UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q



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

For the quarterly period ended ~~September 25, 2016~~July 2, 2017



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

For the transition period from to .

Commission file number 1-5353

TELEFLEX INCORPORATED

(Exact name of registrant as specified in its charter)



Delaware		23-1147939
(State or other jurisdiction of incorporation or organization)		(I.R.S. employer identification no.)



550 E. Swedesford Rd., Suite 400, Wayne, PA		19087
(Address of principal executive offices)		(Zip Code)

(610) 225-6800

(Registrant’s telephone number, including area code)

(None)

(Former Name, Former Address and Former Fiscal Year,

If Changed Since Last Report)

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



Large accelerated filer	x		Accelerated filer	¨

Non-accelerated filer	¨	(Do not check if a smaller reporting company)	Smaller reporting company	¨

			Emerging growth 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 Exchange Act). Yes ¨ No x

The registrant had ~~44,053,239~~45,037,418 shares of common stock, par value $1.00 per share, outstanding as of ~~October 24, 2016.~~July 31, 2017.

TELEFLEX INCORPORATED

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTER ENDED ~~SEPTEMBER 25, 2016~~JULY 2, 2017

TABLE OF CONTENTS



		Page
PART I — FINANCIAL INFORMATION

Item 1:	Financial Statements (Unaudited):	2
	Condensed Consolidated Statements of Income	2
	Condensed Consolidated Statements of Comprehensive Income	3
	Condensed Consolidated Balance Sheets	4
	Condensed Consolidated Statements of Cash Flows	5
	Condensed Consolidated Statements of Changes in Equity	6
	Notes to Condensed Consolidated Financial Statements	7
Item 2:	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3734
Item 3:	Quantitative and Qualitative Disclosures About Market Risk	4745
Item 4:	Controls and Procedures	4745

PART II — OTHER INFORMATION

Item 1:	Legal Proceedings	4946
Item 1A:	Risk Factors	4946
Item 2:	Unregistered Sales of Equity Securities and Use of Proceeds	4946
Item 3:	Defaults Upon Senior Securities	4946
Item 4:	Mine Safety Disclosures	4946
Item 5:	Other Information	4946
Item 6:	Exhibits	5047

SIGNATURES		5148

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements

TELEFLEX INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)


	Three Months Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 25, 2016			September 27, 2015			September 25, 2016			September 27, 2015			July 2, 2017			June 26, 2016			July 2, 2017			June 26, 2016
	(Dollars and shares in thousands, except per share)												(Dollars and shares in thousands, except per share)
Net revenues	$	455,648		$	443,714		$	1,354,094		$	1,325,189		$	528,613		$	473,553		$	1,016,494		$	898,446
Cost of goods sold	214,046			215,501			630,946			641,102			238,329			217,154			470,650			416,900
Gross profit	241,602			228,213			723,148			684,087			290,284			256,399			545,844			481,546
Selling, general and administrative expenses	139,797			138,840			419,128			420,765			158,934			142,983			322,903			279,331
Research and development expenses	15,067			12,571			42,892			38,898			20,278			15,472			38,105			27,825
Restructuring charges	3,027			660			12,876			5,688			870			(119		)	13,815			9,849
Gain on sale of assets	(2,776		)	(408		)	(4,173		)	(408		)	—			(378		)	—			(1,397		)
Income from continuing operations before interest, extinguishment of debt and taxes	86,487			76,550			252,425			219,144
Income from continuing operations before interest, loss on extinguishment of debt and taxes													110,202			98,441			171,021			165,938
Interest expense	12,888			14,306			38,579			47,685			19,894			11,907			37,620			25,691
Interest income	(115		)	(130		)	(324		)	(453		)	(161		)	(129		)	(330		)	(209		)
Loss on extinguishment of debt	—			—			19,261			10,454			11			19,261			5,593			19,261
Income from continuing operations before taxes	73,714			62,374			194,909			161,458			90,458			67,402			128,138			121,195
Taxes on income from continuing operations	7,514			803			18,134			15,415			12,095			8,007			9,426			10,620
Income from continuing operations	66,200			61,571			176,775			146,043			78,363			59,395			118,712			110,575
Operating income (loss) from discontinued operations	260			(788		)	(116		)	(1,432		)	(566		)	6			(848		)	(376		)
(Benefit) taxes on income (loss) from discontinued operations	138			(69		)	(119		)	180
Benefit on income (loss) from discontinued operations													(206		)	(187		)	(309		)	(257		)
Income (loss) from discontinued operations	122			(719		)	3			(1,612		)	(360		)	193			(539		)	(119		)
Net income	66,322			60,852			176,778			144,431			78,003			59,588			118,173			110,456
Less: Income from continuing operations attributable to noncontrolling interest	—			28			464			692			—			285			—			464
Net income attributable to common shareholders	$	66,322		$	60,824		$	176,314		$	143,739		$	78,003		$	59,303		$	118,173		$	109,992
Earnings per share available to common shareholders:
Basic:
Income from continuing operations	$	1.50		$	1.48		$	4.09		$	3.50		$	1.74		$	1.36		$	2.64		$	2.58
Income (loss) from discontinued operations	0.01			(0.02		)	—			(0.04		)	(0.01		)	—			(0.01		)	—
Net income	$	1.51		$	1.46		$	4.09		$	3.46		$	1.73		$	1.36		$	2.63		$	2.58
Diluted:
Income from continuing operations	$	1.40		$	1.27		$	3.69		$	3.03		$	1.67		$	1.25		$	2.54		$	2.29
Loss from discontinued operations	—			(0.02		)	—			(0.03		)	—			0.01			(0.01		)	—
Net income	$	1.40		$	1.25		$	3.69		$	3.00		$	1.67		$	1.26		$	2.53		$	2.29
Dividends per share	$	0.34		$	0.34		$	1.02		$	1.02		$	0.34		$	0.34		$	0.68		$	0.68
Weighted average common shares outstanding
Basic	44,045			41,597			43,081			41,542			44,996			43,549			44,945			42,598
Diluted	47,446			48,532			47,824			47,969			46,818			47,246			46,716			48,014
Amounts attributable to common shareholders:
Income from continuing operations, net of tax	$	66,200		$	61,543		$	176,311		$	145,351		$	78,363		$	59,110		$	118,712		$	110,111
Income (loss) from discontinued operations, net of tax	122			(719		)	3			(1,612		)	(360		)	193			(539		)	(119		)
Net income	$	66,322		$	60,824		$	176,314		$	143,739		$	78,003		$	59,303		$	118,173		$	109,992

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

TELEFLEX INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)


	Three Months Ended						Nine Months Ended					Three Months Ended					Six Months Ended
	September 25, 2016			September 27, 2015			September 25, 2016		September 27, 2015			July 2, 2017		June 26, 2016			July 2, 2017		June 26, 2016
	(Dollars in thousands)											(Dollars in thousands)
Net income	$	66,322		$	60,852		$	176,778	$	144,431		$	78,003	$	59,588		$	118,173	$	110,456
Other comprehensive income (loss), net of tax:
Foreign currency translation, net of tax of $(327), $2,750, $(2,978) and $20,854 for the three and nine month periods, respectively	(130		)	(29,329		)	11,088		(91,216		)
Pension and other postretirement benefit plans adjustment, net of tax of $(737), $(609), $(2,007) and $(1,894) for the three and nine month periods, respectively	1,430			1,185			3,914		3,622
Derivatives qualifying as hedges, net of tax of $(393), $420, $212 and $856 for the three and nine month periods, respectively	(223		)	(730		)	761		(1,489		)
Foreign currency translation, net of tax of $(11,392), $1,526, $(18,481), and $(2,651) for the three and six month periods, respectively												65,685		(9,237		)	112,667		11,218
Pension and other postretirement benefit plans adjustment, net of tax of $(465), $(641), $(997) $(1,270) for the three and six month periods, respectively												704		1,246			1,594		2,484
Derivatives qualifying as hedges, net of tax of $(615), $984, $(1,170), and $605 for the three and six month periods, respectively												3,433		(496		)	5,161		984
Other comprehensive income (loss), net of tax:	1,077			(28,874		)	15,763		(89,083		)	69,822		(8,487		)	119,422		14,686
Comprehensive income	67,399			31,978			192,541		55,348			147,825		51,101			237,595		125,142
Less: comprehensive income (loss) attributable to noncontrolling interest	24			(57		)	421		613
Less: comprehensive income attributable to noncontrolling interest												—		239			—		397
Comprehensive income attributable to common shareholders	$	67,375		$	32,035		$	192,120	$	54,735		$	147,825	$	50,862		$	237,595	$	124,745

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

TELEFLEX INCORPORATED

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)


	September 25, 2016		December 31, 2015		July 2, 2017		December 31, 2016
	(Dollars in thousands)				(Dollars in thousands)
ASSETS
Current assets
Cash and cash equivalents	$	499,459	$	338,366	$	676,214	$	543,789
Accounts receivable, net	261,833		262,416		303,702		271,993
Inventories, net	341,830		330,275		368,526		316,171
Prepaid expenses and other current assets	34,354		34,915		47,298		40,382
Prepaid taxes	22,259		30,895		11,878		8,179
Assets held for sale	4,137		6,972		—		2,879
Total current assets	1,163,872		1,003,839		1,407,618		1,183,393
Property, plant and equipment, net	322,019		316,123		369,301		302,899
Goodwill	1,305,078		1,295,852		1,854,076		1,276,720
Intangible assets, net	1,164,644		1,199,975		1,612,904		1,091,663
Investments in affiliates	27		152
Deferred tax assets	2,792		2,341		1,963		1,712
Other assets	43,237		53,492		44,162		34,826
Total assets	$	4,001,669	$	3,871,774	$	5,290,024	$	3,891,213
LIABILITIES AND EQUITY
Current liabilities
Current borrowings	$	181,895	$	417,350	$	112,039	$	183,071
Accounts payable	70,246		66,305		81,973		69,400
Accrued expenses	68,972		64,017		85,050		65,149
Current portion of contingent consideration	7,539		7,291		584		587
Payroll and benefit-related liabilities	81,746		84,658		78,951		82,679
Accrued interest	12,611		7,480		5,294		10,450
Income taxes payable	11,271		8,059		3,438		7,908
Other current liabilities	18,122		8,960		8,722		8,402
Total current liabilities	452,402		664,120		376,051		427,646
Long-term borrowings	849,967		641,850		1,887,716		850,252
Deferred tax liabilities	311,390		315,983		468,034		271,377
Pension and postretirement benefit liabilities	131,222		149,441		128,335		133,062
Noncurrent liability for uncertain tax positions	26,693		40,400		18,378		17,520
Other liabilities	60,073		48,887		52,981		52,015
Total liabilities	1,831,747		1,860,681		2,931,495		1,751,872
Commitments and contingencies
Total common shareholders' equity	2,169,922		2,009,272
Noncontrolling interest	—		1,821
Total equity	2,169,922		2,011,093
Total liabilities and equity	$	4,001,669	$	3,871,774
Convertible notes - redeemable equity component					—		1,824
Mezzanine equity					—		1,824
Total shareholders' equity					2,358,529		2,137,517
Total liabilities and shareholders' equity					$	5,290,024	$	3,891,213

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

TELEFLEX INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


	Nine Months Ended						Six Months Ended
	September 25, 2016			September 27, 2015			July 2, 2017			June 26, 2016
	(Dollars in thousands)						(Dollars in thousands)
Cash flows from operating activities of continuing operations:
Net income	$	176,778		$	144,431		$	118,173		$	110,456
Adjustments to reconcile net income to net cash provided by operating activities:
Loss (income) from discontinued operations	(3		)	1,612
Loss from discontinued operations							539			119
Depreciation expense	40,272			34,035			28,084			26,609
Amortization expense of intangible assets	47,486			45,278			41,375			31,397
Amortization expense of deferred financing costs and debt discount	8,506			12,662			2,825			6,554
Loss on extinguishment of debt	19,261			10,454			5,593			19,261
Gain on sale of assets	(4,173		)	(408		)	—			(1,397		)
Fair value step up of acquired inventory sold							10,442			—
Changes in contingent consideration	1,672			(3,260		)	(237		)	1,242
Stock-based compensation	12,540			10,379			9,534			7,949
Deferred income taxes, net	(8,699		)	(21,960		)	(8,779		)	(1,292		)
Other	(15,132		)	(18,329		)	(3,300		)	(1,970		)
Changes in operating assets and liabilities, net of effects of acquisitions and disposals:
Accounts receivable	4,316			(8,714		)	5,071			(10,237		)
Inventories	(5,617		)	(19,904		)	(12,187		)	(3,284		)
Prepaid expenses and other current assets	1,184			1,636			4			238
Accounts payable and accrued expenses	17,390			(2,855		)	6,541			(3,500		)
Income taxes receivable and payable, net	5,817			(8,297		)	(5,988		)	(657		)
Net cash provided by operating activities from continuing operations	301,598			176,760			197,690			181,488
Cash flows from investing activities of continuing operations:
Expenditures for property, plant and equipment	(35,912		)	(45,566		)	(36,833		)	(19,535		)
Proceeds from sale of assets	9,792			408			6,332			3,985
Payments for businesses and intangibles acquired, net of cash acquired	(14,040		)	(63,451		)	(993,459		)	(3,117		)
Net cash used in investing activities from continuing operations	(40,160		)	(108,609		)	(1,023,960		)	(18,667		)
Cash flows from financing activities of continuing operations:
Proceeds from new borrowings	671,700			288,100			1,194,500			665,000
Reduction in borrowings	(714,487		)	(303,627		)	(228,273		)	(656,479		)
Debt extinguishment, issuance and amendment fees	(8,958		)	(9,017		)	(19,114		)	(8,182		)
Net proceeds from share based compensation plans and the related tax impacts	7,647			4,815			1,305			6,593
Payments to noncontrolling interest shareholders	(464		)	(833		)
Payments for contingent consideration	(133		)	(7,974		)	(153		)	(133		)
Payments for acquisition of noncontrolling interest	(9,231		)	��
Dividends paid	(43,980		)	(42,382		)	(30,590		)	(28,998		)
Net cash used in financing activities from continuing operations	(97,906		)	(70,918		)
Net cash provided by (used in) financing activities from continuing operations							917,675			(22,199		)
Cash flows from discontinued operations:
Net cash used in operating activities	(1,451		)	(1,954		)	(961		)	(1,183		)
Net cash used in discontinued operations	(1,451		)	(1,954		)	(961		)	(1,183		)
Effect of exchange rate changes on cash and cash equivalents	(988		)	(22,052		)	41,981			(1,315		)
Net increase (decrease) in cash and cash equivalents	161,093			(26,773		)
Net increase in cash and cash equivalents							132,425			138,124
Cash and cash equivalents at the beginning of the period	338,366			303,236			543,789			338,366
Cash and cash equivalents at the end of the period	$	499,459		$	276,463		$	676,214		$	476,490

Non cash financing activities of continuing operations:
Settlement and exchange of convertible notes with common or treasury stock	$	35,205		$	62		$	983		$	35,197
Acquisition of treasury stock associated with settlement and exchange of convertible note hedge and warrant agreements	$	85,909		$	125		$	19,361		$	85,895

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

TELEFLEX INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Unaudited)

Accumulated
Other
Comprehensive
Loss

Common Stock
Additional
Paid In
Capital
Retained
Earnings Treasury Stock Noncontrolling
Interest Total
Equity
Shares Dollars Shares Dollars
(Dollars and shares in thousands, except per share)
Balance at December 31, 2015 43,517
$ 43,517
$ 440,127
$ 2,016,176
$ (371,124 ) 1,908
$ (119,424 ) $ 1,821
$ 2,011,093
Net income

176,314

464
176,778
Cash dividends ($1.02 per share)

(43,980 )

(43,980 )
Other comprehensive income (loss)

15,806

(43 ) 15,763
Distributions to noncontrolling interest shareholders

(464 ) (464 )
Acquisition of noncontrolling interest (6,621 ) (832 ) (1,778 ) (9,231 )
Settlements of convertible notes 2,168
2,168
(31,921 )

(429 ) 33,051
3,298
Settlements of note hedges associated with convertible notes and warrants 85,909
314
(85,909 )
—
Shares issued under compensation plans 114
114
15,719

(45 ) 756

16,589
Deferred compensation

2
76

76
Balance as of September 25, 2016 45,799
$ 45,799
$ 503,213
$ 2,148,510
$ (356,150 ) 1,750
$ (171,450 ) $ —
$ 2,169,922



	Common Stock			Additional Paid In Capital		Retained Earnings			Accumulated Other Comprehensive Loss			Treasury Stock					Total
	Shares	Dollars		Additional Paid In Capital		Retained Earnings			Accumulated Other Comprehensive Loss			Shares		Dollars			Total

Balance at December 31, 2016	45,814	$	45,814	$	506,800	$	2,194,593		$	(438,717	)	1,741		$	(170,973	)	$	2,137,517
Net income						118,173											118,173
Cash dividends ($0.68 per share)						(30,590		)									(30,590		)
Other comprehensive income									119,422								119,422
Settlements of convertible notes	928	928		3,865								1		55			4,848
Settlements of note hedges associated with convertible notes and warrants				19,361								119		(19,358		)	3
Shares issued under compensation plans	80	80		6,717								(46	)	2,271			9,068
Deferred compensation												(2	)	88			88
Balance as of July 2, 2017	46,822	$	46,822	$	536,743	$	2,282,176		$	(319,295	)	1,813		$	(187,917	)	$	2,358,529

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

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1 — Basis of presentation

The accompanying unaudited condensed consolidated financial statements of Teleflex Incorporated and its subsidiaries (“we,” “us,” “our,” “Teleflex” and the “Company”) are prepared on the same basis as its annual consolidated financial statements.

In the opinion of management, the financial statements reflect all adjustments, which are of a normal recurring nature, necessary for the fair statement of financial statements for interim periods in accordance with accounting principles generally accepted in the United States of America ("GAAP") and with Rule 10-01 of Securities and Exchange Commission ("SEC") Regulation S-X, which sets forth the instructions for financial statements included in Form 10-Q. The preparation of condensed 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, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. The results of operations for the periods reported are not necessarily indicative of those that may be expected for a full year.

In accordance with applicable accounting standards, the accompanying condensed consolidated financial statements do not include all of the information and footnote disclosures that are required to be included in the Company's annual consolidated financial statements. The year-end condensed consolidated balance sheet data was derived from the Company's audited financial statements, but, as permitted by Rule 10-01 of ~~SEC~~ Regulation S-X, does not include all disclosures required by GAAP for complete financial statements. Accordingly, the Company's quarterly condensed consolidated financial statements should be read in conjunction with the Company's consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, ~~2015.~~

As used in this report, the terms “we,” “us,” “our,” “Teleflex” and the “Company” mean Teleflex Incorporated and its subsidiaries, unless the context indicates otherwise. The results of operations for the periods reported are not necessarily indicative of those that may be expected for a full year.

2016.

Note 2 — New 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. ~~The~~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. ~~In August 2015, the FASB issued an amendment to the new guidance that deferred the effective date.~~ The ~~amendment provides that the~~ new guidance is effective for annual periods beginning after December 15, 2017 and interim periods within those ~~years; early application is permitted for annual periods beginning after December 15, 2016.~~years. The Company ~~is currently evaluating~~will adopt this standard in the first quarter 2018 and expects to use the modified retrospective method of adoption by recognizing the cumulative effect of adopting this guidance as an adjustment to ~~determine its~~the Company's opening balance of retained earnings. Although the Company's evaluation of this guidance is ongoing, the Company's preliminary assessment indicates that the adoption of this guidance will not have a material impact on the Company’s results of operations, cash flows and financial position.

In April 2015, the FASB issued guidance for the reporting of debt issuance costs within the balance sheet. Under the new guidance, debt issuance costs related to term loans are to be presented in the balance sheet as a direct deduction from the associated debt liability, consistent with the presentation of a debt discount. Previously, debt issuance costs were presented as a deferred charge (i.e., an asset) on the balance sheet. The guidance provides uniform treatment for debt issuance costs and debt discounts and eliminates inconsistencies that previously existed with other FASB guidance. The Company retrospectively adopted this guidance as of January 1, 2016.

