectively.	Due to	uncertainties	regarding	the	ultimate	resolution	of	ongoing	or	future	tax	examinations,	we	are	not	able	to	reasonably	estimate	the	amount	of	any	income tax	payments	that	will	be	required	to	settle	uncertain	income	tax	positions	or	the	periods	in	which	any	such	payments	will	be	made	and	as	a	result,	these amounts	are	excluded	from	the	contractual	obligations	table	above.

We	recorded	contingent	consideration	liabilities	of	$272.1	million	and	$7.1	million	as	of	December	31,	2017	and	2016,	respectively,	of	which	 $74.2 million	and	$0.6	million,	respectively,	were	recorded	as	 the	current	portion	of	contingent	consideration.	Due	to	uncertainty	regarding	the	timing	and amount	of	future	payments	related	to	these	liabilities,	these	amounts	are	excluded	from	the	contractual	obligations	table	above.

See	Notes	10,	13	and	14	to	the	consolidated	financial	statements	included	in	this	Annual	Report	on	Form	10-K	for	additional	information.

# Critical	Accounting	Policies	and	Estimates

The	preparation	of	consolidated	financial	statements	in	conformity	with	GAAP	requires	management	to	make	estimates	and	assumptions	that	affect the	reported	amounts	of	assets	and	liabilities	and	disclosure	of	contingent	assets	and	liabilities	at	the	date	of	the	financial	statements	and	the	reported amounts	of	revenues	and	expenses	during	the	reporting	period.	Actual	results	could	differ	materially	from	the	amounts	derived	from	those	estimates	and assumptions.

We	 have	 identified	 the	 following	 as	 critical	 accounting	 estimates,	 which	 are	 defined	 as	 those	 that	 are	 reflective	 of	 significant	 judgments	 and uncertainties,	are	the	most	pervasive	and	important	to	the	presentation	of	our	financial	condition	and	results	of	operations	and	could	potentially	result	in materially	different	results	under	different	assumptions	and	conditions.	The	following	discussion	should	be	considered	in	conjunction	with	the	description of	our	accounting	policies	in	Note	1	to	the	consolidated	financial	statements	in	this	Annual	Report	on	Form	10-K.

# Allowance	for	Doubtful	Accounts

In	the	ordinary	course	of	business,	we	grant	non-interest	bearing	trade	credit	to	our	customers	on	normal	credit	terms.		In	an	effort	to	reduce	our credit	risk,	we	(i)	establish	credit	limits	for	all	of	our	customer	relationships,	(ii)	perform	ongoing	credit	evaluations	of	our	customers'	financial	condition,	(iii) monitor	the	payment	history	and	aging	of	our	customers'	receivables,	and	(iv)	monitor	open	orders	against	an	individual	customer's	outstanding	receivable balance.

An	allowance	for	doubtful	accounts	is	maintained	for	trade	accounts	receivable	based	on	the	expected	collectability	of	accounts	receivable,	after considering	the	Company's	historical	collection	experience,	the	length	of	time	an	account	is	outstanding,	the	financial	position	of	the	customer	and information	 provided	 by	 credit	 rating	 services.	The	 adequacy	 of	 this	 allowance	 is	 reviewed	 each	 reporting	 period	 and	 adjusted	 as	 necessary.	Our allowance	for	doubtful	accounts	was	$10.3	million	and	$8.6	million	at	December	31,	2017	and	2016,	respectively,	which	constituted	 2.8%	and	3.0%	of gross	trade	accounts	receivable	at	December	31,	2017	and	2016,	respectively.

In	 light	of	 the	volatility	 in	global	economic	markets	 in	recent	years,	we	have	procedures	 in	place	within	countries	where	we	have	collectability concerns	to	facilitate	customer-by-customer	risk	assessment	when	estimating	the	allowance	for	doubtful	accounts.		These	procedures	include	monthly credit	control	committee	meetings,	at	which	customer	credit	risks	are	identified	after	review	of,	among	other	things,	accounts	that	exceed	specified	credit limits,	payment	delinquencies	and	other	customer	issues.		In	addition,	with	respect	to	government	customers,	we	evaluate	receivables	for	potential collection	risks	associated	with	any	limitations	on	the	availability	of	government	funding	and	reimbursement	practices.		To	reduce	risk	exposures	with respect	 to	certain	of	our	non-government	customers,	we	have	 instituted	procedures	 that	 include	reducing	credit	 limits	and	requiring	 that	payments accompany	orders.	Some	of	our	customers,	particularly	in	Greece,	Italy,	Spain	and	Portugal,	have	extended	or	delayed	payments	for	products	and services	already	provided	resulting	in	collectability	concerns	regarding	our	accounts	receivable	from	these	customers.	If	the	financial	condition	of	these customers	or	the	healthcare	systems	in	these	countries	deteriorate	to	the	extent	that	the	ability	of	an	increasing	number	of	customers	to	make	payments is	uncertain,	additional	allowances	may	be	required	in	future	periods.

Although	we	maintain	allowances	for	doubtful	accounts	to	cover	the	estimated	losses	which	may	occur	when	customers	cannot	make	their	required payments,	we	cannot	be	assured	that	the	allowances	will	be	sufficient	to	cover	future	losses	given	the	volatility	in	the	worldwide	economy	and	the possibility	that	other,	unanticipated	events	may	adversely	affect	collectability	of	the	accounts.		If	our	allowance	for	doubtful	accounts	is	insufficient	to address	receivables	we	ultimately	determine	are	uncollectible,	we	would	be	required	to	incur	additional	charges,	which	could	materially	adversely	affect our	results	of	operations.		Moreover,	our	inability	to	collect	outstanding	receivables	could	adversely	affect	our	financial	condition	and	cash	flow	from operations.

# Distributor	Rebates

We	offer	rebates	to	certain	distributors	and	record	a	reserve	with	respect	to	the	estimated	amount	of	the	rebates	as	a	reduction	of	revenues	at	the time	of	sale.	In	estimating	rebates,	we	consider	the	lag	time	between	the	point	of	sale	and	the	payment	of	the	distributor's	rebate	claim,	distributor-specific trend	analyses,	contractual	commitments,	including	stated	rebate	rates,	historical	experience	and	other	relevant	information.	When	necessary,	we	adjust the	reserves,	with	a	corresponding	adjustment	to	revenue,	to	reflect	differences	between	estimated	and	actual	experience.	Historical	adjustments	to recorded	reserves	have	not	been	significant	and	we	do	not	expect	significant	revisions	of	these	estimates	in	the	future.	The	reserve	for	estimated	rebates was	$12.2	million	and	$11.6	million	at	December	31,	2017	and	2016,	respectively.	We	expect	to	pay	amounts	subject	to	the	reserve	as	of	 December	31, 2017	within	90	days	subsequent	to	year-end.

# Inventory	Utilization

Inventories	are	valued	at	the	lower	of	cost	or	net	realizable	value.	We	maintain	a	reserve	for	excess	and	obsolete	inventory	that	reduces	the	carrying value	of	our	 inventories	 to	reflect	 the	diminution	of	value	resulting	 from	product	obsolescence,	damage	or	other	 issues	affecting	marketability.	The reduction	in	carrying	value	is	equal	to	the	difference	between	the	cost	of	the	inventory	and	its	estimated	net	realizable	value.		Factors	utilized	in	the determination	of	estimated	net	realizable	value	and	whether	a	reserve	is	required	include	(i)	current	sales	data	and	historical	return	rates,	(ii)	estimates	of future	 demand,	 (iii)	 competitive	 pricing	 pressures,	 (iv)	 new	 product	 introductions,	 (v)	 product	 expiration	 dates,	 and	 (vi)	 component	 and	 packaging obsolescence.

The	adequacy	of	the	reserve	is	reviewed	each	reporting	period	and	adjusted	as	necessary.		We	regularly	compare	inventory	quantities	on	hand against	historical	usage	or	forecasts	related	to	specific	items	in	order	to	evaluate	obsolescence	and	excessive	quantities.	In	assessing	historical	usage, we	also	qualitatively	assess	business	trends	to	evaluate	the	reasonableness	of	using	historical	information	in	estimating	future	usage.

Our	inventory	reserve	was	$35.6	million	and	$36.4	million	at	December	31,	2017	and	2016,	respectively,	which	represents	8.3%	and	10.3%	of	gross inventories	at	those	respective	dates.

# Long-Lived	Assets

We	assess	the	remaining	useful	life	and	recoverability	of	long-lived	assets	whenever	events	or	circumstances	indicate	the	carrying	value	of	an	asset may	not	be	recoverable.	For	example,	such	an	assessment	may	be	initiated	if,	as	a	result	of	a	change	in	expectations,	we	believe	it	is	more	likely	than	not that	the	asset	will	be	sold	or	disposed	of	significantly	before	the	end	of	its	useful	life	or	if	an	adverse	change	occurs	in	the	business	employing	the asset.	Significant	judgments	in	this	area	involve	determining	whether	such	events	or	circumstances	have	occurred	and	determining	the	appropriate	asset group	requiring	evaluation.	The	recoverability	evaluation	 is	based	on	various	analyses,	 including	undiscounted	cash	 flow	projections,	which	 involve significant	management	judgment.	Any	impairment	loss,	if	indicated,	equals	the	amount	by	which	the	carrying	amount	of	the	asset	exceeds	the	estimated fair	value	of	the	asset.

# Goodwill	and	Other	Intangible	Assets

Intangible	assets	include	indefinite-lived	assets	(such	as	goodwill,	certain	trade	names	and	in-process	research	and	development	("IPR&D")),	as	well as	finite-lived	intangibles	(such	as	trade	names	that	do	not	have	indefinite	lives,	customer	relationships,	intellectual	property	and	distribution	rights).	The costs	of	 finite-lived	 intangibles	are	amortized	 to	expense	over	 their	estimated	useful	 life.	Determining	 the	useful	 life	of	an	 intangible	asset	requires considerable	judgment	as	different	types	of	intangible	assets	typically	will	have	different	useful	lives.	Goodwill	and	other	indefinite-lived	intangible	assets are	not	amortized;	we	test	these	assets	annually	for	impairment	during	the	fourth	quarter,	using	the	first	day	of	the	quarter	as	the	measurement	date,	or earlier	upon	the	occurrence	of	certain	events	or	substantive	changes	in	circumstances	that	indicate	an	impairment	may	have	occurred.	Such	conditions may	include	an	economic	downturn	in	a	geographic	market	or	a	change	in	the	assessment	of	future	operations.	Our	impairment	testing	for	goodwill	is performed	separately	from	our	impairment	testing	of	indefinite-lived	intangibles.

Considerable	management	judgment	is	necessary	in	making	the	assumptions	used	in	the	impairment	analysis	including	evaluating	the	impact	of operating	and	macroeconomic	changes	and	estimating	future	cash	flows,	which	are	key	elements	in	determining	fair	value.	Assumptions	we	use	in	our impairment	evaluations,	such	as	forecasted	growth	rates	and	cost	of	capital,	are	consistent	with	our	internal	projections	and	operating	plans.	We	believe these	assumptions	and	estimates	are	also	comparable	to	those	that	would	be	used	by	other	marketplace	participants.

# Goodwill

Goodwill	impairment	assessments	are	performed	at	a	reporting	unit	level.	For	purposes	of	this	assessment,	a	reporting	unit	is	an	operating	segment, or	a	business	one	level	below	that	operating	segment.	We	have	ten	reporting	units.	In	applying	the	goodwill	impairment	test,	we	may	assess	qualitative factors	to	determine	whether	it	is	more	likely	than	not	that	the	fair	value	of	a	reporting	unit	is	less	than	its	carrying	value.	Qualitative	factors	may	include, but	are	not	limited	to,	macroeconomic	conditions,	industry	conditions,	the	competitive	environment,	changes	in	the	market	for	our	products	and	services, regulatory	 and	 political	 developments,	 and	 entity	 specific	 factors	 such	 as	 strategies	 and	 financial	 performance.	 If,	 after	 completing	 the	 qualitative assessment,	we	determine	it	is	more	likely	than	not	that	the	fair	value	of	a	reporting	unit	is	less	than	its	carrying	value,	we	proceed	to	a	two-step quantitative	impairment	test,	described	below.	Alternatively,	we	may	test	goodwill	for	impairment	through	the	two-step	quantitative	impairment	test	without conducting	the	qualitative	analysis.	Under	guidance	issued	by	the	Financial	Accounting	Standards	Board,	the	quantitative	goodwill	impairment	test	will	be simplified,	effective	for	fiscal	years	beginning	after	December	15,	2019,	subject	to	optional	early	adoption.	See	Note	2	to	the	consolidated	financial statements	in	this	Annual	Report	on	Form	10-K	for	additional	information.

The	first	step	of	the	two-step	impairment	test	is	to	compare	the	fair	value	of	a	reporting	unit	to	the	carrying	value.	In	performing	the	first	step,	we calculate	the	fair	value	of	the	reporting	unit	using	equal	weighting	of	two	methods;	one	which	estimates	the	discounted	cash	flows	of	the	reporting	unit based	on	projected	earnings	in	the	future	(the	Income	Approach)	and	one	which	is	based	on	sales	of	similar	businesses	to	those	of	the	reporting	unit	in actual	transactions	(the	Market	Approach).		If	the	fair	value	of	the	reporting	unit	exceeds	the	carrying	value,	there	is	no	impairment.	If	the	reporting	unit carrying	value	exceeds	the	fair	value,	we	recognize	an	impairment	loss	based	on	the	amount	by	which	the	carrying	value	of	goodwill	exceeds	its	implied fair	value,	which	we	determine	in	the	second	step	of	the	two-step	test.	The	implied	fair	value	of	goodwill	is	determined	by	deducting	the	fair	value	of	a reporting	unit's	identifiable	assets	and	liabilities	from	the	fair	value	of	the	reporting	unit	as	a	whole,	as	if	that	reporting	unit	had	just	been	acquired	and	the fair	value	of	the	individual	assets	acquired	and	liabilities	assumed	were	being	determined	initially.

Determining	fair	value	requires	the	exercise	of	significant	judgment.	The	more	significant	judgments	and	assumptions	used	in	the	Income	Approach include	(1)	the	amount	and	timing	of	expected	future	cash	flows,	which	are	based	primarily	on	our	estimates	of	future	sales,	operating	income,	industry trends	and	the	regulatory	environment	of	the	individual	reporting	units,	(2)	the	expected	long-term	growth	rates	for	each	of	our	reporting	units,	which approximate	the	expected	long-term	growth	rate	of	the	global	economy	and	of	the	medical	device	industry,	and	(3)	discount	rates	that	are	used	to	discount future	cash	flows	to	their	present	values,	which	are	based	on	an	assessment	of	the	risk	inherent	in	the	future	cash	flows	of	the	respective	reporting	units along	with	various	market	based	inputs.		The	more	significant	judgments	and	assumptions	used	in	the	Market	Approach	include	(1)	determination	of appropriate	revenue	and	EBITDA	multiples	used	to	estimate	a	reporting	unit's	fair	value	and	(2)	the	selection	of	appropriate	comparable	companies	to	be used	for	purposes	of	determining	those	multiples.	There	were	no	changes	to	the	underlying	methods	used	in	2017	as	compared	to	the	valuations	of	our reporting	units	in	2016.

Our	expected	future	growth	rates	estimated	for	purposes	of	the	goodwill	impairment	test	are	based	on	our	estimates	of	future	sales,	operating income	and	cash	flow	and	are	consistent	with	our	internal	budgets	and	business	plans,	which	reflect	a	modest	amount	of	core	revenue	growth	coupled with	the	successful	launch	of	new	products	each	year;	the	effect	of	these	growth	indicators	more	than	offset	volume	losses	from	products	that	are expected	to	reach	the	end	of	their	life	cycle.	Changes	in	assumptions	underlying	the	Income	Approach	could	cause	a	reporting	unit's	carrying	value	to exceed	its	fair	value.	While	we	believe	our	assumed	growth	rates	of	sales	and	cash	flows	are	reasonable,	the	possibility	remains	that	the	revenue	growth of	a	reporting	unit	may	not	be	as	high	as	expected,	and,	as	a	result,	the	estimated	fair	value	of	that	reporting	unit	may	decline.	In	this	regard,	if	our strategy	and	new	products	are	not	successful	and	we	do	not	achieve	anticipated	core	revenue	growth	in	the	future	with	respect	to	a	reporting	unit,	the goodwill	in	the	reporting	unit	may	become	impaired	and,	in	such	case,	we	may	incur	material	impairment	charges.	Moreover,	changes	in	revenue	and EBITDA	multiples	in	actual	transactions	from	those	historically	present	could	result	in	an	assessment	that	a	reporting	unit's	carrying	value	exceeds	its	fair value,	in	which	case	we	also	may	incur	material	impairment	charges.

We	did	not	record	any	goodwill	impairment	charges	as	a	result	of	the	annual	goodwill	impairment	testing	performed	during	the	fourth	quarter	 2017. As	noted	above	under	"Changes	in	Reporting	Segments,"	because	changes	in	our	operating	segments	during	the	fourth	quarter	2017	affected	certain	of our	reporting	units,	we	reallocated	the	goodwill	balances	of	the	reporting	units	based	on	their	relative	fair	values	and	performed	goodwill	impairment analyses	on	those	reporting	units.	We	did	not	record	any	goodwill	impairment	charges	as	a	result	of	these	analyses.

# Other	Intangible	Assets

Intangible	 assets	 are	 assets	 acquired	 that	 lack	 physical	 substance	 and	 that	 meet	 the	 specified	 criteria	 for	 recognition	 apart	 from	 goodwill. Management	tests	indefinite-lived	intangible	assets	for	impairment	annually,	and	more	frequently	if	events	or	changes	in	circumstances	indicate	that	an impairment	may	have	occurred.	Similar	to	the	goodwill	impairment	test	process,	we	may	assess	qualitative	factors	to	determine	whether	it	is	more	likely than	not	 that	 the	 fair	value	of	an	 indefinite-lived	 intangible	asset	 is	 less	 than	 its	carrying	value.	 If,	after	completing	 the	qualitative	assessment,	we determine	it	is	more	likely	than	not	that	the	fair	value	of	the	indefinite-lived	intangible	asset	is	greater	than	its	carrying	amount,	the	asset	is	not	impaired. If	we	conclude	it	is	more	likely	than	not	that	the	fair	value	of	the	indefinite-lived	intangible	asset	is	less	than	the	carrying	value,	we	then	proceed	to	a quantitative	impairment	test,	which	consists	of	a	comparison	of	the	fair	value	of	the	intangible	asset	to	its	carrying	amount.	Alternatively,	we	may	elect	to forgo	the	qualitative	analysis	and	test	the	indefinite-lived	intangible	asset	for	impairment	through	the	quantitative	impairment	test.

In	connection	with	the	quantitative	impairment	test,	since	quoted	market	prices	are	seldom	available	for	intangible	assets,	we	utilize	several	present value	techniques	to	estimate	fair	value.	The	fair	value	of	trade	names	and	IPR&D	is	estimated	by	the	use	of	a	relief	from	royalty	method,	a	form	of	income approach	that	values	an	intangible	asset	by	estimating	the	royalties	saved	through	the	ownership	of	an	asset.	Under	this	method,	an	owner	of	an intangible	asset	determines	the	arm's	length	royalty	that	likely	would	have	been	charged	if	the	owner	had	to	license	the	asset	from	a	third	party.	The value	of	the	hypothetical	royalty,	which	is	based	on	the	estimated	royalty	rate	applied	against	forecasted	sales,	is	tax-effected	and	discounted	to	present value	using	a	discount	rate	commensurate	with	the	relative	risk	of	achieving	the	cash	flow	attributable	to	the	asset.	Management	must	estimate	the volume	of	sales,	hypothetical	royalty	rate,	discount	rate,	and	terminal	growth	rate	to	estimate	the	hypothetical	royalty	associated	with	the	asset.		Discount rate	assumptions	are	based	on	an	assessment	of	the	risk	inherent	in	the	future	cash	flows	generated	from	the	intangible	asset.	Assumptions	about royalty	rates	are	based	on	the	rates	at	which	similar	intangible	assets	are	being	licensed	in	the	marketplace.

No	impairment	was	recorded	as	a	result	of	the	annual	indefinite-lived	intangible	asset	impairment	testing	performed	during	the	fourth	quarter	 2017. For	the	year	ended	December	31,	2016,	we	recognized	a	pre-tax	IPR&D	impairment	charge	of	$41.0	million.	See	"Restructuring	and	impairment	charges" within	"Result	of	Operations"	above	as	well	as	Note	4	to	the	consolidated	financial	statements	included	in	this	Annual	Report	on	Form	10-K	for	additional information	on	this	charge.

# Pensions	and	Other	Postretirement	Benefits

We	 provide	 a	 range	 of	 benefits	 to	 eligible	 employees	 and	 retired	 employees,	 including	 under	 plans	 that	 provide	 pension	 and	 postretirement healthcare	benefits.	Several	statistical	and	other	factors	that	are	designed	to	project	future	events	are	used	in	calculating	the	expense	and	liability	related to	these	plans.	These	factors	include	actuarial	assumptions	about	discount	rates,	expected	rates	of	return	on	plan	assets,	compensation	increases, turnover	rates	and	healthcare	cost	trend	rates.	We	review	the	actuarial	assumptions	on	an	annual	basis	and	make	modifications	to	the	assumptions based	on	current	rates	and	trends	when	appropriate.

Significant	differences	in	our	actual	experience	or	significant	changes	in	our	assumptions	may	materially	affect	our	pension	and	other	postretirement obligations	and	our	future	expense.	The	following	table	shows	the	sensitivity	of	plan	expenses	and	benefit	obligations	to	changes	in	the	weighted	average assumptions:

|  | Assumed	Discount	Rate | Expected	Return	on<br>Plan	Assets | Expected	Return	on<br>Plan	Assets | Assumed	Healthcare	Trend	Rate | Assumed	Healthcare	Trend	Rate |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  | 50\tBasis\tPoint | 50\tBasis\tPoint |  |  |  |
|  | Increase | Decrease | 50\tBasis\tPoint\tChange | 1.0%\tIncrease | 1.0%\tDecrease |
|  |  | (Dollars\tin\tmillions) | (Dollars\tin\tmillions) |  |  |
| Net\tperiodic\tpension\tand\tpostretirement\nhealthcare\texpense | $— | $(0.1) | $1.7 | $0.2 | $(0.1) |
| Projected\tbenefit\tobligation | $(31.2) | $34.6 | N/A | $3.6 | $(3.1) |

For	additional	information	on	assumptions	pertaining	to	pension	and	other	postretirement	benefit	plans,	refer	to	Note	14	to	the	consolidated	financial statements	included	in	this	Annual	Report	on	Form	10-K.

# Share-based	Compensation

We	estimate	the	fair	value	of	share-based	awards	on	the	date	of	grant	using	an	option	pricing	model.	The	value	of	the	portion	of	the	award	that	is ultimately	expected	to	vest	is	recognized	as	expense	over	the	requisite	service	periods.	Share-based	compensation	expense	related	to	stock	options	is measured	using	a	Black-Scholes	option	pricing	model	that	takes	into	account	subjective	and	complex	assumptions	with	respect	 to	expected	 life	of options,	volatility,	risk-free	interest	rate	and	expected	dividend	yield.	The	expected	life	of	options	granted	represents	the	period	of	time	that	options	are expected	to	be	outstanding,	which	is	derived	from	the	vesting	period	of	the	award,	as	well	as	historical	exercise	behavior.	Expected	volatility	is	based	on a	blend	of	historical	volatility	and	implied	volatility	derived	from	publicly	traded	options	to	purchase	our	common	stock,	which	we	believe	is	more	reflective of	market	conditions	and	a	better	indicator	of	expected	volatility	than	solely	using	historical	volatility.	The	risk-free	interest	rate	is	the	implied	yield	currently available	on	United	States	Treasury	zero-coupon	issues	with	a	remaining	term	equal	to	the	expected	life	of	the	option.	Share	based	compensation expense	for	2017,	2016	and	2015	was	$19.4	million,	$16.9	million	and	$14.5	million,	respectively.

# Contingent	Consideration	Liabilities

In	connection	with	an	acquisition,	we	may	be	required	to	pay	future	consideration	that	is	contingent	upon	the	achievement	of	specified	objectives, such	as	receipt	of	regulatory	approval,	commercialization	of	a	product	or	achievement	of	sales	targets.	As	of	the	acquisition	date,	we	record	a	contingent liability	 representing	 the	 estimated	 fair	 value	 of	 the	 contingent	 consideration	 we	 expect	 to	 pay.	 We	 determined	 the	 fair	 value	 of	 the	 contingent consideration	liability	related	to	the	NeoTract	acquisition,	which	represented	the	vast	majority	of	our	contingent	consideration	liabilities	at	December	31, 2017,	using	a	Monte	Carlo	valuation	approach,	which	simulates	future	revenues	during	the	earn	out-period	using	management's	best	estimates.	We determined	 the	 fair	 value	 of	 our	 other	 contingent	 consideration	 liabilities	 using	 a	 probability-weighted	 discounted	 cash	 flow	 analysis.	Increases	 in projected	revenues	and	probabilities	of	payment	may	result	in	significantly	higher	fair	value	measurements;	decreases	in	these	items	may	have	the opposite	effect.	Increases	in	discount	rates	and	the	period	prior	to	payment	may	result	in	significantly	lower	fair	value

measurements;	decreases	in	these	items	may	have	the	opposite	effect.	See	Note	10	to	the	consolidated	financial	statements	included	in	this	Annual Report	on	Form	10-K	for	additional	information.

We	remeasure	 the	 liability	each	reporting	period	and	recognize	 the	change	 in	 the	 liability's	 fair	value	within	selling,	general	and	administrative expenses	 in	our	consolidated	statement	of	 income.	As	 of	December	31,	2017	 and	2016,	 we	 accrued	$272.1	million	 and	$7.1	million	of	contingent consideration,	respectively.	For	the	year	ended	December	31,	2017	there	were	no	changes	to	the	estimated	probabilities	associated	with	the	contingent consideration	liabilities.	For	the	years	ended	December	31	2016	and	2015,	we	recognized	a	reduction	to	contingent	consideration	of	 $8.3	million	and	$4.4 million,	respectively,	resulting	from	changes	in	estimated	probabilities	associated	with	certain	regulatory	and	sales	milestones.

# Income	Taxes

Our	annual	provision	for	income	taxes	and	determination	of	the	deferred	tax	assets	and	liabilities	require	management	to	assess	uncertainties,	make judgments	regarding	outcomes	and	utilize	estimates.	We	conduct	a	broad	range	of	operations	around	the	world,	subjecting	us	to	complex	tax	regulations in	numerous	international	jurisdictions,	resulting	at	times	in	tax	audits,	disputes	with	tax	authorities	and	potential	litigation,	the	outcome	of	which	is uncertain.	In	connection	with	its	estimates	of	our	tax	assets	and	liabilities,	management	must,	among	other	things,	make	judgments	about	the	outcome	of these	uncertain	matters.	Deferred	tax	assets	and	liabilities	are	measured	and	recorded	using	currently	enacted	tax	rates,	which	we	expect	will	apply	to taxable	income	in	the	years	in	which	differences	between	the	financial	statement	carrying	amounts	of	existing	assets	and	liabilities	and	their	tax	bases	are recovered	or	settled.	The	likelihood	of	a	material	change	in	our	expected	realization	of	these	assets	is	dependent	on	future	taxable	income,	our	ability	to use	foreign	tax	credit	carryforwards	and	carrybacks,	final	United	States	and	foreign	tax	settlements,	changes	in	tax	law,	and	the	effectiveness	of	our	tax planning	strategies	in	the	various	relevant	jurisdictions.	While	management	believes	that	its	judgments	and	interpretations	regarding	income	taxes	are appropriate,	significant	differences	in	actual	experience	may	require	future	adjustments	to	our	tax	assets	and	liabilities,	which	could	be	material.

In	assessing	the	realizability	of	our	deferred	tax	assets,	we	evaluate	positive	and	negative	evidence	and	use	judgments	regarding	past	and	future events,	including	results	of	operations	and	available	tax	planning	strategies	that	could	be	implemented	to	realize	the	deferred	tax	assets.	Based	on	this assessment,	we	determine	when	it	is	more	likely	than	not	that	all	or	some	portion	of	our	deferred	tax	assets	may	not	be	realized,	in	which	case	we	apply	a valuation	allowance	to	offset	the	amount	of	such	deferred	tax	assets.		To	the	extent	facts	and	circumstances	change	in	the	future,	adjustments	to	the valuation	allowances	may	be	required.	The	valuation	allowance	for	deferred	tax	assets	of	$104.8	million	and	$104.5	million	at	December	31,	2017	and 2016,	respectively,	relates	principally	to	the	uncertainty	of	the	utilization	of	tax	loss	and	credit	carryforwards	in	various	jurisdictions.

Significant	judgment	is	required	in	determining	income	tax	provisions	and	in	evaluating	tax	positions.	We	establish	additional	provisions	for	income taxes	when,	despite	the	belief	that	tax	positions	are	supportable,	there	remain	certain	positions	that	do	not	meet	the	minimum	probability	threshold,	which is	a	tax	position	that	is	more	likely	than	not	to	be	sustained	upon	examination	by	the	applicable	taxing	authority.	In	the	normal	course	of	business,	we	are examined	 by	 various	 federal,	 state	 and	 foreign	 tax	 authorities.	 We	 regularly	 assess	 the	 potential	 outcomes	 of	 these	 examinations	 and	 any	 future examinations	for	the	current	or	prior	years	in	determining	the	adequacy	of	our	provision	for	income	taxes.	We	adjust	the	income	tax	provision,	the	current tax	liability	and	deferred	taxes	in	any	period	in	which	we	become	aware	of	facts	that	necessitate	an	adjustment.	We	are	currently	under	examination	in Canada,	Germany,	Italy	and	the	United	States.	The	ultimate	outcome	of	these	examinations	could	result	in	increases	or	decreases	to	our	recorded	tax liabilities,	which	would	affect	our	financial	results.	See	Note	13	to	the	consolidated	financial	statements	in	this	Annual	Report	on	Form	10-K	for	additional information	regarding	our	uncertain	tax	positions.

As	noted	above,	the	TCJA	significantly	changes	U.S.	tax	law.	As	permitted	by	SAB	118,	we	have	included	in	our	consolidated	financial	statements for	the	year	ended	December	31,	2017,	provisional	amounts	reflecting	the	tax	impact	related	to	deemed	repatriated	earnings	and	the	revaluation	of deferred	tax	assets	and	liabilities.	Once	our	accounting	for	the	income	tax	effects	of	the	TCJA	is	complete,	the	amounts	with	respect	to	the	income	tax effects	 of	 the	 TCJA	 may	 differ	 from	 these	 provisional	 amounts,	 possibly	 materially,	 due	 to,	 among	 other	 things,	 additional	 analysis,	 changes	 in interpretations	and	assumptions	we	have	made,	additional	regulatory	guidance	that	may	be	issued,	and	actions	we	may	take	as	a	result	of	the	TCJA.	See Note	13	to	the	consolidated	financial	statements	included	in	this	Annual	Report	on	Form	10-K	for	additional	information.

# New	Accounting	Standards

See	Note	2	to	the	consolidated	financial	statements	included	in	this	Annual	Report	on	Form	10-K	for	a	discussion	of	recently	issued	accounting standards,	including	estimated	effects,	if	any,	of	the	adoption	of	those	standards	on	our	consolidated	financial	statements.

# ITEM	7A.				QUANTITATIVE	AND	QUALITATIVE	DISCLOSURES	ABOUT	MARKET	RISK

# Market	Risk

We	are	exposed	to	certain	financial	risks,	specifically	fluctuations	in	market	interest	rates,	foreign	currency	exchange	rates	and,	to	a	lesser	extent, commodity	prices.	We	use	derivative	financial	instruments	to	manage	or	reduce	the	impact	of	some	of	these	risks.	We	do	not	enter	into	derivative instruments	for	trading	purposes.	We	are	also	exposed	to	changes	in	the	market	traded	price	of	our	common	stock	as	it	influences	the	valuation	of	stock options	and	their	effect	on	earnings.

# Interest	Rate	Risk

We	are	exposed	to	changes	in	interest	rates	as	a	result	of	our	borrowing	activities	and	our	cash	balances.	The	table	below	provides	information regarding	the	interest	rates	by	year	of	maturity	for	our	fixed	and	variable	rate	debt	obligations.	Variable	interest	rates	on	December	31,	2017	 were determined	using	a	base	rate	of	the	one-month	LIBOR	rate	plus	the	applicable	spread.

|  | 2018 | 2019 | 2020 | 2021 | 2022 | Thereafter | Total |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  |  |  |  | (Dollars\tin\tthousands) |  |  |  |
| Fixed\trate\tdebt | $— | $— | $— | $— | $— | $1,150,000 | $1,150,000 |
| Average\tinterest\trate | —% | —% | —% | —% | —% | 4.848% | 4.848% |
| Variable\trate\tdebt | $86,625 | $37,500 | $51,563 | $70,312 | $874,000 | $— | $1,120,000 |
| Average\tinterest\trate | 2.845% | 3.569% | 3.569% | 3.569% | 3.516% | —% | 3.472% |

A	change	of	1.0%	in	variable	interest	rates	would	increase	or	decrease	annual	interest	expense	by $7.1	million	based	on	our	outstanding	debt	as	of December	31,	2017.

# Foreign	Currency	Risk

We	are	exposed	to	currency	fluctuations	in	connection	with	transactions,	as	well	as	monetary	assets	and	liabilities,	denominated	in	currencies	other than	the	functional	currencies	of	certain	subsidiaries.	We	enter	into	forward	contracts	with	several	major	financial	institutions	to	hedge	the	risk	associated with	these	exposures;	these	contracts	generally	involve	the	purchase	or	sale,	at	designated	future	dates,	of	specified	amounts	of	a	foreign	currency	while simultaneously	committing	to	an	opposite	way	sale	or	purchase	of	a	specified	amount	of	U.S.	dollars	or	euros,	based	on	the	exchange	rate	at	the	time	of entry	into	the	contract.	The	contracts	we	enter	into	to	hedge	transactions	denominated	in	non-functional	currencies	are	designated	as	cash	flow	hedges. The	 contracts	 to	 hedge	 monetary	 asset	 and	 liabilities	 denominated	 in	 non-functional	 currencies	 are	 not	 designated	 as	 cash	 flow,	 fair	 value	 or	 net investment	 hedges.	See	Note	9	to	the	consolidated	financial	statements	included	in	this	Annual	Report	on	Form	10-K	for	information	regarding	the accounting	treatment	of	designated	and	non-designated	hedge	contracts.

The	following	table	provides	information	regarding	our	open	foreign	currency	forward	contracts	at	 December	31,	2017,	which	mature	during	2018.	As of	December	31,	2017,	the	total	notional	amount	for	the	designated	and	non-designated	contracts,	expressed	in	U.S.	dollars,	is	 $88.5	million	and	$110.6 million,	respectively.	As	of	December	31,	2016,	the	total	notional	amount	for	the	designated	and	non-designated	contracts,	expressed	in	U.S.	dollars,	is $101.8	million	and	$73.4	million,	respectively.	Forward	contract	notional	amounts	presented	below	are	expressed	in	the	stated	currencies.

# Forward	Currency	Contracts

|  | (in	thousands) |  |
| :--- | :--- | :--- |
|  | Designated | Non-designated |
| Australian\tdollar | (11,240) | (11,641) |
| British\tpound | (5,700) | (8,933) |
| Canadian\tdollar | (9,726) | 7,231 |
| Chinese\trenminbi | — | (105,863) |
| Czech\tkoruna | 265,226 | 95,473 |
| Euro | (6,537) | 55,185 |
| Indian\trupee | — | (631,139) |
| Japanese\tyen | (762,550) | (447,600) |
| Korean\twon | (3,362,400) | (3,785,050) |
| Malaysian\tringgit | 55,890 | 13,727 |
| Mexican\tpeso | 321,710 | 49,831 |
| Polish\tzloty | — | (12,023) |
| Singapore\tdollar | 7,040 | — |
| South\tAfrican\trand | (45,000) | (52,921) |
| Swiss\tfranc | (3,450) | 4,150 |
| United\tStates\tdollar | 1,239 | (24,060) |

# ITEM	8. FINANCIAL	STATEMENTS	AND	SUPPLEMENTARY	DATA

The	financial	statements	and	supplementary	data	required	by	this	Item	are	included	herein,	commencing	on	page	F-1.

# ITEM	9. CHANGES	IN	AND	DISAGREEMENTS	WITH	ACCOUNTANTS	ON	ACCOUNTING	AND	FINANCIAL	DISCLOSURE

None.