In February 2016, the FASB issued guidance that will change the requirements for accounting for leases. The principal change under the new accounting guidance is that lessees under leases classified as operating leases will recognize a right-of-use asset and a lease liability. Current lease accounting does not require lessees to recognize assets and liabilities arising under operating leases on the balance sheet. Under the new guidance, lessees (including lessees under both 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

~~TELEFLEX INCORPORATED~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)~~

~~(Unaudited)~~

liability on the balance sheet, initially measured as the present value of lease payments under the lease. ~~Expense recognition and cash flow presentation~~Under current guidance, ~~will be based upon whether the lease is classified as an operating lease or a finance lease (the classification criteria for distinguishing between finance leases and~~ operating leases ~~is substantially similar to~~are not recognized on the ~~classification criteria for distinguishing between capital leases and operating leases under current guidance).~~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 ~~capital and operating~~ 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 ~~providing generally that excess tax benefits~~ related to share-based awards should be recorded as a reduction to income tax expense (currently, excess tax benefits generally are recorded as additional-paid-in-capital) and addressing other, related guidance on accounting for income taxes, with respect to share-based payment awards; providing generally that excess tax benefits related to share-based awards should be classified along with other income tax cash flows as an operating activity (currently, excess tax benefits generally are separated from other income tax cash flows and classified as a financing activity); providing that an entity may make an accounting policy election either to base compensation cost accruals on

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modification of the ~~number~~criteria for classification of awards ~~expected to vest (as required by current guidance)~~as either equity awards or ~~to account for forfeitures when they occur; modifying the current exception to~~ liability ~~classification such that partial cash settlement of~~awards where an employer withholds shares from an employee's share-based award for tax withholding purposes, ~~would not result, by itself, in liability~~and classification of the award if the amount withheld does not exceed the maximum statutory tax rate in the employees' applicable jurisdictions (currently, an award cannot qualify for equity classification, rather than liability classification, if the amount withheld exceeds the minimum statutory withholding requirements); and providing that cash paid by an employer when directly withholding shares for tax withholding purposes should be classified as a financing activity on the statement of cash flows ~~(currently there is no authoritative~~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 addressing this classification issue). The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. Early adoption is permitted (if early adoption occurs in an interim period, any adjustments will be reflected as of January 1, 2017. The Company has applied the ~~beginning~~new guidance requiring recognition of excess tax deficiencies and tax benefits in the income statement, rather than in additional paid-in-capital, as previously required. The adoption of the fiscal year that includes the interim period). Depending on the particular issue addressed by the guidance, application of the guidance will be made prospectively, retrospectively or subject to a retrospective transition method. We are currently evaluating the potential impact of adopting this guidance on the Company's results of operations,new standard increased net income and cash flows from operating activities by $1.1 million and ~~financial position.~~$4.5 million ($0.02 and $0.09 diluted earnings per share) for the three and six months ended July 2, 2017, respectively. 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 onwith 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. Early adoption is ~~permitted, including adoption in an interim period.~~permitted. The new guidance should generally be adopted using a retrospective transition method for each period ~~presented; if it~~presented. Although the Company's evaluation of this guidance is ~~impractical to apply~~ongoing, the ~~new standard retrospectively for some~~Company's preliminary assessment indicates that the adoption of this guidance will not have a material impact on the ~~issues addressed by~~Company's cash flows.

In October 2016, the FASB issued new guidance ~~application~~requiring companies to recognize the income tax effects of intra-entity sales and transfers of assets, other than inventory, in the ~~new~~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 ~~with respect to those issues would be made prospectively~~is effective for annual periods beginning after December 15, 2017, and early adoption is permitted as of the ~~earliest date practicable.~~beginning of an annual reporting period. 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 is currently evaluating the impact of the adoption of this guidance, ~~to determine its~~but currently does not anticipate the guidance will have a material impact on its consolidated financial position or results of operations.

In January 2017, the ~~Company’s cash flows.~~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. Early adoption is permitted under specified circumstances.

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 currently 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 new guidance for employers that sponsor defined benefit pension or other postretirement benefit plans. The new 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

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(Unaudited)

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. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of this guidance, but currently does not anticipate the guidance will have a material impact on its consolidated results of operations.

In May 2017, the FASB issued new guidance to provide clarity and reduce diversity of practice as to when an entity should account for the effects of a modification of the terms and conditions of a share-based payment award. The new guidance generally provides that modification accounting is to be applied unless the fair value (or, if applicable, calculated or intrinsic value), vesting conditions and classification as an equity instrument or liability instrument of the award are the same as was the case prior to the modification. The new guidance does not change the guidance regarding the implementation of modification accounting, if required. The new guidance is effective for reporting periods beginning after December 15, 2017. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of this guidance, but currently does not anticipate the guidance will have a material impact on its consolidated results of operations.

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 effective date or, in some cases where early adoption is permitted, in advance of the effective date. The Company has assessed the recently issued guidance that is not yet effective and, unless otherwise indicated above, 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

The Company made two acquisitions during 2017, both of which were accounted for as business combinations.

Pyng

On April 3, 2017, the Company completed the acquisition of Pyng Medical Corp ("Pyng"), a medical device company that develops and markets 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 approximately $17.9 million, net of cash acquired. The assets acquired include goodwill and finite-lived intangible assets (primarily intellectual property and customer lists) 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.

Vascular Solutions

On February 17, 2017, the Company completed the acquisition of Vascular Solutions, Inc. (“Vascular Solutions”) pursuant to a merger transaction. Vascular Solutions is a medical device company that develops and markets 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 six months ended July 2, 2017 the Company incurred $8.2 million in transaction expenses associated with the Vascular Solutions acquisition, which are included in selling, general and administrative expenses in the condensed consolidated statement of income. For the three months ended July 2, 2017, the Company recorded post acquisition revenue and operating profit of $45.0 million and $3.3 million, respectively, related to Vascular Solutions. For the six months ended July 2, 2017, the Company recorded post acquisition revenue and operating loss of 66.7 million and 11.6 million, respectively. Financial information of Vascular Solutions is presented within the "All Other" category in the Company's presentation of segment information.

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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 7.

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 assets	$	63,867
Property, plant and equipment	46,616
Intangible assets	539,250
Goodwill	522,614
Other assets	728
Total assets acquired	1,173,075
Less:
Current liabilities	15,079
Deferred tax liabilities	182,472
Liabilities assumed	197,551
Net assets acquired	$	975,524

The Company is continuing to evaluate the initial purchase price allocations, 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 Vascular Solution acquisition primarily reflects synergies currently expected to be realized from the integration of the acquired businesses.

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 in thousands)	(Years)
Intellectual property	248,200	10- 20
In-process research and development ("IPR&D")	15,600	Indefinite
Trade names	16,650	20
Customer lists	258,800	25

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(Unaudited)

Pro forma combined financial information

The following unaudited pro forma combined financial information for the three and six months ended July 2, 2017 and June 26, 2016, respectively, gives effect to the Vascular Solutions acquisition as if it was 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.



	Three Months Ended				Six Months Ended
	July 2, 2017		June 26, 2016		July 2, 2017		June 26, 2016
	(Dollars and shares in thousands, except per share)
Net revenue	$	528,613	$	514,574	$	1,039,318	$	978,697
Net income	$	79,221	$	59,352	$	128,302	$	77,252
Basic earnings per common share:
Net income	$	1.76	$	1.36	$	2.85	$	1.81
Diluted earnings per common share:
Net income	$	1.69	$	1.26	$	2.75	$	1.61
Weighted average common shares outstanding:
Basic	44,996		43,549		44,945		42,598
Diluted	46,818		47,246		46,716		48,014

The unaudited pro forma combined financial information presented above includes the accounting effects of the Vascular Solutions business combination, including 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 includes non-recurring charges specifically related to the Vascular Solutions acquisition 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 unaudited pro forma combined financial information for the three and six months ended June 26, 2016 reflects the historical results of Vascular Solutions for its three and six month ended June 30, 2016, respectively, and the effects of the pro forma adjustments listed above.

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.

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~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)~~

~~(Unaudited)~~

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 in connection with the 2016 acquisitions was $22.8 million. Transaction expenses associated with the 2016 acquisitions, which are included in selling, general and administrative expenses in the condensed consolidated statement of income were $0.2 million and $0.3 million for the three and nine months ended September 25, 2016, respectively. The results of operations of the 2016 acquisitions are included in the condensed consolidated statements of income from their respective acquisition dates. For the three and nine months ended September 25, 2016, the Company recorded revenue and income from continuing operations before taxes related to the acquired businesses of $0.9 million and $0.2 million, respectively. Pro forma information is not presented, as the operations of the acquired businesses are not significant to the overall operations of the Company.

The following table presents the preliminary fair value determination of the assets acquired and liabilities assumed with respect to those 2016 acquisitions that were accounted for as a business combination:

(Dollars in thousands)
Assets
Current assets $ 2,480
Property, plant and equipment 537
Intangible assets:

Non-compete agreements 608
Customer relationships 6,445
Goodwill 3,947
Total assets acquired 14,017
Less:
Current liabilities 597
Liabilities assumed 597
Net assets acquired $ 13,420

The Company is continuing to evaluate the 2016 acquisitions, 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 and goodwill. Among the acquired assets, customer lists have useful lives ranging from 10 to 16 years and non-compete arrangements have useful lives of 2 years. The goodwill resulting from the acquisitions primarily reflects synergies currently expected to be realized from the integration of the acquired businesses.

The Company made the following acquisitions during 2015 (the "2015 acquisitions"), which, with the exception of the Company's acquisition of certain assets of Ace Medical US, LLC ("Ace Medical"), were accounted for as business combinations:

~~On January 20, 2015, the Company acquired Human Medics Co., Ltd., (“Human Medics”), a distributor of medical devices and supplies primarily in the Korean market.~~

~~On March 30, 2015, the Company acquired Trintris Medical, Inc. ("Trintris"), an original equipment manufacturer (OEM) of balloons and catheters that complement the Company's OEM product portfolio.~~

On April 8, 2015, the Company acquired Truphatek Holdings (1993) Limited ("Truphatek"), a manufacturer of a broad range of disposable and reusable laryngoscope devices that complement the Company's anesthesia product portfolio. Previously, the Company held a noncontrolling, 6% interest in Truphatek.

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~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)~~

~~(Unaudited)~~

~~On June 26, 2015, the Company acquired certain assets of N. Stenning & Co. Pty. Ltd. ("Stenning"), a distributor of medical devices and supplies primarily in the Australian market.~~

~~On June 29, 2015, the Company acquired certain assets, primarily distribution rights, of Ace Medical, a distributor of medical devices and supplies in the United States of America.~~

~~On August 26, 2015, the Company acquired certain assets of Atsina Surgical, LLC ("Atsina") related to the development of surgical clips that complement the Company's surgical ligation portfolio.~~

On December 22, 2015, the Company acquired all of the membership interests of, and voting equity interest in, Nostix, LLC, a developer of catheter tip confirmation systems that complement the Company's vascular product portfolio.

~~The total fair value of consideration for the 2015 acquisitions was $96.5 million.~~ The results of operations of the acquired businesses and assets are included in the condensed 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.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)

Note 4 — Restructuring charges

The following tables provide information regarding restructuring charges recognized by the Company for the three and six months ended July 2, 2017 and June 26, 2016:



Three Months Ended July 2, 2017
	Termination Benefits			Facility Closure Costs		Contract Termination Costs			Other Exit Costs			Total
	(Dollars in thousands)
2017 Vascular Solutions integration program	$	370		$	—	$	—		$	34		$	404
2017 EMEA restructuring program	(584		)	—		—			—			(584		)
2016 Footprint realignment plan	286			10		(4		)	99			391
2014 Footprint realignment plan	(121		)	14		—			(7		)	(114		)
Other restructuring programs ⁽¹⁾	661			11		79			22			773
Total restructuring charges	$	612		$	35	$	75		$	148		$	870



Three Months Ended June 26, 2016
	Termination Benefits			Facility Closure Costs		Contract Termination Costs		Other Exit Costs		Total
	(Dollars in thousands)
2016 Footprint realignment plan	$	(279	)	$	—	$	—	$	286	$	7
2015 Restructuring programs	(442		)	55		115		25		(247		)
2014 Footprint realignment plan	112			—		—		9		121
Total restructuring charges	$	(609	)	$	55	$	115	$	320	$	(119	)



Six Months Ended July 2, 2017
	Termination Benefits		Facility Closure Costs		Contract Termination Costs			Other Exit Costs		Total
	(Dollars in thousands)
2017 Vascular Solutions integration program	$	4,853	$	—	$	—		$	34	$	4,887
2017 EMEA restructuring program	6,536		—		—			—		6,536
2016 Footprint realignment plan	825		22		(75		)	129		901
2014 Footprint realignment plan	182		14		—			1		197
Other restructuring programs ⁽¹⁾	965		58		209			62		1,294
Total restructuring charges	$	13,361	$	94	$	134		$	226	$	13,815



Six Months Ended June 26, 2016
	Termination Benefits			Facility Closure Costs		Contract Termination Costs			Other Exit Costs		Total
	(Dollars in thousands)
2016 Footprint realignment plan	$	10,068		$	—	$	—		$	286	$	10,354
2015 Restructuring programs	(399		)	178		93			118		(10		)
2014 Footprint realignment plan	(426		)	—		—			11		(415		)
Other restructuring programs ⁽²⁾	—			—		(86		)	6		(80		)
Total restructuring charges	$	9,243		$	178	$	7		421		$	9,849

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)

(1)

Other restructuring programs include the 2017 Pyng Integration program, the 2016 Other Restructuring programs , the 2015 Restructuring programs, and the 2014 European Restructuring plan. The Company committed to the 2017 Pyng Integration program, which relates to the integration of Pyng into Teleflex, during the second quarter 2017. For a description of the 2015 Restructuring programs, see Note 4 to the Company’s consolidated financial statements included in its annual report on Form 10-K for the year ended December 31, 2016.

(2) Other restructuring programs includes the 2014 European Restructuring Plan, the Other 2014 restructuring programs, the 2013 Restructuring programs and the LMA restructuring program. For a description of these plans, see Note 4 to the Company’s consolidated financial statements included in its annual report on Form 10-K for the year ended December 31, 2016.

2017 Vascular Solutions Integration Program

During the first quarter 2017, the Company committed to a restructuring program related to the integration of Vascular Solutions into Teleflex. The Company initiated the program in the first quarter 2017 and 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 $6.0 million to $7.5 million related to this program, of which $4.5 million to $5.3 million will constitute termination benefits, while $1.5 million to $2.2 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.

2017 EMEA Restructuring Program

During the ~~third~~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 is expected to be substantially completed by the end of 2018. The Company estimates that it will record aggregate pre-tax restructuring charges of $7.1 million to $8.5 million related to this program, almost all of which constitute termination benefits, and all of which will result in future cash outlays.

2016 Other Restructuring Programs

During 2016, the Company committed to ~~actions associated with~~programs designed to improve operating efficiencies and reduce costs. The programs involve the consolidation of ~~operations impacting three manufacturing facilities, including certain of those obtained in recent acquisitions, as well as~~ certain global administrative ~~functions.~~functions and manufacturing operations. The ~~actions~~programs commenced in the ~~third quarter~~second half of 2016 and are expected to be substantially complete by the end of the first quarter 2018. The Company estimates that it will record aggregate pre-tax charges of ~~$2.5~~$3.8 million to ~~$3.5~~$4.7 million related to these ~~actions,~~programs, substantially all of which constitute termination benefits that will result in future cash outlays. Additionally, the Company expects to incur approximately $1$1.5 million of accelerated depreciation and other costs directly related to ~~the program~~these programs and ~~expect~~anticipates these costs towill be recognized in cost of goods sold, of which approximately ~~$0.5~~$1.0 million is expected to result in future outlays.

~~The Company recorded restructuring charges, specifically, employee termination benefits, of $1.7 million during the three and nine months ended September 25, 2016 related to these actions.~~ As of ~~September 25, 2016,~~July 2, 2017, the Company has a restructuring reserve of ~~$1.7~~$1.2 million related to ~~this program.~~these programs.

2016 ~~Manufacturing~~ Footprint Realignment Plan

~~On February 23,~~In 2016, the ~~Board of Directors of the~~ Company ~~approved~~initiated a restructuring plan (the “2016 ~~Plan"~~footprint realignment plan") designed to reduce costs, improve operating efficiencies and enhance the Company’s long term competitive position. The ~~2016 Plan, which was developed in response to continuing cost pressures in the healthcare industry, primarily~~plan involves 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. These actions commenced in the first quarter of 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 ~~Plan~~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.

In addition to the restructuring charges shown in the tables above, the Company recorded restructuring related charges of $2.0 millionand $4.1 million for the three and six months ended July 2, 2017, respectively, and $1.8 million and $2.4 million for the three and six months ended June 26, 2016, respectively, related to the 2016 footprint realignment plan. The majority of charges in both periods constituted accelerated depreciation and other costs, principally as a result of the transfer of manufacturing operations to the new locations.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)

~~The following table provides a summary of the Company's current cost estimates for each major expense category associated with the 2016 Plan:~~



~~Type of expense~~	~~Total estimated amount expected to be incurred~~

~~Employee termination benefits~~	~~$14 million to $15 million~~
~~Facility closure and other exit costs~~ ~~(1)~~	~~$2 million to $3 million~~
~~Accelerated depreciation charges~~	~~$10 million to $13 million~~
~~Other~~ ~~(2)~~	~~$8 million to $13 million~~
	~~$34 million to $44 million~~

~~(1) Includes costs to transfer product lines among facilities, legal, outplacement and employee relocation costs.~~

~~(2) Consists of other costs directly related to the 2016 Plan, including project management and other regulatory costs.~~

The Company recorded charges of $2.8 million during the three months ended September 25, 2016 related to the 2016 Plan, of which $0.9 million consisted mainly of employee termination benefits recorded as restructuring expense, and $1.9 million related to accelerated depreciation and other costs, which primarily were recorded as cost of goods sold.

The Company recorded $15.5 million during the nine months ended September 25, 2016 related to the 2016 Plan, of which $11.3 million consisted mainly of employee termination benefits recorded as restructuring expense, and $4.2 million related to accelerated depreciation and other costs, which primarily were recorded as cost of goods sold.

As of ~~September 25, 2016, the Company has a reserve of $10.5 million related to this program.~~

~~As the 2016 Plan progresses, management will reevaluate the estimated expenses set forth above, and may revise its estimates, as appropriate, consistent with GAAP.~~

~~2015 Restructuring Programs~~

During 2015, the Company committed to programs associated with the reorganization of certain of its businesses and the consolidation of certain of its facilities in North America. For the three months ended September 25, 2016, the Company recorded charges of $0.1 million related to these programs. As of September 25, 2016,July 2, 2017, the Company has incurred net aggregate restructuring charges related to the 2016 footprint realignment plan of ~~$6.4~~$13.4 million. Additionally, as of July 2, 2017, the Company has incurred net aggregate accelerated depreciation and certain other costs, principally as a result of the transfer of manufacturing operations to new locations, of $10.5 million. These costs primarily were included in cost of goods sold. As of ~~September 25, 2016,~~July 2, 2017, the Company has a restructuring reserve of ~~$0.5~~$8.7 million related to ~~these programs.~~this plan, the majority of which relates to termination benefits.

2014 ~~Manufacturing~~ Footprint Realignment Plan

In ~~April~~ 2014, the ~~Company's Board of Directors approved~~Company initiated a restructuring plan ~~(the "2014 Manufacturing Footprint Realignment Plan"~~(“the 2014 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~~2014 and are expected to be substantially completed by the third quarter 2016, the Company revised its expense and timing estimates related to the 2014 Manufacturing Footprint Realignment Plan to reflect the impact of changes the Company has implemented with respect to medication delivery devices included in certainend of the ~~kits primarily sold by the Company’s Vascular North America operating segment and, to a lesser extent, the Company's Anesthesia North America operating segment. The~~first half of 2020.The Company estimates that it will incur aggregate pre-tax restructuring and restructuring related charges in connection with the 2014 ~~Manufacturing Footprint Realignment Plan~~footprint realignment plan of approximately $43 million to $48 million, ~~compared to the Company’s prior estimate~~ of ~~approximately $37 million to $44 million. The Company expects aggregate cash outlays associated with the plan to be in the range of~~which an estimated $33 million to $38 million ~~compared to its prior estimate of approximately $26 million to $31 million. Most of these charges and cash outlays~~ are expected to ~~be incurred prior to 2020. Additionally, as of September 25, 2016, the~~result in future cash outlays. The Company ~~continues to expect~~expects to incur $24 million to $30 million in aggregate capital expenditures under the ~~plan.~~

The Company currently expects that the 2014 Manufacturing Footprint Realignment Plan will be substantially complete by the end of the first half of 2020 rather than the end of 2017, which was previously estimated.plan.

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:

~~TELEFLEX INCORPORATED~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)~~

~~(Unaudited)~~



~~Type of expense~~	~~Total estimated amount expected to be incurred~~

~~Employee termination benefits~~	~~$11 million to $12 million~~
~~Facility closure and other exit costs~~ ~~(1)~~	~~$1 million to $2 million~~
~~Accelerated depreciation charges~~	~~$10 million to $10 million~~
~~Other~~ ~~(2)~~	~~$21 million to $24 million~~
	~~$43 million to $48 million~~

~~(1) Includes costs to transfer product lines among facilities and outplacement and employee relocation costs.~~

~~(2) Consists of other costs directly related~~In addition to the ~~plan, including project management, legal and regulatory costs.~~

~~The~~restructuring charges set forth in the tables above, the Company recorded restructuring related charges of ~~$2.8~~$0.5 million and ~~$6.8~~$2.1 million for the three and ~~nine~~six months ended ~~September 25,~~July 2, 2017, respectively, and $2.3 million and $4.4 million for the three and six months ended June 26, 2016, respectively, related to the 2014 ~~Manufacturing Footprint Realignment Plan. Of this amount, $2.5 million and $6.9 million for the three and nine months ended September 25, 2016, respectively, were recorded~~footprint realignment plan. The majority of charges in ~~costs of goods sold, and related to~~both periods constituted accelerated depreciation and ~~certain~~ other costs ~~primarily for~~principally resulting from the transfer of manufacturing operations ~~from the existing locations~~ to ~~the~~ new locations. For the three months ended September 25, 2016, the charges also included $0.3 million in restructuring expense. During the nine months ended September 25, 2016, the Company recorded a net reversal of previously recorded restructuring charges of $0.1 million.

As of ~~September 25, 2016,~~July 2, 2017, the Company has incurred net aggregate restructuring charges related to the 2014 footprint realignment plan of ~~$10.8~~$11.3 million. Additionally, as of ~~September 25, 2016,~~July 2, 2017, the Company has incurred net aggregate accelerated depreciation and certain other costs ~~primarily for~~of $25.0 million, principally resulting from the transfer of manufacturing operations from the existing locations to the new locations in connection with the ~~plan of $21.3 million, which~~plan. These costs primarily were ~~primarily~~ included in cost of goods sold. As of ~~September 25, 2016,~~July 2, 2017, the Company has a restructuring reserve of ~~$5.9~~$4.5 million in connection with the plan, all of which relates to termination benefits.

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 generally accepted accounting principles.

For additional information regarding the Company's restructuring programs, see Note 4 to the Company's consolidated financial statements included in its annual report on Form 10-K for the year ended December 31, ~~2015.~~2016.

~~The restructuring~~Restructuring charges ~~recognized~~by reportable operating segment for the three and ~~nine~~six months ended ~~September 25,~~July 2, 2017 and June 26, 2016 ~~and September 27, 2015 consisted of~~are set forth in the ~~following:~~following table:

Three Months Ended September 25, 2016
Termination Benefits Facility Closure Costs Contract Termination Costs Other Exit Costs Total
(Dollars in thousands)
2016 Other Restructuring programs $ 1,713
$ —
$ —
$ —
$ 1,713
2016 Manufacturing footprint realignment plan 851
—
—
74
925
2015 Restructuring programs (103 ) 54
107
—
58
2014 Manufacturing footprint realignment plan 308
—
—
6
314
2014 European restructuring plan 15
—
—
2
17
Total restructuring charges $ 2,784
$ 54
$ 107
$ 82
$ 3,027



	Three Months Ended						Six Months Ended
	July 2, 2017			June 26, 2016			July 2, 2017		June 26, 2016
	(Dollars in thousands)						(Dollars in thousands)
Restructuring charges
Vascular North America	$	361		$	351		$	1,109	$	4,514
Anesthesia North America	564			364			811		2,239
Surgical North America	—			—			—		(20		)
EMEA	(365		)	(949		)	7,135		2,923
Asia	—			(2		)	—		—
OEM	—			(1		)	—		4
All other	310			118			4,760		189
Total restructuring charges	$	870		$	(119	)	$	13,815	$	9,849

Three Months Ended September 27, 2015
Termination Benefits Facility
Closure
Costs Contract Termination Costs Other Exit Costs Total
(Dollars in thousands)
2015 Restructuring programs $ (198 ) $ 37
$ 78
$ 9
$ (74 )
2014 Manufacturing footprint realignment plan 619
(3 ) 163
52
831
2014 European restructuring plan (97 ) —
—
—
(97 )
Total restructuring charges $ 324
$ 34
$ 241
$ 61
$ 660

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)

Nine Months Ended September 25, 2016
Termination Benefits Facility
Closure
Costs Contract Termination Costs Other Exit Costs Total
(Dollars in thousands)
2016 Other Restructuring programs $ 1,713
$ —
$ —
$ —
$ 1,713
2016 Manufacturing footprint realignment plan 10,919
—
—
360
11,279
2015 Restructuring programs (502 ) 232
200
118
48
2014 Manufacturing footprint realignment plan (118 ) —
—
17
(101 )
Other restructuring programs (1)
15
—
(86 ) 8
(63 )
Total restructuring charges $ 12,027
$ 232
$ 114
$ 503
$ 12,876

Nine Months Ended September 27, 2015
Termination Benefits Facility Closure Costs Contract Termination Costs Other Exit Costs Total
(Dollars in thousands)
2015 Restructuring programs $ 3,361
$ 166
$ 723
$ 56
$ 4,306
2014 Manufacturing footprint realignment 831
241
389
36
1,497
Other restructuring programs (2)
(181 ) 2
29
35
(115 )
Total restructuring charges $ 4,011
$ 409
$ 1,141
127
$ 5,688


~~(1)~~	Other restructuring programs include the 2014 European Restructuring Plan and the 2012 Restructuring Program. For a description of these plans, see Note 4 to the Company’s consolidated financial statements included in its annual report on Form 10-K for the year ended December 31, 2015.


~~(2)~~	Other restructuring programs include the 2014 European Restructuring Plan, the Other 2014 restructuring programs, the 2013 Restructuring programs and the LMA restructuring program. For a description of these plans, see Note 4 to the Company’s consolidated financial statements included in its annual report on Form 10-K for the year ended December 31, 2015.

~~Termination benefits include estimated employee retention, severance and benefit payments for terminated employees.~~

~~Facility closure costs include general operating costs incurred subsequent to production shutdown as well as legal costs, equipment relocation and other associated costs.~~

~~Contract termination costs include costs associated with terminating existing leases and distributor agreements.~~

~~Other costs include outplacement and employee relocation costs and other employee-related costs.~~

~~TELEFLEX INCORPORATED~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)~~

~~(Unaudited)~~

~~Restructuring charges by reportable operating segment for the three and nine months ended September 25, 2016 and September 27, 2015 are set forth in the following table:~~

Three Months Ended Nine Months Ended
September 25, 2016 September 27, 2015 September 25, 2016 September 27, 2015
(Dollars in thousands) (Dollars in thousands)
Restructuring charges
Vascular North America $ 960
$ 232
$ 5,474
$ 2,466
Anesthesia North America 946
(250 ) 3,185
284
Surgical North America 277
36
257
282
EMEA 89
(64 ) 3,012
(139 )
Asia —
2
—
3
OEM 187
—
191
—
All other 568
704
757
2,792
Total restructuring charges $ 3,027
$ 660
$ 12,876
$ 5,688

Note 5 — Inventories, net

Inventories as of ~~September 25, 2016~~July 2, 2017 and December 31, ~~2015~~2016 consisted of the following:


	September 25, 2016			December 31, 2015			July 2, 2017		December 31, 2016
	(Dollars in thousands)						(Dollars in thousands)
Raw materials	$	80,348		$	76,037		$	94,924	$	65,319
Work-in-process	61,418			60,218			61,561		54,555
Finished goods	236,991			230,536			212,041		196,297
	378,757			366,791
Less: inventory reserve	(36,927		)	(36,516		)
Inventories, net	$	341,830		$	330,275		$	368,526	$	316,171

Note 6 — Goodwill and other intangible assets, net

The following table provides information relating to changes in the carrying amount of goodwill by reportable operating segment for the ~~nine~~six months ended ~~September 25, 2016:~~July 2, 2017:

Vascular
North America
Anesthesia
North America
Surgical
North America
EMEA
Asia OEM
All
Other
Total
(Dollars in thousands)
Balance as of December 31, 2015 $ 345,546

$ 141,122

$ 250,912

$ 306,009

$ 141,067
$ 1,194

$ 110,002

$ 1,295,852
Goodwill related to acquisitions —

—

—

—

—
3,947

—

3,947
Currency translation adjustment —

318

—

1,363

6,729
—

(3,131 )
5,279
Balance as of September 25, 2016 $ 345,546
$ 141,440
$ 250,912
$ 307,372
$ 147,796
$ 5,141
$ 106,871
$ 1,305,078

~~TELEFLEX INCORPORATED~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)~~

~~(Unaudited)~~



	Vascular North America			Anesthesia North America		Surgical North America		EMEA		Asia		OEM		All Other		Total
	(Dollars in thousands)
Balance as of December 31, 2016	$	345,546		$	141,253	$	250,912	$	290,041	$	138,185	$	4,883	$	105,900	$	1,276,720
Goodwill related to acquisitions	—			5,426		—		6,010		1,559		—		522,614		535,609
Currency translation and other adjustments	(1,590		)	215		—		24,729		6,217		—		12,176		41,747
Balance as of July 2, 2017	$	343,956		$	146,894	$	250,912	$	320,780	$	145,961	$	4,883	$	640,690	$	1,854,076

The following table provides information as of ~~September 25, 2016~~July 2, 2017 and December 31, ~~2015~~2016 regarding the gross carrying amount of, and accumulated amortization relating to intangible ~~assets, net:~~assets:

Gross Carrying Amount Accumulated Amortization
September 25, 2016 December 31, 2015 September 25, 2016 December 31, 2015
(Dollars in thousands)
Customer relationships $ 630,127
$ 621,078
$ (235,074 ) $ (214,924 )
In-process research and development 58,668
58,908
—
—
Intellectual property 523,361
522,374
(197,465 ) (173,903 )
Distribution rights 23,356
23,279
(15,294 ) (14,393 )
Trade names 387,759
384,821
(12,734 ) (8,929 )
Non-compete agreements 2,853
2,186
(913 ) (522 )
$ 1,626,124
$ 1,612,646
$ (461,480 ) $ (412,671 )

In May 2012, the Company acquired Semprus BioSciences Corp. ("Semprus"), a biomedical research and development company that developed a polymer surface treatment technology intended to reduce thrombus related complications. As previously disclosed, the Company experienced difficulties with respect to the development of the Semprus technology, and devoted further research and testing towards attempting to resolve the issue. As a result of these efforts, the Company believes it has resolved the issue and is focused on seeking regulatory approval and engaging in additional research and development efforts to achieve commercialization of the technology. Despite the progress made since these issues were first identified, significant challenges to commercialization of the Semprus technology remain, and the Company ultimately may find it necessary to recognize impairment charges with respect to the related assets, which could be material. As of September 25, 2016, the Company has in-process research and development intangible assets of $41.0 million related to this investment, which is recorded in intangible assets, net.

Amortization expense related to intangible assets was $16.1 million and $15.5 million for the three months ended September 25, 2016 and September 27, 2015, respectively, and $47.5 million and $45.3 million for the nine months ended September 25, 2016 and September 27, 2015, respectively.



	Gross Carrying Amount				Accumulated Amortization
	July 2, 2017		December 31, 2016		July 2, 2017			December 31, 2016
	(Dollars in thousands)
Customer relationships	$	892,574	$	622,428	$	(259,002	)	$	(239,055	)
In-process research and development	33,595		16,532		—			—
Intellectual property	774,980		519,962		(226,354		)	(203,390		)
Distribution rights	23,452		23,021		(16,208		)	(15,239		)
Trade names	405,283		379,724		(16,862		)	(13,974		)
Non-compete agreements	2,900		2,692		(1,454		)	(1,038		)
	$	2,132,784	$	1,564,359	$	(519,880	)	$	(472,696	)

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)

Note 7 — Borrowings

The Company's borrowings at ~~September 25, 2016~~July 2, 2017 and December 31, ~~2015 are~~2016 were as follows:


	September 25, 2016			December 31, 2015			July 2, 2017			December 31, 2016
	(Dollars in thousands)						(Dollars in thousands)
Senior Credit Facility:
Revolving credit facility, at a rate of 2.05% at September 25, 2016, due 2018	$	210,000		$	396,000
Revolving credit facility, at a rate of 3.22% at July 2, 2017, due 2022							$	547,000		$	210,000
Term loan facility, at a rate of 3.22% at July 2, 2017, due 2022							721,000			—
3.875% Convertible Senior Subordinated Notes due 2017	136,154			399,641			44,303			136,076
4.875% Senior Notes due 2026	400,000			—			400,000			400,000
5.25% Senior Notes due 2024	250,000			250,000			250,000			250,000
Securitization program, at a rate of 1.27% at September 25, 2016	50,000			43,300
Securitization program, at a rate of 1.97% at July 2, 2017							50,000			50,000
	1,046,154			1,088,941			2,012,303			1,046,076
Less: Unamortized debt discount on 3.875% Convertible Senior Subordinated Notes due 2017	(3,833		)	(22,999		)	(126		)	(2,707		)
Less: Unamortized debt issuance costs	(10,459		)	(6,742		)	(12,422		)	(10,046		)
	1,031,862			1,059,200			1,999,755			1,033,323
Current borrowings	(181,895		)	(417,350		)	(112,039		)	(183,071		)
Long-term borrowings	$	849,967		$	641,850		$	1,887,716		$	850,252

~~4.875% Senior Notes~~Amended and restated senior credit facility

On ~~May 16, 2016,~~January 20, 2017, the Company ~~issued $400.0 million~~entered into the Credit Agreement, which provides for a five year revolving credit facility of ~~4.875% Senior Notes due 2026 (the "2026 Notes").~~$1.0 billion and a term loan facility of $750.0 million. The 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 ~~pay~~mature on February 17, 2022.

At the Company’s option, loans under the Credit Agreement will bear interest ~~on the 2026 Notes semi-annually on June 1 and December 1, commencing on December 1, 2016,~~ 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 is defined as the highest of ~~4.875% per year. The 2026 Notes mature~~(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 on ~~June 1, 2026 unless earlier redeemed by~~such day, plus an applicable margin ranging from 0.25% to 1.50%, in each case subject to adjustment based on 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~~Company’s consolidated total leverage ratio (generally, Consolidated Total Funded Indebtedness, as defined in the ~~Indenture~~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 Company is required to maintain a maximum total consolidated leverage ratio of 4.50 to 1.00 and a maximum 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 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 $12.0 million 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, incurred in connection with the ~~offering~~Credit Agreement. In addition, because the Company's entry into the Credit Agreement was considered a partial extinguishment 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 used the net proceeds from the offering to repay borrowings~~indebtedness under ~~the Company’s revolving~~its previously outstanding credit ~~facility.~~

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 Company’s revolving credit facility and by certain of the Company’s other 100% owned domestic subsidiaries.

~~At any time on or after June 1, 2021,~~agreement, the Company ~~may,~~recognized a loss on ~~one or more occasions, redeem some or all~~extinguishment of debt of $0.4 million during 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, 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 offeringsfirst quarter 2017.

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)

~~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.~~

The 2026 Notes contain 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; pay dividends, make investments or make other restricted payments; sell assets; merge, consolidate, sell or otherwise disposes of all or substantially all of the Company's assets; or enter into transactions with the Company's affiliates.

3.875% Convertible Senior Subordinated ~~Notes~~

~~For a discussion regarding the classification of the Convertible Notes as a current liability, see~~ Note ~~8 to the Company's consolidated financial statements included in its annual report on Form 10-K for the year ended December 31, 2015.~~s

Exchange Transactions

On ~~April 4, 2016,~~January 5, 2017, pursuant to separate, privately negotiated agreements between the Company and certain ~~of the~~ holders (the "Holders") of its 3.875% Convertible Senior Subordinated Notes due 2017 (the "Convertible Notes"), the Company paid cash and common stock (the "Exchange Consideration") to the Holders in exchange for ~~$219.2~~$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 iswas equal to: (i) $1,000in cash, (ii) a number of shares of the ~~Company’s~~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~~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 ~~$220.7~~approximately $93.2 million (which includes approximately $1.5 million in accrued but previously unpaid interest) and issued and delivered to the Holders ~~2.17~~approximately 0.93 million shares of Company common stock (including both Conversion Shares and Inducement Shares)~~.The~~. The Company funded the ~~$220.7~~$93.2 million cash payment constituting part of the Exchange Consideration through borrowings under its revolving credit agreement. The issuance of the shares of the Company’s common stock to the Holders pursuant to the Exchange Transactions was made pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act"), under Section 3(a)(9) of the Securities Act.facility. As a result of the Exchange Transactions, the Company recognized a loss on extinguishment of debt of ~~$16.3 million.~~$5.2 million during the first quarter 2017.

In connection with ~~entering~~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 the 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 ~~subject~~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. ~~In addition,~~Under the ~~Company entered into warrant unwind agreements (the “Warrant~~Warrant Unwind ~~Agreements”) with the dealer counterparties to reduce~~Agreements, the number of warrants ~~initially issued to~~then held by the dealer counterparties also ~~in connection with the initial issuance of the Convertible Notes.~~was reduced. On a net basis, after giving effect to the Hedge Unwind Agreements and Warrant Unwind Agreements, the Company received ~~0.3~~0.12 million shares of Company common stock from ~~such~~the dealer counterparties.

Settlement and Conversions Upon Maturity

~~During~~The Convertible Notes matured on August 1, 2017 (the "Maturity Date"). On the ~~second quarter of 2016,~~Maturity Date, the Company ~~settled conversion notices previously received by~~repaid the ~~Company in respect of~~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"). ~~In accordance with~~On the ~~terms of the supplemental indenture relating~~Maturity Date, in addition to the ~~Convertible Notes,~~Cash Payment, the Company delivered to ~~each holder~~the holders of the Converted Notes, (the "Converting Holders") a combination of cash and shares of Company common stock, based on the conversion methodology set forth in the supplemental indenture. The Company provided the Converting Holders, in the aggregate, ~~$44.3 million in cash and 0.4~~0.5 million shares of Company common stock. ~~As a result of~~

In connection with the conversions described above, the Company ~~recognized a loss on extinguishment~~exercised the outstanding Call Options, and the counterparties to the Convertible Note hedge transactions delivered to the Company 0.5 million shares of ~~debt of $3.0 million.~~Company common stock.

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)

Under the terms of the agreements related to the Convertible Note hedge transactions, and in connection with the conversions described above, the counterparties to the Convertible Note hedge transactions delivered to the Company a number of shares of Company common stock equal to the number of shares of Company common stock delivered to the Converting Holders. Additionally, the Company entered into warrant unwind agreements with the dealer counterparties to reduce the number of warrants initially issued. The Company delivered 0.4 million shares of Company common stock to the dealer counterparties in connection with the warrant unwind agreements.

Fair Value of Long-Term Borrowings

The following table provides information regarding the fair value of the Company’s debt as of July 2, 2017 and December 31, 2016, categorized by the level of inputs within the fair value hierarchy used to measure fair value:



	July 2, 2017		December 31, 2016
	(Dollars in thousands)
Level 1	$	149,676	$	344,765
Level 2	1,983,816		929,362
Total	$	2,133,492	$	1,274,127

To determine the fair value of the debt categorized as Level 2 in the table ~~below,~~above, 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 September 25, 2016 and December 31, 2015, categorized by the level of inputs within the fair value hierarchy used to measure fair value (seeSee Note 10, “Fair value measurement,” into the Company’s consolidated financial statements in its Annual Report on Form 10-K for the year ended December 31, ~~2015~~2016 for further ~~information):~~

September 25, 2016 December 31, 2015
(Dollars in thousands)
Level 1 $ 390,762
$ 858,709
Level 2 937,619
687,072
Total $ 1,328,381
$ 1,545,781

information regarding the fair value hierarchy.

Note 8 — Financial instruments

Foreign Currency Forward Contracts ~~Designated as Cash Flow Hedges~~

The Company uses derivative instruments for risk management purposes. Foreign currency forward contracts ~~are used to manage foreign currency transaction exposure. These derivative instruments are~~ designated as cash flow hedges ~~and~~ are recorded on the condensed consolidated balance sheet at fair market value. The effective portion of the gains or losses on derivatives is reported as a component of other comprehensive loss and thereafter is recognized in the condensed consolidated statement of income in the period or periods during which the hedged transaction affects earnings. Gains and losses on the derivatives representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness, if any, are recognized in the condensed consolidated statement of income in the period in which such gains and losses occur.

~~Non-designated Foreign Currency Forward Contracts~~

~~The Company uses foreign currency forward contracts as part of its strategy~~used to manage exposure related to foreign currency transactions. Foreign currency forward contracts not designated as hedges for accounting purposes are used to manage near term foreign currency denominated monetary assets and liabilities. ~~These currency forward contracts are not designated as cash flow, fair value or net investment hedges; therefore,~~For the ~~changes in fair value are recorded in~~three and six months ended July 2, 2017, the ~~condensed consolidated statement of income as~~Company recognized a ~~selling, general and administrative expense. The Company enters into~~loss related to non-designated foreign currency forward contracts ~~for periods consistent with its currency translation exposures, which generally approximate one month.~~of $2.3 million and $3.1 million, respectively. For the three and ~~nine~~six months ended ~~September 25,~~June 26, 2016, the Company recognized a loss related to non-designated foreign currency forward contracts of ~~$0.1~~$1.3 million and ~~$1.7~~$1.6 million, respectively.