# ITEM	9A. CONTROLS	AND	PROCEDURES

# (a)	Evaluation	of	Disclosure	Controls	and	Procedures

Our	management,	with	the	participation	of	our	Chief	Executive	Officer	and	Chief	Financial	Officer,	evaluated	the	effectiveness	of	our	disclosure controls	and	procedures	as	of	the	end	of	the	period	covered	by	this	report.	Based	on	that	evaluation,	the	Chief	Executive	Officer	and	Chief	Financial Officer	concluded	that	our	disclosure	controls	and	procedures	as	of	the	end	of	the	period	covered	by	this	report	are	functioning	effectively	to	provide reasonable	assurance	that	the	information	required	to	be	disclosed	by	us	in	reports	filed	under	the	Securities	Exchange	Act	of	1934	is	(i)	recorded, processed,	summarized	and	reported	within	the	time	periods	specified	in	the	SEC's	rules	and	forms	and	(ii)	accumulated	and	communicated	to	our management,	including	the	Chief	Executive	Officer	and	Chief	Financial	Officer,	as	appropriate	to	allow	timely	decisions	regarding	disclosure.	A	controls system	cannot	provide	absolute	assurance,	however,	that	the	objectives	of	the	controls	system	are	met,	and	no	evaluation	of	controls	can	provide absolute	assurance	that	all	control	issues	and	instances	of	fraud,	if	any,	within	a	company	have	been	detected.	We	acquired	Vascular	Solutions	and NeoTract	on	February	17,	2017	and	October	2,	2017,	respectively.	Consistent	with	the	guidance	provided	by	the	staff	of	the	Securities	and	Exchange Commission,	management	has	excluded	Vascular	Solutions	and	NeoTract	from	its	assessment	of	the	effectiveness	of	our	internal	control	over	financial reporting	as	of	December	31,	2017.	The	net	revenues	attributable	to	Vascular	Solutions	and	NeoTract	were	$152.6	million	and	$39.0	million,	respectively, from	the	respective	dates	of	acquisition	through	December	31,	2017,	representing,	in	the	aggregate,	9%	of	our	consolidated	net	revenues	for	the	year ended	December	31,	2017.	Total	assets	of	Vascular	Solutions	and	NeoTract	(excluding	goodwill	and	intangible	assets)	at	December	31,	2017	were $303.2	million	and	$49.1	million,	respectively,	representing,	in	aggregate,	6%	of	our	consolidated	total	assets	as	of	December	31,	2017.

# (b)	Management's	Report	on	Internal	Control	Over	Financial	Reporting

Our	management's	report	on	internal	control	over	financial	reporting	is	set	forth	on	page	F-2	of	this	Annual	Report	on	Form	10-K	and	is	incorporated by	reference	herein.

# (c)	Change	in	Internal	Control	over	Financial	Reporting

No	change	in	our	internal	control	over	financial	reporting	occurred	during	our	most	recent	fiscal	quarter	that	has	materially	affected,	or	is	reasonably likely	to	materially	affect,	our	internal	control	over	financial	reporting.	As	a	result	of	our	acquisition	of	Vascular	Solutions	and	NeoTract,	we	are	in	the process	of	evaluating	both	acquisitions'	internal	controls	to	determine	the	extent	to	which	modifications	to	Vascular	Solutions'	and	NeoTract's	internal controls	would	be	appropriate.

# ITEM	9B. OTHER	INFORMATION

# PART	III

# ITEM	10. DIRECTORS,	EXECUTIVE	OFFICERS	AND	CORPORATE	GOVERNANCE

For	the	information	required	by	this	Item	10	with	respect	to	our	Executive	Officers,	see	Part	I,	Item	1.	of	this	report.	For	the	other	information	required by	this	Item	10,	see	"Election	Of	Directors,"	"Nominees	for	Election	to	the	Board	of	Directors,"	"Corporate	Governance"	and	"Section	16(a)	Beneficial Ownership	Reporting	Compliance,"	in	the	Proxy	Statement	for	our	2018	Annual	Meeting,	which	information	is	incorporated	herein	by	reference.	The Proxy	Statement	for	our	2018	Annual	Meeting	will	be	filed	within	120	days	after	the	end	of	the	fiscal	year	covered	by	this	Annual	Report	on	Form	10-K.

# ITEM	11. EXECUTIVE	COMPENSATION

For	the	information	required	by	this	Item	11,	see	"Compensation	Discussion	and	Analysis,"	"Compensation	Committee	Report,"	and	"Executive Compensation"	in	the	Proxy	Statement	for	our	2018	Annual	Meeting,	which	information	is	incorporated	herein	by	reference.

# ITEM	12. SECURITY	OWNERSHIP	OF	CERTAIN	BENEFICIAL	OWNERS	AND	MANAGEMENT	AND	RELATED	STOCKHOLDER	MATTERS

For	the	information	required	by	this	Item	12	with	respect	to	beneficial	ownership	of	our	common	stock,	see	"Security	Ownership	of	Certain	Beneficial Owners	and	Management"	in	the	Proxy	Statement	for	our	2018	Annual	Meeting,	which	information	is	incorporated	herein	by	reference.

The	following	table	sets	forth	certain	information	as	of	 December	31,	2017	regarding	our	equity	plans	:

| Plan	Category | Number	of	Securities<br>to	be	Issued	Upon<br>Exercise	of<br>Outstanding	Options,	Warrants	and<br>Rights<br>(A) | Weighted-Average<br>Exercise	Price	of<br>Outstanding	Options,	Warrants	and<br>Rights<br>(B) | Number	of	Securities<br>Remaining	Available	for<br>Future	Issuance	Under<br>Equity	Compensation<br>Plans	(Excluding<br>Securities	Reflected	in	Column	(A))<br>(C) |
| :--- | :--- | :--- | :--- |
| Equity\tcompensation\tplans\napproved\tby\tsecurity\tholders | 1,708,928 | $113.49 | 3,629,455 |

# ITEM	13. CERTAIN	RELATIONSHIPS	AND	RELATED	TRANSACTIONS,	AND	DIRECTOR	INDEPENDENCE

For	the	information	required	by	this	Item	13,	see	"Certain	Transactions"	and	"Corporate	Governance"	in	the	Proxy	Statement	for	our 2018	Annual Meeting,	which	information	is	incorporated	herein	by	reference.

# ITEM	14. PRINCIPAL	ACCOUNTING	FEES	AND	SERVICES

For	 the	 information	 required	 by	 this	 Item	 14,	 see	 "Audit	 and	 Non-Audit	 Fees"	 and "Audit	 Committee	 Pre-Approval	 Procedures" in the	 Proxy Statement	for	our	2018	Annual	Meeting,	which	information	is	incorporated	herein	by	reference.

# PART	IV

# 	ITEM	15. EXHIBITS,	FINANCIAL	STATEMENT	SCHEDULES

# (a) Consolidated	Financial	Statements:

The	Index	to	Consolidated	Financial	Statements	and	Schedule	is	set	forth	on	page	F-1	of	this	Annual	Report	on	Form	10-K.

# (b) Exhibits:

The	following	exhibits	are	filed	as	part	of,	or	incorporated	by	reference	into,	this	report:

+*10.13.2 — Letter	Agreement,	dated	April	29,	2013,	between	the	Company	and	Thomas	Anthony	Kennedy,	relating	to	Mr.	Kennedy's appointment	as	Senior	Vice	President,	Global	Operations	(incorporated	by	reference	to	Exhibit	10.15.2	to	the	Company's Form	10-K	filed	on	February	20,	2015).

  +*10.14 — Letter	Agreement,	dated	March	8,	2013,	between	the	Company	and	Cameron	Hicks	relating	to	Mr.	Hicks'	employment	as	Vice President,	Global	Human	Resources	(incorporated	by	reference	to	Exhibit	10.16	to	the	Company's	Form	10-K	filed	on	February 20,	2015).

Exhibit	No. Description 101.1 — The	following	materials	from	the	Company's	Annual	Report	on	Form	10-K	for	the	year	ended	December	31,	2017,	formatted	in XBRL	(eXtensible	Business	Reporting	Language):	(i)	the	Consolidated	Statements	of	Income	for	the	years	ended	December	31, 2017,	December	31,	2016	and	December	31,	2015;	(ii)	the	Consolidated	Statements	of	Comprehensive	Income	for	the	years ended	December	31,	2017,	December	31,	2016	and	December	31,	2015;	(iii)	the	Consolidated	Balance	Sheets	as	of December	31,	2017	and	December	31,	2016;	(iv)	the	Consolidated	Statements	of	Cash	Flows	for	the	years	ended	December	31, 2017,	December	31,	2016	and	December	31,	2015;	(v)	the	Consolidated	Statements	of	Changes	in	Equity	for	the	years	ended December	31,	2017,	December	31,	2016	and	December	31,	2015;	and	(vi)	Notes	to	Consolidated	Financial	Statements.

* Each	such	exhibit	has	previously	been	filed	with	the	Securities	and	Exchange	Commission	as	part	of	the	filing	indicated	and	is	incorporated herein	by	reference.

+ Indicates	management	contract	or	compensatory	plan	or	arrangement	required	to	be	filed	pursuant	to	Item	15(b)	of	this	report.

Registrants	may	voluntarily	include	a	summary	of	information	required	by	Form	10-K	under	this	Item	16.	We	have	elected	not	to	include	such summary	information.

# SIGNATURES

Pursuant	to	the	requirements	of	Section	13	or	15(d)	of	the	Securities	Exchange	Act	of	1934,	the	registrant	has	duly	caused	this	Annual	Report	to	be signed	on	its	behalf	by	the	undersigned,	thereunto	duly	authorized	as	of	the	date	indicated	below.

Liam	J.	Kelly

# President	and	Chief	Executive	Officer

Pursuant	to	the	requirements	of	the	Securities	Exchange	Act	of	1934,	this	report	has	been	signed	below	by	the	following	persons	on	behalf	of	the registrant	and	in	the	capacities	and	as	of	the	date	indicated	below.

/s/	Thomas	E.	Powell

Thomas	E.	Powell

Executive	Vice	President	and	Chief Financial	Officer (Principal	Financial	Officer)

# INDEX	TO	CONSOLIDATED	FINANCIAL	STATEMENTS

# FINANCIAL	STATEMENT	SCHEDULE

# MANAGEMENT'S	REPORT	ON	INTERNAL	CONTROL	OVER	FINANCIAL	REPORTING

The	management	of	Teleflex	Incorporated	and	its	subsidiaries	(the	"Company")	is	responsible	for	establishing	and	maintaining	adequate	internal control	over	financial	reporting.	Internal	control	over	financial	reporting	is	a	process	designed	by,	or	under	the	supervision	of	our	Chief	Executive	Officer and	Chief	Financial	Officer	and	effected	by	 the	Company's	board	of	directors,	management	and	other	personnel,	 to	provide	reasonable	assurance regarding	the	reliability	of	financial	reporting	and	the	preparation	of	financial	statements	for	external	purposes	in	accordance	with	generally	accepted accounting	principles.	A	company's	internal	control	over	financial	reporting	includes	those	policies	and	procedures	that	pertain	to	the	maintenance	of records	 that,	 in	 reasonable	 detail,	 accurately	 and	 fairly	 reflect	 the	 transactions	 and	 dispositions	 of	 the	 assets	 of	 the	 company;	 provide	 reasonable assurance	that	transactions	are	recorded	as	necessary	to	permit	preparation	of	financial	statements	in	accordance	with	generally	accepted	accounting principles,	and	that	receipts	and	expenditures	of	the	company	are	being	made	only	in	accordance	with	authorizations	of	management	and	directors	of	the company;	and	provide	reasonable	assurance	regarding	prevention	or	timely	detection	of	unauthorized	acquisition,	use,	or	disposition	of	the	company's assets	that	could	have	a	material	effect	on	the	financial	statements.

Because	 of	 its	 inherent	 limitations,	 internal	 control	 over	 financial	 reporting	 may	 not	 prevent	 or	 detect	 misstatements.	Also,	 projections	 of	 any evaluation	of	effectiveness	to	future	periods	are	subject	to	the	risk	that	controls	may	become	inadequate	because	of	changes	in	conditions,	or	that	the degree	of	compliance	with	the	policies	or	procedures	may	deteriorate.

Management	 assessed	 the	 effectiveness	 of	 the	 Company's	 internal	 control	 over	 financial	 reporting	 as	 of	 December	31,	2017.	 In	 making	 this assessment,	management	used	the	framework	established	in	Internal	Control	—	Integrated	Framework	(2013)	issued	by	the	Committee	of	Sponsoring Organizations	of	the	Treadway	Commission	(COSO).	As	a	result	of	this	assessment	and	based	on	the	criteria	in	the	COSO	framework,	management	has concluded	that,	as	of	December	31,	2017,	the	Company's	internal	control	over	financial	reporting	was	effective.

The	Company	acquired	Vascular	Solutions,	Inc.	("Vascular	Solutions")	and	NeoTract,	Inc.	("NeoTract")	on	February	17,	2017	and	October	2,	2017, respectively.	Management	has	excluded	Vascular	Solutions	and	NeoTract	from	its	assessment	of	the	effectiveness	of	the	Company's	internal	control over	financial	reporting	as	of	December	31,	2017.	The	net	revenues	attributable	to	Vascular	Solutions	and	NeoTract	were	$152.6	million	and	$39.0 million,	 respectively,	 from	 the	 respective	 dates	 of	 acquisition	 through	 December	 31,	 2017,	 representing,	 in	 aggregate,	 9%	 of	 our	 consolidated	 net revenues	 for	 the	 year	 ended	 December	 31,	 2017.	Total	 assets	 of	 Vascular	 Solutions	 and	 NeoTract	 (excluding	 goodwill	 and	 intangible	 assets)	 at December	31,	2017	were	$303.2	million	and	$49.1	million,	respectively,	representing,	in	aggregate,	6%	of	our	consolidated	total	assets	as	of	December 31,	2017.

The	effectiveness	of	the	Company's	internal	control	over	financial	reporting	as	of	 December	31,	2017	has	been	audited	by	PricewaterhouseCoopers LLP,	an	independent	registered	public	accounting	firm,	as	stated	in	their	report	which	appears	herein.

Executive	Vice	President	and	Chief	Financial	Officer

# REPORT	OF	INDEPENDENT	REGISTERED	PUBLIC	ACCOUNTING	FIRM

# To	the	Board	of	Directors	and	Shareholders	of	Teleflex	Incorporated

# Opinions	on	the	Financial	Statements	and	Internal	Control	over	Financial	Reporting

We	have	audited	the	consolidated	financial	statements,	including	the	related	notes	and	financial	statement	schedule	of	Teleflex	Incorporated	and	its subsidiaries	as	listed	in	the	accompanying	index	appearing	on	page	F-1	(collectively	referred	to	as	the	"consolidated	financial	statements").	We	also	have audited	the	Company's	internal	control	over	financial	reporting	as	of	December	31,	2017,	based	on	criteria	established	in	Internal	Control	-	Integrated Framework	(2013)	issued	by	the	Committee	of	Sponsoring	Organizations	of	the	Treadway	Commission	(COSO).

In	our	opinion,	the	consolidated	financial	statements	referred	to	above	present	fairly,	in	all	material	respects,	the	financial	position	of	the	Company	as	of December	31,	2017	and	2016,	and	the	results	of	its	operations	and	its	cash	flows	for	each	of	the	three	years	in	the	period	ended	December	31,	2017	in conformity	with	accounting	principles	generally	accepted	in	the	United	States	of	America.	Also	in	our	opinion,	the	Company	maintained,	in	all	material respects,	 effective	 internal	 control	 over	 financial	 reporting	 as	 of	 December	 31,	 2017,	 based	 on	 criteria	 established	 in	 Internal	 Control	 -	 Integrated Framework	(2013)	issued	by	the	COSO.

# Basis	for	Opinions

The	Company's	management	is	responsible	for	these	consolidated	financial	statements,	for	maintaining	effective	internal	control	over	financial	reporting, and	 for	 its	 assessment	 of	 the	 effectiveness	 of	 internal	 control	 over	 financial	 reporting,	 included	 in	 "Management's	Report	 on	 Internal	 Control	 over Financial	Reporting"	appearing	on	page	F-2.	Our	responsibility	is	to	express	opinions	on	the	Company's	consolidated	financial	statements	and	on	the Company's	internal	control	over	financial	reporting	based	on	our	audits.	We	are	a	public	accounting	firm	registered	with	the	Public	Company	Accounting Oversight	Board	(United	States)	("PCAOB")	and	are	required	 to	be	 independent	with	respect	 to	 the	Company	 in	accordance	with	 the	U.S.	 federal securities	laws	and	the	applicable	rules	and	regulations	of	the	Securities	and	Exchange	Commission	and	the	PCAOB.

We	conducted	our	audits	 in	accordance	with	 the	standards	of	 the	PCAOB.	Those	standards	require	that	we	plan	and	perform	the	audits	to	obtain reasonable	assurance	about	whether	the	consolidated	financial	statements	are	free	of	material	misstatement,	whether	due	to	error	or	fraud,	and	whether effective	internal	control	over	financial	reporting	was	maintained	in	all	material	respects.

Our	audits	of	the	consolidated	financial	statements	included	performing	procedures	to	assess	the	risks	of	material	misstatement	of	the	consolidated financial	statements,	whether	due	to	error	or	fraud,	and	performing	procedures	that	respond	to	those	risks.	Such	procedures	included	examining,	on	a test	basis,	evidence	regarding	the	amounts	and	disclosures	in	the	consolidated	financial	statements.	Our	audits	also	included	evaluating	the	accounting principles	used	and	significant	estimates	made	by	management,	as	well	as	evaluating	the	overall	presentation	of	the	consolidated	financial	statements. Our	audit	of	internal	control	over	financial	reporting	included	obtaining	an	understanding	of	internal	control	over	financial	reporting,	assessing	the	risk	that a	material	weakness	exists,	and	testing	and	evaluating	the	design	and	operating	effectiveness	of	internal	control	based	on	the	assessed	risk.	Our	audits also	included	performing	such	other	procedures	as	we	considered	necessary	in	the	circumstances.	We	believe	that	our	audits	provide	a	reasonable	basis for	our	opinions.

As	described	in	Management's	Report	on	Internal	Control	over	Financial	Reporting,	management	has	excluded	Vascular	Solutions,	Inc.	and	NeoTract, Inc.	from	its	assessment	of	internal	control	over	financial	reporting	as	of	December	31,	2017	because	they	were	both	acquired	by	the	Company	in purchase	business	combinations	during	2017.	We	have	also	excluded	Vascular	Solutions,	Inc.	and	NeoTract,	Inc.	from	our	audit	of	internal	control	over financial	 reporting.	Vascular	Solutions,	 Inc.	and	NeoTract,	 Inc.	are	wholly-owned	subsidiaries	whose	 total	revenues	and	 total	assets	excluded	 from management's	 assessment	 and	 our	 audit	 of	 internal	 control	 over	 financial	 reporting	 collectively	 represent	 approximately	 9%	 of	 total	 revenues,	 in aggregate,	and	approximately	6%	of	total	assets,	in	aggregate,	of	the	related	consolidated	financial	statement	amounts	as	of	and	for	the	year	ended December	31,	2017.

# Definition	and	Limitations	of	Internal	Control	over	Financial	Reporting

A	company's	internal	control	over	financial	reporting	is	a	process	designed	to	provide	reasonable	assurance	regarding	the	reliability	of	financial	reporting and	the	preparation	of	financial	statements	for	external	purposes	in	accordance	with	generally	accepted	accounting	principles.	A	company's	internal control	over	financial	reporting	includes	those	policies	and	procedures	that	(i)	pertain	to	the	maintenance	of	records	that,	in	reasonable	detail,	accurately and	fairly	reflect	the	transactions	and	dispositions	of	the	assets	of	the	company;	(ii)	provide	reasonable	assurance	that	transactions	are	recorded	as necessary	to	permit	preparation	of	financial	statements	in	accordance	with	generally	accepted	accounting	principles,	and	that	receipts	and	expenditures	of the	company	are	being	made	only	in	accordance	with	authorizations	of	management	and	directors	of	the	company;	and	(iii)	provide	reasonable	assurance regarding	prevention	or	timely	detection	of	unauthorized	acquisition,	use,	or	disposition	of	the	company's	assets	that	could	have	a	material	effect	on	the financial	statements.

/s/	PricewaterhouseCoopers	LLP Philadelphia,	Pennsylvania February	22,	2018

We	have	served	as	the	Company's	auditor	since	1962.

# CONSOLIDATED	STATEMENTS	OF	INCOME

| Net	revenues | $2,146,303 | $1,868,027 | $1,809,690 |
| :--- | :--- | :--- | :--- |
| Cost\tof\tgoods\tsold | 974,501 | 871,827 | 865,287 |
| Gross\tprofit | 1,171,802 | 996,200 | 944,403 |
| Selling,\tgeneral\tand\tadministrative\texpenses | 699,963 | 563,308 | 568,982 |
| Research\tand\tdevelopment\texpenses | 84,770 | 58,579 | 52,119 |
| Restructuring\tand\timpairment\tcharges | 14,790 | 59,227 | 7,819 |
| Gain\ton\tsale\tof\tassets | — | (4,367) | (408) |
| Income\tfrom\tcontinuing\toperations\tbefore\tinterest,\tloss\ton\textinguishment\tof\tdebt\tand\ttaxes | 372,279 | 319,453 | 315,891 |
| Interest\texpense | 82,546 | 54,941 | 61,323 |
| Interest\tincome | (771) | (474) | (532) |
| Loss\ton\textinguishment\tof\tdebt | 5,593 | 19,261 | 10,454 |
| Income\tfrom\tcontinuing\toperations\tbefore\ttaxes | 284,911 | 245,725 | 244,646 |
| Taxes\ton\tincome\tfrom\tcontinuing\toperations | 129,648 | 8,074 | 7,838 |
| Income\tfrom\tcontinuing\toperations | 155,263 | 237,651 | 236,808 |
| Operating\tloss\tfrom\tdiscontinued\toperations | (4,534) | (922) | (1,730) |
| Tax\tbenefit\ton\tloss\tfrom\tdiscontinued\toperations | (1,801) | (1,112) | (10,635) |
| (Loss)\tincome\ton\tdiscontinued\toperations | (2,733) | 190 | 8,905 |
| Net\tincome | 152,530 | 237,841 | 245,713 |
| Less:\tIncome\tfrom\tcontinuing\toperations\tattributable\tto\tnoncontrolling\tinterest | — | 464 | 850 |
| Net\tincome\tattributable\tto\tcommon\tshareholders | $152,530 | $237,377 | $244,863 |
| Earnings\tper\tshare\tavailable\tto\tcommon\tshareholders: |  |  |  |
| Basic: |  |  |  |
| Income\tfrom\tcontinuing\toperations | $3.45 | $5.47 | $5.68 |
| (Loss)\tincome\ton\tdiscontinued\toperations | (0.06) | 0.01 | 0.21 |
| Net\tincome | $3.39 | $5.48 | $5.89 |
| Diluted: |  |  |  |
| Income\tfrom\tcontinuing\toperations | $3.33 | $4.98 | $4.91 |
| (Loss)\tincome\ton\tdiscontinued\toperations | (0.06) | — | 0.19 |
| Net\tincome | $3.27 | $4.98 | $5.10 |
| Dividends\tper\tshare | $1.36 | $1.36 | $1.36 |
| Weighted\taverage\tcommon\tshares\toutstanding: |  |  |  |
| Basic | 45,004 | 43,325 | 41,558 |
| Diluted | 46,664 | 47,646 | 48,058 |
| \tAmounts\tattributable\tto\tcommon\tshareholders: |  |  |  |
| Income\tfrom\tcontinuing\toperations,\tnet\tof\ttax | $155,263 | $237,187 | $235,958 |
| (Loss)\tincome\tfrom\tdiscontinued\toperations,\tnet\tof\ttax | (2,733) | 190 | 8,905 |
| Net\tincome | $152,530 | $237,377 | $244,863 |

The	accompanying	notes	are	an	integral	part	of	the	consolidated	financial	statements.

# CONSOLIDATED	STATEMENTS	OF	COMPREHENSIVE	INCOME

| Net	income | $152,530 | $237,841 | $245,713 |
| :--- | :--- | :--- | :--- |
| Other\tcomprehensive\tincome,\tnet\tof\ttax: |  |  |  |
| Foreign\tcurrency: |  |  |  |
| Foreign\tcurrency\ttranslation\tcontinuing\toperations\tadjustments,\tnet\tof\ttax\tof\n($29,448),\t$10,977,\tand\t$24,150,\trespectively | 173,074 | (69,162) | (110,671) |
| Foreign\tcurrency\ttranslation,\tnet\tof\ttax | 173,074 | (69,162) | (110,671) |
| Pension\tand\tother\tpostretirement\tbenefits\tplans: |  |  |  |
| Prior\tservice\tcost\trecognized\tin\tnet\tperiodic\tcost,\tnet\tof\ttax\tof\t$(39),\t$(20),\nand\t$0\trespectively | 66 | 36 | — |
| Unamortized\t(loss)\tgain\tarising\tduring\tthe\tperiod,\tnet\tof\ttax\tof\t$1,677,\t$1,849,\nand\t$1,469,\trespectively | (5,419) | (3,255) | (2,137) |
| Plan\tamendments,\tnet\tof\ttax\tof\t$74,\t$0,\tand\t$0\trespectively | (223) | — | — |
| Net\tloss\trecognized\tin\tnet\tperiodic\tcost,\tnet\tof\ttax\tof\t$(2,457),\t$(2,489),\tand |  |  |  |
| $(2,242),\trespectively | 4,447 | 4,476 | 4,133 |
| Foreign\tcurrency\ttranslation,\tnet\tof\ttax\tof\t$413,\t$(373),\tand\t$(316),\nrespectively | (1,083) | 1,034 | 861 |
| Pension\tand\tother\tpostretirement\tbenefits\tplans\tadjustment,\tnet\tof\ttax | (2,212) | 2,291 | 2,857 |
| Derivatives\tqualifying\tas\thedges: |  |  |  |
| Unrealized\tgain\t(loss)\ton\tderivatives\tarising\tduring\tthe\tperiod,\tnet\tof\ttax\n$(631),\t$1,359,\tand\t$379,\trespectively | 2,775 | (3,434) | (2,974) |
| Reclassification\tadjustment\ton\tderivatives\tincluded\tin\tnet\tincome,\tnet\tof\ttax\tof\n$83,\t$(1,010),\tand\t$(196),\trespectively | (11) | 3,501 | 483 |
| Derivatives\tqualifying\tas\thedges,\tnet\tof\ttax | 2,764 | 67 | (2,491) |
| \tOther\tcomprehensive\t(loss)\tincome,\tnet\tof\ttax | 173,626 | (66,804) | (110,305) |
| \tComprehensive\tincome | 326,156 | 171,037 | 135,408 |
| Less:\tcomprehensive\tincome\tattributable\tto\tnoncontrolling\tinterest | — | 421 | 774 |
| Comprehensive\tincome\tattributable\tto\tcommon\tshareholders | $326,156 | $170,616 | $134,634 |

# CONSOLIDATED	BALANCE	SHEETS

| Cash	and	cash	equivalents | $333,558 | $543,789 |
| :--- | :--- | :--- |
| Accounts\treceivable,\tnet | 345,875 | 271,993 |
| Inventories,\tnet | 395,744 | 316,171 |
| Prepaid\texpenses\tand\tother\tcurrent\tassets | 47,882 | 40,382 |
| Prepaid\ttaxes | 5,748 | 8,179 |
| Assets\theld\tfor\tsale | — | 2,879 |
| Total\tcurrent\tassets | 1,128,807 | 1,183,393 |
| Property,\tplant\tand\tequipment,\tnet | 382,999 | 302,899 |
| Goodwill | 2,235,592 | 1,276,720 |
| Intangibles\tassets,\tnet | 2,383,748 | 1,091,663 |
| Deferred\ttax\tassets | 3,810 | 1,712 |
| Other\tassets | 46,536 | 34,826 |
| Total\tassets | $6,181,492 | $3,891,213 |
| LIABILITIES\tAND\tEQUITY |  |  |
| Current\tliabilities |  |  |
| Current\tborrowings | $86,625 | $183,071 |
| Accounts\tpayable | 92,027 | 69,400 |
| Accrued\texpenses | 96,853 | 65,149 |
| Current\tportion\tof\tcontingent\tconsideration | 74,224 | 587 |
| Payroll\tand\tbenefit-related\tliabilities | 107,415 | 82,679 |
| Accrued\tinterest | 6,165 | 10,450 |
| Income\ttaxes\tpayable | 11,514 | 7,908 |
| Other\tcurrent\tliabilities | 9,053 | 8,402 |
| Total\tcurrent\tliabilities | 483,876 | 427,646 |
| Long-term\tborrowings | 2,162,927 | 850,252 |
| Deferred\ttax\tliabilities | 603,676 | 271,377 |
| Pension\tand\tpostretirement\tbenefit\tliabilities | 121,410 | 133,062 |
| Noncurrent\tliability\tfor\tuncertain\ttax\tpositions | 12,296 | 17,520 |
| Noncurrent\tcontingent\tconsideration | 197,912 | 6,516 |
| Other\tliabilities | 168,864 | 45,499 |
| Total\tliabilities | 3,750,961 | 1,751,872 |
| Commitments\tand\tcontingencies |  |  |
| Convertible\tnotes\t-\tredeemable\tequity\tcomponent | — | 1,824 |
| Mezzanine\tequity | — | 1,824 |
| Shareholders'\tequity |  |  |
| Common\tshares,\t$1\tpar\tvalue\tIssued:\t2017\t—\t46,871\tshares;\t2016\t—\t45,814\tshares | 46,871 | 45,814 |
| Additional\tpaid-in\tcapital | 591,721 | 506,800 |
| Retained\tearnings | 2,285,886 | 2,194,593 |
| Accumulated\tother\tcomprehensive\tloss | (265,091) | (438,717) |
|  | 2,659,387 | 2,308,490 |
| Less:\tTreasury\tstock,\tat\tcost | 228,856 | 170,973 |
| Total\tshareholders'\tequity | 2,430,531 | 2,137,517 |
| Total\tliabilities\tand\tshareholders'\tequity | $6,181,492 | $3,891,213 |

# CONSOLIDATED	STATEMENTS	OF	CASH	FLOWS

|  |  | Year	Ended	December	31, |  |
| :--- | :--- | :--- | :--- |
|  | 2017 | 2016 | 2015 |
|  |  | (Dollars\tin\tthousands) |  |
| Cash\tflows\tfrom\toperating\tactivities\tof\tcontinuing\toperations: |  |  |  |
| Net\tincome | $152,530 | $237,841 | $245,713 |
| Adjustments\tto\treconcile\tnet\tincome\tto\tnet\tcash\tprovided\tby\toperating\tactivities: |  |  |  |
| Loss\t(income)\tfrom\tdiscontinued\toperations | 2,733 | (190) | (8,905) |
| Depreciation\texpense | 56,497 | 54,415 | 46,013 |
| Amortization\texpense\tof\tintangible\tassets | 98,766 | 63,491 | 62,380 |
| Amortization\texpense\tof\tdeferred\tfinancing\tcosts\tand\tdebt\tdiscount | 5,075 | 10,440 | 16,941 |
| Loss\ton\textinguishment\tof\tdebt | 5,593 | 19,261 | 10,454 |
| Fair\tvalue\tstep\tup\tof\tacquired\tinventory\tsold | 10,442 | — | — |
| Changes\tin\tcontingent\tconsideration | 3,575 | (6,445) | (4,576) |
| Impairment\tof\tlong-lived\tassets | — | 2,356 | — |
| In-process\tresearch\tand\tdevelopment\timpairment\tcharge | — | 41,000 | — |
| Stock-based\tcompensation | 19,407 | 16,871 | 14,467 |
| Net\tgain\ton\tsales\tof\tbusinesses\tand\tassets | — | (4,367) | (408) |
| Deferred\tincome\ttaxes,\tnet | (41,822) | (29,346) | (54,413) |
| Other | (18,469) | (13,311) | (20,775) |
| Changes\tin\toperating\tassets\tand\tliabilities,\tnet\tof\teffects\tof\tacquisitions\tand\tdisposals: |  |  |  |
| Accounts\treceivable | (11,039) | (11,029) | 398 |
| Inventories | (22,363) | 6,408 | (8,371) |
| Prepaid\texpenses\tand\tother\tcurrent\tassets | 547 | (3,613) | (3,027) |
| Accounts\tpayable\tand\taccrued\texpenses | 39,001 | 15,422 | (117) |
| Income\ttaxes\treceivable\tand\tpayable,\tnet | 125,828 | 11,386 | 7,672 |
| Net\tcash\tprovided\tby\toperating\tactivities\tfrom\tcontinuing\toperations | 426,301 | 410,590 | 303,446 |
| Cash\tflows\tfrom\tinvesting\tactivities\tof\tcontinuing\toperations: |  |  |  |
| Expenditures\tfor\tproperty,\tplant\tand\tequipment | (70,903) | (53,135) | (61,448) |
| Payments\tfor\tbusinesses\tand\tintangibles\tacquired,\tnet\tof\tcash\tacquired | (1,768,284) | (14,040) | (93,808) |
| Proceeds\tfrom\tsales\tof\tbusinesses\tand\tassets | 6,332 | 10,201 | 408 |
| Net\tcash\tused\tin\tinvesting\tactivities\tfrom\tcontinuing\toperations | (1,832,855) | (56,974) | (154,848) |
| Cash\tflows\tfrom\tfinancing\tactivities\tof\tcontinuing\toperations: |  |  |  |
| Proceeds\tfrom\tnew\tborrowings | 2,463,500 | 671,700 | 288,100 |
| Reduction\tin\tborrowings | (1,239,576) | (714,565) | (303,757) |
| Debt\textinguishment,\tissuance\tand\tamendment\tfees | (26,664) | (8,958) | (9,017) |
| Proceeds\tfrom\tshare\tbased\tcompensation\tplans\tand\tthe\trelated\ttax\timpacts | 5,571 | 9,068 | 4,994 |
| Payments\tto\tnoncontrolling\tinterest\tshareholders | — | (464) | (1,343) |
| Payments\tfor\tacquisition\tof\tnoncontrolling\tinterest | — | (9,231) | — |
| Payments\tfor\tcontingent\tconsideration | (335) | (7,282) | (8,028) |
| Dividends | (61,237) | (58,960) | (56,532) |
| Net\tcash\tprovided\tby\t(used\tin)\tfinancing\tactivities\tfrom\tcontinuing\toperations | 1,141,259 | (118,692) | (85,583) |
| Cash\tflows\tfrom\tdiscontinued\toperations: |  |  |  |
| Net\tcash\tused\tin\toperating\tactivities | (6,416) | (2,110) | (2,636) |
| Net\tcash\tused\tin\tdiscontinued\toperations | (6,416) | (2,110) | (2,636) |
| Effect\tof\texchange\trate\tchanges\ton\tcash\tand\tcash\tequivalents | 61,480 | (27,391) | (25,249) |
| Net\t(decrease)\tincrease\tin\tcash\tand\tcash\tequivalents | (210,231) | 205,423 | 35,130 |
| Cash\tand\tcash\tequivalents\tat\tthe\tbeginning\tof\tthe\tyear | 543,789 | 338,366 | 303,236 |
| Cash\tand\tcash\tequivalents\tat\tthe\tend\tof\tthe\tyear | $333,558 | $543,789 | $338,366 |
| Supplemental\tcash\tflow\tinformation: |  |  |  |
| Cash\tinterest\tpaid | $74,256 | $44,203 | $45,973 |
| Income\ttaxes\tpaid,\tnet\tof\trefunds | $49,144 | $23,955 | $56,079 |
| Non\tcash\tinvesting\tand\tfinancing\tactivities\tof\tcontinuing\toperations: |  |  |  |
| Purchases\tof\tbusinesses\tand\trelated\tcosts | $261,733 | $— | $— |
| Settlement\tand\texchange\tof\tconvertible\tnotes\twith\tcommon\tor\ttreasury\tstock | $53,207 | $35,286 | $133 |
| Acquisition\tof\ttreasury\tstock\tfrom\tsettlement\tand\texchange\tof\tconvertible\tnote\thedge\tand\twarrants | $141,405 | $86,046 | $269 |

# CONSOLIDATED	STATEMENTS	OF	CHANGES	IN	SHAREHOLDERS'	EQUITY

|  | Common	Stock<br>Shares | Dollars | Additional<br>Paid	in<br>Capital | Retained<br>Earnings | Accumulated<br>Other	Comprehensive<br>Income	(loss) | Treasury<br>Stock<br>Shares | Dollars | Non-<br>controlling<br>Interest | Total	Shareholders'<br>Equity |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  |  |  |  | (Dollars\tand\tshares\tin\tthousands,\texcept\tper\tshare\tamounts) | (Dollars\tand\tshares\tin\tthousands,\texcept\tper\tshare\tamounts) | (Dollars\tand\tshares\tin\tthousands,\texcept\tper\tshare\tamounts) |  |  |  |
| Balance\tat\tDecember\t31,\t2014 | 43,420 | $43,420 | $422,394 | $1,827,845 | $(260,895) | 1,981 | $(121,455) | $2,390 | $1,913,699 |
| Net\tincome |  |  |  | 244,863 |  |  |  | 850 | 245,713 |
| Cash\tdividends\t($1.36\tper\tshare) |  |  |  | (56,532) |  |  |  |  | (56,532) |
| Other\tcomprehensive\tloss |  |  |  |  | (110,229) |  |  | (76) | (110,305) |
| Distributions\tto\tnoncontrolling\tinterest\nshareholders |  |  |  |  |  |  |  | (1,343) | (1,343) |
| Settlement\tof\tconvertible\tnotes |  |  | (128) |  |  | (2) | 133 |  | 5 |
| Settlement\tof\tnote\thedges\tassociated\twith\nconvertible\tnotes |  |  | 270 |  |  | 2 | (269) |  | 1 |
| Shares\tissued\tunder\tcompensation\tplans | 97 | 97 | 17,591 |  |  | (70) | 2,094 |  | 19,782 |
| Deferred\tcompensation |  |  | — |  |  | (3) | 73 |  | 73 |
| Balance\tat\tDecember\t31,\t2015 | 43,517 | 43,517 | 440,127 | 2,016,176 | (371,124) | 1,908 | (119,424) | 1,821 | 2,011,093 |
| Net\tincome |  |  |  | 237,377 |  |  |  | 464 | 237,841 |
| Cash\tdividends\t($1.36\tper\tshare) |  |  |  | (58,960) |  |  |  |  | (58,960) |
| Other\tcomprehensive\tloss |  |  |  |  | (66,761) |  |  | (43) | (66,804) |
| Distributions\tto\tnoncontrolling\tinterest\nshareholders |  |  |  |  |  |  |  | (464) | (464) |
| Acquisition\tof\tnoncontrolling\tinterest |  |  | (6,621) |  | (832) |  |  | (1,778) | (9,231) |
| Settlement\tof\tconvertible\tnotes | 2,168 | 2,168 | (32,004) |  |  | (430) | 33,132 |  | 3,296 |
| Settlement\tof\tnote\thedges\tassociated\twith\nconvertible\tnotes |  |  | 86,048 |  |  | 316 | (86,046) |  | 2 |
| Reclassification\tof\tconvertible\tnotes\tto\nmezzanine\tequity |  |  | (1,824) |  |  |  |  |  | (1,824) |
| Shares\tissued\tunder\tcompensation\tplans | 129 | 129 | 21,074 |  |  | (51) | 1,289 |  | 22,492 |
| \tDeferred\tcompensation |  |  |  |  |  | (2) | 76 |  | 76 |
| Balance\tat\tDecember\t31,\t2016 | 45,814 | 45,814 | 506,800 | 2,194,593 | (438,717) | 1,741 | (170,973) | — | 2,137,517 |
| Net\tincome |  |  |  | 152,530 |  |  |  |  | 152,530 |
| Cash\tdividends\t($1.36\tper\tshare) |  |  |  | (61,237) |  |  |  |  | (61,237) |
| Other\tcomprehensive\tloss |  |  |  |  | 173,626 |  |  |  | 173,626 |
| Settlement\tof\tconvertible\tnotes | 928 | 928 | (48,375) |  |  | (503) | 52,279 |  | 4,832 |
| Settlement\tof\tnote\thedges\tassociated\twith\nconvertible\tnotes\tand\twarrants |  |  | 112,901 |  |  | 516 | (112,908) |  | (7) |
| Shares\tissued\tunder\tcompensation\tplans | 129 | 129 | 20,395 |  |  | (48) | 2,658 |  | 23,182 |
| \tDeferred\tcompensation |  |  |  |  |  | (2) | 88 |  | 88 |
| Balance\tat\tDecember\t31,\t2017 | 46,871 | $46,871 | $591,721 | $2,285,886 | $(265,091) | 1,704 | $(228,856) | $— | $2,430,531 |

# NOTES	TO	CONSOLIDATED	FINANCIAL	STATEMENTS

# Note	1	—	Summary	of	significant	accounting	policies

Consolidation:	 The consolidated	 financial	 statements	 include	 the	 accounts	 of	 Teleflex	 Incorporated	 and	 its	 subsidiaries	 (the	 "Company"). Intercompany	transactions	are	eliminated	in	consolidation.	Investments	in	affiliates	over	which	the	Company	has	significant	influence	but	not	a	controlling equity	interest,	including	variable	interest	entities	for	which	the	Company	is	not	the	primary	beneficiary,	are	accounted	for	using	the	equity	method. Investments	in	affiliates	over	which	the	Company	does	not	have	significant	influence	are	accounted	for	using	the	cost	method	of	accounting.	These consolidated	 financial	 statements	 have	 been	 prepared	 in	 conformity	 with	 accounting	 principles	 generally	 accepted	 in	 the	 United	 States	 of	America ("GAAP")	and	reflect	management's	estimates	and	assumptions	that	affect	the	recorded	amounts.