The following table presents the locations in the condensed consolidated balance sheet and fair value of derivative financial instruments as of July 2, 2017 and December 31, 2016:



	July 2, 2017		December 31, 2016
	Fair Value
	(Dollars in thousands)
Asset derivatives:
Designated foreign currency forward contracts	$	2,590	$	667
Non-designated foreign currency forward contracts	290		490
Prepaid expenses and other current assets	$	2,880	$	1,157
Total asset derivatives	$	2,880	$	1,157
Liability derivatives:
Designated foreign currency forward contracts	$	323	$	2,139
Non-designated foreign currency forward contracts	166		118
Other current liabilities	$	489	$	2,257
Total liability derivatives	$	489	$	2,257

The total notional amount for all open foreign currency forward contracts designated as cash flow hedges as of July 2, 2017 and December 31, 2016 was $73.6 million and $101.8 million, respectively. The total notional amount for all open non-designated foreign currency forward contracts as of July 2, 2017 and December 31, 2016 was $92.2 million and $73.4 million, respectively. All open foreign currency forward contracts as of July 2, 2017 have durations of twelve months or less.

There was no ineffectiveness related to the Company’s cash flow hedges during the three and six months ended July 2, 2017 and June 26, 2016.

Concentration of Credit Risk

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)

~~The following table presents the location and fair value of derivative financial instruments reported in the condensed consolidated balance sheet as of September 25, 2016 and December 31, 2015:~~

September 25, 2016 December 31, 2015
Fair Value Fair Value
(Dollars in thousands)
Asset derivatives:
Designated foreign currency forward contracts $ 615
$ 285
Non-designated foreign currency forward contracts 519
44
Prepaid expenses and other current assets $ 1,134
$ 329
Total asset derivatives $ 1,134
$ 329
Liability derivatives:
Designated foreign currency forward contracts $ 2,369
$ 807
Non-designated foreign currency forward contracts 34
491
Other current liabilities $ 2,403
$ 1,298
Total liability derivatives $ 2,403
$ 1,298

The total notional amount for all open foreign currency forward contracts designated as cash flow hedges as of September 25, 2016 and December 31, 2015 was $100.1 million and $49.5 million, respectively. The total notional amount for all open non-designated foreign currency forward contracts as of September 25, 2016 and December 31, 2015 was $77.4 million and $69.1 million, respectively. All open foreign currency forward contracts as of September 25, 2016 have durations of twelve months or less.

The following table provides information as to the gains and losses attributable to derivatives in cash flow hedging relationships that were reported in other comprehensive income (loss) (“OCI”) for the three and nine months ended September 25, 2016 and September 27, 2015:

After Tax Gain (Loss) Recognized in OCI
Three Months Ended Nine Months Ended
September 25, 2016 September 27, 2015 September 25, 2016 September 27, 2015
(Dollars in thousands)
Foreign currency forward contracts $ (223 ) $ (730 ) $ 761
$ (1,489 )

See Note 10 for information on the location in the condensed consolidated statements of income and amount of losses/(gains) attributable to derivatives that were reclassified from accumulated other comprehensive income (“AOCI”) to expense (income), net of tax.

~~There was no ineffectiveness related to the Company’s cash flow hedges during the three and nine months ended September 25, 2016 and September 27, 2015.~~

~~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. A portion of the Company’s trade accounts receivable outside the United States, however, 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 those countries and the financial stability of their economies.

An allowance for doubtful accounts is maintained for trade accounts receivable based on the Company’s historical collection experience and expected collectability of the accounts receivable, considering the 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

~~TELEFLEX INCORPORATED~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)~~

~~(Unaudited)~~

was $9.0 million and $8.0 million at September 25, 2016 and December 31, 2015, respectively. The current portion of the allowance for doubtful accounts at September 25, 2016 and December 31, 2015 of $2.1 million and $2.0 million, respectively, was reflected in accounts receivable, net. The allowance for doubtful accounts on receivables outstanding for greater than one year at September 25, 2016 and December 31, 2015 of $6.9 million and $6.0 million, respectively, was reflected in other assets.

Certain of the Company’s customers, particularly in Greece, Italy, Spain and Portugal, have extended or delayed payments for products and services already provided, raising collectability concerns regarding the Company’s accounts receivable from these customers. As a result, the Company continues to closely monitor the allowance for doubtful accounts with respect to these customers. The following table provides information regarding the Company's allowance for doubtful accounts, the aggregate net current and long-term trade accounts receivable ~~for~~related to 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~~these customers' trade accounts receivable ~~for customers in those countries~~ at ~~September 25, 2016~~July 2, 2017 and December 31, ~~2015 are as follows:~~2016:


	September 25, 2016			December 31, 2015			July 2, 2017			December 31, 2016
	(Dollars in thousands)						(Dollars in thousands)
Current and long-term trade accounts receivable (net of allowances of $8.0 million and $7.2 million at September 25, 2016 and December 31, 2015, respectively) in Greece, Italy, Spain and Portugal (1)	$	59,785		$	62,272
Allowance for doubtful accounts(1)							$	9,813		$	8,630
Current and long-term trade accounts receivable in Greece, Italy, Spain and Portugal (2)							$	51,896		$	51,098
Percentage of total net current and long-term trade accounts receivable - Greece, Italy, Spain and Portugal	22.9		%	23.9		%	17.5		%	19.3		%

(1) The long-term portion of trade accounts receivable, net from customers in Greece, Italy, Spain and Portugal at September 25, 2016 and December 31, 2015 was $7.7 million and $8.1 million, respectively, and is reported on the condensed consolidated balance sheet in other assets.


(1)	The current portion of the allowance for doubtful accounts was $2.7 million and $2.0 million as of July 2, 2017 and December 31, 2016, respectively, and was recognized in accounts receivable, net.


(2)	The long-term portion of trade accounts receivable, net from customers in Greece, Italy, Spain and Portugal at July 2, 2017 and December 31, 2016 was $3.0 million and $2.7 million, respectively In January 2017, the Company sold $16.1 million of receivables outstanding with respect to publicly funded hospitals in Italy for $16.0 million.

For the ~~nine~~six months ended ~~September 25,~~July 2, 2017 and June 26, 2016, ~~and September 27, 2015,~~ net revenues from customers in Greece, Italy, Spain and Portugal were ~~$95.8~~$64.5 million and ~~$94.4~~$63.7 million, respectively.

Note 9 — Fair value measurement

For a description of the fair value hierarchy, see Note 10 to the Company’s consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, ~~2015.~~2016.

The following tables provide information regarding the Company's financial assets and liabilities that are measured at fair value on a recurring basis as of ~~September 25, 2016~~July 2, 2017 and December 31, ~~2015:~~2016:


	Total carrying value at September 25, 2016		Quoted prices in active markets (Level 1)		Significant other observable Inputs (Level 2)		Significant unobservable Inputs (Level 3)		Total carrying value at July 2, 2017		Quoted prices in active markets (Level 1)		Significant other observable Inputs (Level 2)		Significant unobservable Inputs (Level 3)
	(Dollars in thousands)								(Dollars in thousands)
Investments in marketable securities	$	7,411	$	7,411	$	—	$	—	$	8,252	$	8,252	$	��	$	—
Derivative assets	1,134		—		1,134		—		2,880		—		2,880		—
Derivative liabilities	2,403		—		2,403		—		489		—		489		—
Contingent consideration liabilities(1)	22,368		—		—		22,368		6,712		—		—		6,712



	Total carrying value at December 31, 2016		Quoted prices in active markets (Level 1)		Significant other observable Inputs (Level 2)		Significant unobservable Inputs (Level 3)
	(Dollars in thousands)
Investments in marketable securities	$	7,660	$	7,660	$	—	$	—
Derivative assets	1,157		—		1,157		—
Derivative liabilities	2,257		—		2,257		—
Contingent consideration liabilities ⁽¹⁾	7,102		—		—		7,102

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)

Total carrying
value at
December 31, 2015 Quoted prices in active
markets (Level 1) Significant other
observable
Inputs (Level 2) Significant
unobservable
Inputs (Level 3)
(Dollars in thousands)
Investments in marketable securities $ 6,922
$ 6,922
$ —
$ —
Derivative assets 329
—
329
—
Derivative liabilities 1,298
—
1,298
—
Contingent consideration liabilities 20,829
—
—
20,829


(1)	As of July 2, 2017 and December 31, 2016, (a) $0.6 million of contingent consideration liabilities were recognized in the current portion of contingent consideration, and (b) $6.1 million and $6.5 million of contingent consideration liabilities, respectively, were recognized in other liabilities in the condensed consolidated balance sheet.

There were no transfers of financial assets or liabilities reported at fair value among Level 1, Level 2 or Level 3 within the fair value hierarchy during the ~~nine~~six months ended ~~September 25, 2016.~~July 2, 2017.

The following table provides information regarding changes, during the ~~nine~~six months ended ~~September 25, 2016,~~July 2, 2017, in Level 3 financial liabilities related to contingent consideration, which are described below in this Note 9 under ~~"valuation techniques"~~"Valuation Techniques":


	Contingent consideration			Contingent consideration
	2016			2017
	(Dollars in thousands)			(Dollars in thousands)
Balance - December 31, 2015	$	20,829
Balance - December 31, 2016				$	7,102
Payment	(133		)	(153		)
Revaluations	1,672			(237		)
Balance - September 25, 2016	$	22,368
Balance - July 2, 2017				$	6,712

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 as of the measurement date, 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. In connection with several of its acquisitions, the Company agreed to pay contingent consideration upon the achievement of specified objectives, including receipt of regulatory approvals, commercialization of a product or achievement of sales targets. The Company accounts for contingent consideration in accordance with applicable accounting guidance related to business combinations, recording contingent consideration liabilities at the time of an acquisition based on the fair value of future payments under its contingent consideration arrangement. The Company determines the fair value of ~~its~~the liabilities for contingent consideration ~~liabilities~~ based on ~~a probability-weighted~~ discounted cash flow analysis. ~~In determining the fair value of the contingent consideration liability associated with future payments under contingent consideration arrangements, the Company considers several factors, including:~~



l	~~estimated cash flows projected from the success of market launches;~~



l	~~the estimated time and resources needed to complete the development of acquired technologies;~~



l	~~the uncertainty of obtaining regulatory approvals within the required time periods; and~~

~~TELEFLEX INCORPORATED~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)~~

~~(Unaudited)~~



l	~~the risk adjusted discount rate for fair value measurement.~~

~~As the~~This fair value measurement is based on significant inputs ~~not observable~~unobservable in the market, ~~it represents~~primarily estimated sales royalties and the discount rate and, therefore, constitutes a Level 3 measurement within the fair value hierarchy.

In connection with the Company's contingent consideration arrangements, the Company estimates that it will make payments from 2016 through 2029. As of September 25, 2016, the range of undiscounted amounts the Company could be required to pay under contingent consideration arrangements is between $7.0 million and $46.3 million. The Company is required to reevaluate the fair value of contingent consideration each reporting period based on new developments and record changes in fair value until such consideration is satisfied through payment upon the achievement of the specified objectives or is no longer payable due to failure to achieve the specified objectives.

The following table provides information regarding the valuation techniques and inputs used in determining the fair value of assets or liabilities categorized as Level 3 measurements as of September 25, 2016:



	~~Valuation Technique~~	~~Unobservable Input~~	~~Range (Weighted Average)~~
~~Contingent consideration~~	~~Discounted cash flow~~	~~Discount rate~~	~~2.3% - 10% (8.4%)~~
~~Contingent consideration~~		~~Probability of payment~~	~~2% - 100% (71.3%)~~

As of September 25, 2016, the Company recorded $22.4 million of total liabilities for contingent consideration, of which $7.5 million was recorded as the current portion of contingent consideration and $14.9 million was recorded as other liabilities in the condensed consolidated balance sheet.

Note 10 — ~~Changes in shareholders’~~Shareholders’ equity

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 number of common shares outstanding:


	Three Months Ended		Nine Months Ended		Three Months Ended		Six Months Ended
	September 25, 2016	September 27, 2015	September 25, 2016	September 27, 2015	July 2, 2017	June 26, 2016	July 2, 2017	June 26, 2016
	(Shares in thousands)				(Shares in thousands)
Basic	44,045	41,597	43,081	41,542	44,996	43,549	44,945	42,598
Dilutive effect of share-based awards	639	511	574	483	866	566	843	543
Dilutive effect of 3.875% Convertible Notes and warrants(1)	2,762	6,424	4,169	5,944	956	3,131	928	4,873
Diluted	47,446	48,532	47,824	47,969	46,818	47,246	46,716	48,014


(1)	The reduction in the dilutive effect of the Convertible Notes and warrants during the three and six months ended July 2, 2017 as compared to three and six months ended June 26, 2016 is due principally to the Company’s repurchase of Convertible Notes and conversions by holders of the Convertible Notes during and subsequent to the three month period ended June 26, 2016.

~~Weighted~~TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)

The weighted average number of shares that were antidilutive and therefore ~~not included in~~excluded from the calculation of earnings per share were ~~1.4~~0.7 million and ~~3.9~~0.6 million for the three and ~~nine~~six months ended ~~September 25, 2016,~~July 2, 2017, respectively, and ~~5.4~~5.0 million and ~~5.6~~5.1 million for the three and ~~nine~~six months ended ~~September 27, 2015,~~June 26, 2016, respectively.

In connection with the issuance of the Convertible Notes, the Company entered into convertible note hedge and warrant agreements. The convertible note hedge, consisting of call options held by the Company, economically reduces the dilutive impact of the Convertible Notes. However, applicable accounting guidance requires the Company to separately address the dilutive impact of the warrants issued under the warrant agreements in computing diluted weighted average number of common shares outstanding, without giving effect to the anti-dilutive impact of the call options. The reduction in the weighted average number of diluted shares that would result from giving effect to the anti-dilutive impact of the call options would have been ~~1.5~~0.5 millionfor the three and ~~2.3~~six months ended July 2, 2017, and 1.7 millionand2.6 million for the three and ~~nine~~six months ended ~~September 25,~~June 26, 2016, ~~respectively, and 3.5 million and 3.3 million for the three and nine months ended September 27, 2015,~~ respectively. The treasury stock method is applied to the warrants ~~when~~because the average market price of the Company's common stock during the reporting

~~TELEFLEX INCORPORATED~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)~~

~~(Unaudited)~~

~~period~~ periods presented exceeds the warrant exercise price of $74.65 per share, and assumes the proceeds from the exercise of the warrants are used by the Company to repurchase shares based on such average market price. Shares issuable upon exercise of the warrants that were included in the total diluted shares outstanding were ~~1.3~~0.5 million and ~~1.9~~0.4 million for the three and ~~nine~~six months ended ~~September 25, 2016~~July 2, 2017, respectively, and 1.5 million and ~~2.9 million and 2.6~~2.2 million for the three and ~~nine~~six months ended ~~September 27, 2015,~~June 26, 2016, respectively.

See Note 7 for information regarding the reduction in the outstanding principal amount of Convertible Notes as a result of the Company's acquisition of Convertibles Notes in exchange for cash and shares of Company common stock, as well as the conversion of a portion of the Convertible Notes, and the related reduction in the number of call options and warrants outstanding under the convertible note hedge and warrant agreements.

The following tables provide information relating to the changes in accumulated other comprehensive loss, net of tax, for the ~~nine~~six months ended ~~September 25, 2016~~July 2, 2017 and ~~September 27, 2015:~~

June 26, 2016:


	Cash Flow Hedges			Pension and Other Postretirement Benefit Plans			Foreign Currency Translation Adjustment			Accumulated Other Comprehensive (Loss) Income			Cash Flow Hedges			Pension and Other Postretirement Benefit Plans			Foreign Currency Translation Adjustment			Accumulated Other Comprehensive (Loss) Income
	(Dollars in thousands)												(Dollars in thousands)
Balance as of December 31, 2015	$	(2,491	)	$	(138,887	)	$	(229,746	)	$	(371,124	)
Balance as of December 31, 2016													$	(2,424	)	$	(136,596	)	$	(299,697	)	$	(438,717	)
Other comprehensive income (loss) before reclassifications	(2,255		)	618			11,131			9,494			2,684			(669		)	112,667			114,682
Amounts reclassified from accumulated other comprehensive income	3,016			3,296			—			6,312			2,477			2,263			—			4,740
Net current-period other comprehensive income	761			3,914			11,131			15,806			5,161			1,594			112,667			119,422
Reclassification related to acquisition of noncontrolling interest	—			—			(832		)	(832		)
Balance as of September 25, 2016	$	(1,730	)	$	(134,973	)	$	(219,447	)	$	(356,150	)
Balance as of July 2, 2017													$	2,737		$	(135,002	)	$	(187,030	)	$	(319,295	)

Cash Flow Hedges Pension and Other Postretirement Benefit Plans Foreign Currency Translation Adjustment Accumulated Other Comprehensive (Loss) Income
(Dollars in thousands)
Balance at December 31, 2014 $ —
$ (141,744 ) $ (119,151 ) $ (260,895 )
Other comprehensive (loss) before reclassifications (2,599 ) 465
(91,137 ) (93,271 )
Amounts reclassified from accumulated other comprehensive loss 1,110
3,157
—
4,267
Net current-period other comprehensive (loss) income (1,489 ) 3,622
(91,137 ) (89,004 )
Balance at September 27, 2015 $ (1,489 ) $ (138,122 ) $ (210,288 ) $ (349,899 )



	Cash Flow Hedges			Pension and Other Postretirement Benefit Plans			Foreign Currency Translation Adjustment			Accumulated Other Comprehensive (Loss) Income
	(Dollars in thousands)
Balance at December 31, 2015	$	(2,491	)	$	(138,887	)	$	(229,746	)	$	(371,124	)
Other comprehensive (loss) before reclassifications	(1,684		)	375			11,285			9,976
Amounts reclassified from accumulated other comprehensive loss	2,668			2,109			—			4,777
Net current-period other comprehensive income	984			2,484			11,285			14,753
Balance at June 26, 2016	$	(1,507	)	$	(136,403	)	$	(218,461	)	$	(356,371	)

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)

The following table provides information relating to the location in the statements of operations and amount of reclassifications of losses/(gains) in accumulated other comprehensive (loss) income into expense/(income), net of tax, for the three and ~~nine~~six months ended ~~September 25, 2016~~July 2, 2017 and ~~September 27, 2015:~~

June 26, 2016:


	Three Months Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 25, 2016			September 27, 2015			September 25, 2016			September 27, 2015			July 2, 2017			June 26, 2016			July 2, 2017			June 26, 2016
	(Dollars in thousands)												(Dollars in thousands)
Losses on foreign exchange contracts:
Cost of goods sold	$	535		$	1,168		$	3,907		$	1,431		$	1,303		$	1,501		$	2,948		$	3,372
Total before tax	535			1,168			3,907			1,431			1,303			1,501			2,948			3,372
Tax benefit	(187		)	(221		)	(891		)	(321		)	(204		)	(363		)	(471		)	(704		)
Net of tax	$	348		$	947		$	3,016		$	1,110		$	1,099		$	1,138		$	2,477		$	2,668
Amortization of pension and other postretirement benefit items:													Amortization of pension and other postretirement benefit items:
Actuarial losses (1)	$	1,829		$	1,571		$	5,071		$	4,782		$	1,727		$	1,620		$	3,453		$	3,242
Prior-service costs(1)	15			—			43			—
Prior-service costs⁽¹⁾													30			14			59			28
Total before tax	1,844			1,571			5,114			4,782			1,757			1,634			3,512			3,270
Tax benefit	(657		)	(551		)	(1,818		)	(1,625		)	(625		)	(581		)	(1,249		)	(1,161		)
Net of tax	$	1,187		$	1,020		$	3,296		$	3,157		$	1,132		$	1,053		$	2,263		$	2,109

Total reclassifications, net of tax	$	1,535		$	1,967		$	6,312		$	4,267		$	2,231		$	2,191		$	4,740		$	4,777

(1) These accumulated other comprehensive (loss) income components are included in the computation of net benefit expense for pension and other postretirement benefit plans (see Note 12 for additional information).


~~(1)~~	These accumulated other comprehensive (loss) income components are included in the computation of net benefit expense for pension and other postretirement benefit plans (see Note 12 for additional information).

Mezzanine Equity

As of December 31, 2016, the Company reclassified $1.8 million from additional paid-in capital to convertible notes in the mezzanine equity section of the Company's consolidated balance sheet. The reclassified amount represents the aggregate difference between the principal amount and the carrying value of the Convertible Notes purchased by the Company pursuant to the Exchange Transactions (see "3.875% Convertible Senior Subordinated Notes - Exchange Transactions" within Note 7) under agreements that were entered into prior to December 31,2016, but not consummated until January 5, 2017. No reclassification was required as of July 2, 2017.

Note 11 — Taxes on income from continuing operations

Three Months Ended Nine Months Ended
September 25, 2016 September 27, 2015 September 25, 2016 September 27, 2015
Effective income tax rate 10.2% 1.3% 9.3% 9.5%



	Three Months Ended		Six Months Ended
	July 2, 2017	June 26, 2016	July 2, 2017	June 26, 2016
Effective income tax rate	13.4%	11.9%	7.4%	8.8%

The effective income tax rate for the three and ~~nine~~six months ended ~~September 25, 2016~~July 2, 2017 was ~~10.2%~~13.4% and ~~9.3%~~7.4%, respectively, and ~~1.3%~~11.9% and ~~9.5%~~8.8% for the three and ~~nine~~six months ended ~~September 27, 2015,~~June 26, 2016, respectively. The effective income tax rate for the three and ~~nine~~six months ended ~~September 25, 2016,~~July 2, 2017, as compared to the prior year ~~period,~~periods, reflects an ~~increased~~excess tax ~~expense~~benefit associated with share based payments, recognized under the new FASB guidance adopted as of January 1, 2017. In addition, the effective tax rate for the six months ended July 2, 2017 reflects a ~~shift~~tax benefit associated with costs incurred in ~~income to jurisdictions~~connection with ~~higher tax rates.~~the Vascular Solutions acquisition. The effective ~~income~~ tax rate for the three months ended ~~September 27, 2015 also~~June 26, 2016 reflects a tax benefit associated with ~~a legislative~~the loss on extinguishment of debt. The effective tax rate ~~change.~~for the six months ended June 26, 2016 reflects a tax benefit on the settlement of a foreign tax audit as well as the above mentioned benefit associated with the loss on extinguishment of debt.

Note 12 — 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 ~~September 25, 2016,~~July 2, 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.

~~TELEFLEX INCORPORATED~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)~~

~~(Unaudited)~~

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.

Net pension and other postretirement benefits expense (income) consist of the following:

Pension
Three Months Ended Other Postretirement Benefits
Three Months Ended Pension
Nine Months Ended Other Postretirement Benefits
Nine Months Ended
September 25, 2016 September 27, 2015 September 25, 2016 September 27, 2015 September 25, 2016 September 27, 2015 September 25, 2016 September 27, 2015
(Dollars in thousands)
Service cost $ 656
$ 470
$ 44
$ 157
$ 1,963
$ 1,410
$ 266
$ 371
Interest cost 3,948
4,492
383
452
11,797
13,463
1,196
1,476
Expected return on plan assets (6,209 ) (6,606 ) —
—
(18,606 ) (19,457 ) —
—
Net amortization and deferral 1,781
1,563
63
8
4,937
4,620
177
162
Net benefits expense (income) $ 176
$ (81 ) $ 490
$ 617
$ 91
$ 36
$ 1,639
$ 2,009

~~The Company’s pension contributions are expected to be approximately $12.4 million during 2016, of which $12.2 million was contributed during the nine months ended September 25, 2016.~~



	Pension Three Months Ended						Other Postretirement Benefits Three Months Ended				Pension Six Months Ended						Other Postretirement Benefits Six Months Ended
	July 2, 2017			June 26, 2016			July 2, 2017		June 26, 2016		July 2, 2017			June 26, 2016			July 2, 2017		June 26, 2016
	(Dollars in thousands)
Service cost	$	720		$	655		$	75	$	111	$	1,437		$	1,307		$	149	$	222
Interest cost	3,789			3,929			379		407		7,574			7,849			757		813
Expected return on plan assets	(6,750		)	(6,199		)	—		—		(13,493		)	(12,397		)	—		—
Net amortization and deferral	1,691			1,577			66		57		3,381			3,156			131		114
Net benefits expense (income)	$	(550	)	$	(38	)	$	520	$	575	$	(1,101	)	$	(85	)	$	1,037	$	1,149

Note 13 — Commitments and contingent liabilities

~~Operating leases:~~ ~~The Company uses various leased facilities and equipment in its operations.~~

In the first quarter 2016, the Company entered into a build-to-suit lease with respect to a facility in Ireland that will be used for the Company's European and global operations headquarters. Under the build-to-suit lease, the landlord is responsible for the construction and configuration of the facility to the Company's specifications, and the Company is obligated to lease the facility following construction completion. In accordance with applicable accounting principles, the Company is deemed the owner of the facility during the construction period and is required to record, during the construction period, the estimated fair value of the incurred construction costs as construction in progress, and a liability for the costs not funded by the Company. As of September 25, 2016, the Company recorded $14.6 million in property, plant and equipment representing the estimated fair value of the incurred construction costs. The construction of the building and tenant improvements were completed and the Company took occupancy of the entire building in October 2016, at which point, the Company derecognized the assets and related liabilities pertaining to the leased facility.

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

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)

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. 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 ~~September 25, 2016,~~July 2, 2017, the Company has recorded ~~$1.0~~$1.1 million and ~~$5.3~~$5.5 million in accrued liabilities and other liabilities, respectively, relating to these matters. Considerable uncertainty exists with respect to these liabilities and, if adverse changes in circumstances occur, the potential liability may exceed the amount accrued as of ~~September 25, 2016.~~July 2, 2017. The time frame over which the accrued amounts may be paid out, based on past history, is estimated to be 15-20 years.

~~TELEFLEX INCORPORATED~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)~~

~~(Unaudited)~~

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 ~~September 25, 2016,~~July 2, 2017, the Company has recorded accrued liabilities of $2.5 million 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 amount accrued as of ~~September 25, 2016, $1.5~~July 2, 2017, $1.7 million pertains 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 is seeking to recover RMB 51.2 million ($7.5 million) in damages, and is also seeking to compel Teleflex Shanghai to repurchase Teleflex products that the distributor claims it purchased from Teleflex Shanghai at a total price of RMB 97.5 million ($14.4 million). Teleflex Shanghai intends to vigorously contest the distributor’s arbitration claim, and has filed a counterclaim seeking payment from the distributor of RMB 61.2 million ($9.0 million) in respect of outstanding trade receivables owed by the distributor to Teleflex Shanghai. At this time, the Company is unable to make an estimate of the amount of loss, if any, or range of possible loss that the Company could incur as a result of this matter.

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-judgment~~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 ~~appealed to~~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 ~~filed a motion for rehearing with the Louisiana Court of Appeal, which was denied on August 3, 2016. The Company~~ and the plaintiff ~~have~~ filed ~~motions~~applications for a writ of certiorari (a request for review) to the Louisiana Supreme Court. On January 13, 2017, the Louisiana Supreme Court ~~which~~granted the Company's writ application. Following the submission of written briefs, oral arguments were held on May 1, 2017 and the parties currently are ~~currently pending.~~awaiting the court’s decision. As of ~~September 25, 2016,~~July 2, 2017, the Company has accrued a liability representing its best estimate of probable loss associated with this matter, which is included in the Company’s accrued liabilities for litigation matters relating to discontinued operations discussed in the preceding paragraph. The Company believes that any liability arising from this matter ~~in excess of $10.0 million will be~~that is not covered by the ~~Company’s~~Company's product liability ~~insurance.~~insurance will not exceed $10.0 million.

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.

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)

Tax audits and examinations: The Company and its subsidiaries are routinely subject to tax examinations by various tax authorities. As of ~~September 25, 2016,~~July 2, 2017, the most significant tax examinations in process are in ~~Austria~~Canada and ~~Canada.~~Germany. The Company may establish reserves with respect to its uncertain tax positions, after which it adjusts its reserves to address developments with respect to these uncertain tax positions. 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 other items ~~of permanent investment incident to~~occurring in the ordinary conduct of its business. On average, such commitments are not at prices in excess of current market prices.

Note 14 — Segment 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.

The Company has the following six reportable operating segments: Vascular North America, Anesthesia North America, Surgical North America, EMEA (Europe, Middle East and Africa), Asia and OEM (Original Equipment Manufacturer and Development Services). 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

~~TELEFLEX INCORPORATED~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)~~

~~(Unaudited)~~

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.

~~Operating segments other than the reportable operating segments are collectively presented in the “All other” category within the tabular information set forth below.~~

The following tables present the Company’s segment results for the three and ~~nine~~six months ended ~~September 25, 2016~~July 2, 2017 and ~~September 27, 2015:~~June 26, 2016:


	Three Months Ended				Nine Months Ended				Three Months Ended				Six Months Ended
	September 25, 2016		September 27, 2015		September 25, 2016		September 27, 2015		July 2, 2017		June 26, 2016		July 2, 2017		June 26, 2016
	(Dollars in thousands)				(Dollars in thousands)				(Dollars in thousands)				(Dollars in thousands)
Revenue
Vascular North America	$	85,118	$	82,675	$	254,817	$	244,606	$	93,522	$	88,111	$	187,371	$	169,699
Anesthesia North America	48,670		47,628		143,821		138,656		49,081		49,194		97,288		95,151
Surgical North America	41,827		39,591		123,904		118,170		44,716		43,136		90,660		82,077
EMEA	121,398		120,854		375,198		379,268		131,962		131,705		262,695		253,800
Asia	64,087		61,935		176,434		172,506		63,988		63,191		112,941		112,347
OEM	41,418		38,959		115,693		111,592		45,132		40,298		88,478		74,275
All other	53,130		52,072		164,227		160,391		100,212		57,918		177,061		111,097
Consolidated net revenues	$	455,648	$	443,714	$	1,354,094	$	1,325,189	$	528,613	$	473,553	$	1,016,494	$	898,446


	Three Months Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 25, 2016			September 27, 2015			September 25, 2016			September 27, 2015			July 2, 2017			June 26, 2016			July 2, 2017			June 26, 2016
	(Dollars in thousands)						(Dollars in thousands)						(Dollars in thousands)						(Dollars in thousands)
Operating profit
Vascular North America	$	21,781		$	18,086		$	63,431		$	50,891		$	25,258		$	21,994		$	50,074		$	41,650
Anesthesia North America	13,954			15,178			41,181			36,572			20,516			15,050			34,043			27,227
Surgical North America	14,050			12,814			39,654			39,456			17,287			12,348			33,667			25,604
EMEA	16,576			19,656			61,563			65,334			23,250			23,944			45,490			44,987
Asia	18,072			15,715			52,831			42,812			18,604			21,751			29,402			34,759
OEM	10,201			8,865			24,605			25,274			10,337			9,215			19,458			14,404
All other	3,444			5,551			16,623			15,499			11,267			7,436			4,966			13,179
Total segment operating profit (1)	98,078			95,865			299,888			275,838			126,519			111,738			217,100			201,810
Unallocated expenses (2)	(11,591		)	(19,315		)	(47,463		)	(56,694		)	(16,317		)	(13,297		)	(46,079		)	(35,872		)
Income from continuing operations before interest, loss on extinguishment of debt and taxes	$	86,487		$	76,550		$	252,425		$	219,144		$	110,202		$	98,441		$	171,021		$	165,938

(1)

Segment operating profit includes segment net revenues from external customers reduced by ~~its~~the segment's 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,~~net revenues, 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 charges and gain on sale of assets.

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)

Note 15 — Condensed consolidating guarantor financial information

~~The 2024 Notes and 2026 Notes are issued by~~ Teleflex Incorporated (the "Parent Company"), is the issuer of its 5.25% Senior Notes due 2024 (the "2024 Notes") and ~~payment~~4.875% Senior Notes due 2026 (the "2026 Notes"). Payment of the Parent Company's obligations under the 2024 Notes and 2026 Notes is guaranteed, jointly and severally, by certain of the Parent Company’s subsidiaries (each, a “Guarantor Subsidiary” and collectively, the “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 ~~(loss)~~ for the three and ~~nine~~six months ended ~~September 25,~~July 2, 2017 and June 26, 2016, ~~and September 27, 2015,~~ condensed consolidating balance sheets as of ~~September 25, 2016~~July 2, 2017 and December 31, ~~2015~~2016 and condensed consolidating statements of cash flows for the ~~nine~~six months ended ~~September 25,~~July 2, 2017 and June 26, 2016, ~~and September 27, 2015,~~ 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 2024 Notes and 2026 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 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2015~~2016 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

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)

TELEFLEX INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME ~~(LOSS)~~


	Three Months Ended September 25, 2016															Three Months Ended July 2, 2017
	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Condensed Consolidated			Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Condensed Consolidated
	(Dollars in thousands)															(Dollars in thousands)
Net revenues	$	—		$	270,610		$	281,258		$	(96,220	)	$	455,648		$	—		$	338,620		$	296,977		$	(106,984	)	$	528,613
Cost of goods sold	—			163,052			147,240			(96,246		)	214,046			—			190,202			152,440			(104,313		)	238,329
Gross profit	—			107,558			134,018			26			241,602			—			148,418			144,537			(2,671		)	290,284
Selling, general and administrative expenses	11,208			80,333			48,285			(29		)	139,797			7,468			95,171			56,334			(39		)	158,934
Research and development expenses	179			8,422			6,466			—			15,067			264			13,594			6,420			—			20,278
Restructuring charges	380			1,712			935			—			3,027			—			1,335			(465		)	—			870
Gain on sale of assets	(2,707		)	104			(173		)	—			(2,776		)
(Loss) income from continuing operations before interest and taxes	(9,060		)	16,987			78,505			55			86,487
(Loss) income from continuing operations before interest, extinguishment of debt and taxes																(7,732		)	38,318			82,248			(2,632		)	110,202
Interest, net	41,344			(29,612		)	1,041			—			12,773			51,073			(32,421		)	1,081			—			19,733
Loss on extinguishment of debt																11			—			—			—			11
(Loss) income from continuing operations before taxes	(50,404		)	46,599			77,464			55			73,714			(58,816		)	70,739			81,167			(2,632		)	90,458
(Benefit) taxes on (loss) income from continuing operations	(18,017		)	13,166			12,437			(72		)	7,514			(23,115		)	22,123			14,210			(1,123		)	12,095
Equity in net income of consolidated subsidiaries	98,544			57,837			183			(156,564		)	—			114,064			58,861			240			(173,165		)	—
Income from continuing operations	66,157			91,270			65,210			(156,437		)	66,200			78,363			107,477			67,197			(174,674		)	78,363
Operating income from discontinued operations	260			—			—			—			260
Tax on income from discontinued operations	95			—			43			—			138
Income (loss) from discontinued operations	165			—			(43		)	—			122
Operating loss from discontinued operations																(566		)	—			—			—			(566		)
Benefit on loss from discontinued operations																(206		)	—			—			—			(206		)
Loss from discontinued operations																(360		)	—			—			—			(360		)
Net income	66,322			91,270			65,167			(156,437		)	66,322			78,003			107,477			67,197			(174,674		)	78,003
Other comprehensive income (loss) attributable to common shareholders	1,053			(501		)	1,243			(742		)	1,053
Comprehensive income attributable to common shareholders	$	67,375		$	90,769		$	66,410		$	(157,179	)	$	67,375
Other comprehensive income																69,822			68,127			69,374			(137,501		)	69,822
Comprehensive income																$	147,825		$	175,604		$	136,571		$	(312,175	)	$	147,825

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)



	Three Months Ended September 27, 2015															Three Months Ended June 26, 2016
	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Condensed Consolidated			Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Condensed Consolidated
	(Dollars in thousands)															(Dollars in thousands)
Net revenues	$	—		$	269,620		$	270,084		$	(95,990	)	$	443,714		$	—		$	280,430		$	290,784		$	(97,661	)	$	473,553
Cost of goods sold	—			159,567			153,207			(97,273		)	215,501			—			170,700			146,997			(100,543		)	217,154
Gross profit	—			110,053			116,877			1,283			228,213			—			109,730			143,787			2,882			256,399
Selling, general and administrative expenses	9,891			82,372			46,471			106			138,840			10,285			86,385			46,297			16			142,983
Research and development expenses	—			6,006			6,565			—			12,571			140			8,644			6,688			—			15,472
Restructuring charges	—			602			58			—			660			—			557			(676		)	—			(119		)
Gain on sale of assets	—			—			(408		)	—			(408		)	—			(378		)	—			—			(378		)
(Loss) income from continuing operations before interest and taxes	(9,891		)	21,073			64,191			1,177			76,550
(Loss) income from continuing operations before interest, extinguishment of debt and taxes																(10,425		)	14,522			91,478			2,866			98,441
Interest, net	32,439			(19,457		)	1,194			—			14,176			33,146			(22,437		)	1,069			—			11,778
Loss on extinguishment of debt																19,261			—			—			—			19,261
(Loss) income from continuing operations before taxes	(42,330		)	40,530			62,997			1,177			62,374			(62,832		)	36,959			90,409			2,866			67,402
(Benefit) taxes on (loss) income from continuing operations	(15,102		)	7,582			8,053			270			803			(23,077		)	14,504			15,909			671			8,007
Equity in net income of consolidated subsidiaries	88,728			49,885			211			(138,824		)	—			99,295			63,605			175			(163,075		)	—
Income from continuing operations	61,500			82,833			55,155			(137,917		)	61,571			59,540			86,060			74,675			(160,880		)	59,395
Operating loss from discontinued operations	(784		)	—			(4		)	—			(788		)
Taxes on loss from discontinued operations	(108		)	—			39			—			(69		)
Loss from discontinued operations	(676		)	—			(43		)	—			(719		)
Operating (loss) income from discontinued operations																(373		)	—			379			—			6
Benefit on (loss) income from discontinued operations																(136		)	—			(51		)	—			(187		)
(Loss) income from discontinued operations																(237		)	—			430			—			193
Net income	60,824			82,833			55,112			(137,917		)	60,852			59,303			86,060			75,105			(160,880		)	59,588
Less: Income from continuing operations attributable to noncontrolling interest	—			—			28			—			28			—			—			285			—			285
Net income attributable to common shareholders	60,824			82,833			55,084			(137,917		)	60,824			59,303			86,060			74,820			(160,880		)	59,303
Other comprehensive loss attributable to common shareholders	(28,789		)	(32,855		)	(26,073		)	58,928			(28,789		)	(8,441		)	(9,685		)	(11,378		)	21,063			(8,441		)
Comprehensive income attributable to common shareholders	$	32,035		$	49,978		$	29,011		$	(78,989	)	$	32,035		$	50,862		$	76,375		$	63,442		$	(139,817	)	$	50,862

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)


	Nine Months Ended September 25, 2016															Six Months Ended July 2, 2017
	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Condensed Consolidated			Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Condensed Consolidated
	(Dollars in thousands)															(Dollars in thousands)
Net revenues	$	—		$	809,951		$	833,390		$	(289,247	)	$	1,354,094		$	—		$	654,263		$	573,292	$	(211,061	)	$	1,016,494
Cost of goods sold	—			489,293			427,200			(285,547		)	630,946			—			382,203			296,336		(207,889		)	470,650
Gross profit	—			320,658			406,190			(3,700		)	723,148			—			272,060			276,956		(3,172		)	545,844
Selling, general and administrative expenses	30,822			248,195			139,641			470			419,128			27,987			189,214			105,178		524			322,903
Research and development expenses	319			23,501			19,072			—			42,892			499			24,780			12,826		—			38,105
Restructuring charges	380			7,027			5,469			—			12,876			—			6,709			7,106		—			13,815
Gain on sale of assets	(2,707		)	(274		)	(1,192		)	—			(4,173		)
(Loss) income from continuing operations before interest, extinguishment of debt and taxes	(28,814		)	42,209			243,200			(4,170		)	252,425			(28,486		)	51,357			151,846		(3,696		)	171,021
Interest, net	107,534			(72,367		)	3,088			—			38,255			98,747			(63,384		)	1,927		—			37,290
Loss on extinguishment of debt	19,261			—			—			—			19,261			5,593			—			—		—			5,593
(Loss) income from continuing operations before taxes	(155,609		)	114,576			240,112			(4,170		)	194,909			(132,826		)	114,741			149,919		(3,696		)	128,138
(Benefit) taxes on (loss) income from continuing operations	(56,942		)	39,347			36,210			(481		)	18,134			(53,022		)	36,608			26,439		(599		)	9,426
Equity in net income of consolidated subsidiaries	275,296			179,342			526			(455,164		)	—			198,516			114,663			456		(313,635		)	—
Income from continuing operations	176,629			254,571			204,428			(458,853		)	176,775			118,712			192,796			123,936		(316,732		)	118,712
Operating (loss) income from discontinued operations	(495		)	—			379			—			(116		)
(Benefit) taxes on (loss) income from discontinued operations	(180		)	—			61			—			(119		)
(Loss) income from discontinued operations	(315		)	—			318			—			3
Operating loss from discontinued operations																(848		)	—			—		—			(848		)
Benefit on loss from discontinued operations																(309		)	—			—		—			(309		)
Loss from discontinued operations																(539		)	—			—		—			(539		)
Net income	176,314			254,571			204,746			(458,853		)	176,778			118,173			192,796			123,936		(316,732		)	118,173
Less: Income from continuing operations attributable to noncontrolling interest	—			—			464			—			464
Net income attributable to common shareholders	176,314			254,571			204,282			(458,853		)	176,314
Other comprehensive income attributable to common shareholders	15,806			8,387			12,277			(20,664		)	15,806
Comprehensive income attributable to common shareholders	$	192,120		$	262,958		$	216,559		$	(479,517	)	$	192,120
Other comprehensive income																119,422			117,531			123,275		(240,806		)	119,422
Comprehensive income																$	237,595		$	310,327		$	247,211	$	(557,538	)	$	237,595