During	the	fourth	quarter	2017,	the	Company	changed	some	of	its	operating	segments	as	a	result	of	an	integration	program	under	which	it	is combining	the	businesses	of	Vascular	Solutions,	Inc.	("Vascular	Solutions"),	which	the	Company	acquired	in	February	2017,	with	certain	other	legacy businesses.	These	changes	also	reflect	the	manner	in	which	the	Company's	new	chief	operating	decision	maker	assesses	business	performance	and allocation	of	resources.	All	prior	comparative	periods	have	been	restated	to	reflect	these	changes.	See	Note	16	for	additional	information	on	the	changes to	the	Company's	operating	segments.

Use	of	estimates:	The	preparation	of	financial	statements	in	conformity	with	GAAP	requires	management	to	make	estimates	and	assumptions	that affect	the	reported	amounts	of	assets	and	liabilities	and	disclosure	of	contingent	assets	and	liabilities	at	the	date	of	the	financial	statements	and	the reported	amounts	of	net	revenues	and	expenses	during	the	reporting	period.	Actual	results	could	differ	from	those	estimates.

Cash	and	cash	equivalents:	All	highly	liquid	debt	instruments	with	an	original	maturity	of	three	months	or	less	are	classified	as	cash	equivalents.	The carrying	value	of	cash	equivalents	approximates	the	current	market	value.

Accounts	receivable:	Accounts	receivable	represent	amounts	due	from	customers	related	to	the	sale	of	products	and	provision	of	services.	An allowance	for	doubtful	accounts	is	maintained	and	represents	the	Company's	estimate	of	the	amount	of	uncollectible	receivables.	The	allowance	is provided	at	such	time	as	management	believes	reasonable	doubt	exists	that	such	balances	will	be	collected	within	a	reasonable	period	of	time.	The allowance	is	based	on	the	Company's	historical	collection	experience	with	respect	to	the	customer,	the	length	of	time	an	account	is	outstanding,	the financial	position	of	 the	customer	and	 information	provided	by	credit	rating	services.	 In	addition,	 the	Company	maintains	a	reserve	 for	returns	and allowances	based	on	its	historical	experience.	See	Note	9	for	information	on	the	Company's	concentration	of	credit	risk	with	respect	to	trade	accounts receivable,	as	well	as	the	Company's	allowance	for	doubtful	accounts.

Inventories:	Inventories	are	valued	at	the	lower	of	cost	or	net	realizable	value.	The	cost	of	the	Company's	inventories	is	determined	using	the average	cost	method.	Elements	of	cost	in	inventory	include	raw	materials,	direct	labor,	and	manufacturing	overhead.	In	estimating	net	realizable	value, the	Company	evaluates	inventory	for	excess	and	obsolete	quantities	based	on	estimated	usage	and	sales,	among	other	factors.

Property,	plant	and	equipment:	Property,	plant	and	equipment	are	stated	at	cost,	net	of	accumulated	depreciation.	Costs	incurred	to	develop	internal- use	computer	software	during	the	application	development	stage	generally	are	capitalized.	Costs	of	enhancements	to	internal-use	computer	software	are capitalized,	provided	that	these	enhancements	result	in	additional	functionality.	Other	additions	and	those	improvements	which	increase	the	capacity	or lengthen	the	useful	lives	of	the	assets	are	also	capitalized.	Composite	useful	lives	for	categories	of	property,	plant	and	equipment,	which	are	depreciated on	a	straight-line	basis,	are	as	follows:	buildings	—	30	years;	machinery	and	equipment	—	3	to	10	years;	computer	equipment	and	software	—	 3	to	5 years.	Leasehold	improvements	are	depreciated	over	the	lesser	of	the	useful	lives	of	the	leasehold	improvements	or	the	remaining	lease	term.	Repairs and	maintenance	costs	are	expensed	as	incurred.

Goodwill	and	other	intangible	assets: 	Goodwill	and	other	indefinite-lived	intangible	assets	are	not	amortized	but	are	tested	for	impairment	annually during	the	fourth	quarter	or	more	frequently	if	events	or	changes	in	circumstances	indicate	that	an	impairment	may	exist.	Impairment	losses,	if	any,	are included	in	income	from	operations.	The	goodwill	impairment	test	is	applied	to	each	of	the	Company's	reporting	units.	For	purposes	of	this	assessment,	a reporting	unit	is	an	operating	segment,	or	a	business	one	level	below	an	operating	segment	(also	known	as	a	component)	if	discrete

# NOTES	TO	CONSOLIDATED	FINANCIAL	STATEMENTS	—	(Continued)

financial	information	is	prepared	for	that	business	and	regularly	reviewed	by	segment	management.	However,	separate	components	are	aggregated	as	a single	reporting	unit	if	they	have	similar	economic	characteristics.

In	applying	the	goodwill	impairment	test,	the	Company	may	assess	qualitative	factors	to	determine	whether	it	is	more	likely	than	not	that	the	fair value	of	a	reporting	unit	 is	 less	 than	 its	carrying	value.	Qualitative	 factors	may	 include,	but	are	not	 limited	 to,	macroeconomic	conditions,	 industry conditions,	the	competitive	environment,	changes	in	the	market	for	the	Company's	products	and	services,	regulatory	and	political	developments,	and entity	specific	factors	such	as	strategies	and	financial	performance.	If,	after	completing	the	qualitative	assessment,	the	Company	determines	it	is	more likely	than	not	that	the	fair	value	of	a	reporting	unit	is	less	than	its	carrying	value,	the	Company	proceeds	to	a	two-step	quantitative	impairment	test, described	below.	Alternatively,	the	Company	may	elect	to	bypass	the	qualitative	assessment	and	perform	the	two-step	quantitative	impairment	test.	The first	step	of	the	two-step	impairment	test	is	to	compare	the	fair	value	of	a	reporting	unit	to	its	carrying	value.	If	the	reporting	unit	fair	value	exceeds	the carrying	value,	there	is	no	impairment.	If	the	reporting	unit	carrying	value	exceeds	the	fair	value,	the	Company	would	perform	the	second	step	of	the goodwill	impairment	test,	in	which	the	Company	would	measure	the	amount	of	an	impairment	loss,	if	any,	based	on	the	amount	by	which	the	carrying value	of	goodwill	exceeds	its	implied	fair	value.	The	implied	fair	value	of	goodwill	is	determined	by	deducting	the	fair	value	of	a	reporting	unit's	identifiable assets	and	liabilities	from	the	fair	value	of	the	reporting	unit	as	a	whole,	as	if	that	reporting	unit	had	just	been	acquired	and	the	fair	value	of	the	individual assets	acquired	and	liabilities	assumed	were	being	determined	initially.	The	Company	did	not	record	a	goodwill	impairment	charge	for	the	year	ended December	31,	2017.

The	Company's	intangible	assets	consist	of	customer	relationships,	intellectual	property,	distribution	rights,	in-process	research	and	development ("IPR&D")	and	trade	names.	The	Company	defines	IPR&D	as	the	value	of	technology	acquired	for	which	the	related	projects	have	substance	and	are incomplete.	IPR&D	acquired	in	a	business	acquisition	is	recognized	at	fair	value	and	is	required	be	capitalized	as	an	indefinite-lived	intangible	asset	until completion	of	the	IPR&D	project	or	upon	abandonment.	Upon	completion	of	the	development	project	(generally	when	regulatory	approval	to	market	the product	that	utilizes	the	technology	is	obtained),	an	impairment	assessment	is	performed	prior	to	amortizing	the	asset	over	its	estimated	useful	life.	If	the IPR&D	projects	are	abandoned,	the	related	IPR&D	assets	would	be	written	off.

The	Company	tests	its	indefinite-lived	intangible	assets	for	impairment	annually,	and	more	frequently	if	events	or	changes	in	circumstances	indicate that	an	impairment	may	have	occurred.	Similar	to	the	goodwill	impairment	test	process,	the	Company	may	elect	to	perform	a	qualitative	assessment.	If, after	completing	the	qualitative	assessment,	the	Company	determines	it	is	more	likely	than	not	that	the	fair	value	of	the	indefinite-lived	intangible	asset	is greater	than	its	carrying	amount,	the	asset	is	not	impaired.	If	the	Company	concludes	it	is	more	likely	than	not	that	the	fair	value	of	the	indefinite-lived intangible	asset	is	less	than	the	carrying	value,	the	Company	then	proceeds	to	a	quantitative	impairment	test,	which	consists	of	a	comparison	of	the	fair value	of	the	intangible	asset	to	its	carrying	amount.	The	Company	did	not	record	an	indefinite-lived	intangible	asset	impairment	charge	for	the	year	ended December	31,	2017.

Intangible	assets	consisting	of	intellectual	property,	customer	relationships,	distribution	rights,	trade	names	and	noncompete	agreement	do	not	have indefinite	lives	and	are	being	amortized	over	their	estimated	useful	lives,	which	are	as	follows:	intellectual	property,	7	to	20	years;	customer	relationships, 8	to	27	years;	distribution	rights,	10	to	17	years;	trade	names,	5	to	30	years;	noncompete	agreements,	2	to	6	years	.	The	weighted	average	remaining amortization	period	with	respect	to	the	Company's	intangible	assets	is	approximately	13	years.	The	Company	periodically	evaluates	the	reasonableness of	the	useful	lives	of	these	assets.

Long-lived	 assets:	 The	 Company	 assesses	 the	 remaining	 useful	 life	 and	 recoverability	 of	 long-lived	 assets	 whenever	 events	 or	 changes	 in circumstances	indicate	the	carrying	value	of	an	asset	may	not	be	recoverable.	The	assessment	is	based	on	various	analyses,	including	undiscounted cash	flow	and	profitability	projections	that	incorporate,	as	applicable,	the	impact	on	the	existing	business.		Therefore,	the	evaluation	involves	significant management	judgment.	Any	impairment	loss,	if	indicated,	is	measured	as	the	amount	by	which	the	carrying	amount	of	the	asset	exceeds	the	estimated fair	value	of	the	asset.

Foreign	currency	translation:	Assets	and	liabilities	of	subsidiaries	with	non-United	States	dollar	denominated	functional	currencies	are	translated	into United	States	dollars	at	the	rates	of	exchange	at	the	balance	sheet	date;	income	and	expenses	are	translated	at	the	average	rates	of	exchange	prevailing during	the	year.	The	translation	adjustments	are	reported	as	a	component	of	accumulated	other	comprehensive	loss.

Derivative	financial	instruments:	The	Company	uses	derivative	financial	instruments	primarily	for	purposes	of	hedging	exposures	to	fluctuations	in foreign	currency	exchange	rates.	All	instruments	are	entered	into	for	other	than

trading	 purposes.	All	 derivatives	 are	 recognized	 on	 the	 balance	 sheet	 at	 fair	 value.	 Changes	 in	 the	 fair	 value	 of	 derivatives	 are	 recorded	 in	 the consolidated	statement	of	comprehensive	income	as	other	comprehensive	income	(loss),	if	the	instrument	is	designated	as	part	of	a	hedge	transaction. Gains	or	losses	on	derivative	instruments	reported	in	other	comprehensive	income	(loss)	are	reclassified	to	the	consolidated	statement	of	income	in	the period	in	which	earnings	are	affected	by	the	underlying	hedged	item.	Gains	or	losses	on	derivative	instruments	representing	hedge	ineffectiveness	or hedge	components	excluded	from	the	assessment	of	effectiveness,	if	any,	are	recognized	in	the	consolidated	statement	of	income	for	the	period	in	which such	gains	and	losses	occur.	If	the	hedging	relationship	ceases	to	be	highly	effective	or	it	becomes	probable	that	an	expected	transaction	will	no	longer occur,	gains	or	losses	on	the	derivative	instrument	are	recorded	in	the	consolidated	statement	of	income	for	the	period	in	which	either	such	event	occurs. For	non-designated	derivatives,	gains	and	losses	are	reported	as	selling,	general	and	administrative	expenses	in	the	consolidated	statement	of	income. The	receipt	or	payment	of	funds	upon	settlement	of	derivative	financial	instruments	is	classified	as	cash	flows	from	operating	activities.

Share-based	compensation:	The	Company	estimates	the	fair	value	of	share-based	awards	on	the	date	of	grant	using	an	option	pricing	model.	The value	of	the	portion	of	the	award	that	is	ultimately	expected	to	vest,	which	is	derived,	in	part,	in	consideration	of	estimated	forfeitures,	is	recognized	as expense	over	the	requisite	service	periods.	Share-based	compensation	expense	related	to	stock	options	is	measured	using	a	Black-Scholes	option pricing	model	that	takes	into	account	subjective	and	complex	assumptions	with	respect	to	the	expected	life	of	the	options,	volatility,	risk-free	interest	rate and	expected	dividend	yield.	The	expected	life	of	options	granted	is	derived	from	the	vesting	period	of	the	award,	as	well	as	historical	exercise	behavior, and	represents	the	period	of	time	that	options	granted	are	expected	to	be	outstanding.	Expected	volatility	is	based	on	a	blend	of	historical	volatility	and implied	volatility	derived	from	publicly	traded	options	to	purchase	the	Company's	common	stock,	which	the	Company	believes	is	more	reflective	of	the market	conditions	and	a	better	indicator	of	expected	volatility	than	would	be	the	case	if	the	Company	only	used	historical	volatility.	The	risk-free	interest rate	is	the	implied	yield	currently	available	on	United	States	(or	"U.S.")	Treasury	zero-coupon	issues	with	a	remaining	term	equal	to	the	expected	life	of the	option.	Forfeitures	are	estimated	at	the	time	of	grant	based	on	management's	expectations	regarding	the	extent	to	which	awards	ultimately	will	vest and	are	adjusted	for	actual	forfeitures	when	they	occur.

Income	taxes:	The	provision	 for	 income	 taxes	 is	determined	using	 the	asset	and	 liability	approach	of	accounting	 for	 income	 taxes.	Under	 this approach,	deferred	tax	assets	and	liabilities	are	recognized	to	reflect	the	future	tax	consequences	attributable	to	the	differences	between	the	financial statement	carrying	amounts	of	existing	assets	and	liabilities	and	their	tax	bases,	and	to	reflect	operating	loss	and	tax	credit	carryforwards.	The	provision for	income	taxes	represents	income	taxes	paid	or	payable	for	the	current	year	plus	the	change	in	deferred	taxes	during	the	year.	Provision	has	been made	for	income	taxes	on	unremitted	earnings	of	subsidiaries	and	affiliates,	except	to	the	extent	that	such	earnings	are	deemed	to	be	permanently reinvested.

Significant	judgment	is	required	in	determining	income	tax	provisions	and	in	evaluating	tax	positions.	The	Company	establishes	additional	provisions for	income	taxes	when,	despite	the	belief	that	tax	positions	are	supportable,	there	remain	certain	positions	that	do	not	meet	the	minimum	probability threshold,	which	is	a	tax	position	that	is	more	likely	than	not	to	be	sustained	upon	examination	by	the	applicable	taxing	authority.	In	the	normal	course	of business,	the	Company	and	its	subsidiaries	are	examined	by	various	federal,	state	and	foreign	tax	authorities.	The	Company	regularly	assesses	the potential	outcomes	of	these	examinations	and	any	future	examinations	for	the	current	or	prior	years	in	determining	the	adequacy	of	its	provision	for income	taxes.	Interest	accrued	with	respect	to	unrecognized	tax	benefits	and	income	tax	related	penalties	are	both	included	in	taxes	on	income	from continuing	operations.	The	Company	periodically	assesses	the	likelihood	and	amount	of	potential	adjustments	and	adjusts	the	income	tax	provision,	the current	tax	liability	and	deferred	taxes	in	the	period	in	which	the	facts	that	give	rise	to	an	adjustment	become	known.

Pensions	and	other	postretirement	benefits:	The	Company	provides	a	range	of	benefits	to	eligible	employees	and	retired	employees,	including	under plans	that	provide	pension	and	postretirement	healthcare	benefits.	The	Company	records	annual	amounts	relating	to	these	plans	based	on	calculations which	include	various	actuarial	assumptions	such	as	discount	rates,	expected	rates	of	return	on	plan	assets,	compensation	increases,	turnover	rates	and healthcare	cost	trend	rates.	The	Company	reviews	its	actuarial	assumptions	on	an	annual	basis	and	makes	modifications	to	the	assumptions	based	on current	rates	and	trends	when	appropriate.	The	effect	of	the	modifications	is	generally	amortized	over	future	periods.

Restructuring	costs:	Restructuring	costs,	which	include	termination	benefits,	facility	closure	costs,	contract	termination	costs	and	other	restructuring costs	are	recorded	at	estimated	 fair	value.	Key	assumptions	used	 in	calculating	 the	restructuring	costs	 include	 the	 terms	of,	and	payments	under, agreements	to	terminate	certain	contractual	obligations	and	the	timing	of	reductions	in	force.

Contingent	consideration	related	to	business	acquisitions:	In	connection	with	business	acquisitions,	the	Company	may	be	required	to	pay	future consideration	that	is	contingent	upon	the	achievement	of	specified	objectives	such	as	receipt	of	regulatory	approval,	commercialization	of	a	product	or achievement	of	sales	targets.	As	of	the	acquisition	date,	the	Company	records	a	contingent	liability	representing	the	estimated	fair	value	of	the	contingent consideration	that	it	expects	to	pay.	The	Company	remeasures	the	fair	value	of	its	contingent	consideration	arrangements	each	reporting	period	and, based	on	new	developments,	records	changes	in	fair	value	until	either	the	contingent	consideration	obligation	is	satisfied	through	payment	upon	the achievement	of,	or	the	obligation	no	longer	exists	due	to	the	failure	to	achieve,	the	specified	objectives.	The	change	in	the	fair	value	is	recorded	in	selling, general	and	administrative	expenses	in	the	consolidated	statement	of	income.	A	contingent	consideration	payment	is	classified	as	a	financing	activity	in the	consolidated	statement	of	cash	flows	to	the	extent	it	was	recorded	as	a	liability	as	of	the	acquisition	date.	Any	additional	amount	paid	in	excess	of	the amount	initially	accrued	is	classified	as	an	operating	activity	in	the	consolidated	statement	of	cash	flows.

Revenue	recognition:	The	Company	recognizes	revenues	from	product	sales,	including	sales	to	distributors,	or	services	provided	when	the	following revenue	recognition	criteria	are	met:	persuasive	evidence	of	an	arrangement	exists,	delivery	has	occurred	or	services	have	been	rendered,	the	selling price	is	fixed	or	determinable	and	collectability	is	reasonably	assured.	This	generally	occurs	when	products	are	shipped,	when	services	are	rendered	or upon	customers'	acceptance.	Revenues	are	net	of	estimated	returns	and	other	allowances,	including	rebates.

The	Company's	normal	policy	is	to	accept	returns	only	in	cases	in	which	the	product	is	defective	and	covered	under	the	Company's	standard warranty	provisions.	With	respect	to	the	limited	cases	where	an	arrangement	provides	a	right	of	return	to	the	customer,	including	a	distributor,	the Company	believes	it	has	the	ability	to	reasonably	estimate	the	amount	of	returns	based	on	its	substantial	historical	experience	with	respect	to	these arrangements.	Revenues	and	cost	of	goods	sold	are	reduced	to	reflect	estimated	returns.	The	reserve	for	returns	and	allowances	was	$4.2	million	and $4.4	million	as	of	December	31,	2017	and	2016,	respectively.

Allowances	related	to	customer	incentive	programs,	which	include	discounts	or	rebates,	are	estimated	and	provided	for	in	the	period	that	the	related revenues	are	recorded.	These	allowances	are	recorded	as	a	reduction	of	revenue.	The	Company	also	offers	rebates	to	certain	distributors	and	records the	estimated	rebate	as	a	reduction	of	revenue	at	the	time	of	sale.	In	estimating	rebates,	the	Company	considers	the	lag	time	between	the	point	of	sale and	the	payment	of	the	distributor's	rebate	claim,	distributor-specific	trend	analyses,	contractual	commitments,	including	stated	rebate	rates,	historical experience	with	respect	to	specific	customers	and	other	relevant	information.	The	Company	adjusts	estimated	rebates	based	on	actual	experience	and records	the	adjustment	to	revenue	in	the	period	of	adjustment.		The	reserve	for	the	customer	incentive	programs,	including	distributor	rebates,	was	$12.2 million	and	$11.6	million	at	December	31,	2017	and	2016,	respectively.	The	Company	expects	the	amounts	subject	to	the	reserve	as	of	 December	31, 2017	to	be	paid	within	90	days	subsequent	to	year-end.

# Note	2	—	Recently	issued	accounting	standards

In	May	2014,	the	Financial	Accounting	Standards	Board	("FASB"),	in	a	joint	effort	with	the	International	Accounting	Standards	Board	("IASB"),	issued new	accounting	guidance	to	clarify	the	principles	for	recognizing	revenue.	This	new	guidance,	collectively	with	related	guidance	provided	by	the	FASB,	is designed	to	enhance	the	comparability	of	revenue	recognition	practices	across	entities,	industries,	jurisdictions	and	capital	markets,	and	will	affect	any entity	that	enters	into	contracts	with	customers	or	enters	into	contracts	for	the	transfer	of	nonfinancial	assets,	unless	those	contracts	are	within	the	scope of	other	standards.	The	new	guidance	establishes	principles	for	reporting	information	to	users	of	financial	statements	about	the	nature,	amount,	timing, and	uncertainty	of	revenue	and	cash	flows	arising	from	an	entity's	contracts	with	customers.	The	core	principle	of	the	new	guidance	is	that	an	entity recognizes	revenue	to	depict	the	transfer	of	promised	goods	or	services	to	customers	in	an	amount	that	reflects	the	consideration	to	which	the	entity expects	to	be	entitled	in	exchange	for	those	goods	and	services.	The	new	guidance	is	effective	for	annual	periods	beginning	after	December	15,	2017 and	interim	periods	within	those	years.	The	Company	adopted	the	new	standard	on	January	1,	2018	using	the	modified	retrospective	method	of	adoption, which	involves	recognizing	the	cumulative	effect	of	adopting	this	guidance	as	an	adjustment	to	the	Company's	opening	balance	of	retained	earnings	on the	adoption	date.	The	adoption	of	this	guidance	did	not	have	a	material	impact	on	the	Company's	consolidated	results	of	operations,	cash	flows	and financial	position.

In	February	2016,	the	FASB	issued	guidance	that	will	change	the	requirements	for	accounting	for	leases.	Under	the	new	guidance,	lessees	(including lessees	under	leases	classified	as	finance	leases,	which	are	to	be	classified	based	on	criteria	similar	to	that	applicable	to	capital	leases	under	current guidance,	and	leases	classified	as	operating

leases)	will	recognize	a	right-to-use	asset	and	a	lease	liability	on	the	balance	sheet,	initially	measured	as	the	present	value	of	lease	payments	under	the lease.	Under	current	guidance,	operating	leases	are	not	recognized	on	the	balance	sheet.	The	standard	is	effective	for	fiscal	years,	and	interim	periods within	 those	 fiscal	 years,	 beginning	 after	 December	 15,	 2018.	 Early	 adoption	 is	 permitted.	 The	 new	 standard	 must	 be	 adopted	 using	 a	 modified retrospective	transition	approach	for	leases	existing	at,	or	entered	into	after,	the	beginning	of	the	earliest	comparative	period	presented	in	the	financial statements;	 the	 guidance	 provides	 certain	 practical	 expedients.	The	 Company	 is	 currently	 evaluating	 this	 guidance	 to	 determine	 its	 impact	 on	 the Company's	results	of	operations,	cash	flows	and	financial	position.

In	March	2016,	 the	FASB	 issued	new	guidance	designed	 to	simplify	several	aspects	of	 the	accounting	 for	share-based	payment	 transactions, including,	among	other	things,	guidance	related	to	accounting	for	income	taxes,	modification	of	the	criteria	for	classification	of	awards	as	either	equity awards	or	liability	awards	where	an	employer	withholds	shares	from	an	employee's	share-based	award	for	tax	withholding	purposes,	and	classification	on the	statement	of	cash	flows	of	cash	payments	to	a	tax	authority	by	an	employer	that	withholds	shares	from	an	employee's	award	for	tax	withholding purposes.	The	Company	adopted	this	guidance	as	of	January	1,	2017.	The	Company	has	applied	the	new	guidance	requiring	recognition	of	excess	tax deficiencies	and	tax	benefits	in	the	consolidated	statement	of	income,	rather	than	in	additional	paid-in-capital,	as	previously	required.	The	adoption	of	the new	standard	increased	net	income	and	cash	flows	from	operating	activities	by	$6.6	million	and	increased	diluted	earnings	per	share	by	 $0.14	for	the	year ended	December	31,	2017.	The	Company	will	continue	to	estimate	forfeitures	of	share-based	awards	at	the	time	of	grant,	rather	than	recognize	actual forfeitures	as	they	occur,	as	permitted	under	the	new	guidance.

In	August	2016,	the	FASB	issued	new	guidance	with	regard	to	eight	specific	issues	pertaining	to	the	classification	of	certain	cash	receipts	and	cash payments	within	the	statement	of	cash	flows.	The	guidance	is	effective	for	fiscal	years,	and	interim	periods	within	those	fiscal	years,	beginning	after December	15,	2017.	The	Company	adopted	this	guidance	on	January	1,	2018.	The	adoption	of	the	guidance	did	not	have	a	material	impact	on	its	cash flows.

In	October	2016,	the	FASB	issued	new	guidance	requiring	companies	to	recognize	the	income	tax	effects	of	intra-entity	sales	and	transfers	of	assets, other	than	inventory,	in	the	income	statement	as	income	tax	expense	(or	benefit)	in	the	period	in	which	the	transfer	occurs.	Previously,	recognition	was prohibited	until	the	assets	were	sold	to	an	outside	party	or	otherwise	utilized.	The	guidance	is	effective	for	annual	periods	beginning	after	December	15, 2017.	The	guidance	should	be	applied	on	a	modified	retrospective	basis	through	a	cumulative-effect	adjustment	to	retained	earnings	as	of	the	beginning of	the	annual	period	of	adoption.	The	Company	adopted	this	guidance	on	January	1,	2018.	The	adoption	of	the	guidance	did	not	have	a	material	effect	on its	consolidated	financial	statements.

In	January	2017,	the	FASB	issued	new	guidance	to	clarify	the	definition	of	a	"business,"	with	the	objective	of	assisting	entities	in	evaluating	whether	a transaction	should	be	accounted	for	as	an	acquisition	(or	disposal)	of	assets	or	as	an	acquisition	of	a	business.	The	definition	of	a	business	affects	many areas	of	accounting,	including	acquisitions,	disposals,	goodwill	and	consolidation.	The	guidance	generally	defines	a	business	as	an	integrated	set	of activities	and	assets	(collectively	referred	to	as	a	"set")	that	is	capable	of	being	conducted	and	managed	for	the	purpose	of	providing	a	return	to	investors or	other	owners,	members,	or	participants.	The	guidance	further	provides	that,	to	be	considered	a	business,	a	set	must	meet	specified	requirements. However,	the	guidance	also	states	that,	if	substantially	all	of	the	fair	value	of	gross	assets	acquired	(subject	to	specified	exceptions)	is	concentrated	in	a single	identifiable	asset	or	group	of	similar	identifiable	assets,	the	set	is	not	considered	a	business	and	no	further	analysis	is	required.	The	guidance	is effective	for	fiscal	years,	and	interim	periods	within	those	fiscal	years,	beginning	after	December	15,	2017.	The	guidance	permits	early	adoption,	and	the Company	adopted	this	guidance	during	the	fourth	quarter	2017.	The	adoption	of	the	guidance	did	not	have	a	material	effect	on	its	consolidated	financial statements.

In	January	2017,	the	FASB	issued	guidance	to	simplify	the	quantitative	test	for	goodwill	impairment.	Under	current	guidance,	if	a	reporting	unit's carrying	value	exceeds	its	fair	value,	the	entity	must	determine	the	implied	value	of	goodwill.	This	determination	is	made	by	deducting	the	fair	value	of	a reporting	unit's	identifiable	assets	and	liabilities	from	the	fair	value	of	the	reporting	unit	as	a	whole	as	if	the	reporting	unit	had	just	been	acquired.	Under the	new	guidance,	a	determination	of	the	implied	value	of	goodwill	will	no	longer	be	required;	a	goodwill	impairment	will	be	equal	to	the	amount	by	which a	reporting	unit's	carrying	value	exceeds	its	fair	value,	not	to	exceed	the	carrying	amount	of	goodwill.	The	revised	guidance	is	effective	for	fiscal	years, and	any	interim	goodwill	impairment	tests	within	those	fiscal	years,	beginning	after	December	15,	2019.	Early	adoption	is	permitted	for	any	impairment tests	performed	after	January	1,	2017.	The	Company	is	evaluating	the	impact	of	the	adoption	of	this	guidance,	but	currently	does	not	anticipate	the guidance	will	have	a	material	impact	on	its	consolidated	financial	position	or	results	of	operations.

In	March	2017,	the	FASB	issued	guidance	for	employers	that	sponsor	defined	benefit	pension	or	other	postretirement	benefit	plans.	The	guidance requires	that	these	employers	disaggregate	specified	components	of	net	periodic	pension	cost	and	net	periodic	postretirement	benefit	cost	(collectively, "net	benefit	cost").	Specifically,	the

guidance	generally	requires	employers	to	present	in	the	income	statement	the	service	cost	component	of	net	benefit	cost	in	the	same	line	item	or	items as	other	compensation	costs	arising	from	services	rendered	by	the	pertinent	employees	during	the	period.	The	other	components	of	net	benefit	cost	are required	to	be	presented	in	the	income	statement	separately	from	the	service	cost	component	and	outside	a	subtotal	of	income	from	operations.	This guidance	is	effective	for	fiscal	years,	and	interim	periods	within	those	fiscal	years,	beginning	after	December	15,	2017	and	generally	is	required	to	be applied	retrospectively.	The	Company	adopted	this	guidance	on	January	1,	2018.	The	adoption	of	the	guidance	did	not	have	a	material	impact	on	the consolidated	financial	statements.

In	August	2017,	the	FASB	issued	guidance	with	the	objective	of	improving	the	financial	reporting	of	hedging	relationships	to	better	portray	the economic	results	of	an	entity's	risk	management	activities	in	its	financial	statements.	The	new	guidance	provides	for	changes	to	current	designation	and measurement	guidance	for	qualifying	hedging	relationships	and	to	the	method	of	presenting	hedge	results.	In	addition,	the	new	guidance	includes	certain targeted	improvements	to	ease	the	application	of	current	guidance	related	to	the	assessment	of	hedge	effectiveness.	The	new	guidance	is	effective	for reporting	periods	beginning	after	December	15,	2018.	Early	adoption	is	permitted.	The	Company	is	currently	evaluating	the	impact	of	the	adoption	of	this guidance	on	its	consolidated	results	of	operations	and	financial	position.

In	February	2018,	the	FASB	issued	an	amendment	to	the	guidance	on	comprehensive	income.	The	amendment	permits	a	company	to	reclassify	the income	tax	effects	of	the	Tax	Cuts	and	Jobs	Act	("the	TCJA")	on	items	within	accumulated	other	comprehensive	income	to	retained	earnings.	The amendment	also	requires	certain	new	disclosures	about	these	stranded	tax	effects.	The	guidance	is	effective	for	fiscal	years	beginning	after	December 15,	2018,	and	interim	periods	within	those	fiscal	years.	Early	adoption	is	permitted	for	reporting	periods	for	which	financial	statements	have	not	yet	been issued.	The	new	guidance	can	be	applied	either	in	the	period	of	adoption	or	retrospectively	to	each	period	(or	periods)	in	which	the	effect	of	the	change	in the	U.S.	federal	corporate	income	tax	rate	in	the	2017	Act	is	recognized.	The	Company	is	currently	evaluating	the	impact	this	guidance	will	have	on	its consolidated	financial	statements.

From	time	to	time,	new	accounting	guidance	is	issued	by	the	FASB	or	other	standard	setting	bodies	that	is	adopted	by	the	Company	as	of	the specified	effective	date	or,	when	permitted	by	the	guidance	and	as	determined	by	the	Company,	as	of	an	earlier	date.	The	Company	has	assessed recently	issued	guidance	that	is	not	yet	effective	and	believes	the	new	guidance	will	not	have	a	material	impact	on	the	Company's	results	of	operations, cash	flows	or	financial	position.

# Note	3	—	Acquisitions

During	2017,	the	Company	completed	the	acquisitions	described	below,	which,	with	the	exception	of	its	acquisition	of	certain	assets	of	Airway	Medix S.A.	and	certain	of	the	distributor	sales	to	direct	sales	conversions,	were	accounted	for	as	business	combinations.	The	results	of	operations	of	the acquired	businesses	and	assets	are	included	in	the	consolidated	statements	of	income	from	their	respective	acquisition	dates.

# Vascular	Solutions,	Inc.

On	February	17,	2017,	the	Company	completed	the	acquisition,	via	a	merger	transaction,	of	Vascular	Solutions,	a	medical	device	company	that	has developed	and	marketed	products	for	use	in	minimally	invasive	coronary	and	peripheral	vascular	procedures.	In	connection	with	the	merger,	subject	to specified	exclusions,	each	share	of	common	stock	of	Vascular	Solutions	(each,	a	"Share"	and	collectively,	the	"Shares")	was	converted	into	the	right	to receive	$56.00	per	Share	in	cash,	without	interest	and	subject	to	applicable	withholding	tax.	In	addition,	each	outstanding	option	or	similar	right	to purchase	Shares	issued	under	the	Vascular	Solutions'	Stock	Option	and	Stock	Award	Plan	(the	"Company	Options")	was	cancelled	and	converted	into the	 right	 to	 receive	 an	 amount	 in	 cash,	 without	 interest,	 equal	 to	 the	 product	 of	 (i)	 the	 total	 number	 of	 Shares	 subject	 to	 such	 Company	 Option immediately	prior	to	the	acquisition	and	(ii)	the	excess,	if	any,	of	$56.00	over	the	exercise	price	of	such	Company	Option.	The	aggregate	consideration paid	by	the	Company	in	connection	with	the	merger	was	approximately	$975.5	million,	net	of	cash	acquired.