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)



	Nine Months Ended September 27, 2015															Six Months Ended June 26, 2016
	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Condensed Consolidated			Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Condensed Consolidated
	(Dollars in thousands)															(Dollars in thousands)
Net revenues	$	—		$	803,484		$	805,243		$	(283,538	)	$	1,325,189		$	—		$	539,341		$	552,132		$	(193,027	)	$	898,446
Cost of goods sold	—			476,611			443,180			(278,689		)	641,102			—			326,241			279,960			(189,301		)	416,900
Gross profit	—			326,873			362,063			(4,849		)	684,087			—			213,100			272,172			(3,726		)	481,546
Selling, general and administrative expenses	30,006			249,484			141,252			23			420,765			19,614			167,862			91,356			499			279,331
Research and development expenses	—			22,027			16,871			—			38,898			140			15,079			12,606			—			27,825
Restructuring charges	—			4,932			756			—			5,688			—			5,315			4,534			—			9,849
Gain on sale of assets	—			—			(408		)	—			(408		)	—			(378		)	(1,019		)	—			(1,397		)
(Loss) income from continuing operations before interest, extinguishment of debt and taxes	(30,006		)	50,430			203,592			(4,872		)	219,144			(19,754		)	25,222			164,695			(4,225		)	165,938
Interest, net	100,157			(56,591		)	3,666			—			47,232			66,190			(42,755		)	2,047			—			25,482
Loss on extinguishment of debt	10,454			—			—			—			10,454			19,261			—			—			—			19,261
(Loss) income from continuing operations before taxes	(140,617		)	107,021			199,926			(4,872		)	161,458			(105,205		)	67,977			162,648			(4,225		)	121,195
(Benefit) taxes on (loss) income from continuing operations	(48,336		)	33,491			31,260			(1,000		)	15,415			(38,925		)	26,181			23,773			(409		)	10,620
Equity in net income of consolidated subsidiaries	237,512			161,539			430			(399,481		)	—			176,752			121,505			343			(298,600		)	—
Income from continuing operations	145,231			235,069			169,096			(403,353		)	146,043			110,472			163,301			139,218			(302,416		)	110,575
Operating loss from discontinued operations	(1,432		)	—			—			—			(1,432		)
Taxes on loss from discontinued operations	60			—			120			—			180
Loss from discontinued operations	(1,492		)	—			(120		)	—			(1,612		)
Operating (loss) income from discontinued operations																(755		)	—			379			—			(376		)
(Benefit) taxes on (loss) income from discontinued operations																(275		)	—			18			—			(257		)
(Loss) income from discontinued operations																(480		)	—			361			—			(119		)
Net income	143,739			235,069			168,976			(403,353		)	144,431			109,992			163,301			139,579			(302,416		)	110,456
Less: Income from continuing operations attributable to noncontrolling interest	—			—			692			—			692			—			—			464			—			464
Net income attributable to common shareholders	143,739			235,069			168,284			(403,353		)	143,739			109,992			163,301			139,115			(302,416		)	109,992
Other comprehensive loss attributable to common shareholders	(89,004		)	(94,601		)	(101,461		)	196,062			(89,004		)
Other comprehensive income attributable to common shareholders																14,753			8,888			11,034			(19,922		)	14,753
Comprehensive income attributable to common shareholders	$	54,735		$	140,468		$	66,823		$	(207,291	)	$	54,735		$	124,745		$	172,189		$	150,149		$	(322,338	)	$	124,745

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)

TELEFLEX INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATING BALANCE SHEETS


	September 25, 2016											July 2, 2017
	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Condensed Consolidated		Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Condensed Consolidated
	(Dollars in thousands)											(Dollars in thousands)
ASSETS
Current assets
Cash and cash equivalents	$	33,460	$	1,024	$	464,975	$	—		$	499,459	$	56,699	$	10,963	$	608,552	$	—		$	676,214
Accounts receivable, net	2,478		6,249		249,190		3,916			261,833		2,236		34,592		262,539		4,335			303,702
Accounts receivable from consolidated subsidiaries	4,610		2,167,693		330,802		(2,503,105		)	—		8,333		2,265,552		345,901		(2,619,786		)	—
Inventories, net	—		209,912		160,241		(28,323		)	341,830		—		228,022		168,954		(28,450		)	368,526
Prepaid expenses and other current assets	8,929		5,976		15,784		3,665			34,354		14,163		9,280		20,518		3,337			47,298
Prepaid taxes	5,154		—		17,105		—			22,259		4,490		—		7,760		(372		)	11,878
Assets held for sale	—		—		4,137		—			4,137
Total current assets	54,631		2,390,854		1,242,234		(2,523,847		)	1,163,872		85,921		2,548,409		1,414,224		(2,640,936		)	1,407,618
Property, plant and equipment, net	2,654		163,396		155,969		—			322,019		2,398		212,907		153,996		—			369,301
Goodwill	—		708,805		596,273		—			1,305,078		—		1,238,551		615,525		—			1,854,076
Intangibles assets, net	—		691,398		473,246		—			1,164,644		—		1,152,095		460,809		—			1,612,904
Investments in affiliates	6,005,108		1,544,772		23,335		(7,573,188		)	27
Deferred tax assets	90,853		—		6,947		(95,008		)	2,792		72,037		—		5,435		(75,509		)	1,963
Notes receivable and other amounts due from consolidated subsidiaries	1,362,709		2,067,932		—		(3,430,641		)	—		1,310,464		2,163,757		—		(3,474,221		)	—
Other assets	22,446		6,704		14,087		—			43,237		7,386,675		1,706,244		31,051		(9,079,808		)	44,162
Total assets	$	7,538,401	$	7,573,861	$	2,512,091	$	(13,622,684	)	$	4,001,669	$	8,857,495	$	9,021,963	$	2,681,040	$	(15,270,474	)	$	5,290,024
LIABILITIES AND EQUITY
Current liabilities
Current borrowings	$	131,895	$	—	$	50,000	$	—		$	181,895	$	62,039	$	—	$	50,000	$	—		$	112,039
Accounts payable	3,960		32,551		33,735		—			70,246		3,136		38,529		40,308		—			81,973
Accounts payable to consolidated subsidiaries	2,232,673		236,780		33,652		(2,503,105		)	—		2,306,666		261,263		51,857		(2,619,786		)	—
Accrued expenses	15,920		17,603		35,449		—			68,972		19,284		26,593		39,173		—			85,050
Current portion of contingent consideration	—		7,539		—		—			7,539		—		584		—		—			584
Payroll and benefit-related liabilities	18,562		23,679		39,505		—			81,746		17,855		26,071		35,025		—			78,951
Accrued interest	12,592		—		19		—			12,611		5,264		—		30		—			5,294
Income taxes payable	—		—		11,424		(153		)	11,271		—		—		4,408		(970		)	3,438
Other current liabilities	2,413		3,042		12,667		—			18,122		500		4,250		3,972		—			8,722
Total current liabilities	2,418,015		321,194		216,451		(2,503,258		)	452,402		2,414,744		357,290		224,773		(2,620,756		)	376,051
Long-term borrowings	849,967		—		—		—			849,967		1,887,716		—		—		—			1,887,716
Deferred tax liabilities	—		370,943		35,455		(95,008		)	311,390		—		508,629		34,914		(75,509		)	468,034
Pension and postretirement benefit liabilities	83,905		31,376		15,941		—			131,222		80,154		31,026		17,155		—			128,335
Noncurrent liability for uncertain tax positions	1,749		17,899		7,045		—			26,693		1,729		13,781		2,868		—			18,378
Notes payable and other amounts due to consolidated subsidiaries	1,991,921		1,237,297		201,423		(3,430,641		)	—		2,089,600		1,185,791		198,830		(3,474,221		)	—
Other liabilities	22,922		24,812		12,339		—			60,073		25,023		13,961		13,997		—			52,981
Total liabilities	5,368,479		2,003,521		488,654		(6,028,907		)	1,831,747		6,498,966		2,110,478		492,537		(6,170,486		)	2,931,495
Total common shareholders' equity	2,169,922		5,570,340		2,023,437		(7,593,777		)	2,169,922
Total liabilities and equity	$	7,538,401	$	7,573,861	$	2,512,091	$	(13,622,684	)	$	4,001,669
Total shareholders' equity												2,358,529		6,911,485		2,188,503		(9,099,988		)	2,358,529
Total liabilities and shareholders' equity												$	8,857,495	$	9,021,963	$	2,681,040	$	(15,270,474	)	$	5,290,024

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)


	December 31, 2015											December 31, 2016
	Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Condensed Consolidated		Parent Company		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Condensed Consolidated
	(Dollars in thousands)											(Dollars in thousands)
ASSETS
Current assets
Cash and cash equivalents	$	21,612	$	—	$	316,754	$	—		$	338,366	$	14,571	$	1,031	$	528,187	$	—		$	543,789
Accounts receivable, net	2,538		4,326		251,166		4,386			262,416		2,551		8,768		255,815		4,859			271,993
Accounts receivable from consolidated subsidiaries	5,276		2,412,079		289,697		(2,707,052		)	—		4,861		2,176,059		309,149		(2,490,069		)	—
Inventories, net	—		205,163		149,705		(24,593		)	330,275		—		200,852		140,406		(25,087		)	316,171
Prepaid expenses and other current assets	10,511		4,702		16,037		3,665			34,915		14,239		5,332		17,474		3,337			40,382
Prepaid taxes	16,686		—		14,622		(413		)	30,895		—		—		7,766		413			8,179
Assets held for sale	2,901		—		4,071		—			6,972		—		—		2,879		—			2,879
Total current assets	59,524		2,626,270		1,042,052		(2,724,007		)	1,003,839		36,222		2,392,042		1,261,676		(2,506,547		)	1,183,393
Property, plant and equipment, net	2,931		174,674		138,518		—			316,123		2,566		163,847		136,486		—			302,899
Goodwill	—		705,753		590,099		—			1,295,852		—		708,546		568,174		—			1,276,720
Intangibles assets, net	—		762,084		437,891		—			1,199,975		—		640,999		450,664		—			1,091,663
Investments in affiliates	5,724,226		1,360,045		23,065		(7,107,184		)	152
Deferred tax assets	91,432		—		8,042		(97,133		)	2,341		73,051		—		5,185		(76,524		)	1,712
Notes receivable and other amounts due from consolidated subsidiaries	1,358,446		1,658,092		—		(3,016,538		)	—		1,387,615		2,085,538		—		(3,473,153		)	—
Other assets	22,602		6,615		24,275		—			53,492		6,044,337		1,525,285		29,962		(7,564,758		)	34,826
Total assets	$	7,259,161	$	7,293,533	$	2,263,942	$	(12,944,862	)	$	3,871,774	$	7,543,791	$	7,516,257	$	2,452,147	$	(13,620,982	)	$	3,891,213
LIABILITIES AND EQUITY
Current liabilities
Current borrowings	$	374,050	$	—	$	43,300	$	—		$	417,350	$	133,071	$	—	$	50,000	$	—		$	183,071
Accounts payable	1,945		27,527		36,833		—			66,305		4,540		30,924		33,936		—			69,400
Accounts payable to consolidated subsidiaries	2,478,109		201,400		27,543		(2,707,052		)	—		2,242,814		214,203		33,052		(2,490,069		)	—
Accrued expenses	15,399		22,281		26,337		—			64,017		16,827		18,126		30,196		—			65,149
Current portion of contingent consideration	—		7,291		—		—			7,291		—		587		—		—			587
Payroll and benefit-related liabilities	21,617		29,305		33,736		—			84,658		20,610		26,672		35,397		—			82,679
Accrued interest	7,455		—		25		—			7,480		10,429		—		21		—			10,450
Income taxes payable	—		—		8,144		(85		)	8,059		1,246		—		6,577		85			7,908
Other current liabilities	1,300		2,679		4,981		—			8,960		2,262		3,643		2,497		—			8,402
Total current liabilities	2,899,875		290,483		180,899		(2,707,137		)	664,120		2,431,799		294,155		191,676		(2,489,984		)	427,646
Long-term borrowings	641,850		—		—		—			641,850		850,252		—		—		—			850,252
Deferred tax liabilities	—		376,738		36,378		(97,133		)	315,983		—		316,526		31,375		(76,524		)	271,377
Pension and postretirement benefit liabilities	100,355		32,274		16,812		—			149,441		85,645		31,561		15,856		—			133,062
Noncurrent liability for uncertain tax positions	1,151		17,722		21,527		—			40,400		1,169		13,684		2,667		—			17,520
Notes payable and other amounts due to consolidated subsidiaries	1,585,727		1,253,189		177,622		(3,016,538		)	—		2,011,737		1,264,004		197,412		(3,473,153		)	—
Other liabilities	20,931		15,685		12,271		—			48,887		23,848		15,695		12,472		—			52,015
Total liabilities	5,249,889		1,986,091		445,509		(5,820,808		)	1,860,681		5,404,450		1,935,625		451,458		(6,039,661		)	1,751,872
Total common shareholders' equity	2,009,272		5,307,442		1,816,612		(7,124,054		)	2,009,272
Noncontrolling interest	—		—		1,821		—			1,821
Total equity	2,009,272		5,307,442		1,818,433		(7,124,054		)	2,011,093
Total liabilities and equity	$	7,259,161	$	7,293,533	$	2,263,942	$	(12,944,862	)	$	3,871,774
Convertible notes - redeemable equity component												1,824		—		—		—			1,824
Mezzanine equity												1,824		—		—		—			1,824
Total shareholders' equity												2,137,517		5,580,632		2,000,689		(7,581,321		)	2,137,517
Total liabilities and shareholders' equity												$	7,543,791	$	7,516,257	$	2,452,147	$	(13,620,982	)	$	3,891,213

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)

TELEFLEX INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS


	Nine Months Ended September 25, 2016															Six Months Ended July 2, 2017
	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Condensed Consolidated			Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Condensed Consolidated
	(Dollars in thousands)															(Dollars in thousands)
Net cash (used in) provided by operating activities from continuing operations	$	(72,542	)	$	123,249		$	253,166		$	(2,275	)	$	301,598		$	(121,726	)	$	232,874		$	148,460		$	(61,918	)	$	197,690
Cash flows from investing activities of continuing operations:
Expenditures for property, plant and equipment	(191		)	(15,713		)	(20,008		)	—			(35,912		)	(173		)	(19,760		)	(16,900		)	—			(36,833		)
Proceeds from sale of assets	5,607			49,571			1,451			(46,837		)	9,792			—			—			6,332			—			6,332
Payments for businesses and intangibles acquired, net of cash acquired	—			(10,305		)	(50,572		)	46,837			(14,040		)	(975,524		)	—			(17,935		)	—			(993,459		)
Net cash provided by (used in) investing activities from continuing operations	5,416			23,553			(69,129		)	—			(40,160		)
Net cash used in investing activities from continuing operations																(975,697		)	(19,760		)	(28,503		)	—			(1,023,960		)
Cash flows from financing activities of continuing operations:
Proceeds from new borrowings	665,000			—			6,700			—			671,700			1,194,500			—			—			—			1,194,500
Reduction in borrowings	(714,487		)	—			—			—			(714,487		)	(228,273		)	—			—			—			(228,273		)
Debt extinguishment, issuance and amendment fees	(8,958		)	—			—			—			(8,958		)	(19,114		)	—			—			—			(19,114		)
Net proceeds from share based compensation plans and the related tax impacts	7,647			—			—			—			7,647			1,305			—			—			—			1,305
Payments to noncontrolling interest shareholders	—			—			(464		)	—			(464		)
Payments for contingent consideration	—			(133		)	—			—			(133		)	—			(153		)	—			—			(153		)
Payments for acquisition of noncontrolling interest	—			—			(9,231		)	—			(9,231		)
Dividends paid	(43,980		)	—			—			—			(43,980		)	(30,590		)	—			—			—			(30,590		)
Intercompany transactions	175,203			(145,645		)	(29,558		)	—			—			222,684			(203,029		)	(19,655		)	—			—
Intercompany dividends paid	—			—			(2,275		)	2,275			—			—			—			(61,918		)	61,918			—
Net cash provided by (used in) financing activities from continuing operations	80,425			(145,778		)	(34,828		)	2,275			(97,906		)	1,140,512			(203,182		)	(81,573		)	61,918			917,675
Cash flows from discontinued operations:
Net cash used in operating activities	(1,451		)	—			—			—			(1,451		)	(961		)	—			—			—			(961		)
Net cash used in discontinued operations	(1,451		)	—			—			—			(1,451		)	(961		)	—			—			—			(961		)
Effect of exchange rate changes on cash and cash equivalents	—			—			(988		)	—			(988		)	—			—			41,981			—			41,981
Net increase in cash and cash equivalents	11,848			1,024			148,221			—			161,093			42,128			9,932			80,365						132,425
Cash and cash equivalents at the beginning of the period	21,612			—			316,754			—			338,366			14,571			1,031			528,187			—			543,789
Cash and cash equivalents at the end of the period	$	33,460		$	1,024		$	464,975		$	—		$	499,459		$	56,699		$	10,963		$	608,552		$	—		$	676,214

TELEFLEX INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(Unaudited)


	Nine Months Ended September 27, 2015															Six Months Ended June 26, 2016
	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Condensed Consolidated			Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Condensed Consolidated
	(Dollars in thousands)															(Dollars in thousands)
Net cash (used in) provided by operating activities from continuing operations	$	(124,131	)	$	88,937		$	214,314		$	(2,360	)	$	176,760		$	(29,648	)	$	69,875		$	141,261		$	—		$	181,488
Cash flows from investing activities of continuing operations:
Expenditures for property, plant and equipment	(122		)	(25,072		)	(20,372		)	—			(45,566		)	(146		)	(9,947		)	(9,442		)	—			(19,535		)
Proceeds from sales of assets	408			—			—			—			408
Proceeds from sale of assets																—			20,642			1,251			(17,908		)	3,985
Payments for businesses and intangibles acquired, net of cash acquired	—			(30,336		)	(33,115		)	—			(63,451		)	—			—			(21,025		)	17,908			(3,117		)
Investments in affiliates	—			—			(121,850		)	121,850			—
Net cash provided by (used in) investing activities from continuing operations	286			(55,408		)	(175,337		)	121,850			(108,609		)
Net cash (used in) provided by investing activities from continuing operations																(146		)	10,695			(29,216		)	—			(18,667		)
Cash flows from financing activities of continuing operations:
Proceeds from new borrowings	288,100			—			—			—			288,100			665,000			—			—			—			665,000
Reduction in borrowings	(303,627		)	—			—			—			(303,627		)	(656,479		)	—			—			—			(656,479		)
Debt extinguishment, issuance and amendment fees	(9,017		)	—			—			—			(9,017		)	(8,182		)	—			—			—			(8,182		)
Net proceeds from share based compensation plans and the related tax impacts	4,815			—			—			—			4,815			6,593			—			—			—			6,593
Payments to noncontrolling interest shareholders	—			—			(833		)	—			(833		)
Payments for contingent consideration	—			(7,974		)	—			—			(7,974		)	—			(133		)	—			—			(133		)
Proceeds from issuance of shares	—			121,850			—			(121,850		)	—
Dividends paid	(42,382		)	—			—			—			(42,382		)	(28,998		)	—			—			—			(28,998		)
Intercompany transactions	196,963			(147,365		)	(49,598		)	—			—			81,640			(79,348		)	(2,292		)	—			—
Intercompany dividends paid	—			—			(2,360		)	2,360			—
Net cash provided by (used in) financing activities from continuing operations	134,852			(33,489		)	(52,791		)	(119,490		)	(70,918		)	59,574			(79,481		)	(2,292		)	—			(22,199		)
Cash flows from discontinued operations:
Net cash used in operating activities	(1,105		)	—			(849		)	—			(1,954		)	(1,183		)	—			—			—			(1,183		)
Net cash used in discontinued operations	(1,105		)	—			(849		)	—			(1,954		)	(1,183		)	—			—			—			(1,183		)
Effect of exchange rate changes on cash and cash equivalents	—			—			(22,052		)	—			(22,052		)	—			—			(1,315		)	—			(1,315		)
Net increase (decrease) in cash and cash equivalents	9,902			40			(36,715		)	—			(26,773		)
Net increase in cash and cash equivalents																28,597			1,089			108,438			—			138,124
Cash and cash equivalents at the beginning of the period	27,996			—			275,240			—			303,236			21,612			—			316,754			—			338,366
Cash and cash equivalents at the end of the period	$	37,898		$	40		$	238,525		$	—		$	276,463		$	50,209		$	1,089		$	425,192		$	—		$	476,490

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

All statements made in this Quarterly Report on Form 10-Q, 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, uncertainties and assumptions 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; delays or cancellations in shipments; demand for and market acceptance of new and existing products; our ~~ability~~inability to integrate acquired businesses into our operations, realize planned synergies and operate such businesses profitably in accordance with our expectations; our ~~ability~~inability to effectively execute our restructuring programs; our inability to realize anticipated savings ~~resulting~~ from restructuring plans and ~~programs at anticipated levels;~~programs; the impact of ~~recently passed~~ healthcare reform legislation and proposals to amend the legislation; changes in Medicare, Medicaid and third party coverage and reimbursements; 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; difficulties entering new markets; and general economic conditions. For a further discussion of the risks relating to our business, see Item 1A of our Annual Report on Form 10-K for the ~~fiscal~~ year ended December 31, ~~2015.~~2016. 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.

Overview

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 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 divest 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~~improve our cost ~~base~~structure and enhance our competitive position. ~~For a discussion~~We also may continue to explore opportunities to expand the size of our ~~ongoing restructuring programs, see "Restructuring charges"~~business and improve operating margins through a combination of acquisitions and distributor to direct sales conversions, which generally involve eliminating a distributor from the sales channel either by acquiring the distributor or terminating the distributor relationship (in some instances, the conversions involve our acquisition or termination of a master distributor and the continued sale of our products through sub-distributors or through new distributors). Distributor to direct conversions enable us to obtain 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”) for $975.5 million, net of cash acquired. Vascular Solutions is a medical device company that develops and markets clinical products for use in minimally invasive coronary and peripheral vascular procedures. The acquisition is expected to meaningfully accelerate the growth of our vascular and interventional access product portfolios by facilitating our entry 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 borrowings under ~~“Results~~our revolving credit facility, which was increased in anticipation of ~~Operations” below.~~the acquisition, and a new senior secured term loan facility, both of which were provided under our amended and restated credit agreement (the "Credit Agreement"), which is described in more detail below under "Borrowings" within "Liquidity and Capital Resources".

On April 3, 2017, we completed the acquisition of Pyng Medical Corp. ("Pyng") for $17.9 million, net of cash acquired, which we financed using available cash. Pyng is a medical device company that develops and markets sternal intraosseous infusion products, which complement our anesthesia product portfolio. The acquisition is expected to broaden our product offerings for the military and civilian trauma markets.

During ~~the first nine months of~~ 2016, we completed acquisitions of businesses that complement our OEM and Asia reportable operating segments. In addition, during ~~this period,~~2016, we acquired the remaining 26% ownership interest in an Indian affiliate from the noncontrolling shareholders. The total fair value of the consideration for these transactions was $22.8 million.

~~During 2015, we completed several acquisitions of businesses that complement~~ See Note 3 to the ~~anesthesia, surgical ligation, vascular and OEM product portfolios, as well as several acquisitions of distributors of medical devices and supplies. The total fair value of consideration~~condensed consolidated financial statements included in this report for ~~these acquisitions was $96.5 million.~~additional information.

Critical Accounting 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 from those estimates and assumptions.

In our Annual Report on Form 10-K for the year ended December 31, ~~2015,~~2016, we provided disclosure regarding our critical accounting estimates, which are reflective of significant judgments and uncertainties, are 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.

Results of Operations

As used in this discussion, "new products" are products that we have sold for 36 months or less, and “existing products” are products that we have sold for more than 36 months. 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. IfTo 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.

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

Net Revenues

Three Months Ended Nine Months Ended
September 25, 2016 September 27, 2015 September 25, 2016 September 27, 2015
(Dollars in millions) (Dollars in millions)
Net Revenues $ 455.6
$ 443.7
$ 1,354.1
$ 1,325.2



	Three Months Ended				Six Months Ended
	July 2, 2017		June 26, 2016		July 2, 2017		June 26, 2016
	(Dollars in millions)				(Dollars in millions)
Net Revenues	$	528.6	$	473.6	$	1,016.5	$	898.4

Net revenues for the three months ended ~~September 25, 2016~~July 2, 2017 increased ~~$11.9~~$55 million, or ~~2.7%~~11.6%, compared to the prior year period. The increase is primarily attributable to net revenues of $49.8 million generated by the acquired businesses, mainly Vascular Solutions, and to a lesser extent, an increase in new product sales of $5.8 million, primarily in the Surgical North America, Vascular North America and Anesthesia North America segments, an increase in sales volumes of existing products of $4.1 million, primarily in the EMEA and OEM segments, price increases of $2.9 million and net revenues generated by acquired businesses, partially offset by unfavorable fluctuations onin foreign currency exchange ~~rates of $1.6 million.~~rates.

Net revenues for the ~~nine~~six months ended ~~September 25, 2016~~July 2, 2017 increased ~~$28.9~~$118.1 million, or ~~2.2%~~13.1%, compared to the prior year period. The increase is primarily attributable to ~~an increase in new product sales~~net revenues of ~~$16.4~~$74.0 million generated by acquired businesses, mainly Vascular Solutions, and ana $33.7 million increase in sales volumes of existing products, reflecting the impact of ~~$15.7 million, both in most of our segments, price increases of $6.0 million, primarily in~~4 additional shipping days for the Surgical North America, Vascular North America, and Asia segments and net revenues generated by acquired businesses of $2.6 million, partially offset by unfavorable fluctuations in foreign currency exchange rates of $11.7 million.six months ended July 2, 2017.

Gross profit


	Three Months Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 25, 2016			September 27, 2015			September 25, 2016			September 27, 2015			July 2, 2017			June 26, 2016			July 2, 2017			June 26, 2016
	(Dollars in millions)						(Dollars in millions)						(Dollars in millions)						(Dollars in millions)
Gross profit	$	241.6		$	228.2		$	723.1		$	684.1		$	290.3		$	256.4		$	545.8		$	481.5
Percentage of sales	53.0		%	51.4		%	53.4		%	51.6		%	54.9		%	54.1		%	53.7		%	53.6		%

Gross margin for the three months ended ~~September 25, 2016improved 160~~July 2, 2017 increased 80 basis points, or ~~3.1%~~1.5% compared to the prior year period. The increase in gross margin reflects lower manufacturing costs primarily resulting from the 2016 and 2014 footprint realignment plans, partially offset by an increase in logistics and distribution costs. The increase in gross margin also reflects the favorable impact of fluctuations in foreign currency exchange rates. These increases were partially offset by the unfavorable impact of the step-up in carrying value of inventory, recognized in connection with the Vascular Solutions acquisition, that was sold during the second quarter 2017 as well as unfavorable product mix.

Gross margin for the six months ended July 2, 2017 increased 10 basis points, or 0.2%, compared to the prior year period. The increase in gross margin reflects ~~the impact of favorable fluctuations in foreign currency exchange rates, the impact of~~ lower manufacturing costs primarily resulting from the 2016 and ~~the impact of price increases, primarily~~2014 footprint realignment plans, partially offset by an increase in ~~the Asia, Vascular North America~~logistics and ~~Surgical North America segments.~~

~~Gross margin for the nine months ended September 25, 2016 improved 180 basis points, or 3.5%, compared to the prior year period.~~distribution costs. The increase in gross margin also reflects the impact of an increase in sales ~~of higher margin products, primarily in the Anesthesia North America and EMEA segments,~~volumes and the favorable impact of ~~favorable~~ fluctuations in foreign currency exchange ~~rates, including the impact of lower manufacturing costs. Manufacturing costs~~rates. These increases were also favorably impacted by cost improvement initiatives, including the 2014 Manufacturing Footprint Realignment Plan, and the resolution of certain product recall and quality issues impacting prior periods, partially offset by ~~inflationary cost increases.~~

the unfavorable $10.4 million impact of the step-up in carrying value of inventory recognized in connection with the Vascular Solutions acquisition, that was sold during the six months ended July 2, 2017 as well as unfavorable product mix.

Selling, general and administrative


	Three Months Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 25, 2016			September 27, 2015			September 25, 2016			September 27, 2015			July 2, 2017			June 26, 2016			July 2, 2017			June 26, 2016
	(Dollars in millions)						(Dollars in millions)						(Dollars in millions)						(Dollars in millions)
Selling, general and administrative	$	139.8		$	138.8		$	419.1		$	420.8		$	158.9		$	143.0		$	322.9		$	279.3
Percentage of sales	30.7		%	31.3		%	31.0		%	31.8		%	30.1		%	30.2		%	31.8		%	31.1		%

Selling, general and administrative expenses for the three months ended ~~September 25, 2016~~July 2, 2017 increased ~~$1.0~~$15.9 million compared to the prior year period. The increase is primarily attributable to an$15.9 million in expenses related to acquired businesses and distributor to direct conversions, and a $5.9 million increase in ~~selling~~general and ~~marketing~~administrative expenses ~~of $3.1 million and a reduction in the net benefit resulting from contingent consideration liability reversals of $1.4 million,~~including legal expenses. These increases were partially offset by ~~the~~a gain of $6.4 million resulting from a favorable ~~impact of the suspension of the excise tax under the Patient Protection and Affordable Care Act (the "Affordable Care Act") of $3.5 million and the favorable impact of fluctuations~~ruling in ~~foreign currency exchange rates of $1.3 million.~~a lawsuit involving an insurance provider.

Selling, general and administrative expenses for the ~~nine~~six months ended ~~September 25, 2016 decreased $1.7~~July 2, 2017 increased $43.6 million compared to the prior year period. The ~~decrease~~increase is primarily attributable to $35.0 million in expenses related to acquired businesses and distributor to direct conversions, including $7.6 million in transaction fees and other related expenses primarily resulting from the ~~favorable impact of the suspension of the excise tax under the Affordable Care Act of $10.0~~Vascular Solutions acquisition, an $8.2 million increase in general and administrative expenses, including legal expenses, and a $6.0 million increase in selling expenses. These increases were partially offset by a ~~reduction in the net benefit~~gain of $6.4 million resulting from ~~contingent consideration liability reversals of $4.9 million and~~a favorable ruling in a lawsuit involving an ~~increase in selling and marketing expenses of $3.4 million.~~insurance provider.

Research and development


	Three Months Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 25, 2016			September 27, 2015			September 25, 2016			September 27, 2015			July 2, 2017			June 26, 2016			July 2, 2017			June 26, 2016
	(Dollars in millions)						(Dollars in millions)						(Dollars in millions)						(Dollars in millions)
Research and development	$	15.1		$	12.6		$	42.9		$	38.9		$	20.3		$	15.5		$	38.1		$	27.8
Percentage of sales	3.3		%	2.8		%	3.2		%	2.9		%	3.8		%	3.3		%	3.7		%	3.1		%

The increase in research and development expense for the three and ~~nine~~six months ended ~~September 25, 2016~~July 2, 2017 compared to the prior year periods is primarily attributable to expenses incurred by our Vascular Solutions operating segment. Additionally, research and development expenses for the six months ended July 2, 2107 were impacted by increased spending on new product development with respect to several of our segments.

Restructuring charges

Three Months Ended Nine Months Ended
September 25, 2016 September 27, 2015 September 25, 2016 September 27, 2015
(Dollars in millions) (Dollars in millions)
Restructuring charges $ 3.0
$ 0.7
$ 12.9
$ 5.7



	Three Months Ended					Six Months Ended
	July 2, 2017		June 26, 2016			July 2, 2017		June 26, 2016
	(Dollars in millions)					(Dollars in millions)
Restructuring charges	$	0.9	$	(0.1	)	$	13.8	$	9.8

For the three months ~~and nine~~ ended ~~September 25,~~July 2, 2017, we recorded $0.9 million in restructuring charges, which primarily related to employee termination benefits.

For the three months ended June 26, 2016, we recorded ~~$3.0~~a net reversal of $0.1 million ~~and $12.9~~in restructuring charges, primarily resulting from changes in estimates associated with employee termination benefits.

For the six months ended July 2, 2017, we recorded $13.8 million ~~respectively,~~ in restructuring charges. The charges primarily related to termination benefits associated with the ~~2016 Other Restructuring Program~~2017 EMEA restructuring program and the ~~2016 Manufacturing Footprint Realignment Plan.~~2017 Vascular Solutions integration program of $6.5 million and $4.9 million, respectively.

For the ~~three~~six months ended ~~September 27, 2015,~~June 26, 2016, we recorded ~~$0.7 million in restructuring charges, which were primarily related to termination benefits associated with the 2014 Manufacturing Footprint Realignment Plan.~~

~~For the nine months ended September 27, 2015, we recorded $5.7~~$9.8 million in restructuring charges, which primarily related to employee termination benefits ~~and contract termination costs~~ recorded in connection with ~~our 2015~~the 2016 Footprint realignment plan.

In addition to the restructuring programs initiated during the first and second quarter of 2017, we have other ongoing restructuring programs related to the consolidation of our manufacturing operations (referred to as our 2016 and 2014 ~~Manufacturing Footprint Realignment Plan.~~

~~2016 Other Restructuring Program~~

~~During the third quarter 2016, we committed to certain actions~~footprint realignment plans) as well as restructuring programs designed to ~~further~~ improve operating efficiencies and reduce costs. ~~These actions include~~See Note 4 to the ~~consolidation~~condensed consolidated financial statements included in this report. With respect to our restructuring plans and programs, the following table summarizes (1) the estimated total cost and estimated annual pre-tax savings and synergies once the programs are completed; (2) the costs incurred and estimated pre-tax savings realized through December 31, 2016; and (3) the costs expected to be incurred and estimated incremental pre-tax savings and synergies estimated to be realized for these programs from January 1, 2017 through the anticipated completion dates:



	Ongoing Restructuring Plans and Programs
	Estimated Total	Through December 31, 2016	Estimated Remaining from January 1, 2017 through December 31, 2021₍₂₎
	(Dollars in millions)
Restructuring charges	$52 - $60	$33	$19 - $27
Restructuring related charges ₍₁₎	53 - 65	30	23 - 35
Total charges	$105 - $125	$63	$42 - $62

Pre-tax savings₍₃₎	$60 - $71	$31	$29 - $40
Vascular Solutions and Pyng integration programs - synergies (4)	$21 - $27	—	$21 - $27


(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)	We expect to incur substantially all of the costs prior to the end of 2018, and to have realized substantially all of the estimated annual pre-tax savings and synergies by the year ended December 31, 2019.

(3)

Approximately 65% of the savings is expected to result in reductions to cost of goods sold. During 2016, in connection with our execution of the 2014 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 reduce the annual savings that were estimated 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. We expect to begin realizing the benefits of this incremental pricing in 2017. Savings generated from restructuring programs are difficult to estimate, given the nature and timing of the restructuring activities and the possibility that unanticipated expenditures may be required as the programs progress. Moreover, predictions of revenues related to increased pricing are particularly uncertain and can be affected by a number of factors, including customer resistance to price increases and competition.

(4)

While pre-tax savings address anticipated cost savings to be realized with respect to our historical expense items, synergies reflect anticipated efficiencies to be realized with respect to increased costs that otherwise would have resulted from our acquisition of Vascular Solutions and Pyng. In this regard, the synergies 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 programs initiated in 2017:

2017 Vascular Solutions Integration Program

During the first quarter 2017, we committed to a restructuring program related to the integration of ~~global~~Vascular Solutions' operations with 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 $6.0 million to $7.5 million related to this program, of which $4.5 million to $5.3 million will constitute termination benefits, and $1.5 million to $2.2 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 the Company after completion of the program. All of these charges will result in future cash outlays. We began realizing program-related synergies in the first quarter 2017 and expect to achieve annualized pre-tax synergies of $20 million to $25 million once the program is fully implemented.

2017 EMEA Restructuring Program

During the first quarter 2017, we committed to a restructuring program to centralize certain administrative functions ~~and manufacturing operations. This~~in Europe. The program commenced in the ~~third~~second quarter ~~of 2016~~2017 and is expected to be substantially ~~complete~~completed by the end ~~of the first quarter~~ of 2018. We estimate that we will record aggregate pre-tax restructuring charges of ~~$2.5~~$7.1 million to ~~$3.5~~$8.5 million related to this program, ~~substantially~~almost all of which constitute termination benefits, ~~that~~and all of which will result in future cash outlays. Additionally, we expect to incur approximately $1 million of accelerated depreciation and other costs directly related to the plan, which will be recognized in cost of goods sold, of which, approximately $0.5 million is expected to result in future outlays.

We expect to achieve annualized pre-tax savings of ~~$4.5~~$2.7 million to ~~$5.5~~$3.3 million once ~~this~~the program ~~has been~~is fully implemented and expect ~~that we will~~to begin realizing ~~plan-related~~plan related savings in ~~2017.~~

~~2016 Manufacturing Footprint Realignment Plan~~

On February 23, 2016, our Board of Directors approved a restructuring plan that involves the consolidation of operations and a related workforce reduction at certain of our facilities (the "2016 Manufacturing Footprint Realignment Plan"). 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 currently expect to achieve annualized savings of $12 million to $16 million once the plan is fully implemented and currently expect to realize plan-related savings beginning in 2017.

~~2014 Manufacturing Footprint Realignment Plan~~

In April 2014, our Board of Directors approved 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 and were initially expected to be substantially completed by the end of 2017.

To date, we have completed the consolidation and relocation of a significant portion of the operations subject to the 2014 Manufacturing Footprint Realignment Plan, and estimate that we will achieve annualized savings of approximately $17 million by the end of 2016 directly related to these actions. With respect to the remaining actions to be taken under the plan, we revised our savings, expense and timing estimates during the third quarter 2016 to reflect the impact of changes we have implemented with respect to medication delivery devices included in certain kits primarily sold by our Vascular North America operating segment and, to a lesser extent, certain kits primarily sold by our Anesthesia North America operating segment. As a result of these changes, we have reduced our estimate with respect to the overall annualized savings we expect to realize under the plan from our prior estimate of $28 million to $35 million to a range of $23 million to $27 million. We anticipate that this decrease in projected savings will be offset, in large part, by an expected increase in annual revenues resulting from improved pricing on the affected Vascular kits directly related to the changes described above. We anticipate that this projected increase in annual revenues, taken together with the projected annualized savings we expect to realize under the 2014 Manufacturing Footprint Realignment Plan, should enable us to improve our pre-tax income on an annualized basis by approximately $28 million to $33 million once the plan has been completed.

As a result of the changes described above, we also revised our estimates with respect to the charges we expect to incur in connection with the plan. Specifically, we now estimate that we will incur $43 million to $48 million in aggregate pre-tax charges associated with the 2014 Manufacturing Footprint Realignment Plan, compared to our prior estimate of approximately $37 million to $44 million. In addition, we expect cash outlays associated with the plan to be in the range of $33 million to $38 million, compared to our prior estimate of approximately $26 million to $31 million. We continue to expect to incur $24 million to $30 million in aggregate capital expenditures under the plan.

~~We currently expect that the 2014 Manufacturing Footprint Realignment Plan will be substantially complete by the end of~~ the first ~~half of 2020 rather than the end of 2017, which we previously anticipated.~~

~~We currently are evaluating the feasibility of alternative measures designed to mitigate the loss of expected savings and accelerate the currently estimated timetable for completion of the plan.~~quarter 2018.

Interest expense


	Three Months Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 25, 2016			September 27, 2015			September 25, 2016			September 27, 2015			July 2, 2017			June 26, 2016			July 2, 2017			June 26, 2016
	(Dollars in millions)						(Dollars in millions)						(Dollars in millions)						(Dollars in millions)
Interest expense	$	12.9		$	14.3		$	38.6		$	47.7		$	19.9		$	11.9		$	37.6		$	25.7
Average interest rate on debt	4.1		%	3.4		%	3.7		%	4.0		%	3.5		%	3.6		%	3.5		%	3.6		%

The ~~decrease~~increase in interest expense for the three months ended ~~September 25, 2016~~July 2, 2017 compared to the prior year period was primarily due to ~~repayment of a portion of our borrowings under our Revolving Credit Facility and 3.875% Convertible Senior Subordinated Notes due 2017, resulting~~an increase in ~~lower~~ average debt outstanding, ~~compared~~mainly attributable to borrowings under the ~~prior period. These decreases~~Credit Agreement that were utilized to fund the Vascular Solutions acquisition partially offset by ~~our issuance of the 4.875% Senior Notes due 2026 (the “2026 Notes”) and an increase~~a slight decline in the ~~variable~~average interest ~~rates associated with the Revolving Credit Facility.~~rate on debt.

The ~~decrease~~increase in interest expense for the ~~nine~~six months ended ~~September 25, 2016~~July 2, 2017 compared to the prior year ~~periods~~period was primarily ~~reflects~~due to an increase in average debt outstanding, as well as interest expense of $2.1 million incurred in connection with a bridge facility and backstop commitment related to our entry into the ~~impact~~agreement and plan of ~~our June 2015 redemption~~merger under which we ultimately acquired Vascular Solutions. The bridge facility and backstop commitment were put in place on December 1, 2016 to, among other things, enable us to finance the acquisition of ~~$250 million~~Vascular Solutions. The bridge facility and backstop commitment were not utilized, as the required financing was provided under the Credit Agreement. The increases were partially offset by a slight decline in principal amount of our 6.875% Senior Subordinated Notes due 2019 (the "2019 Notes") using borrowings under our revolving credit facility, which bears interests at a variable interest rate that is lower than the average interest rate on the 2019 Notes. Our 2026 Notes, which we issued in May 2016, also carry a lower interest rate than the 2019 Notes, but as we used the net proceeds from the sale of our 2026 Notes to reduce outstanding amounts under our revolving credit facility, the effect of our issuance of the 2026 Notes was a marginal increase in our interest expense, although still below 2015 levels.debt.