For	the	years	ended	December	31,	2017	 and	2016	 the	Company	 incurred	$8.3	million	 and	$3.0	million,	respectively,	in	transaction	expenses associated	with	the	Vascular	Solutions	acquisition,	which	are	included	in	selling,	general	and	administrative	expenses	in	the	consolidated	statements	of income.	For	the	year	ended	December	31,	2017,	the	Company	recorded	post	acquisition	revenue	and	operating	loss	of	$152.6	million	and	$3.5	million, respectively,	related	to	Vascular	Solutions.	Financial	information	of	Vascular	Solutions	is	primarily	presented	within	the	"Interventional	North	America" reportable	operating	segment.

The	Vascular	Solutions	acquisition	was	financed	utilizing	borrowings	under	the	amended	and	restated	credit	agreement,	dated	January	20,	2017	(the "Credit	Agreement"),	which	is	described	in	Note	8.

The	following	table	presents	the	purchase	price	allocation	among	the	assets	acquired	and	liabilities	assumed	with	respect	to	the	Vascular	Solutions acquisition:

|  | (Dollars	in	thousands) |
| :--- | :--- |
| Assets |  |
| Current\tassets | $61,592 |
| Property,\tplant\tand\tequipment | 45,533 |
| Intangible\tassets | 539,250 |
| Goodwill | 524,872 |
| Other\tassets | 728 |
| Total\tassets\tacquired | 1,171,975 |
| Less: |  |
| Current\tliabilities | 15,079 |
| Deferred\ttax\tliabilities | 181,372 |
| Liabilities\tassumed | 196,451 |
| Net\tassets\tacquired | $975,524 |

The	goodwill	resulting	from	the	Vascular	Solutions	acquisition	primarily	reflects	synergies	currently	expected	to	be	realized	from	the	integration	of	the acquired	business	and	is	not	fully	tax	deductible.

The	following	table	sets	forth	the	components	of	identifiable	intangible	assets	acquired	and	the	ranges	of	the	useful	lives	as	of	the	date	of	the Vascular	Solutions	acquisition:

|  | Fair	value | Useful	life	range |
| :--- | :--- | :--- |
|  | (Dollars\tin\tthousands) | (Years) |
| Intellectual\tproperty | $248,200 | 10-\t20 |
| In-process\tresearch\tand\tdevelopment\t("IPR&amp;D") | 15,600 | Indefinite |
| Trade\tnames | 16,650 | 20 |
| Customer\trelationships | 258,800 | 25 |

# NeoTract,	Inc.

On	October	2,	2017,	the	Company	acquired	NeoTract,	Inc.	("NeoTract"),	a	medical	device	company	that	developed	and	commercialized	the	UroLift System,	a	minimally	invasive	medical	device	for	treating	lower	urinary	tract	symptoms	due	to	benign	prostatic	hyperplasia,	or	BPH.	The	fair	value	of consideration	transferred	by	the	Company	was	$975.2	million,	which	included	initial	payments	of	$725.6	million	in	cash	less	a	favorable	working	capital adjustment	of	$1.4	million	(for	which	the	Company	had	not	yet	received	payment	as	of	December	31,	2017)	and	 $251.0	million	in	estimated	fair	value	of contingent	consideration.	The	contingent	consideration	liability	represents	the	estimated	fair	value	of	the	Company's	obligations,	under	the	acquisition agreement,	to	make	four	milestone	payments	of	up	to	$375	million	in	the	aggregate	if	certain	sales	goals	are	met.	The	milestone	payments	are	based	on net	sales	(as	defined	in	the	acquisition	agreement)	for	the	periods	from	January	1,	2018	through	April	30,	2018	and	the	years	ended	December	31,	2018, 2019	 and	 2020.	The	 fair	value	of	 the	contingent	consideration	was	estimated	using	a	Monte	Carlo	valuation	approach.	See	Note	10	 for	additional information	 on	 the	 fair	 value	 measurement	 of	 the	 contingent	 consideration.	The	 acquisition	 was	 financed	 using	 borrowings	 under	 the	 Company's revolving	credit	facility.

For	the	year	ended	December	31,	2017,	the	Company	incurred	$10.1	million	in	transaction	expenses	associated	with	the	NeoTract	acquisition,	which are	included	in	selling,	general	and	administrative	expenses	in	the	consolidated	statement	of	income.	For	the	year	ended	December	31,	2017,	the Company	recorded	post	acquisition	revenue	and	operating	loss	of	$39.0	million	and	$13.3	million,	respectively,	related	to	NeoTract.	Financial	information of	NeoTract	is	primarily	presented	within	the	newly	established	Interventional	Urology	North	America	operating	segment,	which	is	included	in	the	"all other"	category	in	the	Company's	presentation	of	segment	information.

The	following	table	presents	the	purchase	price	allocation	among	the	assets	acquired	and	liabilities	assumed	with	respect	to	the	NeoTract	acquisition:

|  | (Dollars	in	thousands) |
| :--- | :--- |
| Assets |  |
| Current\tassets | $32,887 |
| Property,\tplant\tand\tequipment | 6,980 |
| Intangible\tassets | 763,314 |
| Goodwill | 341,171 |
| Other\tassets | 184 |
| Total\tassets\tacquired | 1,144,536 |
| Less: |  |
| Current\tliabilities | 13,580 |
| Deferred\ttax\tliabilities | 155,806 |
| Liabilities\tassumed | 169,386 |
| Net\tassets\tacquired | $975,150 |

The	Company	is	continuing	to	evaluate	the	initial	purchase	price	allocations	in	connection	with	its	acquisition	of	NeoTract,	and	further	adjustments may	be	necessary	as	a	result	of	the	Company's	assessment	of	additional	information	related	to	the	fair	values	of	the	assets	acquired	and	liabilities assumed,	primarily	deferred	tax	liabilities,	certain	intangible	assets	and	goodwill.	The	goodwill	resulting	from	the	NeoTract	acquisition	primarily	reflects the	benefit	the	Company	expects	to	realize	from	the	establishment	of	new	customer	relationships	and	the	development	of	technology	resulting	from	the operation	of	NeoTract's	business.	Goodwill	arising	from	the	NeoTract	acquisition	is	not	tax	deductible.

The	following	table	sets	forth	the	components	of	identifiable	intangible	assets	acquired	and	the	ranges	of	the	useful	lives	as	of	the	date	of	the NeoTract	acquisition:

|  | Fair	value | Useful	life |
| :--- | :--- | :--- |
|  | (Dollars\tin\tthousands) | (Years) |
| Intellectual\tproperty | $492,118 | 15 |
| Trade\tnames | 161,637 | 25 |
| Customer\trelationships | 109,559 | 15 |

# Tianjin	Medis	Medical	Device	Co.	LTD

On	September	15,	2017,	the	Company	acquired	certain	assets	from	one	of	its	contract	manufacturers,	Tianjin	Medis	Medical	Co.	LTD	("Tianjin Medis"),	consisting	of	substantially	all	of	the	assets	used	by	Tianjin	Medis	to	manufacture	a	line	of	the	Company's	laryngeal	masks.	The	aggregate consideration	transferred	for	the	assets	was	$21.3	million,	which	included	payments	of	$16.0	million	and	$5.3	million	in	estimated	fair	value	of	contingent consideration.	The	assets	acquired	include	goodwill	and	finite-lived	intangible	assets	(consisting	of	intellectual	property,	customer	relationships	and	a	non- compete	 agreement)	 of	$14.7	million	 and	$6.9	million,	respectively.	The	goodwill	resulting	 from	 the	acquisition	primarily	reflects	synergies	currently expected	to	be	realized	from	the	integration	of	the	acquired	business	and	is	not	tax	deductible.

# Pyng	Medical	Corp

On	April	3,	2017,	the	Company	completed	the	acquisition	of	Pyng	Medical	Corp	("Pyng"),	a	medical	device	company	that	developed	and	marketed sternal	intraosseous	infusion	products,	which	complement	the	Company's	anesthesia	product	portfolio.	The	Company	acquired	all	of	the	issued	and outstanding	common	shares	of	Pyng	utilizing	available	cash.	The	aggregate	consideration	was	$17.9	million,	net	of	cash	acquired.	The	assets	acquired include	goodwill	and	finite-lived	intangible	assets	(primarily	intellectual	property	and	customer	relationships)	of	$13.0	million	and	$5.5	million,	respectively. The	goodwill	resulting	from	the	acquisition	primarily	reflects	synergies	currently	expected	to	be	realized	from	the	integration	of	the	acquired	business	and is	not	tax	deductible.

# Airway	Medix	assets

On	October	2,	2017,	the	Company	acquired	certain	assets	of	Airway	Medix	S.A.,	a	medical	device	company	that	developed	and	marketed	devices for	 mechanically	 ventilated	 patients	 in	 intensive	 care,	 which	 complement	 the	 Company's	 respiratory	 product	 portfolio.	The	 aggregate	 consideration transferred	for	this	asset	acquisition	was	$11.6	million,	which	included	payments	of	$6.3	million	 and	$5.3	million	in	estimated	fair	value	of	contingent consideration.	The	assets	acquired	consist	mainly	of	intellectual	property	of	$11.5	million.

# Distributor	to	direct	sales	conversions

During	the	past	several	years,	the	Company	has	engaged	in	a	number	of	"distributor	to	direct"	sales	conversions,	which	generally	involve	the elimination	 of	 a	 distributor	 from	 the	 sales	 channel,	 either	 by	 acquiring	 the	 distributor	 or	 terminating	 the	 distributor	 relationship.	 In	 some	 instances, particularly	in	Asia,	the	conversion	involves	the	acquisition	or	termination	of	a	master	distributor	and	the	continued	sale	of	the	Company's	products through	third	party	sub-distributors	or	through	new	distributors.

During	2017,	the	Company	completed	conversions	from	distributor	sales	to	direct	sales	related	to	the	Vascular	Solutions	business	in	several countries,	primarily	within	the	Company's	EMEA	segment.	The	aggregate	consideration	the	Company	provided	in	connection	with	the	conversions	was $29.3	million.	The	assets	acquired	consisted	mainly	of	non-compete	agreements	and	customer	relationships.	The	Company	reversed	$2.4	million	in	net revenues	associated	with	sales	of	inventory	made	to	these	distributors	that,	in	conjunction	with	the	conversions,	the	Company	subsequently	repurchased.

# Pro	forma	combined	financial	information

The	following	unaudited	pro	forma	combined	financial	information	for	the	years	ended	 December	31,	2017	and	2016,	respectively,	gives	effect	to	the Vascular	Solutions	and	NeoTract	acquisitions	as	if	they	were	completed	at	the	beginning	of	the	earliest	period	presented.	The	pro	forma	information	is presented	for	informational	purposes	only	and	is	not	necessarily	indicative	of	the	results	of	operations	that	actually	would	have	occurred	under	the ownership	and	management	of	the	Company.

|  | 2017 | 2016 |
| :--- | :--- | :--- |
|  | (unaudited) | (unaudited) |
| Net\trevenue | $2,255,696 | $2,084,439 |
| Net\tincome | $119,934 | $106,512 |
| Basic\tearnings\tper\tcommon\tshare: |  |  |
| Net\tincome | $2.66 | $2.46 |
| Diluted\tearnings\tper\tcommon\tshare: |  |  |
| Net\tincome | $2.57 | $2.24 |
| Weighted\taverage\tcommon\tshares\toutstanding: |  |  |
| Basic | 45,004 | 43,325 |
| Diluted | 46,664 | 47,646 |

The	unaudited	pro	forma	combined	financial	information	presented	above	includes	the	accounting	effects	of	the	Vascular	Solutions	and	NeoTract business	combinations,	including,	to	the	extent	applicable,	amortization	charges	from	acquired	intangible	assets;	adjustments	for	depreciation	of	property, plant	and	equipment;	interest	expense;	the	revaluation	of	inventory;	and	the	related	tax	effects.	The	unaudited	pro	 forma	 financial	 information	also includes	non-recurring	charges	specifically	related	to	the	Vascular	Solutions	and	NeoTract	acquisitions	and	interest	expense	associated	with	a	bridge loan	facility	that	was	put	in	place	to,	among	other	things,	assist	the	Company	in	financing	the	acquisition	of	Vascular	Solutions.	The	Company	did	not	use the	bridge	loan	facility,	as	it	obtained	financing	from	other	sources.

Pro	 forma	 information	 for	 Tianjin	 Medis,	 Pyng	 and	 the	 distributor	 to	 direct	 conversions	 (for	 those	 conversions	 accounted for	 as	 a	 business combination)	is	not	presented	as	the	operations	of	the	acquired	businesses	are	not	material	to	the	overall	operations	of	the	Company.

# 2016	acquisitions

The	Company	made	the	following	acquisitions	during	2016	(the	"2016	acquisitions"),	which,	with	the	exception	of	its	acquisition	of	the	outstanding noncontrolling	interest	in	Teleflex	Medical	Private	Limited,	were	accounted	for	as	business	combinations:

•On	September	2,	2016,	the	Company	acquired	certain	assets	of	CarTika	Medical,	Inc.,	("CarTika"),	an	original	equipment	manufacturer	(OEM)	of catheters	and	other	medical	devices	that	complement	the	Company's	OEM	product	portfolio.

•On	July	1,	2016,	the	Company,	which	previously	owned	a	74%	controlling	interest	in	its	Indian	affiliate,	Teleflex	Medical	Private	Limited,	acquired the	 remaining	26%	ownership	interest	from	the	noncontrolling	shareholders.	Teleflex	Medical	Private	Limited	is	part	of	the	Company's	Asia reportable	operating	segment.	As	this	acquisition	did	not	result	in	a	change	in	the	Company's	control	of	the	entity,	the	Company	recognized	the $7.5	million	excess	of	the	purchase	price	of	the	noncontrolling	interest	over	its	carrying	value	as	equity.

•During	the	second	quarter	2016,	the	Company	acquired	certain	assets	of two	medical	device	and	supplies	distributors	in	New	Zealand.

The	aggregate	purchase	price	paid	by	the	Company	in	connection	with	the	2016	acquisitions	was	 $22.8	million.	The	results	of	operations	of	the acquired	businesses	and	assets	are	included	in	the	consolidated	statements	of	income	from	their	respective	acquisition	dates.	Pro	forma	information	is not	presented,	as	the	operations	of	the	acquired	businesses	are	not	significant	to	the	overall	operations	of	the	Company.

# Note	4	—	Restructuring	and	impairment	charges

The	restructuring	and	impairment	charges	recognized	for	the	years	ended	 December	31,	2017,	2016,	and	2015	consisted	of	the	following:

|  |  | 2017 | 2017 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | Termination\tbenefits | Facility\tclosure\tand\nother\texit\tcosts | Contract\ttermination\ncosts | Total |
|  |  | (Dollars\tin\tthousands) | (Dollars\tin\tthousands) |  |
| 2017\tVascular\tSolutions\tintegration\tprogram | $5,377 | $118 | $— | $5,495 |
| 2017\tEMEA\trestructuring\tprogram | 4,921 | 280 | — | 5,201 |
| Other\t2016\trestructuring\tprograms | 589 | 77 | 212 | 878 |
| 2016\tManufacturing\tfootprint\trealignment\tplan | 1,314 | 420 | 363 | 2,097 |
| 2014\tManufacturing\tfootprint\trealignment\tplan | 687 | 68 | — | 755 |
| Other\trestructuring\tprograms\t(1) | 428 | (160) | 96 | 364 |
| Total\trestructuring\tcharges | $13,316 | $803 | $671 | $14,790 |

(1) Includes	activity	related	to	the	2017	Pyng	Integration	program	and	programs	initiated	in	prior	years	that	have	been	completed.	The	Company	committed	to	the	2017	Pyng Integration	program,	which	relates	to	the	integration	of	Pyng	Medical	Corp.	("Pyng")	into	the	Company,	during	the	second	quarter	2017,	following	the	Company's	acquisition of	Pyng	in	April	2017.

|  |  | 2016 |  |  |
| :--- | :--- | :--- | :--- | :--- |
|  | Termination\tbenefits | Facility\tclosure\tand\nother\texit\tcosts | Contract\ttermination\ncosts | Total |
|  |  | (Dollars\tin\tthousands) |  |  |
| Other\t2016\trestructuring\tprograms | $2,531 | $12 | $671 | $3,214 |
| 2016\tManufacturing\tfootprint\trealignment\tplan | 11,176 | 468 | 866 | 12,510 |
| 2014\tManufacturing\tfootprint\trealignment\tplan | 81 | 38 | — | 119 |
| Other\trestructuring\tprograms(1) | (558) | 398 | 188 | 28 |
| Total\trestructuring\tcharges | $13,230 | $916 | $1,725 | $15,871 |
| Impairment\tcharges | — | 43,356 | — | 43,356 |
| Total\trestructuring\tand\timpairment\tcharges | $13,230 | $44,272 | $1,725 | $59,227 |

(1) Includes	activity	primarily	related	to	programs	initiated	in	2015	that	were	associated	with	the	reorganization	of	certain	businesses	and	shared	service	center	functions	as well	as	the	consolidation	of	certain	facilities	in	North	America.	These	programs	have	been	completed.

|  | Termination	benefits | Facility	closure	and<br>other	exit	costs | Contract	termination<br>costs | Total |
| :--- | :--- | :--- | :--- | :--- |
|  |  | (Dollars\tin\tthousands) | (Dollars\tin\tthousands) |  |
| 2015\tRestructuring\tprograms | $5,009 | $295 | $1,000 | $6,304 |
| 2014\tManufacturing\tfootprint\trealignment\tplan | 1,007 | 289 | 389 | 1,685 |
| Other\trestructuring\tprograms\t(1) | (194) | 37 | (13) | (170) |
| Total\trestructuring\tcharges | $5,822 | $621 | $1,376 | $7,819 |

(1)	Includes	activity	related	to	programs	initiated,	and	substantially	completed,	in	prior	years.

Termination	benefits	include	employee	retention,	severance	and	benefit	payments	for	terminated	employees.	Facility	closure	costs	include	general operating	costs	incurred	subsequent	to	production	shutdown	as	well	as	equipment	relocation	and	other	associated	costs.	Other	exit	costs	include	legal, outplacement	and	employee	relocation	costs	and	other	employee-related	costs.	Contract	termination	costs	include	costs	associated	with	terminating existing	leases	and	distributor	agreements.

# Restructuring	Charges

During	the	first	quarter	2017,	the	Company	committed	to	a	restructuring	program	related	to	the	integration	of	Vascular	Solutions	into	Teleflex.	 The program	commenced	in	the	first	quarter	2017,	and	the	Company	expects	the	program	to	be	substantially	completed	by	the	end	of	the	second	quarter 2018.	The	Company	estimates	that	it	will	record	aggregate	pre-tax	restructuring	charges	of	$6.5	million	to	$8.0	million	related	to	this	program,	of	which, $5.5	million	to	$6.2	million	will	constitute	termination	benefits,	and	 $1.0	million	to	$1.8	million	will	relate	to	other	exit	costs,	including	employee	relocation and	outplacement	costs.	Additionally,	the	Company	expects	to	incur	$2.5	million	to	$3.0	million	of	restructuring	related	charges,	consisting	primarily	of retention	bonuses	offered	to	certain	employees	expected	to	remain	with	the	Company	after	completion	of	the	program.	All	of	these	charges	will	result	in future	cash	outlays.	As	of	December	31,	2017,	the	Company	has	a	restructuring	reserve	of	$ 2.1	million	related	to	this	program.

During	the	first	quarter	2017,	the	Company	committed	to	a	restructuring	program	to	centralize	certain	administrative	functions	in	Europe.	The program	commenced	in	the	second	quarter	2017,	and	the	Company	expects	the	program	to	be	substantially	completed	by	the	end	of	2018.	The	Company estimates	that	it	will	record	aggregate	pre-tax	restructuring	charges	of	approximately	$5.0	million	related	to	this	program,	almost	all	of	which	constitute termination	benefits,	and	all	of	which	will	result	in	future	cash	outlays.	This	represents	a	decrease	as	compared	to	the	prior	estimate	of	aggregate	pre-tax restructuring	charges	of	$7.1	million	to	$8.5	million	as	a	result	of	a	decrease	in	the	headcount	reduction	initially	contemplated	under	the	program.	As	of December	31,	2017,	the	Company	has	a	restructuring	reserve	of	 $4.9	million	related	to	this	program.

In	2016,	the	Company	initiated	a	restructuring	plan	involving	the	relocation	of	certain	manufacturing	operations,	the	relocation	and	outsourcing	of certain	distribution	operations	and	a	related	workforce	reduction	at	certain	of	the	Company's	facilities	(the	"2016	Manufacturing	Footprint	Realignment Plan").	These	actions	commenced	in	the	first	quarter	2016	and	are	expected	to	be	substantially	completed	by	the	end	of	2018.

The	Company	estimates	that	it	will	incur	aggregate	pre-tax	restructuring	and	restructuring	related	charges	in	connection	with	the	2016	Manufacturing Footprint	Realignment	Plan	of	between	approximately	$34	million	to	$44	million,	of	which	an	estimated	$27	million	to	$31	million	are	expected	to	result	in future	cash	outlays.	Most	of	these	charges,	and	the	related	cash	outlays,	are	expected	to	be	made	prior	to	the	end	of	2018.

The	following	table	provides	a	summary	of	the	Company's	cost	estimates	by	major	type	of	expense	associated	with	the	2016	Manufacturing	Footprint Realignment	Plan:

Type	of	expense Total	estimated	amount	expected	to	be	incurred Termination	benefits $14	million	to	$15	million Other	exit	costs	(1) $2	million	to	$3	million Restructuring	charges $16	million	to	$18	million Restructuring	related	charges	(2) $18	million	to	$26	million

(1) Includes	contract	termination	costs	as	well	as	facility	closure	and	other	exit	costs	(employee	relocation	costs,	equipment	relocation	costs	and	outplacement).

(2) Consists	of	accelerated	depreciation	and	other	costs	directly	related	to	the	plan,	primarily	as	a	result	of	the	transfer	of	manufacturing	operations	to	new	locations.

The	following	table	summarizes	the	activity	related	to	the	2016	Manufacturing	Footprint	Realignment	Plan	restructuring	reserve:

|  | Termination<br>benefits | Facility	closure	and	other<br>exit	costs | Contract	termination<br>costs | Total |
| :--- | :--- | :--- | :--- | :--- |
|  | (Dollars\tin\tthousands) |  |  |  |
| Balance\tat\tDecember\t31,\t2015 | $— | $— | $— | $— |
| Subsequent\taccruals | 11,176 | 468 | 866 | 12,510 |
| Cash\tpayments | (3,220) | (469) | (95) | (3,784) |
| Foreign\tcurrency\ttranslation | 179 | 1 | (11) | 169 |
| Balance\tat\tDecember\t31,\t2016 | 8,135 | — | 760 | 8,895 |
| Subsequent\taccruals | 1,314 | 420 | 363 | 2,097 |
| Cash\tpayments | (2,096) | (420) | (798) | (3,314) |
| Foreign\tcurrency\ttranslation | (57) | — | 44 | (13) |
| Balance\tat\tDecember\t31,\t2017 | $7,296 | $— | $369 | $7,665 |

For	 the	 years	 ended	 December	 31,	 2017	 and	 2016,	 the	 Company	 also	 incurred	 restructuring	 related	 costs	 of $8.3	 million and	$6.4	 million, respectively,	with	respect	to	the	2016	Manufacturing	Footprint	Realignment	Plan,	the	majority	of	which	constituted	accelerated	depreciation	and	other costs,	which	primarily	were	recognized	within	cost	of	goods	sold.

As	of	December	31,	2017,	the	Company	has	incurred	net	aggregate	restructuring	expenses	related	to	the	2016	Manufacturing	Footprint	Realignment Plan	of	$14.6	million.	Additionally,	as	of	December	31,	2017,	the	Company	has	incurred	net	aggregate	accelerated	depreciation	and	certain	other	costs	in connection	with	the	plan	of	$14.7	million,	which	were	included	in	cost	of	goods	sold.

In	April	 2014,	 the	 Company	 initiated	 a	 restructuring	 plan	 (the	 "2014	 Manufacturing	 Footprint	 Realignment	 Plan")	 involving	 the	 consolidation	 of operations	and	a	related	reduction	in	workforce	at	certain	facilities,	and	the	relocation	of	manufacturing	operations	from	certain	higher-cost	locations	to existing	lower-cost	locations.	These	actions	commenced	in	the	second	quarter	2014.

During	the	fourth	quarter	2017,	the	Company	executed	an	agreement	with	an	alternate	provider	for	the	development	and	supply	of	a	component	to be	included	in	certain	kits	primarily	sold	by	the	Company's	Vascular	and	Anesthesia	North	America	operating	segments.	The	agreement	will	result	in increased	 development	 costs,	 but	 is	 expected	 to	 reduce	 the	 cost	 of	 the	 component	 supply,	 once	 the	 supply	 becomes	 commercially	 available,	 as compared	to	costs	incurred	with	respect	to	current	suppliers.	As	a	result,	the	Company	revised	its	cost	and	timing	estimates	with	respect	to	the	2014 Manufacturing	Footprint	Realignment	Plan.	The	Company	estimates	that	it	will	incur	aggregate	pre-tax	charges	in	connection	with	the	2014	Manufacturing Footprint	Realignment	Plan	of	$46	million	to	$51	million,	compared	to	the	Company's	prior	estimate	of	approximately $43	million to	$48	million.	The Company	expects	aggregate	cash

outlays	associated	with	the	plan	to	be	in	the	range	of	 $38	million	to	$43	million,	compared	to	its	prior	estimate	of	 $33	million	to	$38	million.	Additionally, the	Company	continues	to	expect	that	it	will	incur	$24	million	to	$30	million	in	aggregate	capital	expenditures	under	the	plan.	Most	of	these	charges	and cash	outlays	are	expected	to	be	incurred	prior	to	2020,	and	the	Company	expects,	as	a	result	of	the	changes	described	above,	the	program	will	now	be substantially	complete	by	the	end	of	2021,	compared	to	its	prior	estimate	of	the	second	half	of	2020.

The	following	table	provides	a	summary	of	the	Company's	cost	estimates	by	major	type	of	expense	associated	with	the	2014	Manufacturing	Footprint Realignment	Plan,	which	reflect	the	revised	estimates:

As	the	2014	Manufacturing	Footprint	Realignment	Plan	progresses,	management	will	reevaluate	the	estimated	expenses	and	charges	set	forth above,	and	may	revise	its	estimates,	as	appropriate,	consistent	with	GAAP.

| Balance	at	December	31,	2015 | $7,447 | $— | $7,447 |
| :--- | :--- | :--- | :--- |
| Subsequent\taccruals | 81 | 38 | 119 |
| Cash\tpayments | (2,158) | (38) | (2,196) |
| Balance\tat\tDecember\t31,\t2016 | 5,370 | — | 5,370 |
| Subsequent\taccruals | 687 | 68 | 755 |
| Cash\tpayments | (2,131) | (68) | (2,199) |
| Balance\tat\tDecember\t31,\t2017 | $3,926 | $— | $3,926 |

	For	the	years	ended	December	31,	2017,	2016	and	2015,	the	Company	reported	restructuring	related	costs	of	$4.0	million,	$8.5	million	 and	$9.5 million,	respectively,	related	to	this	plan	within	cost	of	goods	sold.	These	costs	related	to	accelerated	depreciation	and	certain	other	costs,	primarily	for the	transfer	of	manufacturing	operations	from	the	existing	locations	to	the	new	locations	in	connection	with	the	plan.

As	of	December	31,	2017,	the	Company	has	incurred	net	aggregate	restructuring	expenses	related	to	the	plan	of	 $11.8	million.	Additionally,	as	of December	31,	2017,	the	Company	has	incurred	net	aggregate	accelerated	depreciation	and	certain	other	costs	in	connection	with	the	plan	of $26.9 million,	which	were	included	in	cost	of	goods	sold.

During	 2016,	 the	 Company	 commenced	 restructuring	 activities	 involving	 the	 consolidation	 of	 certain	 global	 administrative	 functions	 and manufacturing	operations	(the	"Other	2016	Restructuring	Programs").	The	programs	are	expected	to	be	substantially	complete	by	the	end	of	the	first quarter	2018.	The	Company	estimates	that	it	will	record	aggregate	pre-tax	restructuring	expenses	of	$3.8	million	to	$4.7	million	related	to	these	programs, which	 constitute	 termination	 benefits	 and	 contract	 termination	 costs	 that	 will	 result	 in	 cash	 outlays.	 Additionally,	 the	 Company	 expects	 to	 incur approximately	$1.5	million	 of	 restructuring	 related	 costs,	 including	 accelerated	 depreciation	 and	 other	 costs	 directly	 related	 to	 these	 programs	 and anticipates	that	these	costs	will	be	recognized	as	cost	of	goods	sold;	the	Company

anticipates	that	approximately	$1.0	million	of	this	amount	will	result	in	cash	outlays.	As	of	December	31,	2017,	the	Company	has	a	reserve	of $0.7	million related	to	these	programs.

As	each	of	these	plans	and	programs	progress,	management	will	reevaluate	the	estimated	expenses	set	forth	above,	and	may	revise	its	estimates, as	appropriate,	consistent	with	GAAP.

# Restructuring	Charges	by	Segment

Restructuring	charges	by	reportable	operating	segment	for	the	years	ended	 December	31,	2017,	2016,	and	2015	are	set	forth	in	the	following	table:

| Vascular	North	America | $2,595 | $5,843 | $3,049 |
| :--- | :--- | :--- | :--- |
| Interventional\tNorth\tAmerica | 4,908 | 459 | 1,894 |
| Anesthesia\tNorth\tAmerica | 1,262 | 1,839 | 384 |
| Surgical\tNorth\tAmerica | — | 151 | 397 |
| EMEA | 5,722 | 4,423 | 4 |
| Asia | — | — | 313 |
| OEM | — | 795 | 61 |
| All\tother | 303 | 2,361 | 1,717 |
| Total\trestructuring\tcharges | $14,790 | $15,871 | $7,819 |

# Impairment	Charges

There	were	no	impairment	charges	recorded	for	the	years	ended	December	31,	2017	or	2015.	In	2016,	the	Company	recorded	 $43.4	million	of impairment	charges,	including	$41.0	million	related	to	a	discontinued	IPR&D	project	and	 $2.4	million	related	to	two	properties	that	were	sold	during	the first	quarter	of	2017.

# Note	5	—	Inventories

Inventories,	net	at	December	31,	2017	and	2016	consist	of	the	following:

|  | 2017 | 2016 |
| :--- | :--- | :--- |
|  | (Dollars\tin\tthousands) | (Dollars\tin\tthousands) |
| Raw\tmaterials | $98,451 | $65,319 |
| Work-in-process | 62,381 | 54,555 |
| Finished\tgoods | 234,912 | 196,297 |
| Inventories,\tnet | 395,744 | 316,171 |

# Note	6	—	Property,	plant	and	equipment

The	major	classes	of	property,	plant	and	equipment,	at	cost,	at	 December	31,	2017	and	2016	are	as	follows:

|  | 2017 | 2016 |
| :--- | :--- | :--- |
|  | (Dollars\tin\tthousands) | (Dollars\tin\tthousands) |
| Land,\tbuildings\tand\tleasehold\timprovements | $207,927 | $188,679 |
| Machinery\tand\tequipment | 384,710 | 319,471 |
| Computer\tequipment\tand\tsoftware | 122,890 | 108,547 |
| Construction\tin\tprogress | 73,920 | 47,428 |
|  | 789,447 | 664,125 |
| Less:\tAccumulated\tdepreciation | (406,448) | (361,226) |
| Property,\tplant\tand\tequipment,\tnet | $382,999 | $302,899 |

# Note	7	—	Goodwill	and	other	intangible	assets

Changes	in	the	carrying	amount	of	goodwill,	by	reportable	operating	segment,	for	the	years	ended	 December	31,	2017	and	2016	are	as	follows:

|  | Vascular	North<br>America | Interventional	North<br>America | Anesthesia	North<br>America | Surgical	North<br>America | EMEA | Asia | OEM | All	other | Total |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  |  |  |  | (Dollars\tin\tthousands) | (Dollars\tin\tthousands) |  |  |  |  |
| Balance\tas\tof\tDecember\t31,\n2015 |  |  |  |  |  |  |  |  |  |
| Goodwill | $485,986 | $84,615 | $225,653 | $250,912 | $306,009 | $141,067 | $1,194 | $132,544 | $1,627,980 |
| Accumulated\timpairment\tlosses | (219,527) | (5,528) | (84,531) | — | — | — | — | (22,542) | (332,128) |
|  | 266,459 | 79,087 | 141,122 | 250,912 | 306,009 | 141,067 | 1,194 | 110,002 | 1,295,852 |
| Goodwill\trelated\tto\tacquisitions | — | — | — | — | — | — | 3,689 | — | 3,689 |
| Translation\tadjustment | — | — | 131 | — | (15,968) | (2,882) | — | (4,102) | (22,821) |
| Balance\tas\tof\tDecember\t31,\n2016 | $266,459 | $79,087 | $141,253 | $250,912 | $290,041 | $138,185 | $4,883 | $105,900 | $1,276,720 |
| Goodwill\trelated\tto\tacquisitions | — | 342,901 | 15,599 | — | 161,543 | 59,954 | — | 313,714 | 893,711 |
| Translation\tand\tother\nadjustments | (1,590) | 11,061 | 437 | — | 42,964 | 11,061 | — | 1,228 | 65,161 |
| Balance\tas\tof\tDecember\t31,\n2017 | $264,869 | $433,049 | $157,289 | $250,912 | $494,548 | $209,200 | $4,883 | $420,842 | $2,235,592 |

Intangible	assets	at	December	31,	2017	and	2016	consisted	of	the	following:

|  | Gross	Carrying	Amount |  | Accumulated	Amortization | Accumulated	Amortization |
| :--- | :--- | :--- | :--- | :--- |
|  | 2017 | 2016 | 2017 | 2016 |
|  |  | (Dollars\tin\tthousands) |  |  |
| Customer\trelationships | $1,023,837 | $622,428 | $(281,263) | $(239,055) |
| In-process\tresearch\tand\tdevelopment | 34,672 | 16,532 | — | — |
| Intellectual\tproperty | 1,287,487 | 519,962 | (258,580) | (203,390) |
| Distribution\trights | 23,697 | 23,021 | (16,996) | (15,239) |
| Trade\tnames | 571,510 | 379,724 | (22,069) | (13,974) |
| Non-compete\tagreements | 23,429 | 2,692 | (1,976) | (1,038) |
|  | $2,964,632 | $1,564,359 | $(580,884) | $(472,696) |

As	of	December	31,	2017,	trade	names	having	a	carrying	value	of	 $236.1	million	are	considered	indefinite-lived.	Acquired	IPR&D	is	indefinite-lived until	the	completion	of	the	related	development	project,	at	which	point	amortization	of	the	carrying	value	of	the	technology	will	commence.	See	Note	3	for additional	details	regarding	intangible	assets	acquired	during	2017.

During	the	fourth	quarter	2017,	the	Company	reassessed	the	useful	life	of	one	of	its	trade	names	as	a	result	of	increased	competition	experienced	in the	product	categories	utilizing	it.	The	trade	name,	which	had	a	carrying	value	of	$57.1	million	as	of	December	31,	2017,	was	reclassified	from	an indefinite	lived	intangible	asset	to	a	finite	lived	intangible	asset	and	will	be	amortized	on	a	straight	line	basis	over	its	estimated	useful	life	of	25	years.

For	the	year	ended	December	31,	2016,	the	Company	recognized	a	 $41.0	million	pre-tax	impairment	charge	($26.1	million	after	tax)	resulting	from the	discontinuation	of	research	and	development	efforts	associated	with	an	IPR&D	project.

Amortization	expense	related	to	intangible	assets	was	 $98.8	million,	$63.5	million,	and	$62.4	million	for	the	years	ended	December	31,	 2017,	2016 and	2015,	respectively.	Estimated	annual	amortization	expense	for	each	of	the	five	succeeding	years	is	as	follows:

# Note	8	—	Borrowings

The	Company's	borrowings	at	December	31,	2017	and	2016	were	as	follows:

|  | 349,000 | $210,000 |
| :--- | :--- | :--- |
|  | 721,000 | — |
| 3.875%\tConvertible\tSenior\tSubordinated\tNotes\tdue\t2017 | — | 136,076 |
| 5.25%\tSenior\tNotes\tdue\t2024 | 250,000 | 250,000 |
| 4.875%\tSenior\tNotes\tdue\t2026 | 400,000 | 400,000 |
| 4.625%\tSenior\tNotes\tdue\t2027 | 500,000 | — |
|  | 50,000 | 50,000 |
|  | 2,270,000 | 1,046,076 |
|  | — | (2,707) |
| Less:\tUnamortized\tdebt\tissuance\tcosts | (20,448) | (10,046) |
|  | 2,249,552 | 1,033,323 |
| Current\tportion\tof\tborrowings | (86,625) | (183,071) |
| Long-term\tborrowings | $2,162,927 | $850,252 |

On	January	20,	2017,	the	Company	amended	and	restated	its	then	existing	senior	credit	agreement	by	entering	into	an	Amended	and	Restated Credit	Agreement,	which	provides	for	a	five	year	revolving	credit	facility	of	$1.0	billion	and	a	term	loan	facility	of	 $750.0	million	(the	"Credit	Agreement"). The	Company's	obligations	under	the	Credit	Agreement	are	guaranteed	(subject	to	certain	exceptions	and	limitations)	by	substantially	all	of	the	material domestic	subsidiaries	of	the	Company	and	are	secured	by	a	lien	on	substantially	all	of	the	assets	owned	by	the	Company	and	each	guarantor.	The maturity	date	of	the	revolving	credit	facility	under	the	Credit	Agreement	is	January	20,	2022,	and	the	term	loan	facility	will	mature	on	February	17,	2022.

At	the	Company's	option,	loans	under	the	Credit	Agreement	will	bear	interest	at	a	rate	equal	to	adjusted	LIBOR	plus	an	applicable	margin	ranging from	1.25%	to	2.50%	or	at	an	alternate	base	rate,	which	generally	is	defined	as	the	highest	of	(i)	the	publicly	announced	prime	rate	of	JPMorgan	Chase Bank,	N.A.,	the	administrative	agent	under	the	Credit	Agreement,	(ii)	0.5%	above	the	federal	funds	rate	and	(iii)	 1%	above	adjusted	LIBOR	for	a	one month	interest	period,	plus	an	applicable	margin	ranging	from	0.25%	to	1.50%,	in	each	case	subject	to	adjustment	based	on	the	Company's	consolidated total	leverage	ratio	(generally,	Consolidated	Total	Funded	Indebtedness,	as	defined	in	the	Credit	Agreement,	on	the	date	of	determination	to	Consolidated EBITDA,	as	defined	in	the	Credit	Agreement,	for	the	four	most	recent	fiscal	quarters	ending	on	or	preceding	the	date	of	determination).	Overdue	loans will	bear	interest	at	the	rate	otherwise	applicable	to	such	loans	plus	2.00%.

The	Credit	Agreement	contains	covenants	that,	among	other	things,	place	limitations	on	the	Company	and	its	subsidiaries	regarding	its	ability,	and the	ability	of	its	subsidiaries,	to	incur	additional	indebtedness,	create	additional	liens,	enter	into	a	merger,	consolidation	or	amalgamation,	dispose	of certain	assets,	make	certain	investments	or	acquisitions,	pay	dividends	on,	repurchase	or	make	distributions	in	respect	of	capital	stock	and	enter	into swap	 agreements.	The	Company	is	required	to	maintain	a	total	consolidated	leverage	ratio	of	not	more	than	4.50	to	1.00	and	a	consolidated	senior secured	leverage	ratio	(generally,	Consolidated	Senior	Secured	Funded	Indebtedness,	as	defined	in	the	Credit	Agreement,	on	the	date	of	determination to	Consolidated	EBITDA	for	the	four	most	recent	quarters	ending	on	or	preceding	the	date	of	determination)	of	not	more	than	3.50	to	1.00.	The	Company is	further	required	to	maintain	a	consolidated	interest	coverage	ratio	(generally,	Consolidated	EBITDA	for	the	four	most	recent	fiscal	quarters	ending	on	or preceding	the	date	of	determination	to	Consolidated	Interest	Expense,	as	defined	in	the	Credit	Agreement,	paid	in	cash	for	such	period)	of	not	less	than 3.50	to	1.00.

The	Company	capitalized	$11.8	million	related	to	transaction	fees,	including	underwriters'	discounts	and	commissions,	incurred	in	connection	with	the Credit	Agreement,	of	which,	$6.8	million	related	to	the	revolving	credit	agreement	and	was	recognized	in	other	assets	within	the	Company's	consolidated balance	sheet.	In	addition,	because	the	Company's	entry	into	the	Credit	Agreement	was	considered	a	partial	extinguishment	of	the	indebtedness	under its	previously	outstanding	credit	agreement,	the	Company	recognized	a	loss	on	extinguishment	of	debt	of	$0.4	million	during	the	first	quarter	2017.

As	of	December	31,	2017	and	2016,	the	Company	had	outstanding	irrevocable	standby	letters	of	credit	of	approximately $3.2	million	with	various	third parties.	The	letters	of	credit	reduced	the	amount	of	available	funds	under	the	revolving	credit	facility	by	an	equal	amount.

The	Company's	3.875%	Convertible	Senior	Subordinated	Notes	due	2017	(the	"Convertible	Notes")	matured	on	August	1,	2017	(the	"Maturity	Date"). During	2017,	prior	to	and	on	the	Maturity	Date,	the	Company	engaged	in	the	transactions	described	below.

# Exchange	Transactions

On	January	5,	2017,	pursuant	to	separate,	privately	negotiated	agreements	between	the	Company	and	certain	holders	of	the	Convertible	Notes,	the Company	paid	cash	and	common	stock	(the	"Exchange	Consideration")	to	the	holders	in	exchange	for	$91.7	million	aggregate	principal	amount	of	the Convertible	Notes	(the	"Exchange	Transactions").	The	Exchange	Consideration	paid	to	each	of	the	holders	per	$1,000	principal	amount	of	Convertible Notes	was	equal	to:	(i)	$1,000	in	cash,	(ii)	a	number	of	shares	of	the	Company's	common	stock	equal	to	the	amount	of	the	conversion	value	of	the Convertible	Notes	in	excess	of	the	$1,000	principal	amount	(the	"Conversion	Shares"),	calculated	on	the	basis	of	the	average	daily	volume	weighted average	price	per	share	of	Company	common	stock	over	a	specified	period	(the	"Average	Daily	VWAP"),	(iii)	an	inducement	payment	in	additional	shares of	common	stock	(the	"Inducement	Shares"),	calculated	based	on	the	Average	Daily	VWAP;	and	(iv)	cash	in	an	amount	equal	to	accrued	and	unpaid interest	to,	but	not	including,	the	closing	date.	As	a	result	of	the	Exchange	Transactions,	the	Company	paid	the	holders	aggregate	cash	consideration	of approximately	$93.2	million	(which	includes	approximately	 $1.5	million	in	accrued	but	previously	unpaid	interest)	and	issued	and	delivered	to	the	holders approximately	0.93	million	shares	of	Company	common	stock	(including	both	Conversion	Shares	and	Inducement	Shares).	The	Company	funded	the $93.2	million	cash	payment	constituting	part	of	the	Exchange	Consideration	through	borrowings	under	its	revolving	credit	facility.	As	a	result	of	the Exchange	Transactions,	the	Company	recognized	a	loss	on	extinguishment	of	debt	of	$5.2	million	during	the	first	quarter	2017.

In	connection	with	its	entry	into	the	Exchange	Transactions,	the	Company	also	entered	into	bond	hedge	unwind	agreements	(the	"Hedge	Unwind Agreements")	and	warrant	unwind	agreements	(the	"Warrant	Unwind	Agreements")	with	the	dealer	counterparties	to	convertible	note	hedge	transactions and	warrant	transactions	that	were	effected	at	the	time	of	the	initial	issuance	of	the	Convertible	Notes.	Under	the	Hedge	Unwind	Agreements,	the	number of	 then-outstanding	call	options	 issued	 to	 the	Company	under	 the	Convertible	Note	hedge	 transactions	(the	"Call	Options")	was	reduced	 to	reflect proportionately	the	reduction	in	the	outstanding	principal	amount	of	the	Convertible	Notes	following	the	Exchange	Transactions.	Under	the	Warrant Unwind	Agreements,	the	number	of	warrants	then	held	by	the	dealer	counterparties	also	was	reduced.	On	a	net	basis,	after	giving	effect	to	the	Hedge Unwind	 Agreements	 and	 Warrant	 Unwind	 Agreements,	 the	 Company	 received	0.12	 million	 shares	 of	 Company	 common	 stock	 from	 the	 dealer counterparties.

# Settlement	and	Conversions	upon	Maturity;	Warrant	Activity

On	the	Maturity	Date,	the	Company	repaid	the	remaining	 $44.3	million	in	aggregate	principal	amount	of	the	Convertible	Notes	outstanding,	together with	unpaid	interest	due	and	owing	on	the	Convertible	Notes	(the	"Cash	Payment").	In	connection	with	the	maturity	of	the	Convertible	Notes,	$44.2	million in	aggregate	principal	amount	of	the	Convertible	Notes	were	tendered	to	the	Company	for	conversion	(the	"Converted	Notes").	On	the	Maturity	Date,	in addition	to	the	Cash	Payment,	the	Company	delivered	to	the	holders	of	the	Converted	Notes,	in	the	aggregate,0.5	million	shares	of	Company	common stock.

In	connection	with	the	conversions	described	above,	the	Company	exercised	the	outstanding	Call	Options,	and	the	counterparties	to	the	Convertible Note	hedge	transactions	delivered	to	the	Company	0.5	million	shares	of	Company	common	stock.	The	counterparties	continued	to	hold	warrants,	and between	November	1,	2017	and	December	31,	2017,	warrants	 to	purchase	165,034	 shares	 were	 exercised.	In	connection	with	 the	exercise	of	 the warrants,	the	Company	delivered	105,638	shares	to	the	counterparties,	which	was	net	of	 43,251	shares	withheld	to	cover	payment	of	the	exercise	price for	the	warrants,	and	provided	the	counterparties	with	cash	in	lieu	of	fractional	shares.	As	of	December	31,	2017,	warrants	to	purchase	559,614	shares	of common	stock	remained	outstanding,	and	the	warrants,	which	have	an	exercise	price	of	$74.65	per	share,	had	an	intrinsic	value	of	 $98.0	million.	The warrants	are	divided	into	multiple	components	that	expire	ratably	over	a	period	ending	on	August	31,	2018.

On	May	21,	2014,	the	Company	issued	$250	million	of	5.25%	Senior	Notes	due	2024	(which,	as	originally	issued,	or	in	the	substantially	identical	form issued	April	2015	in	exchange	for	the	originally	issued	notes	(as	discussed	below),	are	referred	to	as	the	"2024	Notes").	The	Company	pays	interest	on the	2024	Notes	semi-annually	on	June	15	and	December	15,	at	a	rate	of	5.25%	per	year.	The	2024	Notes	will	mature	on	 June	15,	2024,	unless	earlier redeemed	by	the	Company	at	its	option,	as	described	below,	or	purchased	by	the	Company	at	the	holder's	option	under	specified	circumstances	following a	Change	of	Control	or	Asset	Sale	(each	as	defined	in	the	indenture	related	to	the	2024	Notes).

The	Company's	obligations	under	the	2024	Notes	are	fully	and	unconditionally	guaranteed,	jointly	and	severally,	by	each	of	the	Company's	existing and	future	100%	owned	domestic	subsidiaries	that	is	a	guarantor	or	other	obligor	under	the	Credit	Agreement	and	by	certain	of	the	Company's	other 100%	owned	domestic	subsidiaries.	The	guarantees	are	subject	to	certain	customary	automatic	release	provisions.	See	Note	17	for	further	information regarding	the	guarantors	under	the	2024	Notes.

At	any	time	on	or	after	June	15,	2019,	the	Company	may,	on	one	or	more	occasions,	redeem	some	or	all	of	the	2024	Notes	at	a	redemption	price	of 102.625%	of	the	principal	amount	of	the	2024	Notes	subject	to	redemption,	declining,	in	annual	increments	of	 0.875%,	to	100%	of	the	principal	amount	on June	15,	2022,	plus	accrued	and	unpaid	interest.		In	addition,	at	any	time	prior	to	June	15,	2019,	the	Company	may,	on	one	or	more	occasions,	redeem some	or	all	of	the	2024	Notes	at	a	redemption	price	equal	to	100%	of	the	principal	amount	of	the	2024	Notes	redeemed,	plus	a	"make-whole"	premium and	any	accrued	and	unpaid	 interest.	 	The	"make-whole"	premium	 is	 the	greater	of	(a)	1.0%	of	the	principal	amount	of	the	2024	Notes	subject	to redemption	or	(b)	the	excess,	if	any,	over	the	principal	amount	of	the	2024	Notes	of	the	present	value,	on	the	redemption	date,	of	the	sum	of	(i)	the June	15,	2019	optional	redemption	price		plus	(ii)	all	required	interest	payments	on	the	2024	Notes	through	June	15,	2019	(other	than	accrued	and unpaid	interest	to	the	redemption	date),	generally	calculated	using	a	discount	rate	equal	to	the	yield	to	maturity	of	U.S.	Treasury	securities	with	a	constant maturity	for	the	period	most	nearly	equal	to	the	period	from	the	redemption	date	to	June	15,	2019	(unless	the	period	is	less	than	one	year,	in	which	case the	weekly	average	yield	on	traded	U.S.	Treasury	securities	adjusted	to	a	constant	maturity	of	one	year	will	be	used),	plus	50	basis	points.

In	addition,	at	any	time	prior	to	June	15,	2017,	the	Company	may,	on	one	or	more	occasions,	redeem	up	to	 35%	of	the	aggregate	principal	amount of	the	2024	Notes,	using	the	proceeds	of	specified	types	of	Company	equity	offerings	and	subject	to	specified	conditions,	at	a	redemption	price	equal	to 105.25%	of	the	principal	amount	of	the	Notes	redeemed,	plus	accrued	and	unpaid	interest.

The	indenture	relating	to	the	2024	Notes	contains	covenants	that,	among	other	things,	limit	or	restrict	the	Company's	ability,	and	the	ability	of	its subsidiaries,	to	incur	additional	debt,	or	issue	preferred	stock	or	other	disqualified	stock;	create	liens;	consolidate,	merge	or	dispose	of	certain	assets, make	certain	investments,	engage	in	acquisitions,	and	pay	dividends	on,	repurchase	or	make	distributions	in	respect	of	capital	stock.

On	May	16,	2016,	the	Company	issued	 $400.0	million	of	4.875%	Senior	Notes	due	2026	(the	"2026	Notes").	The	Company	pays	interest	on	the 2026	Notes	semi-annually	on	June	1	and	December	1,	commencing	on	December	1,	2016,	at	a	rate	of	4.875%	per	year.	The	2026	Notes	mature	on	June 1,	2026	unless	earlier	redeemed	by	the	Company	at	its	option,	as	described	below,	or	purchased	by	the	Company	at	the	holder's	option	under	specified circumstances	following	a	Change	of	Control	or	Asset	Sale	(each	as	defined	in	the	Indenture	related	to	the	2026	Notes)	or	upon	the	Company's	election to	 exercise	 its	 optional	 redemption	 rights,	 as	 described	 below.	 The	 Company	 incurred	 transaction	 fees	 of	 approximately	$6.5	 million,	 including underwriters'	discounts	and	commissions,	in	connection	with	the	offering	of	the	2026	Notes,	which	were	recorded	as	a	reduction	to	long-term	borrowings and	are	being	amortized	over	the	term	of	the	2026	Notes.

The	Company's	obligations	under	the	2026	Notes	are	fully	and	unconditionally	guaranteed,	jointly	and	severally,	by	each	of	the	Company's	existing and	future	100%	owned	domestic	subsidiaries	that	is	a	guarantor	or	other	obligor	under	the	Credit	Agreement	and	by	certain	of	the	Company's	other 100%	owned	domestic	subsidiaries.	See	Note	17	for	further	information	regarding	the	guarantors	under	the	2026	Notes.

At	any	time	on	or	after	June	1,	2021,	the	Company	may,	on	one	or	more	occasions,	redeem	some	or	all	of	the	2026	Notes	at	a	redemption	price	of 102.438%	of	the	principal	amount	of	the	2026	Notes	subject	to	redemption,	declining,	in	annual	increments	of	 0.813%,	to	100%	of	the	principal	amount	on June	1,	2024,	plus	accrued	and	unpaid	interest.	In	addition,	at	any	time	prior	to	June	1,	2021,	the	Company	may,	on	one	or	more	occasions,	redeem some	or	all	of	the	2026	Notes	at	a	redemption	price	equal	to	100%	of	the	principal	amount	of	the	2026	Notes	redeemed,	plus	a	"make-whole"	premium and	 any	 accrued	 and	 unpaid	 interest.	The	 "make-whole"	 premium	 is	 the	 greater	 of	 (a)	1.0%	of	 the	principal	amount	of	 the	2026	Notes	subject	 to redemption	or	(b)	the	excess,	if	any,	over	the	principal	amount	of	the	2026	Notes	of	the	present	value,	on	the	redemption	date	of	the	sum	of	(i)	the	June 1,	2021	optional	redemption	price	plus	(ii)	all	required	interest	payments	on	the	2026	Notes	through	June	1,	2021	(other	than	accrued	and	unpaid	interest to	the	redemption	date),	generally	computed	using	a	discount	rate	equal	to	the	yield	to	maturity	of	U.S.	Treasury	securities	with	a	constant	maturity	for the	period	most	nearly	equal	to	the	period	from	the	redemption	date	to	June	1,	2021	(unless	the	period	is	less	than	one	year,	in	which	case	the	weekly average	yield	on	traded	U.S.	Treasury	securities	adjusted	to	a	constant	maturity	of	one	year	will	be	used),	plus	50	basis	points.

In	addition,	at	any	time	prior	to	June	1,	2019,	the	Company	may,	on	one	or	more	occasions,	redeem	up	to	 40%	of	the	aggregate	principal	amount of	the	2026	Notes,	using	the	proceeds	of	specified	types	of	Company	equity	offerings	and	subject	to	specified	conditions,	at	a	redemption	price	equal	to 104.875%	of	the	principal	amount	of	the	Notes	redeemed,	plus	accrued	and	unpaid	interest.

On	November	20,	2017,	the	Company	issued	 $500.0	million	of	4.625%	Senior	Notes	due	2027	(the	"2027	Notes").	The	Company	pays	interest	on the	2027	Notes	semi-annually	on	May	15	and	November	15,	commencing	on	May	15,	2018,	at	a	rate	of	4.625%	per	year.	The	2027	Notes	mature	on November	15,	2027	unless	earlier	redeemed	by	the	Company	at	its	option,	as	described	below,	or	purchased	by	the	Company	at	the	holder's	option under	specified	circumstances	following	a	Change	of	Control	or	Asset	Sale	(each	as	defined	in	the	indenture	related	to	the	2027	Notes),	coupled	with	a downgrade	in	the	ratings	of	the	2027	Notes,	or	upon	the	Company's	election	to	exercise	its	optional	redemption	rights,	as	described	below.	The	Company incurred	transaction	fees	of	$7.9	million,	including	underwriters'	discounts	and	commissions,	in	connection	with	the	offering	of	the	2027	Notes,	which	were recorded	on	the	consolidated	balance	sheet	as	a	reduction	to	long-term	borrowings	and	are	being	amortized	over	the	term	of	the	2027	Notes.	The Company	used	the	net	proceeds	from	the	offering	to	repay	borrowings	under	its	revolving	credit	facility.

At	any	time	on	or	after	November	15,	2022,	the	Company	may,	on	one	or	more	occasions,	redeem	some	or	all	of	the	2027	Notes	at	a	redemption price	of	102.313%	of	the	principal	amount	of	the	2027	Notes	subject	to	redemption,	declining,	in	annual	increments	of	 0.771%,	to	100%	of	the	principal amount	on	November	15,	2025,	plus	accrued	and	unpaid	interest.	In	addition,	at	any	time	prior	to	November	15,	2022,	the	Company	may,	on	one	or	more occasions,	redeem	some	or	all	of	the	2027	Notes	at	a	redemption	price	equal	to	100%	of	the	principal	amount	of	the	2027	Notes	redeemed,	plus	a "make-whole"	premium	and	any	accrued	and	unpaid	interest.	The	"make-whole"	premium	is	the	greater	of	(a)	1.0%	of	the	principal	amount	of	the	2027 Notes	subject	to	redemption	or	(b)	the	excess,	if	any,	over	the	principal	amount	of	the	2027	Notes	of	the	present	value,	on	the	redemption	date	of	the sum	of	(i)	the	November	15,	2022	optional	redemption	price	plus	(ii)	all	required	interest	payments	on	the	2027	Notes	through	November	15,	2022	(other than	accrued	and	unpaid	interest	to	the	redemption	date),	generally	computed	using	a	discount	rate	equal	to	the	yield	to	maturity	of	U.S.	Treasury securities	with	a	constant	maturity	for	the	period	most	nearly	equal	to	the	period	from	the	redemption	date	to	November	15,	2022	(unless	the	period	is less	than	one	year,	in	which	case	the	weekly	average	yield	on	traded	U.S.	Treasury	securities	adjusted	to	a	constant	maturity	of	one	year	will	be	used), plus	50	basis	points.

In	addition,	at	any	time	prior	to	November	15,	2020,	the	Company	may,	on	one	or	more	occasions,	redeem	up	to	 40%	of	the	aggregate	principal amount	of	the	2027	Notes,	using	the	proceeds	of	specified	types	of	Company	equity	offerings	and	subject	to	specified	conditions,	at	a	redemption	price equal	to	104.625%	of	the	principal	amount	of	the	Notes	redeemed,	plus	accrued	and	unpaid	interest.

The	indenture	relating	to	the	2027	Notes	contains	covenants	that,	among	other	things,	limit	or	restrict	the	Company's	ability,	and	the	ability	of	its subsidiaries,	to	create	liens;	merge,	consolidate,	sell	or	otherwise	dispose	of	all	or	substantially	all	of	the	Company's	assets;	or	enter	into	sale	leaseback transactions.

# Securitization	Program

The	Company	has	an	accounts	receivable	securitization	facility	under	which	accounts	receivable	of	certain	domestic	subsidiaries	are	sold	on	a	non- recourse	basis	to	a	special	purpose	entity	("SPE"),	which	is	a	bankruptcy-remote,	consolidated	subsidiary	of	Teleflex.	Accordingly,	the	assets	of	the	SPE are	not	available	to	satisfy	the	obligations	of	Teleflex	or	any	of	its	subsidiaries.	The	SPE	sells	undivided	interests	in	those	receivables	to	an	asset	backed commercial	paper	conduit	for	consideration	of	up	to	$50.0	million.	This	facility	is	utilized	from	time	to	time	to	provide	increased	flexibility	in	funding	short term	working	capital	requirements.	The	agreement	governing	the	accounts	receivable	securitization	facility	contains	certain	covenants	and	termination events.	An	occurrence	of	an	event	of	default	or	a	termination	event	under	this	facility	may	give	rise	to	the	right	of	its	counterparty	to	terminate	this	facility. As	of	December	31,	2017,	the	Company	was	in	compliance	with	the	covenants,	and	none	of	the	termination	events	had	occurred.	As	of	December	31, 2017	and	2016,	the	Company	had	 $50.0	million	(the	maximum	amount	available)	of	outstanding	borrowings	under	its	accounts	receivable	securitization facility.

# Fair	Value	of	Long-Term	Debt

The	carrying	amount	of	current	and	long-term	borrowings	as	reported	in	the	consolidated	balance	sheet	as	of	 December	31,	2017	is	$2.2	billion.	To determine	the	fair	value	of	its	debt	for	which	quoted	prices	are	not	available,	the	Company	uses	a	discounted	cash	flow	technique	that	incorporates	a market	interest	yield	curve	with	adjustments	for	duration,	optionality	and	risk	profile.	The	Company's	implied	credit	rating	is	a	factor	in	determining	the market	interest	yield	curve.	The	following	table	provides	the	fair	value	of	the	Company's	debt	as	of	December	31,	2017	and	2016,	categorized	by	the level	of	inputs	within	the	fair	value	hierarchy	used	to	measure	fair	value	(see	Note	10	to	the	consolidated	financial	statements	for	further	information):

|  | December	31,	2017 | December	31,	2016 |
| :--- | :--- | :--- |
|  | (Dollars\tin\tthousands) | (Dollars\tin\tthousands) |
| Level\t1 | $— | $344,765 |
| Level\t2 | 2,299,942 | 929,362 |
| Total | $2,299,942 | $1,274,127 |

# Debt	Maturities

As	of	December	31,	2017,	the	aggregate	amounts	of	long-term	debt,	demand	loans	and	debt	under	the	Company's	securitization	program	that	will mature	during	each	of	the	next	four	years	and	thereafter	were	as	follows:

# Note	9	—	Financial	instruments

# Foreign	Currency	Forward	Contracts

The	Company	uses	derivative	instruments	for	risk	management	purposes.	Foreign	currency	forward	contracts	designated	as	cash	flows	hedges	are used	to	manage	foreign	currency	transaction	exposure.	Foreign	currency	forward	contracts	not	designated	as	hedges	for	accounting	purposes	are	used to	manage	exposure	related	to	near	term	foreign	currency	denominated	monetary	assets	and	liabilities.	The	Company	enters	into	the	non-designated foreign	currency	forward	contracts	for	periods	consistent	with	its	currency	translation	exposures,	which	generally	approximate	one	month.	For	the	years ended	December	31,	2017	and	2016,	the	Company	recognized	a	loss	related	to	non-designated	foreign	currency	forward	contracts	of	 $2.6	million	and $2.3	million,	respectively.

The	following	table	presents	the	locations	in	the	consolidated	balance	sheets	and	fair	value	of	derivative	instruments	as	of December	31,	2017	and 2016:

| Designated	foreign	currency	forward	contracts | $914 | $667 |
| :--- | :--- | :--- |
| Non-designated\tforeign\tcurrency\tforward\tcontracts | 307 | 490 |
| Prepaid\texpenses\tand\tother\tcurrent\tassets | 1,221 | 1,157 |
| Total\tasset\tderivatives | 1,221 | 1,157 |
| Liability\tderivatives: |  |  |
| Designated\tforeign\tcurrency\tforward\tcontracts | 1,373 | 2,139 |
| Non-designated\tforeign\tcurrency\tforward\tcontracts | 53 | 118 |
| Other\tcurrent\tliabilities | 1,426 | 2,257 |
| Total\tliability\tderivatives | $1,426 | $2,257 |

The	total	notional	amount	for	all	open	foreign	currency	forward	contracts	designated	as	cash	flow	hedges	as	of	 December	31,	2017	and	2016	was $88.5	 million and	$101.8	 million,	 respectively.	 The	 total	 notional	 amount	 for	 all	 open	 non-designated	 foreign	 currency	 forward	 contracts	 as	 of December	31,	2017	and	2016	was	$110.6	million	and	$73.4	million,	respectively.	All	open	foreign	currency	forward	contracts	as	of	 December	31,	2017 have	durations	of	twelve	months	or	less.

See	Note	11	for	information	on	the	location	and	amount	of	gains	and	losses	attributable	to	derivatives	that	were	reclassified	from	accumulated	other comprehensive	income	(loss)	("AOCI")	to	expense	(income),	net	of	tax.

For	the	years	ended	December	31,	2017,	2016	and	2015,	there	was	no	ineffectiveness	related	to	the	Company's	hedging	derivatives.

# Concentration	of	Credit	Risk

Concentrations	of	credit	risk	with	respect	to	trade	accounts	receivable	are	generally	limited	due	to	the	Company's	large	number	of	customers	and their	diversity	across	many	geographic	areas.	However,	a	portion	of	the	Company's	trade	accounts	receivable	outside	the	United	States	include	sales	to government-owned	 or	 supported	 healthcare	 systems	 in	 several	 countries	 which	 are	 subject	 to	 payment	 delays.	 Payment	 is	 dependent	 upon	 the creditworthiness	of	the	healthcare	systems	in	those	countries	and	the	financial	stability	of	their	economies.

In	the	ordinary	course	of	business,	the	Company	grants	non-interest	bearing	trade	credit	to	its	customers	on	normal	credit	terms.	In	an	effort	to reduce	its	credit	risk,	the	Company	(i)	establishes	credit	limits	for	all	of	its	customer	relationships,	(ii)	performs	ongoing	credit	evaluations	of	its	customers' financial	 condition,	 (iii)	 monitors	 the	 payment	 history	 and	 aging	 of	 its	 customers'	 receivables,	 and	 (iv)	 monitors	 open	 orders	 against	 an	 individual customer's	 outstanding	 receivable	 balance.	An	 allowance	 for	 doubtful	 accounts	 is	 maintained	 for	 trade	 accounts	 receivable	 based	 on	 expected collectability	of	accounts	receivable,	considering	the	Company's	historical	collection	experience,	the	length	of	time	an	account	is	outstanding,	the	financial position	of	the	customer	and	information	provided	by	credit	rating	services.	The	adequacy	of	this	allowance	is	reviewed	each	reporting	period	and adjusted	as	necessary.	The	allowance	for	doubtful	accounts	was	$10.3	million	and	$8.6	million	at	December	31,	2017	and	2016,	respectively.	The	current portion	of	the	allowance	for	doubtful	accounts	at	December	31,	2017	and	2016	of	$3.5	million	and	$2.0	million,	respectively,	was	reported	in	accounts receivable,	net	within	the	consolidated	balance	sheet.	The	allowance	for	doubtful	accounts	on	receivables	outstanding	for	greater	than	one	year	at December	31,	2017	and	2016	of	$6.8	million	and	$6.6	million,	respectively,	is	recognized	in	other	assets	within	the	consolidated	balance	sheet.

Certain	of	the	Company's	customers,	particularly	in	Greece,	Italy,	Portugal	and	Spain,	have	extended	or	delayed	payments	for	products	and	services already	provided,	raising	collectability	concerns	regarding	the	Company's	trade	accounts	receivable	from	these	customers.	As	a	result,	the	Company continues	to	closely	monitor	the	allowance	for	doubtful	accounts	with	respect	to	these	customers	and	uses	other	risk	mitigation	strategies	such	as	selling receivables.	The	aggregate	net	current	and	long-term	trade	accounts	receivable	for	customers	in	Greece,	Italy,	Spain	and	Portugal	and	the	percentage	of the	Company's	total	net	current	and	long-term	trade	accounts	receivable	represented	by	the	net	current	and	long-term	trade	accounts	receivable	for customers	in	those	countries	at	December	31,	2017	and	2016	are	as	follows:

(1)	The	long-term	portion	of	trade	accounts	receivable,	net	from	customers	in	Greece,	Italy,	Spain	and	Portugal	at	December	31,	2017	and	2016	was	$3.3	million	 and	$2.7 million,	respectively.	In	January	2017,	the	Company	sold	$16.1	million	of	receivables	outstanding	with	publicly	funded	hospitals	in	Italy	for	$16.0	million.

# Note	10	—	Fair	value	measurement

Fair	value	is	the	price	that	would	be	received	from	the	sale	of	an	asset	or	paid	to	transfer	a	liability,	using	assumptions	that	market	participants	would use	 in	 pricing	 an	 asset	 or	 liability.	The	 FASB's	 fair	 value	 guidance	 establishes	 a	 three-level	 hierarchy	 of	 the	 inputs	 (i.e.,	 assumptions	 that	 market participants	would	use	in	pricing	an	asset	or	liability)	used	to	measure	fair	value.	The	categorization	within	the	valuation	hierarchy	is	based	on	the	lowest level	of	input	that	is	significant	to	the	entire	fair	value	measurement.

The	levels	of	inputs	within	the	hierarchy	used	to	measure	fair	value	are	as	follows:

Level	1	—	inputs	to	the	fair	value	measurement	that	are	quoted	prices	(unadjusted)	in	active	markets	for	identical	assets	or	liabilities.

Level	2	—	inputs	to	the	fair	value	measurement	that	include	quoted	prices	for	similar	assets	or	liabilities	in	active	markets;	quoted	prices	for	identical or	similar	assets	or	liabilities	in	markets	that	are	not	active;	inputs	other	than	quoted	prices	that	are	observable	for	the	asset	or	liability;	and	inputs	that	are derived	principally	from	or	corroborated	by	observable	market	data	by	correlation	or	other	means.

Level	3	—	inputs	to	the	fair	value	measurement	that	are	unobservable	inputs	for	the	asset	or	liability.

The	following	tables	provide	information	regarding	the	Company's	financial	assets	and	liabilities	measured	at	fair	value	on	a	recurring	basis	as	of December	31,	2017	and	2016:

|  | December	31,	2017 | (Level	1) | (Level	2) | (Level	3) |
| :--- | :--- | :--- | :--- | :--- |
|  |  | (Dollars\tin\tthousands) | (Dollars\tin\tthousands) |  |
| Investments\tin\tmarketable\tsecurities | $9,045 | $9,045 | $— | $— |
| Derivative\tassets | 1,221 | — | 1,221 | — |
| Derivative\tliabilities | 1,426 | — | 1,426 | — |
| Contingent\tconsideration\tliabilities | 272,136 | — | — | 272,136 |

|  | December	31,	2016 | (Level	1) | (Level	2) | (Level	3) |
| :--- | :--- | :--- | :--- | :--- |
|  |  | (Dollars\tin\tthousands) | (Dollars\tin\tthousands) |  |
| Investments\tin\tmarketable\tsecurities | $7,660 | $7,660 | $— | $— |
| Derivative\tassets | 1,157 | — | 1,157 | — |
| Derivative\tliabilities | 2,257 | — | 2,257 | — |
| Contingent\tconsideration\tliabilities | 7,102 | — | — | 7,102 |

There	were	no	transfers	of	financial	assets	or	liabilities	among	Level	1,	Level	2	or	Level	3	within	the	fair	value	hierarchy	during	the	years	ended December	31,	2017	or	2016.

# Valuation	Techniques

The	Company's	financial	assets	valued	based	upon	Level	1	inputs	are	comprised	of	investments	in	marketable	securities	held	in	trust,	which	are available	to	satisfy	benefit	obligations	under	Company	benefit	plans	and	other	arrangements.	The	investment	assets	of	the	trust	are	valued	using	quoted market	prices.

The	Company's	financial	assets	and	liabilities	valued	based	upon	Level	2	inputs	are	comprised	of	foreign	currency	forward	contracts.	The	Company uses	foreign	currency	forward	contracts	to	manage	foreign	currency	transaction	exposure	as	well	as	exposure	to	foreign	currency	denominated	monetary assets	and	liabilities.	The	Company	measures	the	fair	value	of	the	foreign	currency	forward	contracts	by	calculating	the	amount	required	to	enter	into offsetting	contracts	with	similar	remaining	maturities,	based	on	quoted	market	prices,	and	taking	into	account	the	creditworthiness	of	the	counterparties.

The	Company's	financial	liabilities	valued	based	upon	Level	3	inputs	are	comprised	of	contingent	consideration	arrangements	pertaining	to	the Company's	acquisitions.	See	Note	8	for	a	discussion	of	the	fair	value	of	the	Company's	borrowings.

# Contingent	consideration

As	of	December	31,	2017,	the	Company	estimates	that	contingent	consideration	payments	will	occur	in	2018	through	2029	and	the	maximum amount	 of	 undiscounted	 payments	 the	 Company	 could	 make	 under	 contingent	 consideration	 arrangements	 is	$401.8	 million.	 The	 contingent consideration	liabilities,	which	primarily	consist	of	revenue-based	milestones,	are	remeasured	to	fair	value	each	reporting	period	using	assumptions including	estimated	revenues	(based	on	internal	operational	budgets	and	long-range	strategic	plans),	discount	rates,	probability	of	payment	and	project payment	dates.

The	contingent	consideration	fair	value	measurement	is	based	on	significant	inputs	not	observable	in	the	market	and	therefore	constitute	Level	3 inputs	within	the	fair	value	hierarchy.	The	Company	determines	the	fair	value	of	the	contingent	consideration	liability	related	to	the	NeoTract	acquisition using	a	Monte	Carlo	simulation	valuation	approach,	which	simulates	future	revenues	during	the	earn	out-period	using	management's	best	estimates.	The Company	determines	the	value	of	its	other	contingent	consideration	liabilities	based	on	a	probability-weighted	discounted	cash

flow	analysis.	Increases	in	projected	revenues	and	probabilities	of	payment	may	result	in	significantly	higher	fair	value	measurements;	decreases	in	these items	 may	 have	 the	 opposite	 effect.	Increases	 in	 the	 discount	 rates	 and	 the	 period	 prior	 to	 payment	 may	 result	 in	 significantly	 lower	 fair	 value measurements;	decreases	in	these	items	may	have	the	opposite	effect.

The	 table	 below	 provides	 additional	 information	 regarding	 the	 valuation	 technique	 and	 inputs	 used in	 determining the fair	 value	 of	 contingent consideration	recognized	in	connection	with	the	NeoTract	acquisition,	which	is	described	in	Note	3.

The	following	table	provides	information	regarding	changes	in	the	Company's	contingent	consideration	liabilities	for	the	years	ended	 December	31, 2017	and	2016:

|  | 2017 | 2016 |
| :--- | :--- | :--- |
|  | (Dollars\tin\tthousands) |  |
| Beginning\tbalance\t–\tJanuary\t1 | $7,102 | $20,829 |
| Initial\testimate\tupon\tacquisition | 261,733 | — |
| Payments | (335) | (7,282) |
| Revaluations | 3,575 | (6,445) |
| Translation\tadjustment | 61 | — |
| Ending\tbalance\t–\tDecember\t31 | $272,136 | $7,102 |

# Note	11	—	Shareholders'	equity

The	authorized	capital	of	the	Company	is	comprised	of	 200	million	common	shares,	$1	par	value,	and	500,000	preference	shares.	No	preference shares	have	been	outstanding	during	the	last	three	years.

Basic	earnings	per	share	is	computed	by	dividing	net	income	by	the	weighted	average	number	of	common	shares	outstanding	during	the	period. Diluted	 earnings	 per	 share	 is	 computed	 in	 the	 same	 manner	 except	 that	 the	 weighted	 average	 number	 of	 shares	 is	 increased	 to	 include	 dilutive securities.	The	following	table	provides	a	reconciliation	of	basic	to	diluted	weighted	average	shares	outstanding:

|  | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
|  |  | (Shares\tin\tthousands) |  |
| Basic | 45,004 | 43,325 | 41,558 |
| Dilutive\teffect\tof\tshare\tbased\tawards | 923 | 570 | 488 |
| Dilutive\teffect\tof\t3.875%\tConvertible\tNotes\tand\twarrants | 737 | 3,751 | 6,012 |
| Diluted | 46,664 | 47,646 | 48,058 |

Weighted	average	shares	that	were	antidilutive	and	therefore	not	included	in	the	calculation	of	earnings	per	share	were	approximately 0.6	million,	3.4 million	and	5.6	million	for	the	years	ended	December	31,	2017,	2016	and	2015,	respectively.

Prior	to	the	Maturity	Date	of	the	Convertible	Notes	and	during	periods	in	which	the	average	market	price	of	the	Company's	common	stock	was	above the	conversion	price	of	the	Convertible	Notes,	or	$61.32	per	share,	the	impact	of	conversion	was	dilutive	and	the	dilutive	effect	of	conversion	of	the Convertibles	Notes	is	reflected	in	diluted	earnings	per	share.	The	Company	elected	the	net	settlement	method	of	accounting	for	these	conversions,	under which	the	Company	settled	the	principal	amount	of	the	Convertible	Notes	in	cash,	and	settled	the	excess	conversion	value	in	shares.	In	periods	prior	to the	Maturity	Date	where	the	average	market	price	of	the	Company's	common	stock	was	above	$61.32	per	share,	under	the	treasury	stock	method,	the Company	calculated	the	number	of	shares	issuable

under	the	terms	of	the	Convertible	Notes	based	on	the	average	market	price	of	its	common	stock	during	the	period,	and	included	that	number	in	the	total diluted	shares	outstanding	for	the	period.

In	connection	with	the	issuance	of	the	Convertible	Notes,	the	Company	entered	into	convertible	note	hedge	and	warrant	agreements.	The	convertible note	 hedge	 agreements	 economically	 reduced	 the	 dilutive	 impact	 of	 the	 Convertible	 Notes.	 However,	 applicable	 accounting	 guidance	 requires	 the Company	to	separately	analyze	the	impact	of	the	warrant	agreements	on	diluted	weighted	average	shares	outstanding,	without	giving	effect	to	the	anti- dilutive	impact	of	the	convertible	note	hedge	agreements.	The	reductions	in	diluted	shares	that	would	have	resulted	from	giving	effect	to	the	anti-dilutive impact	of	the	convertible	note	hedge	agreements	are	0.3	million,	2.0	million,	and	3.3	million	for	the	years	ended	December	31,	2017,	2016	and	2015, respectively.	The	treasury	stock	method	is	applied	when	the	exercise	price	of	the	warrants	is	less	than	the	average	of	the	market	prices	during	the	period and	assumes	the	proceeds	from	the	exercise	of	the	warrants	are	used	to	repurchase	shares	based	on	the	average	stock	price	during	the	period.	The exercise	price	of	the	warrants	is	approximately	$74.65	per	share	of	common	stock.	Shares	issuable	upon	exercise	of	the	warrants	that	were	included	in the	total	diluted	shares	outstanding	were	0.5	million,	1.7	million	and	2.7	million	for	the	years	ended	December	31,	2017,	2016	and	2015,	respectively.

See	Note	8	 for	 information	 regarding	 (i)	 the	 reduction	 in	 the	 outstanding	 principal	 amount	 of	 Convertible	 Notes	 as	 a	 result	 of	 the	 Company's acquisition	of	Convertible	Notes	in	exchange	for	cash	and	shares	of	Company	common	stock	and	the	related	reduction	in	the	number	of	Call	Options	and warrants	outstanding	under	the	convertible	note	hedge	and	warrant	agreements	as	a	result	of	the	unwinding	of	the	agreements,	(ii)	the	settlement	and conversion	of	the	Convertible	Notes	on	the	Maturity	Date	and	the	related	exercise	of	Call	Options	under	the	convertible	note	hedge	agreements	and	(iii) warrant	activity	subsequent	to	the	Maturity	Date.

The	following	table	provides	information	relating	to	the	changes	in	accumulated	other	comprehensive	income	(loss),	net	of	tax,	for	the	years	ended December	31,	2017	and	2016:

|  | Cash	Flow<br>Hedges | Pension	and<br>Other<br>Postretirement<br>Benefit	Plans | Foreign<br>Currency<br>Translation<br>Adjustment | Accumulated<br>Other<br>Comprehensive<br>Income	(Loss) |
| :--- | :--- | :--- | :--- | :--- |
|  |  | (Dollars\tin\tthousands) | (Dollars\tin\tthousands) |  |
| Balance\tat\tDecember\t31,\t2015 | $(2,491) | $(138,887) | $(229,746) | $(371,124) |
| Other\tcomprehensive\tincome\t(loss)\tbefore\treclassifications | (3,434) | (2,221) | (69,119) | (74,774) |
| Amounts\treclassified\tfrom\taccumulated\tother\tcomprehensive\tincome\n(loss) | 3,501 | 4,512 | — | 8,013 |
| Net\tcurrent-year\tother\tcomprehensive\tincome\t(loss) | 67 | 2,291 | (69,119) | (66,761) |
| Reclassification\trelated\tto\tacquisition\tof\tnoncontrolling\tinterest | — | — | (832) | (832) |
| Balance\tat\tDecember\t31,\t2016 | (2,424) | (136,596) | (299,697) | (438,717) |
| Other\tcomprehensive\tincome\t(loss)\tbefore\treclassifications | 2,775 | (6,725) | 173,074 | 169,124 |
| Amounts\treclassified\tfrom\taccumulated\tother\tcomprehensive\tincome | (11) | 4,513 | — | 4,502 |
| Net\tcurrent-year\tother\tcomprehensive\t(loss)\tincome | 2,764 | (2,212) | 173,074 | 173,626 |
| Balance\tat\tDecember\t31,\t2017 | $340 | $(138,808) | $(126,623) | $(265,091) |

The	following	table	provides	information	relating	to	the	reclassifications	of	losses/(gains)	in	accumulated	other	comprehensive	(loss)	income	into expense/(income),	net	of	tax,	for	the	years	ended	December	31,	2017,	2016	and	2015	:

| Cost	of	goods	sold | $(95) | $4,511 | $679 |
| :--- | :--- | :--- | :--- |
| Total\tbefore\ttax | (95) | 4,511 | 679 |
| Taxes\t(benefit) | 84 | (1,010) | (196) |
| Net\tof\ttax | $(11) | $3,501 | $483 |
| Amortization\tof\tpension\tand\tother\tpostretirement\tbenefits\titems: |  |  |  |
| Actuarial\tlosses\t(1) | $6,904 | $6,965 | $6,375 |
| Prior-service\tcredits\t(1) | 105 | 56 | — |
| Total\tbefore\ttax | 7,009 | 7,021 | 6,375 |
| Tax\tbenefit | (2,496) | (2,509) | (2,242) |
| Net\tof\ttax | $4,513 | $4,512 | $4,133 |
| Total\treclassifications,\tnet\tof\ttax | $4,502 | $8,013 | $4,616 |

(1) These	accumulated	other	comprehensive	(loss)	income	components	are	included	in	the	computation	of	net	benefit	cost	of	pension	and	other	postretirement	benefit	plans	(see Note	14	for	additional	information).

# Note	12	—	Stock	compensation	plans

In	May	of	2014,	the	stockholders	of	the	Company	approved	the	Teleflex	Incorporated	2014	Stock	Incentive	Plan	(the	"2014	Plan")	which	replaced	the Company's	2008	Stock	Incentive	Plan	and	2000	Stock	Compensation	Plan	(the	"Prior	Plans"),	under	which	stock	options	and	restricted	stock	awards previously	were	granted.	The	2014	Plan	provides	for	several	different	kinds	of	awards,	including	stock	options,	stock	appreciation	rights,	stock	awards and	other	stock-based	awards	to	directors,	officers	and	key	employees.	Under	the	2014	Plan,	the	Company	is	authorized	to	issue	up	to	5.3	million	shares of	common	stock,	subject	to	adjustment	in	accordance	with	special	share	counting	rules	in	the	2014	Plan	that,	among	other	things,	(i)	count	shares underlying	a	stock	option	or	stock	appreciation	right	(each,	an	"option	award")	as	one	share	and	each	share	underlying	any	other	type	of	award	(a	"stock award")	as	1.8	shares,	(ii)	increases	the	shares	the	Company	is	authorized	to	issue	by	 one	or	1.8	shares	for	each	share	underlying	an	option	award	or stock	award,	respectively,	under	the	Prior	Plans	that	have	been	canceled,	expired,	settled	in	cash	or	forfeited	after	December	31,	2013	and	(iii)	decrease the	number	of	shares	the	Company	is	authorized	to	issue	by	one	share	and	1.8	shares	for	each	share	underlying	an	option	award	or	stock	award, respectively,	granted	under	the	Prior	Plans	between	January	1,	2014	and	the	May	2,	2014	adoption	of	the	2014	Plan	by	the	Company's	stockholders. Options	granted	under	the	2014	Plan	have	an	exercise	price	equal	to	the	closing	price	of	the	Company's	common	stock	on	the	date	of	the	grant.	In	2017, the	Company	granted	non-qualified	options	to	purchase	260,171	shares	of	common	stock	and	granted	restricted	stock	units	relating	to	 82,865	shares	of common	stock	under	the	2014	Plan.	The	unrecognized	compensation	expense	for	these	awards	as	of	the	grant	date	was	$25.9	million,	which	will	be recognized	over	the	vesting	period	of	the	awards.	As	of	December	31,	2017,	3,629,445	shares	were	available	for	future	grants	under	the	2014	Plan.

Share-based	compensation	expense	for	2017,	2016	and	2015	was	$19.4	million,	$16.9	million	and	$14.5	million,	respectively,	and	is	included	in	cost of	goods	sold	or	selling,	general	and	administrative	expenses	based	on	the	employees'	functional	classification.	The	total	income	tax	benefit	recognized for	share-based	compensation	arrangements	for	2017,	2016	and	2015	was	$12.8	million	(inclusive	of	a	$6.6	million	net	excess	tax	benefit),	$5.5	million and	$4.4	million,	respectively.

The	fair	value	of	options	granted	in	2017,	2016	 and	2015	was	estimated	at	the	date	of	grant	using	a	Black-Scholes	option	pricing	model.	The following	weighted-average	assumptions	were	used:

|  | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
| Risk-free\tinterest\trate | 1.88% | 1.30% | 1.44% |
| Expected\tlife\tof\toption | 4.94\tyears | 4.91\tyears | 4.87\tyears |
| Expected\tdividend\tyield | 0.71% | 0.94% | 1.12% |
| Expected\tvolatility | 21.74% | 21.64% | 20.68% |

The	fair	value	for	stock	awards	granted	in	2017,	2016	and	2015	was	estimated	at	the	date	of	grant	based	on	the	market	price	for	the	underlying stock	on	the	grant	date	discounted	for	the	risk	free	interest	rate	and	the	present	value	of	expected	dividends	over	the	vesting	period.	The	following weighted-average	assumptions	were	used:

The	Company	recorded	$8.2	million	of	expense	related	 to	options	during	 2017,	which	is	included	in	cost	of	goods	sold	or	selling,	general	and administrative	expenses.	As	of	December	31,	2017,	the	unamortized	share-based	compensation	cost	related	to	non-vested	stock	options,	net	of	expected forfeitures,	was	$9.4	million,	which	is	expected	to	be	recognized	over	a	weighted-average	period	of	 1.8	years.	Authorized	but	unissued	shares	of	the Company's	common	stock	are	issued	upon	exercises	of	options.

The	following	table	summarizes	the	non-vested	restricted	stock	unit	activity	during	2017:

The	Company	issued	82,865,	93,367	and	105,239	of	non-vested	restricted	stock	units	in	2017,	2016	and	2015,	respectively,	the	majority	of	which provide	for	vesting	as	to	all	underlying	shares	on	the	third	anniversary	of	the	grant	date.	The	weighted	average	grant-date	fair	value	for	non-vested restricted	stock	units	granted	during	2017,	2016	and	2015	was	$187.85,	$142.71	and	$118.00,	respectively.

The	Company	recorded	$11.2	million	of	expense	related	to	restricted	stock	units	during	2017,	which	is	included	in	cost	of	goods	sold	or	selling, general	and	administrative	expenses.	The	unamortized	share-based	compensation	cost	related	to	non-vested	restricted	stock	units,	net	of	expected forfeitures,	was	$13.2	million,	which	is	expected	to	be	recognized	over	a	weighted-average	period	of	 1.8	years.	The	Company	uses	treasury	stock	to provide	shares	of	common	stock	in	connection	with	vesting	of	the	restricted	stock	units.

# Note	13	—	Income	taxes

The	following	table	summarizes	the	components	of	the	provision	for	income	taxes	from	continuing	operations:

| Federal | $133,621 | $2,344 | $(4,700) |
| :--- | :--- | :--- | :--- |
| State | 5,213 | 5,230 | 2,377 |
| Foreign | 35,444 | 28,842 | 53,151 |
| Deferred: |  |  |  |
| Federal | (258,247) | (25,141) | (35,750) |
| State | 1,459 | (1,837) | (5,012) |
| Foreign | 212,158 | (1,364) | (2,228) |
|  | $129,648 | $8,074 | $7,838 |

The	Tax	Cuts	and	Jobs	Act	(the	"TCJA")	was	enacted	on	December	22,	2017.	The	legislation	significantly	changes	U.S.	tax	law	by,	among	other things,	permanently	reducing	corporate	income	tax	rates	from	a	maximum	of	35%	to	21%,	effective	January	1,	2018;	implementing	a	territorial	tax	system, by	 generally	 providing	 for,	 among	 other	 things,	 a	 dividends	 received	 deduction	 on	 the	 foreign	 source	 portion	 of	 dividends	 received	 from	 a	 foreign corporation	if	specified	conditions	are	met;	and	imposing	a	one-time	repatriation	tax	on	undistributed	post-1986	foreign	subsidiary	earnings	and	profits, which	are	deemed	repatriated	for	purposes	of	the	tax.

As	a	result	of	the	TCJA,	the	Company	reassessed	and	revalued	its	ending	net	deferred	tax	liabilities	at	December	31,	2017	and	recognized	a $46.1 million	provisional	tax	benefit	in	the	Company's	consolidated	statement	of	income	for	the	year	ended	December	31,	2017.

As	a	result	of	the	deemed	repatriation	tax	under	the	TCJA,	the	Company	recognized	a	 $154.0	million	provisional	tax	expense	in	the	Company's consolidated	statement	of	income	for	the	year	ended	December	31,	2017,	and	the	Company	expects	to	pay	this	tax	over	an	eight-year	period.

While	the	TCJA	provides	for	a	territorial	tax	system,	beginning	in	2018,	it	includes	two	new	U.S.	tax	base	erosion	provisions,	the	global	intangible low-taxed	income	("GILTI")	provisions	and	the	base-erosion	and	anti-abuse	tax	("BEAT")	provisions.

The	GILTI	provisions	require	the	Company	to	include	in	its	U.S.	income	tax	return	foreign	subsidiary	earnings	in	excess	of	an	allowable	return	on the	foreign	subsidiary's	tangible	assets.	The	Company	expects	that	it	will	be	subject	to	incremental	U.S.	tax	on	GILTI	income	beginning	in	2018.	Because of	the	complexity	of	the	new	GILTI	tax	rules,	the	Company	is	continuing	to	evaluate	this	provision	of	the	TCJA	and	the	application	of	Financial	Accounting Standards	Board	Accounting	Standards	Codification	Topic	740,	"Income	Taxes."	Under	U.S.	GAAP,	 the	Company	may	make	an	accounting	policy election	to	either	(1)	treat	future	taxes	with	respect	to	the	inclusion	in	U.S.	taxable	income	of	amounts	related	to	GILTI	as	current	period	expense	when incurred	 (the	 "period	 cost	 method")	 or (2) take	 such	 amounts	 into	 a	 company's	 measurement	 of	 its	 deferred	 taxes	 (the	 "deferred	 method").	 The Company's	selection	of	an	accounting	policy	with	respect	to	the	new	GILTI	tax	rules	will	depend,	in	part,	on	an	analysis	of	the	Company's	global	income to	determine	whether	the	Company	expects	to	have	future	U.S.	inclusions	in	taxable	income	related	to	GILTI	and,	if	so,	what	the	impact	is	expected	to	be. The	determination	of	whether	the	Company	expects	to	have	future	U.S.	inclusions

in	taxable	income	related	to	GILTI	depends	not	only	on	the	Company's	current	structure	and	estimated	future	operating	results	but	also	the	Company's ability	and	willingness	to	modify	its	structure	and/or	its	business.	As	such,	the	Company	is	not	yet	able	to	reasonably	estimate	the	effect	of	this	provision of	the	TCJA.	Therefore,	the	Company	has	not	made	any	adjustments	related	to	potential	GILTI	tax	in	its	financial	statements	and	has	not	made	a	policy decision	regarding	whether	to	record	deferred	taxes	on	GILTI.

The	BEAT	provisions	in	the	TCJA	eliminate	the	deduction	of	certain	base-erosion	payments	made	to	related	foreign	corporations,	and	impose	a minimum	tax	if	greater	than	regular	tax.	While	the	Company's	analysis	of	the	BEAT	provisions	is	not	fully	completed,	the	Company	does	not	currently believe	it	will	be	subject	to	the	BEAT	provisions	in	2018	and	has	not	recorded	any	tax	impacts	of	BEAT	in	its	consolidated	financial	statements	for	the year	ended	December	31,	2017.

On	December	22,	2017,	the	SEC	staff	issued	Staff	Accounting	Bulletin	No.	118	("SAB	118")	to	address	the	application	of	U.S.	GAAP	in	situations where	a	company	does	not	have	the	necessary	information	available,	prepared,	or	analyzed	(including	computations)	in	reasonable	detail	to	complete	the accounting	for	certain	income	tax	effects	of	the	TCJA.	SAB	118	states	that	in	these	circumstances,	if	the	company	can	determine	a	reasonable	estimate for	the	income	tax	effects,	the	SEC	staff	would	not	object	if	the	company	includes	in	its	financial	statements	the	reasonable	estimate	it	has	determined (and	the	SEC	staff	also	expressed	its	belief	that	it	would	not	be	appropriate	for	a	company	to	exclude	a	reasonable	estimate	from	its	financial	statements to	the	extent	a	reasonable	estimate	has	been	determined).	The	Company	has	recognized	the	provisional	tax	impacts	related	to	deemed	repatriated earnings	and	the	revaluation	of	deferred	tax	assets	and	liabilities	and	included	these	amounts	in	its	consolidated	financial	statements	for	the	year	ended December	31,	2017.	The	ultimate	impact	may	differ	from	these	provisional	amounts,	possibly	materially,	due	to,	among	other	things,	additional	analysis, changes	in	interpretations	and	assumptions	the	Company	has	made,	additional	regulatory	guidance	that	may	be	issued,	and	actions	the	Company	may take	as	a	result	of	the	TCJA.

At	December	31,	2017,	the	cumulative	unremitted	earnings	of	subsidiaries	outside	the	United	States	that	are	considered	non-permanently	reinvested and	for	which	taxes	have	been	provided	approximated	$2.0	billion.

The	following	table	summarizes	the	United	States	and	non-United	States	components	of	income	from	continuing	operations	before	taxes:

| United	States | $37,528 | $(29,988) | $(19,550) |
| :--- | :--- | :--- | :--- |
| Other | 247,383 | 275,713 | 264,196 |
|  | $284,911 | $245,725 | $244,646 |

Reconciliations	between	the	statutory	federal	income	tax	rate	and	the	effective	income	tax	rate	are	as	follows:

|  | 2017 | 2016 | 2015 |
| :--- | :--- | :--- | :--- |
| Federal\tstatutory\trate | 35.0\t% | 35.0\t% | 35.0\t% |
| Tax\teffect\tof\tinternational\titems | (25.7) | (27.5) | (28.4) |
| Impacts\tof\tU.S.\ttax\treform | 37.9 | — | — |
| Excess\ttax\tbenefits\trelated\tto\tshare-based\tcompensation | (2.3) | — | — |
| State\ttaxes,\tnet\tof\tfederal\tbenefit | 0.1 | 0.9 | (0.7) |
| Uncertain\ttax\tcontingencies | (1.8) | (3.6) | (1.9) |
| Contingent\tconsideration\treversals | 0.4 | (1.2) | (0.7) |
| Other,\tnet | 1.9 | (0.3) | (0.1) |
|  | 45.5\t% | 3.3\t% | 3.2\t% |

The	effective	income	tax	rate	for	2017	was	45.5%	compared	to	3.3%	for	2016.	The	effective	income	tax	rate	for	2017	was	impacted	by	a	net	tax expense	of	$107.9	million	resulting	from	the	enactment	of	the	TCJA.	The	$107.9	million	net	tax	expense	reflects	a	tax	expense	of	 $154.0	million	for	the deemed	repatriation	of	undistributed	foreign	earnings	partially	offset	by	a	$46.1	million	tax	benefit	resulting	from	the	reassessment	and	revaluation	of	the net	deferred	tax	liabilities.	Additionally,	the	effective	tax	rate	for	2017	was	impacted	by	a	net	excess	tax	benefit	related	to	share-based	compensation	and a	benefit	resulting	from	the	expiration	of	various	statutes	of	limitation.

The	effective	income	tax	rate	for	2016	was	impacted	by	a	tax	benefit	associated	with	U.S.	federal	tax	return	filings,	a	benefit	resulting	from	the reduction	of	our	German	reserves	as	a	result	of	the	conclusion	of	an	audit,	a	benefit	resulting	from	the	expiration	of	various	statutes	of	limitation,	and	a benefit	associated	with	the	IP	R&D	asset	impairment	referenced	in	Note	4.

The	Company	and	its	subsidiaries	are	routinely	subject	to	examinations	by	various	taxing	authorities.	In	conjunction	with	these	examinations	and	as	a regular	practice,	the	Company	establishes	and	adjusts	reserves	with	respect	to	its	uncertain	tax	positions	to	address	developments	related	to	those positions.	The	Company	realized	a	net	benefit	of	approximately	$5.2	million	in	2017	as	a	result	of	reducing	its	reserves	with	respect	to	uncertain	tax positions,	principally	due	to	the	expiration	of	a	number	of	applicable	statutes	of	limitations.	The	Company	realized	a	net	benefit	of	approximately	$8.8 million	in	2016,	as	a	result	of	reducing	its	reserves	with	respect	to	uncertain	tax	positions,	principally	due	to	the	conclusion	of	a	tax	audit	in	Germany	and the	expiration	of	various	statutes	of	limitations.	The	Company	realized	a	net	benefit	of	approximately	$4.6	million	in	2015,	which	resulted	from	a	reduction in	 the	 Company's	 U.S.	 reserves	 due	 to	 the	 conclusion	 of	 a	 tax	 audit,	 offset	 by	 an	 increase	 in	 the	 Company's	 foreign	 reserves	 with	 respect	 to developments	in	the	tax	audit	in	Germany	discussed	above.

The	following	table	summarizes	significant	components	of	the	Company's	deferred	tax	assets	and	liabilities	at	 December	31,	2017	and	2016:

| Tax	loss	and	credit	carryforwards | $210,055 | $136,046 |
| :--- | :--- | :--- |
| Pension | 28,147 | 46,563 |
| Reserves\tand\taccruals | 62,378 | 52,343 |
| Other | 3,619 | 17,704 |
| Less:\tvaluation\tallowances | (104,799) | (104,520) |
| Total\tdeferred\ttax\tassets | 199,400 | 148,136 |
| Deferred\ttax\tliabilities: |  |  |
| Property,\tplant\tand\tequipment | 22,299 | 32,209 |
| Intangibles\t—\tstock\tacquisitions | 553,245 | 321,707 |
| Unremitted\tforeign\tearnings | 223,494 | 63,419 |
| Other | 228 | 466 |
| Total\tdeferred\ttax\tliabilities | 799,266 | 417,801 |
| Net\tdeferred\ttax\tliability | $(599,866) | $(269,665) |

As	a	result	of	the	TCJA,	the	Company	reassessed	and	revalued	its	deferred	tax	positions	at	December	31,	2017.	As	a	result,	the	Company recognized	a	$46.1	million	decrease	in	the	net	deferred	tax	liability	in	2017.

Under	the	tax	laws	of	various	jurisdictions	in	which	the	Company	operates,	deductions	or	credits	that	cannot	be	fully	utilized	for	tax	purposes	during the	current	year	may	be	carried	forward,	subject	to	statutory	limitations,	to	reduce	taxable	income	or	taxes	payable	in	a	future	tax	year.	At	December	31, 2017,	the	tax	effect	of	such	carryforwards	approximated	 $210.1	million.	Of	this	amount,	$11.5	million	has	no	expiration	date,	$2.0	million	expires	after 2017	but	before	the	end	of	 2022	and	$196.6	million	expires	after	2022.	A	portion	of	these	carryforwards	consists	of	tax	losses	and	credits	obtained	by	the Company	as	a	result	of	acquisitions;	the	utilization	of	these	carryforwards	are	subject	to	an	annual	limitation	imposed	by	Section	382	of	the	Internal Revenue	Code,	which	limits	a	company's	ability	to	deduct	prior	net	operating	losses	following	a	more	than	50	percent	change	 in	ownership.	It	is	not expected	that	the	Section	382	limitation	will	prevent	the	Company	ultimately	from	utilizing	the	applicable	loss	carryforwards.	The	determination	of	state net	operating	loss	carryforwards	is	dependent	upon	the	United	States	subsidiaries'	taxable	income	or	loss,	the	state's	proportion	of	each	subsidiary's taxable	net	income	and	the	application	of	state	laws,	which	can	change	from	year	to	year	and	impact	the	amount	of	such	carryforward.

The	valuation	allowance	for	deferred	tax	assets	of	 $104.8	million	and	$104.5	million	at	December	31,	2017	and	2016,	respectively,	relates	principally to	the	uncertainty	of	the	Company's	ability	to	utilize	certain	deferred	tax

assets,	 primarily	 tax	 loss	 and	 credit	 carryforwards	 in	 various	 jurisdictions.	 The	 valuation	 allowance	 was	 calculated	 in	 accordance	 with	 applicable accounting	standards,	which	require	that	a	valuation	allowance	be	established	and	maintained	when	it	is	"more	likely	than	not"	that	all	or	a	portion	of deferred	tax	assets	will	not	be	realized.

Uncertain	Tax	Positions :	The	following	table	is	a	reconciliation	of	the	beginning	and	ending	balances	for	liabilities	associated	with	unrecognized	tax benefits	for	the	twelve	month	periods	ended	December	31,	2017,	2016	and	2015:

| Balance	at	January	1 | $15,054 | $34,381 | $51,084 |
| :--- | :--- | :--- | :--- |
| Increase\tin\tunrecognized\ttax\tbenefits\trelated\tto\tprior\tyears | — | — | 2,077 |
| Decrease\tin\tunrecognized\ttax\tbenefits\trelated\tto\tprior\tyears | — | (13,083) | (15,372) |
| Unrecognized\ttax\tbenefits\trelated\tto\tthe\tcurrent\tyear | 895 | 705 | 647 |
| Reductions\tin\tunrecognized\ttax\tbenefits\tdue\tto\tsettlements | — | (2,121) | — |
| Reductions\tin\tunrecognized\ttax\tbenefits\tdue\tto\tlapse\tof\tapplicable\tstatute\tof\tlimitations | (6,813) | (4,840) | (2,337) |
| Increase\t(decrease)\tin\tunrecognized\ttax\tbenefits\tdue\tto\tforeign\tcurrency\ttranslation | 200 | 12 | (1,718) |
| Balance\tat\tDecember\t31 | $9,336 | $15,054 | $34,381 |

The	total	liabilities	associated	with	the	unrecognized	tax	benefits	that,	if	recognized,	would	impact	the	effective	tax	rate	for	continuing	operations, were	$5.0	million	at	December	31,	2017.

The	Company	accrues	interest	and	penalties	associated	with	unrecognized	tax	benefits	in	income	tax	expense	in	the	consolidated	statements	of income,	and	the	corresponding	liability	is	included	in	the	consolidated	balance	sheets.	The	net	interest	expense	(benefit)	and	penalties	reflected	in income	 from	 continuing	 operations	 for	 the	 year	 ended	December	 31,	 2017	 was	$0.2	 million	 and	$(0.2)	 million,	 respectively;	 for	 the	 year	 ended December	31,	2016	was	$0.2	million	and	$(0.5)	million,	respectively;	and	for	the	year	ended	 December	31,	2015	was	$1.6	million	and	$(0.4)	million, respectively.	The	corresponding	liabilities	in	the	consolidated	balance	sheets	for	interest	and	penalties	at	December	31,	2017	were	$0.6	million	and	$2.6 million,	respectively,	and	at	December	31,	2016	were	$0.7	million	and	$2.7	million,	respectively.

The	taxable	years	for	which	the	applicable	statute	of	limitations	remains	open	by	major	tax	jurisdictions	are	as	follows:

The	Company	and	its	subsidiaries	are	routinely	subject	to	income	tax	examinations	by	various	taxing	authorities.	As	of	 December	31,	2017,	the	most significant	tax	examinations	in	process	are	in	Canada,	Germany,	Italy,	and	the	United	States.	The	date	at	which	these	examinations	may	be	concluded and	the	ultimate	outcome	of	the	examinations	is	uncertain.	As	a	result	of	the	uncertain	outcome	of	these	ongoing	examinations,	future	examinations	or the	expiration	of	statutes	of	limitation,	it	is	reasonably	possible	that	the	related	unrecognized	tax	benefits	for	tax	positions	taken	could

materially	change	from	those	recorded	as	liabilities	at	 December	31,	2017.	Due	to	the	potential	for	resolution	of	certain	examinations,	and	the	expiration of	various	statutes	of	limitation,	it	is	reasonably	possible	that	the	Company's	unrecognized	tax	benefits	may	change	within	the	next	year	by	a	range	of zero	to	$1.6	million.

# Note	14	—	Pension	and	other	postretirement	benefits

The	Company	has	a	number	of	defined	benefit	pension	and	postretirement	plans	covering	eligible	U.S.	and	non-U.S.	employees.	The	defined	benefit pension	plans	are	noncontributory.	The	benefits	under	these	plans	are	based	primarily	on	years	of	service	and	employees'	pay	near	retirement.	The Company's	funding	policy	for	U.S.	plans	is	to	contribute	annually,	at	a	minimum,	amounts	required	by	applicable	laws	and	regulations.	Obligations	under non-U.S.	plans	are	systematically	provided	for	by	depositing	funds	with	trustees	or	by	book	reserves.		As	of	December	31,	2017,	no	further	benefits	are being	 accrued	 under	 the	 Company's	 U.S.	 defined	 benefit	 pension	 plans	 and	 the	 Company's	 other	 postretirement	 benefit	 plans,	 other	 than	 certain postretirement	benefit	plans	covering	employees	subject	to	a	collective	bargaining	agreement.

The	Company	and	certain	of	its	subsidiaries	provide	medical,	dental	and	life	insurance	benefits	to	pensioners	or	their	survivors.	The	associated	plans are	unfunded	and	approved	claims	are	paid	from	Company	funds.

The	following	table	provides	information	regarding	the	components	of	the	net	benefit	expense	(income)	of	the	Company's	pension	and	postretirement benefit	plans:

|  |  | Pension |  |  | Other	Benefits |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | 2017 | 2016 | 2015 | 2017 | 2016 | 2015 |
|  |  |  | (Dollars\tin\tthousands) |  |  |  |
| Service\tcost | $2,887 | $2,615 | $1,880 | $279 | $355 | $495 |
| Interest\tcost | 15,137 | 15,711 | 17,948 | 1,577 | 1,595 | 1,967 |
| Expected\treturn\ton\tplan\tassets | (26,809) | (24,786) | (25,940) | — | — | — |
| Net\tamortization\tand\tdeferral | 6,734 | 6,567 | 6,159 | 275 | 454 | 216 |
| Net\tbenefit\texpense\t(income) | $(2,051) | $107 | $47 | $2,131 | $2,404 | $2,678 |

The	following	table	provides	the	weighted	average	assumptions	for	United	States	and	foreign	plans	used	in	determining	net	benefit	cost:

|  |  | Pension |  |  | Other	Benefits |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | 2017 | 2016 | 2015 | 2017 | 2016 | 2015 |
| Discount\trate | 4.2% | 4.5% | 4.1% | 4.1% | 4.3% | 4.0% |
| Rate\tof\treturn | 8.1% | 8.1% | 8.1% |  |  |  |
| Initial\thealthcare\ttrend\trate |  |  |  | 7.9% | 8.4% | 7.3% |
| Ultimate\thealthcare\ttrend\trate |  |  |  | 5.0% | 5.0% | 5.0% |

The following table	provides	summarized information	with	respect to the	Company's	pension	and	postretirement	benefit	plans,	measured	as	of December	31,	2017	and	2016:

|  | Pension |  | Other	Benefits |  |
| :--- | :--- | :--- | :--- | :--- |
|  | 2017 | 2016 | 2017 | 2016 |
|  | Under\tFunded | Under\tFunded | Under\tFunded |  |
|  |  | (Dollars\tin\tthousands) |  |  |
| Benefit\tobligation,\tbeginning\tof\tyear | $430,574 | $421,736 | $47,487 | $48,616 |
| Service\tcost | 2,887 | 2,615 | 279 | 355 |
| Interest\tcost | 15,137 | 15,711 | 1,577 | 1,595 |
| Actuarial\tloss | 31,074 | 16,315 | 2,278 | 646 |
| Currency\ttranslation | 3,916 | (4,300) | — | — |
| Benefits\tpaid | (19,144) | (18,887) | (3,095) | (3,946) |
| Medicare\tPart\tD\treimbursement | — | — | 80 | 221 |
| Plan\tamendments | — | — | 297 | — |
| Curtailments | — | (23) | — | — |
| Administrative\tcosts | (2,286) | (2,593) | — | — |
| Projected\tbenefit\tobligation,\tend\tof\tyear | 462,158 | 430,574 | 48,903 | 47,487 |
| Fair\tvalue\tof\tplan\tassets,\tbeginning\tof\tyear | 340,265 | 315,951 |  |  |
| Actual\treturn\ton\tplan\tassets | 53,065 | 36,620 |  |  |
| Contributions | 12,670 | 12,752 |  |  |
| Benefits\tpaid | (19,144) | (18,887) |  |  |
| Administrative\tcosts | (2,286) | (2,593) |  |  |
| Currency\ttranslation | 1,737 | (3,578) |  |  |
| Fair\tvalue\tof\tplan\tassets,\tend\tof\tyear | 386,307 | 340,265 |  |  |
| Funded\tstatus,\tend\tof\tyear | $(75,851) | $(90,309) | $(48,903) | $(47,487) |

The	following	table	sets	forth	the	amounts	recognized	in	the	consolidated	balance	sheet	with	respect	to	the	Company's	pension	and	postretirement plans:

|  | Pension |  | Other	Benefits | Other	Benefits |
| :--- | :--- | :--- | :--- | :--- |
|  | 2017 | 2016 | 2017 | 2016 |
|  |  | (Dollars\tin\tthousands) |  |  |
| Other\tassets | $1,596 | $106 | $— | $— |
| Payroll\tand\tbenefit-related\tliabilities | (1,767) | (1,640) | (3,173) | (3,200) |
| Pension\tand\tpostretirement\tbenefit\tliabilities | (75,680) | (88,775) | (45,730) | (44,287) |
| Accumulated\tother\tcomprehensive\tloss | 209,365 | 209,785 | 6,715 | 4,415 |
|  | $133,514 | $119,476 | $(42,188) | $(43,072) |

The	following	tables	set	forth	the	amounts	recognized	in	accumulated	other	comprehensive	loss	with	respect	to	the	plans:

|  | Prior	Service<br>Cost | Net	(Gain)<br>or	Loss | Deferred<br>Taxes | Accumulated<br>Other<br>Comprehensive<br>Loss,<br>Net	of	Tax |
| :--- | :--- | :--- | :--- | :--- |
|  |  | (Dollars\tin\tthousands) |  |  |
| Balance\tat\tDecember\t31,\t2015 | $113 | $213,188 | $(77,255) | $136,046 |
| Reclassification\tadjustments\trelated\tto\tcomponents\tof\tNet\tPeriodic\nBenefit\tCost\trecognized\tduring\tthe\tperiod: |  |  |  |  |
| Net\tamortization\tand\tdeferral | (34) | (6,533) | 2,339 | (4,228) |
| Amounts\tarising\tduring\tthe\tperiod: |  |  |  |  |
| Actuarial\tchanges\tin\tbenefit\tobligation | — | 4,481 | (1,603) | 2,878 |
| Curtailments | — | (23) | 6 | (17) |
| Impact\tof\tcurrency\ttranslation | — | (1,407) | 373 | (1,034) |
| Balance\tat\tDecember\t31,\t2016 | 79 | 209,706 | (76,140) | 133,645 |
| Reclassification\tadjustments\trelated\tto\tcomponents\tof\tNet\tPeriodic\nBenefit\tCost\trecognized\tduring\tthe\tperiod: |  |  |  |  |
| Net\tamortization\tand\tdeferral | (28) | (6,706) | 2,395 | (4,339) |
| Amounts\tarising\tduring\tthe\tperiod: |  |  |  |  |
| Actuarial\tchanges\tin\tbenefit\tobligation | — | 4,818 | (1,119) | 3,699 |
| Curtailments | — | — | — | — |
| Impact\tof\tcurrency\ttranslation | — | 1,496 | (413) | 1,083 |
| Balance\tat\tDecember\t31,\t2017 | $51 | $209,314 | $(75,277) | $134,088 |

|  | Prior	Service<br>Cost | Net	(Gain)	or<br>Loss | Deferred<br>Taxes | Accumulated<br>Other<br>Comprehensive<br>Loss,<br>Net	of	Tax |
| :--- | :--- | :--- | :--- | :--- |
|  |  | (Dollars\tin\tthousands) | (Dollars\tin\tthousands) |  |
| Balance\tat\tDecember\t31,\t2015 | $107 | $4,116 | $(1,382) | $2,841 |
| Reclassification\tadjustments\trelated\tto\tcomponents\tof\tNet\tPeriodic\nBenefit\tCost\trecognized\tduring\tthe\tperiod: |  |  |  |  |
| Net\tamortization\tand\tdeferral | (22) | (432) | 170 | (284) |
| Amounts\tarising\tduring\tthe\tperiod: |  |  |  |  |
| Actuarial\tchanges\tin\tbenefit\tobligation | — | 646 | (252) | 394 |
| Balance\tat\tDecember\t31,\t2016 | 85 | 4,330 | (1,464) | 2,951 |
| Reclassification\tadjustments\trelated\tto\tcomponents\tof\tNet\tPeriodic\nBenefit\tCost\trecognized\tduring\tthe\tperiod: |  |  |  |  |
| Net\tamortization\tand\tdeferral | (77) | (198) | 101 | (174) |
| Amounts\tarising\tduring\tthe\tperiod: |  |  |  |  |
| Actuarial\tchanges\tin\tbenefit\tobligation | — | 2,278 | (558) | 1,720 |
| Plan\tamendments | 297 | — | (74) | 223 |
| Balance\tat\tDecember\t31,\t2017 | $305 | $6,410 | $(1,995) | $4,720 |

The	following	table	provides	the	weighted	average	assumptions	for	United	States	and	foreign	plans	used	in	determining	benefit	obligations:

|  | Pension |  | Other	Benefits |  |
| :--- | :--- | :--- | :--- | :--- |
|  | 2017 | 2016 | 2017 | 2016 |
| Discount\trate | 3.6% | 4.2% | 3.6% | 4.1% |
| Rate\tof\tcompensation\tincrease | 2.6% | 2.8% |  |  |
| Initial\thealthcare\ttrend\trate |  |  | 7.8% | 7.9% |
| Ultimate\thealthcare\ttrend\trate |  |  | 5.0% | 5.0% |

The	discount	rate	represents	the	interest	rate	used	to	determine	the	present	value	of	future	cash	flows	currently	expected	to	be	required	to	settle	the Company's	pension	and	other	benefit	obligations.	The	weighted	average	discount	rates	for	United	States	pension	plans	and	other	benefit	plans	of	3.76% and	3.60%,	 respectively,	 were	 established	 by	 comparing	 the	 projection	 of	 expected	 benefit	 payments	 to	 the	AA	Above	 Median	 yield	 curve	 as	 of December	31,	2017.	The	expected	benefit	payments	are	discounted	by	each	corresponding	discount	rate	on	the	yield	curve.	For	payments	beyond 30	years,	the	Company	extends	the	curve	assuming	that	the	discount	rate	derived	in	year	30	is	extended	to	the	end	of	the	plan's	payment	expectations. Once	the	present	value	of	the	string	of	benefit	payments	is	established,	the	Company	determines	the	single	rate	on	the	yield	curve	that,	when	applied	to all	obligations	of	the	plan,	will	exactly	match	the	previously	determined	present	value.

As	part	of	the	evaluation	of	pension	and	other	postretirement	assumptions,	the	Company	applied	assumptions	for	mortality	and	healthcare	cost trends	that	incorporate	generational	white	and	blue	collar	mortality	trends.	In	determining	its	benefit	obligations,	the	Company	used	generational	tables that	take	into	consideration	increases	in	plan	participant	longevity.

The	Company's	assumption	for	the	expected	return	on	plan	assets	is	primarily	based	on	the	determination	of	an	expected	return	for	its	current portfolio.	This	determination	is	made	using	assumptions	for	return	and	volatility	of	the	portfolio.	Asset	class	assumptions	are	set	using	a	combination	of empirical	and	forward-looking	analysis.	To	the	extent	historical	results	have	been	affected	by	unsustainable	trends	or	events,	the	effects	of	those	trends are	quantified	and	removed.	The	Company	applies	a	variety	of	models	for	filtering	historical	data	and	isolating	the	fundamental	characteristics	of	asset classes.	These	models	provide	empirical	return	estimates	for	each	asset	class,	which	are	then	reviewed	and	combined	with	a	qualitative	assessment	of long	term	relationships	between	asset	classes	before	a	return	estimate	is	finalized.	The	qualitative	analysis	is	intended	to	provide	an	additional	means	for addressing	the	effect	of	unrealistic	or	unsustainable	short-term	valuations	or	trends,	resulting	in	return	levels	and	behavior	the	Company	believes	are more	likely	to	prevail	over	long	periods.	Effective	in	2018,	the	Company	changed	the	expected	return	on	plan	assets	of	the	United	States	pension	plans from	8.25%	to	8.0%	due	to	modifications	to	the	investment	strategy	in	order	to	gradually	reduce	portfolio	risk.	This	change	had	no	impact	on	the	results for	the	year	ended	December	31,	2017.

An	increase	in	the	assumed	healthcare	trend	rate	of	1%	would	increase	the	benefit	obligation	at	 December	31,	2017	 by	$3.6	million	and	would increase	the	2017	benefit	expense	by	$0.2	million.	Decreasing	this	assumed	rate	by	1%	would	decrease	the	benefit	obligation	at	 December	31,	2017	by $3.1	million	and	would	decrease	the	2017	benefit	expense	by	$0.1	million.

The	accumulated	benefit	obligation	for	all	United	States	and	foreign	defined	benefit	pension	plans	was	 $461.6	million	and	$430.0	million	for	2017	and 2016,	respectively.	All	of	the	Company's	pension	plans	had	accumulated	benefit	obligations	in	excess	of	their	respective	plan	assets	as	of	 December	31, 2017	and	2016.

The	Company's	investment	objective	is	to	achieve	an	enhanced	long-term	rate	of	return	on	plan	assets,	subject	to	a	prudent	level	of	portfolio	risk,	for the	purpose	of	enhancing	the	availability	of	benefits	for	participants.	These	investments	are	primarily	comprised	of	equity	and	fixed	income	mutual	funds. The	Company's	other	investments	are	largely	comprised	of	a	hedge	fund	of	funds	and	a	structured	credit	fund.	The	equity	funds	are	diversified	in	terms	of domestic	and	international	equity	securities,	as	well	as	small,	middle	and	large	capitalization	stocks.	The	Company's	target	allocation	percentage	is	as follows:	equity	securities	(45%);	fixed-income	securities	(35%)	and	other	securities	(20%).	Equity	funds	are	held	for	their	expected	return	over	inflation. Fixed-income	funds	are	held	for	diversification	relative	to	equities	and	as	a	partial	hedge	of	interest	rate	risk	with	respect	to	plan	liabilities.	The	other investments	are	held	to	further	diversify	assets	within	the	plans	and	are	designed	to	provide	a	mix	of	equity	and	bond	like	return	with

a	bond	like	risk	profile.	The	plans	may	also	hold	cash	to	meet	liquidity	requirements.	Actual	performance	may	not	be	consistent	with	the	respective investment	 strategies.	 Investment	 risks	 and	 returns	 are	 measured	 and	 monitored	 on	 an	 ongoing	 basis	 through	 annual	 liability	 measurements	 and investment	portfolio	reviews	to	determine	whether	the	asset	allocation	targets	continue	to	represent	an	appropriate	balance	of	expected	risk	and	reward.

The	following	table	provides	the	fair	values	of	the	Company's	pension	plan	assets	at	 December	31,	2017	by	asset	category:

|  |  | Fair	Value	Measurements | Fair	Value	Measurements |  |
| :--- | :--- | :--- | :--- | :--- |
| Asset\tCategory\t(a) | Total | Quoted\tPrices\tin\nActive\tMarkets\tfor\nIdentical\tAssets\n(Level\t1) | Significant\nObservable\nInputs\n(Level\t2) | Significant\nUnobservable\nInputs\n(Level\t3) |
|  |  | (Dollars\tin\tthousands) | (Dollars\tin\tthousands) |  |
| Cash | $1,324 | $1,324 |  |  |
| Money\tmarket\tfunds | 51 | 51 |  |  |
| Equity\tsecurities: |  |  |  |  |
| Managed\tvolatility\t(b) | 79,964 | 79,964 |  |  |
| United\tStates\tsmall/mid-cap\tequity\t(c) | 19,239 | 19,239 |  |  |
| World\tEquity\t(excluding\tUnited\tStates)\t(d) | 32,294 | 32,294 |  |  |
| Common\tEquity\tSecurities\t–\tTeleflex\tIncorporated | 29,087 | 29,087 |  |  |
| Diversified\tGlobal | 6,353 | 6,353 |  |  |
| Fixed\tincome\tsecurities: |  |  |  |  |
| Intermediate\tduration\tbond\tfund\t(e) | 23,378 | 23,378 |  |  |
| Long\tduration\tbond\tfund\t(f) | 94,623 | 94,623 |  |  |
| High\tyield\tbond\tfund\t(g) | 12,420 | 12,420 |  |  |
| Emerging\tmarkets\tdebt\tfund\t(h) | 9,184 | 9,184 |  |  |
| Corporate,\tgovernment\tand\tforeign\tbonds | 2,024 | 2,024 |  |  |
| Asset\tbacked\t–\thome\tloans | 454 | $454 | $454 |  |
| Other\ttypes\tof\tinvestments: |  |  |  |  |
| Multi\tasset\tfunds\t\t(i) | 11,114 | 6,187 | 4,927 |  |
| Other | 5 |  |  | $5 |
| Total\tinvestments\tat\tfair\tvalue | $321,514 | $316,128 | $5,381 | $5 |
| Investments\tmeasured\tat\tnet\tasset\tvalue\t(j) | 64,793 |  |  |  |
| Total | $386,307 |  |  |  |

|  |  | Fair	Value	Measurements | Fair	Value	Measurements |  |
| :--- | :--- | :--- | :--- | :--- |
| Asset\tCategory\t(a) | Total | Quoted\tPrices\tin\nActive\tMarkets\tfor\nIdentical\tAssets\n(Level\t1) | Significant\nObservable\nInputs\n(Level\t2) | Significant\nUnobservable\nInputs\n(Level\t3) |
|  |  | (Dollars\tin\tthousands) | (Dollars\tin\tthousands) |  |
| Cash | $437 | $437 |  |  |
| Money\tmarket\tfunds | 76 | 76 |  |  |
| Equity\tsecurities: |  |  |  |  |
| Managed\tvolatility\t(b) | 88,051 | 88,051 |  |  |
| United\tStates\tsmall/mid-cap\tequity\t(c) | 24,785 | 24,785 |  |  |
| World\tEquity\t(excluding\tUnited\tStates)\t(d) | 33,376 | 33,376 |  |  |
| Common\tEquity\tSecurities\t–\tTeleflex\tIncorporated | 18,838 | 18,838 |  |  |
| Diversified\tGlobal | 5,086 | 5,086 |  |  |
| Fixed\tincome\tsecurities: |  |  |  |  |
| Intermediate\tduration\tbond\tfund\t(e) | — |  |  |  |
| Long\tduration\tbond\tfund\t(f) | 73,544 | 73,544 |  |  |
| High\tyield\tbond\tfund\t(g) | 15,451 | 15,451 |  |  |
| Emerging\tmarkets\tdebt\tfund\t(h) | 9,412 | 9,412 |  |  |
| Corporate,\tgovernment\tand\tforeign\tbonds | 1,864 | 1,864 |  |  |
| Asset\tbacked\t–\thome\tloans | 527 | $527 | $527 |  |
| Other\ttypes\tof\tinvestments: |  |  |  |  |
| Multi\tasset\tfunds\t\t(i) | 9,622 | 5,460 | 4,162 |  |
| Other | 5 |  |  | $5 |
| Total\tinvestments\tat\tfair\tvalue | $281,074 | $276,380 | $4,689 | $5 |
| Investments\tmeasured\tat\tNAV\t(j) | 59,191 |  |  |  |
| Total | $340,265 |  |  |  |

(a) Information	on	asset	categories	described	in	notes	(b)-(k)	is	derived	from	prospectuses	and	other	material	provided	by	the	respective	funds comprising	the	respective	asset	categories.

(b) This	category	comprises	mutual	funds	that	invest	in	securities	of	United	States	and	non-United	States	companies	of	all	capitalization	ranges	that exhibit	relatively	low	volatility.

(c) This	category	comprises	a	mutual	fund	that	invests	at	least	 80%	of	its	net	assets	in	equity	securities	of	small	and	mid-sized	companies.	The	fund invests	in	common	stocks	or	exchange	traded	funds	holding	common	stock	of	United	States	companies	with	market	capitalizations	in	the	range	of companies	in	the	Russell	2500	Index.

(d) This	category	comprises	a	mutual	fund	that	invests	at	least	 80%	of	its	net	assets	in	equity	securities	of	foreign	companies.	These	securities	may include	common	stocks,	preferred	stocks,	warrants,	exchange	traded	funds	based	on	an	international	equity	index,	derivative	instruments	whose value	is	based	on	an	international	equity	index	and	derivative	instruments	whose	value	is	based	on	an	underlying	equity	security	or	a	basket	of equity	securities.	The	fund	invests	in	securities	of	foreign	issuers	located	in	developed	and	emerging	market	countries.	However,	the	fund	will	not invest	more	than	35%	of	its	assets	in	the	common	stocks	or	other	equity	securities	of	issuers	located	in	emerging	market	countries.

(e) This	 category	 comprises	 a	 mutual	 fund	 that	 invests	 in	 instruments	 or	 derivatives	 having	 economic	 characteristics	 similar	 to	 fixed	 income securities.	The	fund	invests	in	investment	grade	fixed	income	instruments,	including	United	States	and	foreign	corporate	obligations,	fixed	income securities	issued	by	sovereigns	or	agencies	in	both	developed	and	emerging	foreign	markets,	debt	obligations	issued	by	governments	or	other municipalities,	and	securities	issued	or	guaranteed	by	the	United	States	Government	and	its	agencies.	The	fund	will	seek	to	maintain	an	effective average	 duration	 between	three	 and	ten	years,	and	uses	derivative	 instruments,	 including	 interest	rate	swap	agreements	and	credit	default swaps,	for	the	purpose	of	managing	the	overall	duration	and	yield	curve	exposure	of	the	Fund's	portfolio	of	fixed	income	securities.

(f) This	 category	 comprises	 a	 mutual	 fund	 that	 invests	 in	 instruments	 or	 derivatives	 having	 economic	 characteristics	 similar	 to	 fixed	 income securities.	 The	 fund	 invests	 in	 investment	 grade	 fixed	 income	 instruments,	 including	 securities	 issued	 or	 guaranteed	 by	 the	 United	 States Government	 and	 its	 agencies	 and	 instrumentalities,	 corporate	 bonds,	 asset-backed	 securities,	 exchange	 traded	 funds,	 mortgage-backed securities	and	collateralized	mortgage-backed	securities.	The	fund	invests	primarily	in	long	duration	government	and	corporate	fixed	income securities,	and	uses	derivative	instruments,	including	interest	rate	swap	agreements	and	Treasury	futures	contracts,	for	the	purpose	of	managing the	overall	duration	and	yield	curve	exposure	of	the	Fund's	portfolio	of	fixed	income	securities.

(g) This	category	comprises	a	mutual	fund	that	invests	at	least	 80%	of	its	net	assets	in	higher-yielding	fixed	income	securities,	including	corporate bonds	and	debentures,	convertible	and	preferred	securities	and	zero	coupon	obligations.

(h) This	category	comprises	a	mutual	fund	that	invests	at	least	 80%	of	its	net	assets	in	fixed	income	securities	of	emerging	market	issuers,	primarily in	United	States	dollar-denominated	debt	of	foreign	governments,	government-related	and	corporate	issuers	in	emerging	market	countries	and entities	organized	to	restructure	the	debt	of	those	issuers.

(i) This	category	comprises	funds	that	may	invest	in	equities,	bonds,	or	derivatives.

(j) This	category	comprises	pooled	institutional	investments,	primarily	collective	investment	trusts.	These	funds	are	not	available	on	an	exchange	or	in an	active	market	and	 these	 investments	are	valued	using	 their	NAV,	which	 is	generally	based	on	 the	underlying	asset	values	of	 the	pooled investments	held	in	the	trusts.	This	category	comprises	the	following	funds:

•a	fund	that	invests	primarily	in	collateralized	debt	obligations	("CDOs")	and	other	structured	credit	vehicles	and	may	include	fixed income	 securities,	 loan	 participations,	 credit-linked	 notes,	 medium-term	 notes,	 pooled	 investment	 vehicles	 and	 derivative instruments.

•a	hedge	fund	that	invests	in	various	other	hedge	funds.

•funds	that	invest	in	underlying	funds	that	acquire,	manage,	and	dispose	of	real	estate	properties,	with	a	focus	on	properties	in	the U.S.	and	the	UK	markets.

The	Company's	contributions	to	United	States	and	foreign	pension	plans	during 2018	are	expected	to	be	approximately	 $12.8	million.	Contributions	to postretirement	healthcare	plans	during	2018	are	expected	to	be	approximately	 $3.2	million.

The	following	table	provides	information	about	the	Company's	expected	benefit	payments	under	its	U.S.	and	foreign	plans	for	each	of	the	five succeeding	years	and	the	aggregate	of	the	five	years	thereafter,	net	of	the	annual	average	Medicare	Part	D	subsidy	of	approximately	$0.2	million:

|  | Pension | Other	Benefits |
| :--- | :--- | :--- |
|  | (Dollars\tin\tthousands) | (Dollars\tin\tthousands) |
| 2018 | $20,636 | $3,173 |
| 2019 | 20,865 | 3,201 |
| 2020 | 21,419 | 3,387 |
| 2021 | 22,171 | 3,414 |
| 2022 | 23,024 | 3,579 |
| Years\t2023\t—\t2027 | 124,398 | 18,147 |

The	amounts	in	accumulated	other	comprehensive	income	expected	to	be	recognized	over	the	next	fiscal	year	for	the	Company's	pension	and postretirement	benefit	plans	are	$6.8	million	and	$0.2	million,	respectively.

The	Company	maintains	a	number	of	defined	contribution	savings	plans	covering	eligible	United	States	and	non-United	States	employees.	The Company	partially	matches	employee	contributions.	Costs	related	to	these	plans	were	$12.5	million,	$12.0	million	and	$12.6	million	for	2017,	2016	and 2015,	respectively.

# Note	15	—	Commitments	and	contingent	liabilities

Operating	leases:	The	Company	uses	various	 leased	 facilities	and	equipment	 in	 its	operations.	The	 lease	 terms	 for	 these	 leased	assets	 vary depending	 on	 the	 terms	 of	 the	 applicable	 lease	 agreement.	At	December	31,	2017,	 the	Company	had	no	residual	value	guarantees	related	 to	 its operating	leases.

Future	minimum	lease	payments	as	of	 December	31,	2017	under	noncancellable	operating	leases	are	as	follows:

|  | Future	Lease	Payments |
| :--- | :--- |
|  | (Dollars\tin\tthousands) |
| 2018 | $30,262 |
| 2019 | 26,531 |
| 2020 | 21,355 |
| 2021 | 18,186 |
| 2022 | 15,774 |
| 2023\tand\tthereafter | 27,167 |

Environmental:		The	Company	is	subject	to	contingencies	as	a	result	of	environmental	laws	and	regulations	that	in	the	future	may	require	the Company	to	take	further	action	to	correct	the	effects	on	the	environment	of	prior	disposal	practices	or	releases	of	chemical	or	petroleum	substances	by the	Company	or	other	parties.	Much	of	this	liability	results	from	the	U.S.	Comprehensive	Environmental	Response,	Compensation	and	Liability	Act,	often referred	to	as	Superfund,	the	U.	S.	Resource	Conservation	and	Recovery	Act	and	similar	state	laws.	These	laws	require	the	Company	to	undertake certain	investigative	and	remedial	activities	at	sites	where	the	Company	conducts	or	once	conducted	operations	or	at	sites	where	Company-generated waste	was	disposed.

Remediation	activities	vary	substantially	in	duration	and	cost	from	site	to	site.	The	nature	of	these	activities,	and	their	associated	costs,	depend	on the	mix	of	unique	site	characteristics,	evolving	remediation	technologies,	the	regulatory	agencies	involved	and	their	enforcement	policies,	as	well	as	the presence	or	absence	of	other	potentially	responsible	parties.	At	December	31,	2017	and	2016,	the	Company	has	recorded	$1.0	million	and	$1.1	million, respectively,	 in	 accrued	 liabilities	 and	$5.8	million	 in	other	 liabilities	relating	 to	 these	matters.	Considerable	uncertainty	exists	with	respect	 to	 these liabilities,	and	if	adverse	changes	in	circumstances	occur,	potential	liability	may	exceed	the	amount	accrued	as	of	December	31,	2017.	The	time	frame over	which	the	accrued	amounts	may	be	paid	out,	based	on	past	history,	is	estimated	to	be	15-20	years.

Litigation:		The	Company	is	a	party	to	various	lawsuits	and	claims	arising	in	the	normal	course	of	business.	These	lawsuits	and	claims	include	actions involving	product	liability,	intellectual	property,	employment,	environmental	and	other	matters.	As	of	December	31,	2017	 and	2016,	the	Company	has recorded	accrued	liabilities	of	$3.8	million	and	$2.5	million,	respectively,	in	connection	with	such	contingencies,	representing	its	best	estimate	of	the	cost within	the	range	of	estimated	possible	losses	that	will	be	incurred	to	resolve	these	matters.	Of	the	amounts	accrued	as	of	December	31,	2017	and	2016, $0.1	million	and	$1.6	million,	respectively,	pertain	to	discontinued	operations.

During	 the	 first	 quarter	 2017,	 Teleflex	 Medical	 Trading	 (Shanghai)	 Company,	 Ltd.	 ("Teleflex	 Shanghai"),	 one	 of	 the	 Company's	 subsidiaries, eliminated	a	key	distributor	within	its	sales	channel	in	China	and	undertook	a	distributor	to	direct	sales	conversion	within	that	channel.	On	March	24, 2017,	 the	distributor	submitted	an	application	with	 the	Shanghai	 International	Economy	and	Trade	Arbitration	Commission	("SHIAC")	 for	arbitration alleging,	among	other	things,	that	Teleflex	Shanghai	wrongfully	terminated	its	relationship	with	the	distributor.	Pursuant	to	a	supplementary	submission filed	by	the	distributor	with	SHIAC	in	July	2017,	the	distributor	sought	to	recover	$7.8	million	in	damages,	and	also	sought	to	compel	Teleflex	Shanghai	to repurchase	Teleflex	products	that	the	distributor	claimed	it	purchased	from	Teleflex	Shanghai	at	a	total	price	of	 $14.9	million.	Teleflex	Shanghai	filed	a counterclaim	seeking	payment	from	the	distributor	of	$9.3	million	in	respect	of	outstanding	trade	receivables	owed	by	the	distributor	to	Teleflex	Shanghai. In	February	2018,	Teleflex	Shanghai	and	the	distributor	entered	into	a	settlement	agreement	to	resolve	the	outstanding	claims	of	the	parties.	Under	the agreement,	Teleflex	Shanghai	accepted	the	return	of	certain	inventories	from	the	distributor	for	$11.9	million	during	the	fourth	quarter	2017.	In	connection with	the	return	of	the	inventories,	Teleflex	Shanghai	canceled	$9.3	million	in	trade	receivables	owed	by	the	distributor	to	Teleflex	Shanghai.	The	Company has	recorded	a	provision	of	$3.6	million	in	connection	with	the	settlement.

In	2006,	the	Company	was	named	as	a	defendant	in	a	wrongful	death	product	liability	lawsuit	filed	in	the	Louisiana	State	District	Court	for	the	Parish of	Calcasieu,	involving	a	product	manufactured	by	the	Company's	former	marine	business.	In	September	2014,	the	case	was	tried	before	a	jury,	which returned	a	verdict	in	favor	of	the	Company.	The	plaintiff	subsequently	filed	a	motion	for	a	new	trial,	which	was	granted,	and	the	case	was	re-tried	before	a jury	in

December	2014.	On	December	5,	2014,	the	jury	returned	a	verdict	in	favor	of	the	plaintiff,	awarding	$0.1	million	in	compensatory	damages	and	 $23.0 million	in	punitive	damages,	plus	pre-	and	post-judgment	interest	on	the	compensatory	damages	and	post-judgment	interest	on	the	punitive	damages. The	Company's	post-trial	motions	seeking	to	overturn	the	verdict	or	reduce	the	amount	of	damages	were	denied	in	June	2015.	The	Company	filed	an appeal	with	the	Louisiana	Court	of	Appeal,	and	the	plaintiff	filed	a	cross-appeal,	seeking	to	overturn	the	trial	court's	denial	of	pre-judgment	interest	on	the punitive	damages	award.	On	June	29,	2016,	the	Louisiana	Court	of	Appeal	affirmed	the	trial	court	verdict	in	all	respects.	The	Company	and	the	plaintiff filed	applications	for	a	writ	of	certiorari	(a	request	for	review)	to	the	Louisiana	Supreme	Court.	On	January	13,	2017,	the	Louisiana	Supreme	Court granted	the	Company's	writ	application,	and	oral	arguments	were	held	on	May	1,	2017.	On	October	18,	2017,	the	Louisiana	Supreme	Court	issued	its decision,	affirming	the	lower	court's	judgment	in	part	and	reducing	the	amount	of	punitive	damages	awarded	to	the	plaintiff	from	$23.0	million	 to	$4.3 million.	On	November	10,	2017	the	Company	paid	$5.0	million	(inclusive	of	interest)	in	settlement	of	the	litigation.

Based	on	information	currently	available,	advice	of	counsel,	established	reserves	and	other	resources,	the	Company	does	not	believe	that	the outcome	of	any	outstanding	litigation	and	claims	is	likely	to	be,	individually	or	in	the	aggregate,	material	to	its	business,	financial	condition,	results	of operations	or	liquidity.	However,	in	the	event	of	unexpected	further	developments,	it	is	possible	that	the	ultimate	resolution	of	these	matters,	or	other similar	matters,	if	unfavorable,	may	be	materially	adverse	to	the	Company's	business,	financial	condition,	results	of	operations	or	liquidity.	Legal	costs such	as	outside	counsel	fees	and	expenses	are	charged	to	selling,	general	and	administrative	expenses	in	the	period	incurred.

Tax	 audits	 and	 examinations: 	 The	 Company	 and	 its	 subsidiaries	 are	 routinely	 subject	 to	 tax	 examinations	 by	 various	 tax	 authorities.	 As	 of December	31,	2017,	the	most	significant	tax	examinations	in	process	are	in	Canada,	Germany,	Italy,	and	the	United	States.	The	Company	may	establish reserves	with	respect	to	uncertain	tax	positions,	after	which	it	adjusts	the	reserves	to	address	developments	with	respect	to	its	uncertain	tax	positions, including	 developments	 in	 these	 tax	 examinations.	Accordingly,	 developments	 in	 tax	 audits	 and	 examinations,	 including	 resolution	 of	 uncertain	 tax positions,	could	result	in	increases	or	decreases	to	the	Company's	recorded	tax	liabilities,	which	could	impact	the	Company's	financial	results.

Other:	The	Company	has	various	purchase	commitments	for	materials,	supplies	and	items	of	permanent	investment	incident	to	the	ordinary	conduct of	business.	On	average,	such	commitments	are	not	at	prices	in	excess	of	current	market	prices.

# Note	16	—	Business	segments	and	other	information

An	 operating	 segment	 is	 a	 component	 of	 the	 Company	 (a)	 that	 engages	 in	 business	 activities	 from	 which	 it	 may	 earn	 revenues	 and	 incur expenses,	(b)	whose	operating	results	are	regularly	reviewed	by	the	Company's	chief	operating	decision	maker	to	make	decisions	about	resources	to	be allocated	to	the	segment	and	to	assess	its	performance,	and	(c)	for	which	discrete	financial	information	is	available.	The	Company	does	not	evaluate	its operating	segments	using	discrete	asset	information.

Following	the	Company's	acquisition	of	Vascular	Solutions,	the	Company	commenced	an	integration	program	under	which	it	is	combining	the Vascular	Solutions	business	with	some	of	its	legacy	businesses.	Specifically,	the	Company	is	combining	the	Vascular	Solutions	North	American	business with	the	Company's	interventional	access	business,	which	formerly	was	part	of	the	Vascular	North	America	operating	segment,	and	the	Company's cardiac	 business,	 which	 formerly	 was	 a	 separate	 operating	 segment	 included	 in	 the	 "all	 other"	 category	 for	 purposes	 of	 segment	 reporting.	These businesses	are	now	in	the	Company's	Interventional	North	America	operating	segment.	Additionally,	the	Company	is	combining	the	Vascular	Solutions businesses	 in	 Europe,	 Asia	 and	 Latin	 America	 with	 the	 Company's	 legacy	 businesses	 in	 the	 respective	 locations,	 and	 these	 Vascular	 Solutions businesses	are	now	part	of	the	EMEA	(Europe,	Middle	East	and	Africa),	Asia	and	Latin	America	operating	segments,	respectively.	 The	changes	in	the Company's	operating	segments,	which	became	effective	in	the	fourth	quarter	2017,	also	reflect	the	manner	in	which	the	Company's	new	chief	operating decision	maker	assesses	business	performance	and	allocation	of	resources.

As	a	result	of	the	operating	segment	changes	described	above,	the	Company	has	the	following	 seven	reportable	segments:	Vascular	North	America, Interventional	North	America,	Anesthesia	North	America,	Surgical	North	America,	Europe,	Middle	East	and	Africa	("EMEA"),	Asia	and	Original	Equipment and	Development	Services	("OEM").	In	connection	with	the	presentation	of	segment	information,	we	will	continue	to	present	certain	operating	segments, which	now	include	Interventional	Urology	North	America	and	Respiratory	North	America	as	well	as	Latin	America,	in	the	"all	other"	category	because	they are	not	material.	All	prior	comparative	periods	presented	have	been	restated	to	reflect

these	changes.	Additionally,	because	these	change	affected	certain	of	the	Company's	reporting	units,	the	Company	reallocated	the	goodwill	balances using	relative	fair	values	of	the	reporting	units	and	performed	goodwill	impairment	analyses	on	the	affected	reporting	units.	The	Company	did	not	record any	goodwill	impairment	charges	as	a	result	of	these	analyses.

The	Company's	reportable	segments,	other	than	the	OEM	segment,	design,	manufacture	and	distribute	medical	devices	primarily	used	in	critical care,	surgical	applications	and	cardiac	care,	and	generally	serve	two	end	markets:	hospitals	and	healthcare	providers,	and	home	health.	The	products	of these	segments	are	most	widely	used	in	the	acute	care	setting	for	a	range	of	diagnostic	and	therapeutic	procedures	and	in	general	and	specialty	surgical applications.	The	Company's	OEM	segment	designs,	manufactures	and	supplies	devices	and	instruments	for	other	medical	device	manufacturers.

The	following	tables	present	the	Company's	segment	results	for	the	years	ended	 December	31,	2017,	2016	and	2015:

| Vascular	North	America | $313,618 | $295,206 | $284,097 |
| :--- | :--- | :--- | :--- |
| Interventional\tNorth\tAmerica | 220,611 | 82,431 | 75,196 |
| Anesthesia\tNorth\tAmerica | 197,982 | 198,772 | 189,297 |
| Surgical\tNorth\tAmerica | 175,216 | 172,223 | 161,230 |
| EMEA | 552,722 | 510,934 | 514,443 |
| Asia | 269,208 | 249,416 | 241,726 |
| OEM | 182,967 | 160,990 | 149,399 |
| All\tother | 233,979 | 198,055 | 194,302 |
| Consolidated\tnet\trevenues | $2,146,303 | $1,868,027 | $1,809,690 |

| Vascular	North	America | $77,036 | $77,122 | $59,441 |
| :--- | :--- | :--- | :--- |
| Interventional\tNorth\tAmerica | 25,972 | 13,264 | 5,800 |
| Anesthesia\tNorth\tAmerica | 62,901 | 55,544 | 48,311 |
| Surgical\tNorth\tAmerica | 63,931 | 56,608 | 52,529 |
| EMEA | 92,430 | 84,392 | 92,326 |
| Asia | 75,637 | 75,770 | 67,887 |
| OEM | 41,578 | 33,641 | 33,162 |
| All\tother | 11,142 | 26,486 | 28,399 |
| Total\tsegment\toperating\tprofit\t (1) | 450,627 | 422,827 | 387,855 |
| Unallocated\texpenses\t (2) | (78,348) | (103,374) | (71,964) |
| Income\tfrom\tcontinuing\toperations\tbefore\tinterest,\tloss\ton\textinguishment\tof\tdebt\nand\ttaxes | $372,279 | $319,453 | $315,891 |

(1) Segment	operating	profit	 includes	segment	net	revenues	 from	external	customers	reduced	by	 its	standard	cost	of	goods	sold,	adjusted	 for	 fixed	manufacturing	cost absorption	variances,	selling,	general	and	administrative	expenses,	research	and	development	expenses	and	an	allocation	of	corporate	expenses.	Corporate	expenses	are allocated	among	the	segments	in	proportion	to	the	respective	amounts	of	one	of	several	items	(such	as	sales,	numbers	of	employees,	and	amount	of	time	spent),	depending on	the	category	of	expense	involved.

(2) Unallocated	expenses	primarily	include	manufacturing	variances,	with	the	exception	of	fixed	manufacturing	cost	absorption	variances,	restructuring	and	impairment	charges and	gain	on	sale	of	assets.

| Vascular	North	America | $31,058 | $35,117 | $35,259 |
| :--- | :--- | :--- | :--- |
| Interventional\tNorth\tAmerica | 29,108 | 6,993 | 7,823 |
| Anesthesia\tNorth\tAmerica | 8,573 | 10,932 | 7,089 |
| Surgical\tNorth\tAmerica | 8,694 | 10,459 | 12,289 |
| EMEA | 34,322 | 30,505 | 32,178 |
| Asia | 11,868 | 11,275 | 11,382 |
| OEM | 8,337 | 8,404 | 6,834 |
| All\tother | 28,378 | 14,661 | 12,480 |
| Consolidated\tdepreciation\tand\tamortization | $160,338 | $128,346 | $125,334 |

# Geographic	data

The	following	tables	provide	total	net	revenues	and	total	net	property,	plant	and	equipment	by	geographic	region	for	the	years	ended December	31, 2017,	2016	and	2015:

| United	States | $1,254,825 | $1,018,786 | $967,819 |
| :--- | :--- | :--- | :--- |
| Europe | 591,370 | 567,320 | 570,672 |
| Asia\tand\tAsia\tPacific | 220,110 | 208,841 | 196,796 |
| All\tother | 79,998 | 73,080 | 74,403 |
|  | $2,146,303 | $1,868,027 | $1,809,690 |
| Net\tproperty,\tplant\tand\tequipment: |  |  |  |
| United\tStates | $216,568 | $167,167 | $178,895 |
| Malaysia | 43,730 | 31,415 | 33,777 |
| Ireland | 43,867 | 36,569 | 33,219 |
| Czech\tRepublic | 35,715 | 30,843 | 32,305 |
| All\tother | 43,119 | 36,905 | 37,927 |
|  | $382,999 | $302,899 | $316,123 |

# Note	17	—	Condensed	consolidating	guarantor	financial	information

The	2024	Notes,	2026	Notes	and	2027	Notes	(collectively,	the	"Senior	Notes")	are	issued	by	Teleflex	Incorporated	(the	"Parent	Company"),	and payment	 of	 the	 Parent	 Company's	 obligations	 under	 the	 Senior	 Notes	 are	 guaranteed,	 jointly	 and	 severally,	 by	 certain	 of	 the	 Parent	 Company's subsidiaries	(each,	a	"Guarantor	Subsidiary"	and	collectively,	the	"Guarantor	Subsidiaries").	The	2024	Notes,	2026	Notes	and	2027	Notes	are	guaranteed by	 the	 same	 Guarantor	 Subsidiaries.	 The	 guarantees	 are	 full	 and	 unconditional,	 subject	 to	 certain	 customary	 release	 provisions.	 Each	 Guarantor Subsidiary	 is	 directly	 or	 indirectly	100%	 owned	 by	 the	 Parent	 Company.	 The	 Company's	 condensed	 consolidating	 statements	 of	 income	 and comprehensive	income	and	condensed	consolidating	statements	of	cash	flows	for	the	years	ended	December	31,	2017,	2016	and	2015	and	condensed consolidating	balance	sheets	as	of	December	31,	2017	and	2016	provide	consolidated	information	for:

# a. Parent	Company,	the	issuer	of	the	guaranteed	obligations;

b. Guarantor	Subsidiaries,	on	a	combined	basis;

c. Non-Guarantor	Subsidiaries	(i.e.,	those	subsidiaries	of	the	Parent	Company	that	have	not	guaranteed payment	of	the	Senior	Notes),	on	a	combined	basis;	and

d. Parent	Company	and	its	subsidiaries	on	a	consolidated	basis.

The	same	accounting	policies	as	described	 in	Note	1	are	used	by	 the	Parent	Company	and	each	of	 its	subsidiaries	 in	connection	with	 the condensed	consolidating	financial	information,	except	for	the	use	of	the	equity	method	of	accounting	to	reflect	ownership	interests	in	subsidiaries,	which are	eliminated	upon	consolidation.

Consolidating	 entries	 and	 eliminations	 in	 the	 following	 condensed	 consolidated	 financial	 statements	 represent	 adjustments	 to	 (a)	 eliminate intercompany	transactions	between	or	among	the	Parent	Company,	the	Guarantor	Subsidiaries	and	the	Non-Guarantor	Subsidiaries,	(b)	eliminate	the investments	in	subsidiaries	and	(c)	record	consolidating	entries.

# TELEFLEX	INCORPORATED	AND	SUBSIDIARIES

# CONDENSED	CONSOLIDATING	STATEMENTS	OF	INCOME	AND	COMPREHENSIVE	INCOME

|  |  |  | Year	Ended	December	31,	2017 |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  | Parent\nCompany | Guarantor\nSubsidiaries | Non-Guarantor\nSubsidiaries | Eliminations | Condensed\nConsolidated |
|  |  |  | (Dollars\tin\tthousands) |  |  |
| Net\trevenues | $— | $1,368,149 | $1,177,247 | $(399,093) | $2,146,303 |
| Cost\tof\tgoods\tsold | — | 778,153 | 594,527 | (398,179) | 974,501 |
| Gross\tprofit | — | 589,996 | 582,720 | (914) | 1,171,802 |
| Selling,\tgeneral\tand\tadministrative\texpenses | 47,412 | 408,811 | 243,544 | 196 | 699,963 |
| Research\tand\tdevelopment\texpenses | 1,009 | 57,614 | 26,147 | — | 84,770 |
| Restructuring\tcharges | — | 8,971 | 5,819 | — | 14,790 |
| (Loss)\tincome\tfrom\tcontinuing\toperations\tbefore\n\t\tinterest,\tloss\ton\textinguishment\tof\tdebt\tand\ttaxes | (48,421) | 114,600 | 307,210 | (1,110) | 372,279 |
| Interest,\tnet | 195,649 | (117,431) | 3,557 | — | 81,775 |
| Loss\ton\textinguishment\tof\tdebt | 5,593 | — | — | — | 5,593 |
| (Loss)\tincome\tfrom\tcontinuing\toperations\tbefore\ttaxes | (249,663) | 232,031 | 303,653 | (1,110) | 284,911 |
| (Benefit)\ttaxes\ton\t(loss)\tincome\tfrom\tcontinuing\toperations | (146,116) | 14,862 | 261,386 | (484) | 129,648 |
| Equity\tin\tnet\tincome\tof\tconsolidated\tsubsidiaries | 258,810 | 25,500 | (3,135) | (281,175) | — |
| Income\tfrom\tcontinuing\toperations | 155,263 | 242,669 | 39,132 | (281,801) | 155,263 |
| Operating\tloss\tfrom\tdiscontinued\toperations | (4,534) | — | — | — | (4,534) |
| Benefit\ton\tloss\tfrom\tdiscontinued\toperations | (1,801) | — | — | — | (1,801) |
| Loss\tfrom\tdiscontinued\toperations | (2,733) | — | — | — | (2,733) |
| Net\tincome | 152,530 | 242,669 | 39,132 | (281,801) | 152,530 |
| Other\tcomprehensive\tincome | 173,626 | 158,490 | 198,453 | (356,943) | 173,626 |
| Comprehensive\tincome | $326,156 | $401,159 | $237,585 | $(638,744) | $326,156 |

|  |  |  | Year	Ended	December	31,	2016 | Year	Ended	December	31,	2016 |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  | Parent\nCompany | Guarantor\nSubsidiaries | Non-Guarantor\nSubsidiaries | Eliminations | Condensed\nConsolidated |
|  |  |  | (Dollars\tin\tthousands) |  |  |
| Net\trevenues | $— | $1,112,464 | $1,124,958 | $(369,395) | $1,868,027 |
| Cost\tof\tgoods\tsold | — | 652,442 | 588,110 | (368,725) | 871,827 |
| Gross\tprofit | — | 460,022 | 536,848 | (670) | 996,200 |
| Selling,\tgeneral\tand\tadministrative\texpenses | 43,602 | 328,263 | 191,916 | (473) | 563,308 |
| Research\tand\tdevelopment\texpenses | 547 | 33,080 | 24,952 | — | 58,579 |
| Restructuring\tand\timpairment\tcharges | 173 | 50,183 | 8,871 | — | 59,227 |
| Gain\ton\tsale\tof\tassets | (2,707) | (155) | (1,505) | — | (4,367) |
| (Loss)\tincome\tfrom\tcontinuing\toperations\tbefore\n\t\tinterest,\tloss\ton\textinguishment\tof\tdebt\tand\ttaxes | (41,615) | 48,651 | 312,614 | (197) | 319,453 |
| Interest,\tnet | 153,830 | (103,465) | 4,102 | — | 54,467 |
| Loss\ton\textinguishment\tof\tdebt | 19,261 | — | — | — | 19,261 |
| (Loss)\tincome\tfrom\tcontinuing\toperations\tbefore\ttaxes | (214,706) | 152,116 | 308,512 | (197) | 245,725 |
| (Benefit)\ttaxes\ton\t(loss)\tincome\tfrom\tcontinuing\toperations | (78,478) | 46,758 | 39,875 | (81) | 8,074 |
| Equity\tin\tnet\tincome\tof\tconsolidated\tsubsidiaries | 374,048 | 243,987 | 528 | (618,563) | — |
| Income\tfrom\tcontinuing\toperations | 237,820 | 349,345 | 269,165 | (618,679) | 237,651 |
| Operating\t(loss)\tincome\tfrom\tdiscontinued\toperations | (1,300) | — | 378 | — | (922) |
| Tax\tbenefit\ton\t(loss)\tincome\tfrom\tdiscontinued\toperations | (857) | — | (255) | — | (1,112) |
| \t\t\t(Loss)\tincome\tfrom\tdiscontinued\toperations | (443) | — | 633 | — | 190 |
| \t\t\tNet\tincome | 237,377 | 349,345 | 269,798 | (618,679) | 237,841 |
| Less:\tIncome\tfrom\tcontinuing\toperations\tattributable\n\t\t\t\t\t\t\t\t\t\t\t\t\tto\tnoncontrolling\tinterests | — | — | 464 | — | 464 |
| \t\t\tNet\tincome\tattributable\tto\tcommon\tshareholders | 237,377 | 349,345 | 269,334 | (618,679) | 237,377 |
| Other\tcomprehensive\tloss\tattributable\tto\tcommon\tshareholders | (66,761) | (76,098) | (80,700) | 156,798 | (66,761) |
| Comprehensive\tincome\tattributable\tto\tcommon\n\t\t\tshareholders | $170,616 | $273,247 | $188,634 | $(461,881) | $170,616 |

|  |  |  | Year	Ended	December	31,	2015 | Year	Ended	December	31,	2015 |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  | Parent\nCompany | Guarantor\nSubsidiaries | Non-Guarantor\nSubsidiaries | Eliminations | Condensed\nConsolidated |
|  |  |  | (Dollars\tin\tthousands) |  |  |
| Net\trevenues | $— | $1,079,180 | $1,107,565 | $(377,055) | $1,809,690 |
| Cost\tof\tgoods\tsold | — | 646,427 | 593,855 | (374,995) | 865,287 |
| Gross\tprofit | — | 432,753 | 513,710 | (2,060) | 944,403 |
| Selling,\tgeneral\tand\tadministrative\texpenses | 42,435 | 336,049 | 191,029 | (531) | 568,982 |
| Research\tand\tdevelopment\texpenses | — | 30,359 | 21,760 | — | 52,119 |
| Restructuring\tcharges | — | 6,731 | 1,088 | — | 7,819 |
| Gain\ton\tsale\tof\tassets | — | — | (408) | — | (408) |
| (Loss)\tincome\tfrom\tcontinuing\toperations\tbefore\tinterest\tand\ntaxes | (42,435) | 59,614 | 300,241 | (1,529) | 315,891 |
| Interest,\tnet | 132,711 | (76,873) | 4,953 | — | 60,791 |
| Loss\ton\textinguishment\tof\tdebt | 10,454 | — | — | — | 10,454 |
| (Loss)\tincome\tfrom\tcontinuing\toperations\tbefore\ttaxes | (185,600) | 136,487 | 295,288 | (1,529) | 244,646 |
| (Benefit)\ttaxes\ton\t(loss)\tincome\tfrom\tcontinuing\toperations | (66,264) | 27,260 | 46,804 | 38 | 7,838 |
| Equity\tin\tnet\tincome\tof\tconsolidated\tsubsidiaries | 355,138 | 235,810 | 1,086 | (592,034) | — |
| Income\tfrom\tcontinuing\toperations | 235,802 | 345,037 | 249,570 | (593,601) | 236,808 |
| Operating\t(loss)\tincome\tfrom\tdiscontinued\toperations | (1,734) | — | 4 | — | (1,730) |
| (Benefit)\ttaxes\ton\t(loss)\tincome\tfrom\tdiscontinued\toperations | (10,795) | — | 160 | — | (10,635) |
| Income\t(loss)\tfrom\tdiscontinued\toperations | 9,061 | — | (156) | — | 8,905 |
| Net\tincome | 244,863 | 345,037 | 249,414 | (593,601) | 245,713 |
| Less:\tIncome\tfrom\tcontinuing\toperations\tattributable\tto\nnoncontrolling\tinterests | — | — | 850 | — | 850 |
| Net\tincome\tattributable\tto\tcommon\tshareholders | 244,863 | 345,037 | 248,564 | (593,601) | 244,863 |
| Other\tcomprehensive\tloss\tattributable\tto\tcommon\tshareholders | (110,229) | (110,604) | (120,439) | 231,043 | (110,229) |
| Comprehensive\tincome\tattributable\tto\tcommon\tshareholders | $134,634 | $234,433 | $128,125 | $(362,558) | $134,634 |

# CONDENSED	CONSOLIDATING	BALANCE	SHEETS

|  | Parent<br>Company | Guarantor<br>Subsidiaries | Non-Guarantor<br>Subsidiaries | Eliminations | Condensed<br>Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  |  |  | (Dollars\tin\tthousands) |  |  |
| ASSETS |  |  |  |  |  |
| Current\tassets |  |  |  |  |  |
| Cash\tand\tcash\tequivalents | $37,803 | $8,933 | $286,822 | $— | $333,558 |
| Accounts\treceivable,\tnet | 2,414 | 57,818 | 280,980 | 4,663 | 345,875 |
| Accounts\treceivable\tfrom\tconsolidated\tsubsidiaries | 14,478 | 2,276,248 | 343,115 | (2,633,841) | — |
| Inventories,\tnet | — | 245,533 | 176,490 | (26,279) | 395,744 |
| Prepaid\texpenses\tand\tother\tcurrent\tassets | 14,874 | 9,236 | 19,790 | 3,982 | 47,882 |
| Prepaid\ttaxes | — | — | 5,748 | — | 5,748 |
| Total\tcurrent\tassets | 69,569 | 2,597,768 | 1,112,945 | (2,651,475) | 1,128,807 |
| Property,\tplant\tand\tequipment,\tnet | 2,088 | 213,663 | 167,248 | — | 382,999 |
| Goodwill | — | 1,246,144 | 989,448 | — | 2,235,592 |
| Intangibles\tassets,\tnet | — | 1,355,275 | 1,028,473 | — | 2,383,748 |
| Investments\tin\taffiliates | 7,203,175 | 1,674,077 | 19,620 | (8,896,872) | — |
| Deferred\ttax\tassets | — | — | 6,071 | (2,261) | 3,810 |
| Notes\treceivable\tand\tother\tamounts\tdue\tfrom\tconsolidated\nsubsidiaries | 2,154,172 | 2,231,832 | — | (4,386,004) | — |
| Other\tassets | 31,173 | 6,397 | 8,966 | — | 46,536 |
| Total\tassets | $9,460,177 | $9,325,156 | $3,332,771 | $(15,936,612) | $6,181,492 |
| LIABILITIES\tAND\tEQUITY |  |  |  |  |  |
| Current\tliabilities |  |  |  |  |  |
| Current\tborrowings | $36,625 | $— | $50,000 | $— | $86,625 |
| Accounts\tpayable | 4,269 | 46,992 | 40,766 | — | 92,027 |
| Accounts\tpayable\tto\tconsolidated\tsubsidiaries | 2,310,570 | 261,121 | 62,150 | (2,633,841) | — |
| Accrued\texpenses | 17,957 | 31,827 | 47,069 | — | 96,853 |
| Current\tportion\tof\tcontingent\tconsideration | — | 74,224 | — | — | 74,224 |
| Payroll\tand\tbenefit-related\tliabilities | 21,145 | 44,009 | 42,261 | — | 107,415 |
| Accrued\tinterest | 6,133 | — | 32 | — | 6,165 |
| Income\ttaxes\tpayable | 4,352 | — | 7,162 | — | 11,514 |
| Other\tcurrent\tliabilities | 1,461 | 3,775 | 3,817 | — | 9,053 |
| Total\tcurrent\tliabilities | 2,402,512 | 461,948 | 253,257 | (2,633,841) | 483,876 |
| Long-term\tborrowings | 2,162,927 | — | — | — | 2,162,927 |
| Deferred\ttax\tliabilities | 88,512 | 265,426 | 251,999 | (2,261) | 603,676 |
| Pension\tand\tpostretirement\tbenefit\tliabilities | 70,860 | 32,750 | 17,800 | — | 121,410 |
| Noncurrent\tliability\tfor\tuncertain\ttax\tpositions | 1,117 | 8,196 | 2,983 | — | 12,296 |
| Notes\tpayable\tand\tother\tamounts\tdue\tto\tconsolidated\tsubsidiaries | 2,155,146 | 2,022,682 | 208,176 | (4,386,004) | — |
| Noncurrent\tcontingent\tconsideration | — | 186,923 | 10,989 | — | 197,912 |
| Other\tliabilities | 148,572 | 7,850 | 12,442 | — | 168,864 |
| Total\tliabilities | 7,029,646 | 2,985,775 | 757,646 | (7,022,106) | 3,750,961 |
| Total\tshareholders'\tequity | 2,430,531 | 6,339,381 | 2,575,125 | (8,914,506) | 2,430,531 |
| Total\tliabilities\tand\tshareholders'\tequity | $9,460,177 | $9,325,156 | $3,332,771 | $(15,936,612) | $6,181,492 |

|  | Parent<br>Company | Guarantor<br>Subsidiaries | Non-Guarantor<br>Subsidiaries | Eliminations | Condensed<br>Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  |  |  | (Dollars\tin\tthousands) |  |  |
| ASSETS |  |  |  |  |  |
| Current\tassets |  |  |  |  |  |
| Cash\tand\tcash\tequivalents | $14,571 | $1,031 | $528,187 | $— | $543,789 |
| Accounts\treceivable,\tnet | 2,551 | 8,768 | 255,815 | 4,859 | 271,993 |
| Accounts\treceivable\tfrom\tconsolidated\tsubsidiaries | 4,861 | 2,176,059 | 309,149 | (2,490,069) | — |
| Inventories,\tnet | — | 200,852 | 140,406 | (25,087) | 316,171 |
| Prepaid\texpenses\tand\tother\tcurrent\tassets | 14,239 | 5,332 | 17,474 | 3,337 | 40,382 |
| Prepaid\ttaxes | — | — | 7,766 | 413 | 8,179 |
| Assets\theld\tfor\tsale | — | — | 2,879 | — | 2,879 |
| Total\tcurrent\tassets | 36,222 | 2,392,042 | 1,261,676 | (2,506,547) | 1,183,393 |
| Property,\tplant\tand\tequipment,\tnet | 2,566 | 163,847 | 136,486 | — | 302,899 |
| Goodwill | — | 708,546 | 568,174 | — | 1,276,720 |
| Intangibles\tassets,\tnet | — | 640,999 | 450,664 | — | 1,091,663 |
| Investments\tin\taffiliates | 6,022,042 | 1,519,031 | 23,685 | (7,564,758) | — |
| Deferred\ttax\tassets | 73,051 | — | 5,185 | (76,524) | 1,712 |
| Notes\treceivable\tand\tother\tamounts\tdue\tfrom\tconsolidated\nsubsidiaries | 1,387,615 | 2,085,538 | — | (3,473,153) | — |
| Other\tassets | 22,295 | 6,254 | 6,277 | — | 34,826 |
| Total\tassets | $7,543,791 | $7,516,257 | $2,452,147 | $(13,620,982) | $3,891,213 |
| LIABILITIES\tAND\tEQUITY |  |  |  |  |  |
| Current\tliabilities |  |  |  |  |  |
| Current\tborrowings | $133,071 | $— | $50,000 | $— | $183,071 |
| Accounts\tpayable | 4,540 | 30,924 | 33,936 | — | 69,400 |
| Accounts\tpayable\tto\tconsolidated\tsubsidiaries | 2,242,814 | 214,203 | 33,052 | (2,490,069) | — |
| Accrued\texpenses | 16,827 | 18,126 | 30,196 | — | 65,149 |
| Current\tportion\tof\tcontingent\tconsideration | — | 587 | — | — | 587 |
| Payroll\tand\tbenefit-related\tliabilities | 20,610 | 26,672 | 35,397 | — | 82,679 |
| Accrued\tinterest | 10,429 | — | 21 | — | 10,450 |
| Income\ttaxes\tpayable | 1,246 | — | 6,577 | 85 | 7,908 |
| Other\tcurrent\tliabilities | 2,262 | 3,643 | 2,497 | — | 8,402 |
| Total\tcurrent\tliabilities | 2,431,799 | 294,155 | 191,676 | (2,489,984) | 427,646 |
| Long-term\tborrowings | 850,252 | — | — | — | 850,252 |
| Deferred\ttax\tliabilities | — | 316,526 | 31,375 | (76,524) | 271,377 |
| Pension\tand\tpostretirement\tbenefit\tliabilities | 85,645 | 31,561 | 15,856 | — | 133,062 |
| Noncurrent\tliability\tfor\tuncertain\ttax\tpositions | 1,169 | 13,684 | 2,667 | — | 17,520 |
| Notes\tpayable\tand\tother\tamounts\tdue\tto\tconsolidated\tsubsidiaries | 2,011,737 | 1,264,004 | 197,412 | (3,473,153) | — |
| Noncurrent\tcontingent\tconsideration |  |  |  |  |  |
|  | — | 6,516 | — | — | 6,516 |
| Other\tliabilities | 23,848 | 9,179 | 12,472 | — | 45,499 |
| Total\tliabilities | 5,404,450 | 1,935,625 | 451,458 | (6,039,661) | 1,751,872 |
| Convertible\tnotes\t-\tredeemable\tequity\tcomponent | 1,824 | — | — | — | 1,824 |
| \t\t\t\t\t\t\t\t\t\t\t\tMezzanine\tEquity | 1,824 | — | — | — | 1,824 |
| Total\tshareholders'\tequity | 2,137,517 | 5,580,632 | 2,000,689 | (7,581,321) | 2,137,517 |
| Total\tliabilities\tand\tshareholders'\tequity | $7,543,791 | $7,516,257 | $2,452,147 | $(13,620,982) | $3,891,213 |

# CONDENSED	CONSOLIDATING	STATEMENTS	OF	CASH	FLOWS

|  |  | Year	Ended	December	31,	2017 | Year	Ended	December	31,	2017 | Year	Ended	December	31,	2017 |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  | Parent\nCompany | Guarantor\nSubsidiaries | Non-Guarantor\nSubsidiaries | Eliminations | Condensed\nConsolidated |
|  |  |  | (Dollars\tin\tthousands) |  |  |
| Net\tcash\t(used\tin)\tprovided\tby\toperating\tactivities\tfrom\tcontinuing\noperations | $(50,585) | $223,373 | $315,431 | $(61,918) | $426,301 |
| Cash\tflows\tfrom\tinvesting\tactivities\tof\tcontinuing\toperations: |  |  |  |  |  |
| Expenditures\tfor\tproperty,\tplant\tand\tequipment | (240) | (34,912) | (35,751) | — | (70,903) |
| Payments\tfor\tbusinesses\tand\tintangibles\tacquired,\tnet\tof\tcash\nacquired | (975,524) | (725,554) | (67,206) | — | (1,768,284) |
| Proceeds\tfrom\tsale\tof\tassets\tand\tinvestments | 464,982 | — | 6,332 | (464,982) | 6,332 |
| Investments\tin\taffiliates | — | (5,900) | — | 5,900 | — |
| Net\tcash\tused\tin\tinvesting\tactivities\tfrom\tcontinuing\noperations | (510,782) | (766,366) | (96,625) | (459,082) | (1,832,855) |
| Cash\tflows\tfrom\tfinancing\tactivities\tof\tcontinuing\toperations: |  |  |  |  |  |
| Proceeds\tfrom\tnew\tborrowings | 2,463,500 | — | — | — | 2,463,500 |
| Reduction\tin\tborrowings | (1,239,576) | — | — | — | (1,239,576) |
| Debt\textinguishment,\tissuance\tand\tamendment\tfees | (26,664) | — | — | — | (26,664) |
| Proceeds\tfrom\tshare\tbased\tcompensation\tplans\tand\tthe\trelated\ntax\timpacts | 5,571 | — | — | — | 5,571 |
| Payments\tfor\tcontingent\tconsideration | — | (335) | — | — | (335) |
| Proceeds\tfrom\tissuance\tof\tshares | — | — | 5,900 | (5,900) | — |
| Dividends | (61,237) | — | — | — | (61,237) |
| Intercompany\ttransactions | (550,579) | 551,230 | (465,633) | 464,982 | — |
| Intercompany\tdividends\tpaid | — | — | (61,918) | 61,918 | — |
| Net\tcash\tprovided\tby\t(used\tin)\tfinancing\tactivities\tfrom\ncontinuing\toperations | 591,015 | 550,895 | (521,651) | 521,000 | 1,141,259 |
| Cash\tflows\tfrom\tdiscontinued\toperations: |  |  |  |  |  |
| Net\tcash\tused\tin\toperating\tactivities | (6,416) | — | — | — | (6,416) |
| Net\tcash\tused\tin\tdiscontinued\toperations | (6,416) | — | — | — | (6,416) |
| Effect\tof\texchange\trate\tchanges\ton\tcash\tand\tcash\tequivalents | — | — | 61,480 | — | 61,480 |
| Net\tincrease\t(decrease)\tin\tcash\tand\tcash\tequivalents | 23,232 | 7,902 | (241,365) | — | (210,231) |
| Cash\tand\tcash\tequivalents\tat\tthe\tbeginning\tof\tthe\tyear | 14,571 | 1,031 | 528,187 | — | 543,789 |
| Cash\tand\tcash\tequivalents\tat\tthe\tend\tof\tthe\tyear | $37,803 | $8,933 | $286,822 | $— | $333,558 |

|  |  | Year	Ended	December	31,	2016 | Year	Ended	December	31,	2016 | Year	Ended	December	31,	2016 |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  | Parent\nCompany | Guarantor\nSubsidiaries | Non-Guarantor\nSubsidiaries | Eliminations | Condensed\nConsolidated |
|  |  |  | (Dollars\tin\tthousands) |  |  |
| Net\tcash\t(used\tin)\tprovided\tby\toperating\tactivities\tfrom\tcontinuing\noperations | $(85,088) | $169,400 | $328,553 | $(2,275) | $410,590 |
| Cash\tflows\tfrom\tinvesting\tactivities\tof\tcontinuing\toperations: |  |  |  |  |  |
| Expenditures\tfor\tproperty,\tplant\tand\tequipment | (279) | (24,753) | (28,103) | — | (53,135) |
| Payments\tfor\tbusinesses\tand\tintangibles\tacquired,\tnet\tof\tcash\nacquired | — | (10,305) | (50,572) | 46,837 | (14,040) |
| Proceeds\tfrom\tsale\tof\tassets | 5,607 | 49,571 | 1,860 | (46,837) | 10,201 |
| Investments\tin\taffiliates | — | (5,600) | — | 5,600 | — |
| Net\tcash\tprovided\tby\t(used\tin)\tinvesting\tactivities\tfrom\ncontinuing\toperations | 5,328 | 8,913 | (76,815) | 5,600 | (56,974) |
| Cash\tflows\tfrom\tfinancing\tactivities\tof\tcontinuing\toperations: |  |  |  |  |  |
| Proceeds\tfrom\tnew\tborrowings | 665,000 | — | 6,700 | — | 671,700 |
| Reduction\tin\tborrowings | (714,565) | — | — | — | (714,565) |
| Debt\textinguishment,\tissuance\tand\tamendment\tfees | (8,958) | — | — | — | (8,958) |
| Proceeds\tfrom\tshare\tbased\tcompensation\tplans\tand\trelated\ttax\nimpacts | 9,068 | — | — | — | 9,068 |
| Payments\tto\tnoncontrolling\tinterest\tshareholders | — | — | (464) | — | (464) |
| Payments\tfor\tacquisition\tof\tnoncontrolling\tinterest | — | — | (9,231) | — | (9,231) |
| Payments\tfor\tcontingent\tconsideration | — | (7,282) | — | — | (7,282) |
| Proceeds\tfrom\tissuance\tof\tshares | — | — | 5,600 | (5,600) | — |
| Dividends | (58,960) | — | — | — | (58,960) |
| Intercompany\ttransactions | 183,244 | (170,000) | (13,244) | — | — |
| Intercompany\tdividends\tpaid | — | — | (2,275) | 2,275 | — |
| Net\tcash\tprovided\tby\t(used\tin)\tfinancing\tactivities\tfrom\ncontinuing\toperations | 74,829 | (177,282) | (12,914) | (3,325) | (118,692) |
| Cash\tflows\tfrom\tdiscontinued\toperations: |  |  |  |  |  |
| Net\tcash\tused\tin\toperating\tactivities | (2,110) | — | — | — | (2,110) |
| Net\tcash\tused\tin\tdiscontinued\toperations | (2,110) | — | — | — | (2,110) |
| Effect\tof\texchange\trate\tchanges\ton\tcash\tand\tcash\tequivalents | — | — | (27,391) | — | (27,391) |
| Net\t(decrease)\tincrease\tin\tcash\tand\tcash\tequivalents | (7,041) | 1,031 | 211,433 | — | 205,423 |
| Cash\tand\tcash\tequivalents\tat\tthe\tbeginning\tof\tthe\tyear | 21,612 | — | 316,754 | — | 338,366 |
| Cash\tand\tcash\tequivalents\tat\tthe\tend\tof\tthe\tyear | $14,571 | $1,031 | $528,187 | $— | $543,789 |

|  |  |  | Year	Ended	December	31,	2015 | Year	Ended	December	31,	2015 |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  | Parent\nCompany | Guarantor\nSubsidiaries | Non-Guarantor\nSubsidiaries | Eliminations | Condensed\nConsolidated |
|  |  |  | (Dollars\tin\tthousands) |  |  |
| Net\tcash\t(used\tin)\tprovided\tby\toperating\tactivities\tfrom\tcontinuing\noperations | $(147,704) | $134,817 | $320,145 | $(3,812) | $303,446 |
| Cash\tflows\tfrom\tinvesting\tactivities\tof\tcontinuing\toperations: |  |  |  |  |  |
| Expenditures\tfor\tproperty,\tplant\tand\tequipment | (124) | (32,797) | (28,527) | — | (61,448) |
| Payments\tfor\tbusinesses\tand\tintangibles\tacquired,\tnet\tof\tcash\nacquired | — | (60,336) | (33,472) | — | (93,808) |
| Proceeds\tfrom\tsale\tof\tbusinesses\tand\tassets | 408 | — | — | — | 408 |
| Investments\tin\taffiliates | — | — | (121,850) | 121,850 | — |
| Net\tcash\tused\tin\tinvesting\tactivities\tfrom\tcontinuing\noperations | 284 | (93,133) | (183,849) | 121,850 | (154,848) |
| Cash\tflows\tfrom\tfinancing\tactivities\tof\tcontinuing\toperations: |  |  |  |  |  |
| Proceeds\tfrom\tnew\tborrowings | 288,100 | — | — | — | 288,100 |
| Reduction\tin\tborrowings | (303,757) | — | — | — | (303,757) |
| Debt\textinguishment,\tissuance\tand\tamendment\tfees | (9,017) | — | — | — | (9,017) |
| Proceeds\tfrom\tshare\tbased\tcompensation\tplans\tand\tthe\trelated\ntax\timpacts | 4,994 | — | — | — | 4,994 |
| Payments\tto\tnoncontrolling\tinterest\tshareholders | — | — | (1,343) | — | (1,343) |
| Payments\tfor\tcontingent\tconsideration | — | (8,028) | — | — | (8,028) |
| Proceeds\tfrom\tissuance\tof\tshares | — | 121,850 | — | (121,850) | — |
| Dividends | (56,532) | — | — | — | (56,532) |
| Intercompany\ttransactions | 219,035 | (155,506) | (63,529) | — | — |
| Intercompany\tdividends\tpaid | — | — | (3,812) | 3,812 | — |
| Net\tcash\tprovided\tby\t(used\tin)\tfinancing\tactivities\tfrom\ncontinuing\toperations | 142,823 | (41,684) | (68,684) | (118,038) | (85,583) |
| Cash\tflows\tfrom\tdiscontinued\toperations: |  |  |  |  |  |
| Net\tcash\tused\tin\toperating\tactivities | (1,787) | — | (849) | — | (2,636) |
| Net\tcash\tused\tin\tdiscontinued\toperations | (1,787) | — | (849) | — | (2,636) |
| Effect\tof\texchange\trate\tchanges\ton\tcash\tand\tcash\tequivalents | — | — | (25,249) | — | (25,249) |
| Net\tdecrease\tin\tcash\tand\tcash\tequivalents | (6,384) | — | 41,514 | — | 35,130 |
| Cash\tand\tcash\tequivalents\tat\tthe\tbeginning\tof\tthe\tyear | 27,996 | — | 275,240 | — | 303,236 |
| Cash\tand\tcash\tequivalents\tat\tthe\tend\tof\tthe\tyear | $21,612 | $— | $316,754 | $— | $338,366 |

# Note	18	—	Divestiture-related	activities

# Discontinued	Operations

The	results	of	the	Company's	discontinued	operations	for	the	years	ended	December	31, 2017,	2016	and	2015	were	as	follows:

| Costs	and	other	expenses 	(1) | $4,534 | $922 | $1,730 |
| :--- | :--- | :--- | :--- |
| Loss\tfrom\tdiscontinued\toperations\tbefore\tincome\ttaxes | (4,534) | (922) | (1,730) |
| Tax\tbenefit\ton\tloss\tfrom\tdiscontinued\toperations \t(2) | 1,801 | 1,112 | 10,635 |
| Income\t(loss)\tfrom\tdiscontinued\toperations | $(2,733) | $190 | $8,905 |

(1) Includes	expenses	associated	with	retained	liabilities	related	to	divested	businesses.

(2) The	tax	benefit	on	loss	from	discontinued	operations	recognized	in	2015	reflects	a	reduction	in	U.S.	liabilities	associated	with	unrecognized	tax	benefits	as	a	result	of	the conclusion	of	an	audit.

# QUARTERLY	DATA	(UNAUDITED)

| Net	revenues | $487,881 | $528,613 | $534,703 | $595,106 |
| :--- | :--- | :--- | :--- | :--- |
| Gross\tprofit | 255,560 | 290,284 | 295,227 | 330,731 |
| Income\tfrom\tcontinuing\toperations\tbefore\tinterest,\tloss\ton\textinguishment\tof\ndebt\tand\ttaxes | 60,819 | 110,202 | 110,354 | 90,904 |
| Income\t(loss)\tfrom\tcontinuing\toperations | 40,349 | 78,363 | 79,398 | (42,847) |
| (Loss)\tincome\tfrom\tdiscontinued\toperations | (179) | (360) | (2,383) | 189 |
| Net\tincome\t(loss) | 40,170 | 78,003 | 77,015 | (42,658) |
| Net\tincome\t(loss)\tattributable\tto\tcommon\tshareholders | 40,170 | 78,003 | 77,015 | (42,658) |
| Earnings\tper\tshare\tavailable\tto\tcommon\tshareholders\t—\tbasic (1): |  |  |  |  |
| Income\t(loss)\tfrom\tcontinuing\toperations | $0.90 | $1.74 | $1.76 | $(0.95) |
| (Loss)\tincome\tfrom\tdiscontinued\toperations | (0.01) | (0.01) | (0.05) | — |
| Net\tincome\t(loss) | $0.89 | $1.73 | $1.71 | $(0.95) |
| Earnings\tper\tshare\tavailable\tto\tcommon\tshareholders\t—\tdiluted (1): |  |  |  |  |
| Income\t(loss)\tfrom\tcontinuing\toperations | $0.87 | $1.67 | $1.70 | $(0.92) |
| Loss\tfrom\tdiscontinued\toperations | (0.01) | — | (0.05) | 0.01 |
| Net\tincome\t(loss) | $0.86 | $1.67 | $1.65 | $(0.91) |
| 2016: |  |  |  |  |
| Net\trevenues | $424,893 | $473,553 | $455,648 | $513,933 |
| Gross\tprofit | 225,147 | 256,399 | 241,602 | 273,052 |
| Income\tfrom\tcontinuing\toperations\tbefore\tinterest,\tloss\ton\textinguishment\tof\ndebt\tand\ttaxes | 67,497 | 98,441 | 86,487 | 67,028 |
| Income\tfrom\tcontinuing\toperations | 51,180 | 59,395 | 66,200 | 60,876 |
| Loss\tfrom\tdiscontinued\toperations | (312) | 193 | 122 | 187 |
| Net\tincome | 50,868 | 59,588 | 66,322 | 61,063 |
| Less:\tIncome\tfrom\tcontinuing\toperations\tattributable\tto\tnoncontrolling\tinterest | 179 | 285 | — | — |
| Net\tincome\tattributable\tto\tcommon\tshareholders | 50,689 | 59,303 | 66,322 | 61,063 |
| Earnings\tper\tshare\tavailable\tto\tcommon\tshareholders\t—\tbasic (1): |  |  |  |  |
| Income\tfrom\tcontinuing\toperations | $1.22 | $1.36 | $1.50 | $1.38 |
| Loss\tfrom\tdiscontinued\toperations | — | — | 0.01 | 0.01 |
| Net\tincome | $1.22 | $1.36 | $1.51 | $1.39 |
| Earnings\tper\tshare\tavailable\tto\tcommon\tshareholders\t—\tdiluted (1): |  |  |  |  |
| Income\tfrom\tcontinuing\toperations | $1.05 | $1.25 | $1.40 | $1.29 |
| Loss\tfrom\tdiscontinued\toperations | (0.01) | 0.01 | — | 0.01 |
| Net\tincome | $1.04 | $1.26 | $1.40 | $1.30 |

(1)	Each	quarter	is	calculated	as	a	discrete	period;	the	sum	of	the	four	quarters	may	not	equal	the	calculated	full	year	amount.

# SCHEDULE	II	—	VALUATION	AND	QUALIFYING	ACCOUNTS

# (Dollars	in	thousands)

|  | Balance	at<br>Beginning	of<br>Year | Additions<br>Charged	to<br>Income | Accounts<br>Receivable<br>Write-offs | Translation<br>and	Other | Balance	at<br>End	of<br>Year |
| :--- | :--- | :--- | :--- | :--- | :--- |
| December\t31,\t2017 | $8,636 | $1,949 | $(596) | $266 | $10,255 |
| December\t31,\t2016 | $8,026 | $2,156 | $(862) | $(684) | $8,636 |
| December\t31,\t2015 | $8,783 | $1,618 | $(1,387) | $(988) | $8,026 |

# INVENTORY	RESERVE

|  | Balance	at<br>Beginning	of<br>Year | Additions<br>Charged	to<br>Income | Inventory<br>Write-offs | Translation<br>and	Other | Balance	at<br>End	of<br>Year |
| :--- | :--- | :--- | :--- | :--- | :--- |
| December\t31,\t2017 |  |  |  |  |  |
| Raw\tmaterial | $6,555 | $1,552 | $(2,317) | $303 | $6,093 |
| Work-in-process | 2,853 | 306 | (127) | 57 | 3,089 |
| Finished\tgoods | 26,950 | 8,662 | (10,259) | 1,073 | 26,426 |
|  | $36,358 | $10,520 | $(12,703) | $1,433 | $35,608 |
| December\t31,\t2016 |  |  |  |  |  |
| Raw\tmaterial | $7,577 | $1,446 | $(1,645) | $(823) | $6,555 |
| Work-in-process | 3,139 | (76) | (213) | 3 | 2,853 |
| Finished\tgoods | 25,800 | 12,909 | (11,150) | (609) | 26,950 |
|  | $36,516 | $14,279 | $(13,008) | $(1,429) | $36,358 |
| December\t31,\t2015 |  |  |  |  |  |
| Raw\tmaterial | $6,891 | $4,102 | $(1,611) | $(1,805) | $7,577 |
| Work-in-process | 509 | 579 | (554) | 2,605 | 3,139 |
| Finished\tgoods | 26,474 | 15,060 | (13,653) | (2,081) | 25,800 |
|  | $33,874 | $19,741 | $(15,818) | $(1,281) | $36,516 |
|  | DEFERRED\tTAX\tASSET\tVALUATION\tALLOWANCE | DEFERRED\tTAX\tASSET\tVALUATION\tALLOWANCE |  |  |  |
|  |  | Additions | Reductions |  |  |
|  | Balance\tat | Charged\tto | Credited\tto | Translation | Balance\tat |

# DEFERRED	TAX	ASSET	VALUATION	ALLOWANCE



Question: if the remaining securities would be use or exercised at $ 113.49 , what would cost be for the company?
Answer: 411.91