Loss on extinguishment of debt

Three Months Ended Nine Months Ended
September 25, 2016 September 27, 2015 September 25, 2016 September 27, 2015
(Dollars in millions) (Dollars in millions)
Loss on extinguishment of debt $ —
$ —
$ 19.3
$ 10.5



	Three Months Ended				Six Months Ended
	July 2, 2017		June 26, 2016		July 2, 2017		June 26, 2016
	(Dollars in millions)				(Dollars in millions)
Loss on extinguishment of debt	$	—	$	19.3	$	5.6	$	19.3

For the ~~nine~~six months ended ~~September 25,~~July 2, 2017, we recognized a loss on the extinguishment of debt of $5.6 million, of which, $5.2 million related to our repurchase, on January 5, 2017, of the 3.875% Convertible Senior Subordinated Notes due 2017 (the "Convertible Notes") through exchange transactions we entered into 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.

For the three and six months ended June 26, 2016, we recognized a loss on the extinguishment of debt of $19.3 million, of which, $16.3 million related to ~~the settlement~~our repurchase, on April 4, 2016, of Convertible Notes through exchange transactions we entered into with certain holders of ~~our 3.875%~~the Convertible ~~Senior Subordinated~~ Notes ~~due 2017 (the "Convertible Notes")~~ and $3.0 million related to the settlement of conversions with respect to $44.3 million in aggregate principal amount of the Convertible Notes. See Note 7 to the condensed consolidated financial statements included in this report for additional information. During the nine months ended September 27, 2015, we recognized a $10.5 million loss on extinguishment of debt resulting from our redemption of $250 million in principal amount of the 2019 Notes.

~~Gain on sale of assets~~

Three Months Ended Nine Months Ended
September 25, 2016 September 27, 2015 September 25, 2016 September 27, 2015
(Dollars in millions) (Dollars in millions)
Gain on sale of assets $ 2.8
$ 0.4
$ 4.2
$ 0.4

During the three months ended September 25, 2016, we recognized a gain of $2.8 million, primarily as a result of the sale, for $6.0 million, of a building that previously was classified as held for sale.

During the nine months ended September 25, 2016, we recognized a gain of $4.2 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

Three Months Ended Nine Months Ended
September 25, 2016 September 27, 2015 September 25, 2016 September 27, 2015
Effective income tax rate 10.2 % 1.3 % 9.3 % 9.5 %



	Three Months Ended				Six Months Ended
	July 2, 2017		June 26, 2016		July 2, 2017		June 26, 2016
Effective income tax rate	13.4	%	11.9	%	7.4	%	8.8	%

The effective income tax rate for the three and ~~nine~~six months ended ~~September 25, 2016~~July 2, 2017 was ~~10.2%~~13.4% and ~~9.3%~~7.4%, respectively, and ~~1.3%~~11.9% and ~~9.5%~~8.8% for the three and ~~nine~~six months ended ~~September 27, 2015,~~June 26, 2016, respectively. The effective income tax rate for the three and ~~nine~~six months ended ~~September 25, 2016,~~July 2, 2017, as compared to the prior year ~~period,~~periods, reflects an ~~increased~~excess tax ~~expense~~benefit associated with share based payments recognized under the new FASB guidance adopted as of January 1, 2017. In addition, the effective tax rate for the six months ended July 2, 2017 reflects a ~~shift~~tax benefit associated with costs incurred in ~~income to jurisdictions~~connection with ~~higher tax rates.~~the Vascular Solutions acquisition. The effective ~~income~~ tax rate for the three months ended ~~September 27, 2015 also~~June 26, 2016 reflects a tax benefit associated with ~~a legislative~~the loss on extinguishment of debt. The effective tax rate ~~change.~~for the six months ended June 26, 2016 reflects a tax benefit on the settlement of a foreign tax audit as well as the above mentioned benefit associated with the loss on extinguishment of debt.

Segment Financial Information


	Three Months Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 25, 2016		September 27, 2015		% Increase/ (Decrease)		September 25, 2016		September 27, 2015		% Increase/ (Decrease)		July 2, 2017		June 26, 2016		% Increase/ (Decrease)		July 2, 2017		June 26, 2016		% Increase/ (Decrease)
Segment Revenue	(Dollars in millions)						(Dollars in millions)						(Dollars in millions)						(Dollars in millions)
Vascular North America	$	85.1	$	82.6	3.0		$	254.8	$	244.6	4.2		$	93.5	$	88.2	6.1		$	187.3	$	169.7	10.4
Anesthesia North America	48.7		47.6		2.2		143.9		138.6		3.7		49.1		49.2		(0.2	)	97.3		95.2		2.2
Surgical North America	41.9		39.6		5.6		123.9		118.2		4.9		44.7		43.1		3.7		90.7		82.0		10.5
EMEA	121.4		120.9		0.5		375.2		379.3		(1.1	)	132.0		131.7		0.2		262.7		253.8		3.5
Asia	64.0		61.9		3.5		176.4		172.5		2.3		64.0		63.2		1.3		112.9		112.3		0.5
OEM	41.4		39.0		6.3		115.7		111.6		3.7		45.1		40.3		12.0		88.5		74.3		19.1
All other	53.1		52.1		2.0		164.2		160.4		2.4		100.2		57.9		73.0		177.1		111.1		59.4
Segment net revenues	$	455.6	$	443.7	2.7		$	1,354.1	$	1,325.2	2.2		$	528.6	$	473.6	11.6		$	1,016.5	$	898.4	13.1

	Three Months Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 25, 2016		September 27, 2015		% Increase/ (Decrease)		September 25, 2016		September 27, 2015		% Increase/ (Decrease)		July 2, 2017		June 26, 2016		% Increase/ (Decrease)		July 2, 2017		June 26, 2016		% Increase/ (Decrease)
Segment Operating Profit	(Dollars in millions)						(Dollars in millions)						(Dollars in millions)						(Dollars in millions)
Vascular North America	$	21.7	$	18.1	20.4		$	63.4	$	50.9	24.6		$	25.3	$	22.0	14.8		$	50.1	$	41.7	20.2
Anesthesia North America	14.0		15.2		(8.1	)	41.2		36.6		12.6		20.5		15.0		36.3		34.0		27.2		25.0
Surgical North America	14.1		12.8		9.6		39.7		39.4		0.5		17.3		12.3		40.0		33.7		25.6		31.5
EMEA	16.6		19.6		(15.7	)	61.6		65.3		(5.8	)	23.2		24.0		(2.9	)	45.4		45.0		1.1
Asia	18.1		15.7		15.0		52.9		42.8		23.4		18.6		21.8		(14.5	)	29.4		34.8		(15.4	)
OEM	10.2		8.9		15.1		24.6		25.3		(2.6	)	10.3		9.2		12.2		19.5		14.4		35.1
All other	3.4		5.5		(38.0	)	16.5		15.5		7.3		11.3		7.4		51.5		5.0		13.1		(62.3	)
Segment operating profit (1)	$	98.1	$	95.8	2.3		$	299.9	$	275.8	8.7		$	126.5	$	111.7	13.2		$	217.1	$	201.8	7.6


(1)	See Note 14 to our condensed consolidated financial statements included in this report for a reconciliation of segment operating profit to our condensed consolidated income from continuing operations before interest, extinguishment of debt and taxes.

Comparison of the three and ~~nine~~six months ended ~~September 25,~~July 2, 2017 and June 26, 2016 ~~and September 27, 2015~~

Vascular North America

Vascular North America net revenues for the three months ended ~~September 25, 2016~~July 2, 2017 increased ~~$2.5~~$5.3 million, or ~~3.0%~~6.1% compared to the prior year period. The increase is primarily attributable to a net increase in sales volumes of existing products of $2.9 million, despite the unfavorable impact of one less shipping day in the second quarter 2017, and an increase in new product sales of $2.0 million.

Vascular North America net revenues for the six months ended July 2, 2017 increased $17.6 million, or 10.4% compared to the prior year period. The increase is primarily attributable to an $11.9 million increase in sales volumes of existing products, reflecting, in part, the impact of an increase in the number of shipping days for the six months ended July 2, 2017, and an increase in new product sales.

Vascular North America operating profit for the three months ended July 2, 2017 increased $3.3 million, or 14.8%, compared to the prior year period. The increase is primarily attributable to an increase in gross profit resulting from an increase in sales volumes, lower manufacturing costs and an increase in new ~~products~~product sales, ~~of $1.1 million and price increases.~~partially offset by higher operating expenses.

Vascular North America ~~net revenues~~operating profit for the ~~nine~~six months ended ~~September 25, 2016~~July 2, 2017 increased ~~$10.2~~$8.4 million, or ~~4.2%~~20.2%, compared to the prior year period. The increase is primarily attributable to an increase in sales volumes of existing products of $6.6 million, price increases of $2.3 million and an increase in new product sales of $1.8 million, partially offset by unfavorable fluctuations in foreign currency exchange rates.

~~Vascular North America operating~~gross profit for the three months ended September 25, 2016 increased $3.6 million, or 20.4% compared to the prior year period. The increase is primarily attributable to the $1.5 million impact of the suspension of the excise tax under the Affordable Care Act, the impact of price increases and an increase in sales of higher margin products as well as lower administrative expenses.

Vascular North America operating profit for the nine months ended September 25, 2016 increased $12.5 million, or 24.6%, compared to the prior year period. The increase is primarily attributable to the $4.2 million impact of the suspension of the excise tax under the Affordable Care Act, the $4.1 million impact ofresulting from an increase in sales volumes ~~of existing products, the $2.3 million impact of price increases, the impact of an increase in new product sales~~ and lower ~~other administrative~~manufacturing costs, partially offset by higher ~~manufacturing costs.~~research and development expenses, as well as higher general and administrative expenses.

Anesthesia North America

Anesthesia North America net revenues for the three months ended ~~September 25, 2016~~July 2, 2017 decreased $0.1 million, or 0.2% compared to the prior year period. Net revenues declined due to a $2.4 million decrease in sales volumes of existing products, reflecting, in part, the unfavorable impact of one less shipping day in the second quarter 2017. The decline was partially offset by net revenues generated by an acquired business and an increase in new product sales.

Anesthesia North America net revenues for the six months ended July 2, 2017 increased ~~$1.1~~$2.1 million, or 2.2%, compared to the prior year period. The increase is primarily attributable to ana $1.9 million increase in new product sales, ~~of $1.0 million.~~

~~Anesthesia North America~~ net revenues ~~for the nine months ended September 25, 2016 increased $5.3~~generated by an acquired business and price increases. These increases were partially offset by a net $1.7 million ~~or 3.7%, compared to the prior year period. The increase is primarily attributable to an increase~~decrease in sales volumes of existing products ~~of $2.8 million and~~despite an increase in ~~new product sales~~the number of ~~$2.3 million.~~shipping days for the six months ended July 2, 2017.

Anesthesia North America operating profit for the three and six months ended ~~September 25, 2016 decreased $1.2~~July 2, 2017increased $5.5 million, or ~~8.1%~~36.3%, and $6.8 million, or 25.0% for the three and six months ended July 2, 2017, respectively, compared to the prior year period. The decrease is primarily attributable to unfavorable fluctuations in foreign currency exchange rates of $1.2 million and higher amortization and marketing expense, partially offset by the favorable impact of the suspension of the excise tax under the Affordable Care Act as well as the impact of an increase in new product sales.

~~Anesthesia North America operating profit for the nine months ended September 25, 2016 increased $4.6 million, or 12.6%, compared to the prior year period.~~periods. The increase is primarily attributable to ~~the $3.7~~a gain of $6.4 million ~~impact of~~resulting from a favorable ruling in a lawsuit involving an increase in sales of higher margin products, the $2.9 million impact of an increase in sales volumes of existing products, the $2.2 million favorable impact of the suspension of the excise tax under the Affordable Care Act, the $1.3 million impact of an increase in new product sales and operating profit generated by the acquired businesses. The increase was partially offset by unfavorable fluctuations in foreign currency exchange rates of $1.9 million, higher amortization and marketing expenses as well as an increase in manufacturing costs.insurance provider.

Surgical North America

Surgical North America net revenues for the three months ended ~~September 25, 2016~~July 2, 2017 increased ~~$2.3 million, or 5.6%, compared to the prior year period. The increase is primarily attributable to an increase in new product sales of $1.7 million and price increases.~~

Surgical North America net revenues for the nine months ended September 25, 2016 increased $5.7 million, or 4.9%, compared to the prior year period. The increase is primarily attributable to an increase in new product sales of $4.0 million and price increases of $2.5 million.

Surgical North America operating profit for the three months ended September 25, 2016 increased $1.3 million, or 9.6%, compared to the prior year period. The increase is primarily attributable to the $1.2 million impact of an increase in new product sales, the impact of price increases, lower manufacturing costs and the favorable impact of the suspension of the excise tax under the Affordable Care Act. This increase was partially offset by the $1.0 million impact

~~of unfavorable fluctuations in foreign currency exchange rates and higher selling expense, primarily related to new product sales.~~

Surgical North America operating profit for the nine months ended September 25, 2016 increased $0.3 million, or 0.5%, compared to the prior year period. The increase is primarily attributable to the $2.9 million impact of an increase in new product sales, the $2.5 million impact of price increases, lower manufacturing costs of $2.0 million and the $1.7 million favorable impact of the suspension of the excise tax under the Affordable Care Act. The increase was partially offset by the $3.0 million impact of unfavorable fluctuations in foreign currency exchange rates, the $1.4 million unfavorable impact of an increase in the contingent consideration liability, the impact of a decrease in sales of higher margin products and higher selling expense, primarily related to new product sales.

~~EMEA~~

EMEA net revenues for the three months ended September 25, 2016 increased $0.5 million, or 0.5%, compared to the prior year period. The increase is primarily attributable to an increase in sales volume of existing products of $1.6 ~~million and an increase in new product sales, partially offset by unfavorable fluctuations in foreign currency exchange rates of $2.0 million.~~

EMEA net revenues for the nine months ended September 25, 2016 decreased $4.1 million, or 1.1%, compared to the prior year period. The decrease is primarily attributable to unfavorable fluctuations in foreign currency exchange rates of $5.9 million and price decreases of $1.8 million, partially offset by new products sales of $2.5 million and an increase in sales volumes of existing products.

EMEA operating profit for the three months ended September 25, 2016 decreased $3.0 million, or 15.7%, compared to the prior year period. The decrease is primarily attributable to the $2.7 million impact of unfavorable fluctuations in foreign currency exchange rates, a $1.9 million increase in manufacturing costs and an increase in research and development expense, partially offset by the $1.5 million impact of an increase in sales of higher margin products and an increase in sales volumes of existing products of $1.1 million.

EMEA operating profit for the nine months ended September 25, 2016 decreased $3.7 million, or 5.8%, compared to the prior year period. The decrease is primarily attributable to the $1.8 million impact of price decreases, a $1.6 million increase in manufacturing costs, the $1.5 million impact of unfavorable fluctuations in foreign currency exchange rates and higher operating expenses including selling, general and administrative expense as well as research and development expense. The decrease was partially offset by the $3.1 million impact of an increase in sales of higher margin products and the $1.0 million impact of an increase in new product sales.

~~Asia~~

Asia net revenues for the three months ended September 25, 2016 increased $2.1 million, or 3.5%, compared to the prior year period. The increase is primarily attributable price increases and favorable fluctuations in foreign currency exchange rates.

Asia net revenues for the nine months ended September 25, 2016 increased $3.9 million, or 2.3%, compared to the prior year period. The increase was primarily attributable price increases of $2.6 million, an increase in sales volumes of existing products of $2.2 million and net revenues generated by the acquired businesses of $1.2 million partially offset by unfavorable fluctuations in foreign currency exchange rates of $2.5 million.

Asia operating profit for the three months ended September 25, 2016 increased $2.4 million, or 15.0%, compared to the prior period. The increase is primarily attributable to the $3.1 million impact of favorable fluctuations in foreign currency exchange rates, price increases and a decrease in manufacturing costs, partially offset by a decrease in sales of higher margin products.

Asia operating profit for the nine months ended September 25, 2016 increased $10.1 million or 23.4%, compared to the prior year period. The increase is primarily attributable to price increases of $2.6 million, a decrease in manufacturing costs of $2.4 million, the $2.2 million impact of an increase in sales volumes of existing products, the $2.2 million impact of favorable fluctuations in foreign currency exchange rates and operating profit generated by the acquired businesses.

~~OEM~~

OEM net revenues for the three months ended September 25, 2016 increased $2.4 million, or 6.3%, compared to the prior year period. The increase is primarily attributable to an increase in sales volumes of existing products of $1.6 million and net revenues generated by the acquired businesses.

~~OEM net revenues for the nine months ended September 25, 2016 increased $4.1~~ million, or 3.7%, compared to the prior year period. The increase is primarily attributable to an increase in new product sales of ~~$2.5 million, net revenues generated by the acquired businesses and an increase in sales volumes of existing products.~~

OEM operating profit for the three months ended September 25, 2016 increased $1.3 million, or 15.1%, compared to the prior year period. The increase is primarily attributable to the impact of an increase in sales volumes of existing products.

~~OEM operating profit for the nine months ended September 25, 2016~~decreased $0.7 million, or 2.6%, compared to the prior year period. The decrease is primarily attributable to the $1.5 million impact of a decrease in sales of higher margin products and the unfavorable impact of foreign currency exchange rate fluctuations, partially offset by the $1.5 million impact of an increase in new product sales.

~~All Other~~

~~Net revenues for our other operating segments increased~~ $1.0 million ~~or 2.0% for the three months ended September 25, 2016, compared to the prior year period. The increase is primarily attributable to an~~and price increases. A net increase in sales volumes of existing products ~~and an increase~~were mostly offset by the impact of one less shipping day in ~~new product sales.~~the second quarter 2017.

~~Net~~Surgical North America net revenues for ~~our other operating segments~~the six months ended July 2, 2017 increased ~~$3.8~~$8.7 million, or ~~2.4% for the nine months ended September 25, 2016,~~10.5%, compared to the prior year period. The increase is primarily attributable to an increase in sales volumes of existing products of ~~$3.1~~$4.0 million, including the impact of an increase in the number of shipping days for the six months ended July 2, 2017, and an increase in new product sales of ~~$2.7~~$3.4 million.

Surgical North America operating profit for the three months ended July 2, 2017 increased $5.0 million, or 40.0%, compared to the prior year period. The increase is primarily attributable to an increase in gross profit resulting from favorable product mix, an increase in new product sales and price increases as well as a benefit from a reduction in contingent consideration liabilities.

Surgical North America operating profit for the six months ended July 2, 2017 increased $8.1 million, or 31.5%, compared to the prior year period. The increase is primarily attributable to an increase in gross profit resulting from an increase in sales volumes and new product sales as well as a benefit from a reduction in contingent consideration liabilities partially offset by higher selling expenses.

EMEA

EMEA net revenues for the three months ended July 2, 2017 increased $0.3 million, or 0.2%, compared to the prior year period. The increase is primarily attributable to a net increase in sales volumes of existing products, despite the unfavorable impact of one less shipping day in the second quarter 2017, and an increase in new product sales. The increases in net revenues were partially offset by unfavorable fluctuations in foreign currency exchange ~~rate~~rates of ~~$2.0~~$3.8 million.

~~Operating profit~~EMEA net revenues for ~~our other operating segments decreased $2.1~~the six months ended July 2, 2017 increased $8.9 million, or ~~38.0%~~3.5%, compared to the prior year period. The increase is primarily attributable to an increase in sales volumes of existing products of $12.9 million, including the impact of an increase in the number of shipping days for the six months ended July 2, 2017, which was partially offset by unfavorable fluctuations in foreign currency exchange rates of $8.0 million.

EMEA operating profit for the three months ended ~~September 25, 2016,~~July 2, 2017 decreased $0.8 million, or 2.9%, compared to the prior year period. The decrease is primarily attributable to a ~~reduction in the benefit resulting from contingent consideration liability reversals of $1.3 million, the $1.0 million impact of a~~ decrease in ~~sales of higher margin products and the impact of~~gross profit resulting from unfavorable fluctuations in foreign currency exchange rates and unfavorable product mix partially offset by ~~the favorable impact of the suspension of the excise tax under the Affordable Care Act and~~ an increase in sales ~~volumes of existing products.~~volumes.

~~Operating~~EMEA operating profit for ~~our other operating segments~~the six months ended July 2, 2017 increased ~~$1.0~~$0.4 million, or ~~7.3% for the nine months ended September 25, 2016,~~1.1%, compared to the prior year period. The increase is primarily attributable to an increase in gross profit resulting from an increase in sales volumes partially offset by unfavorable fluctuations in foreign currency exchange rates.

Asia

Asia net revenues for the ~~$1.8~~three months ended July 2, 2017 increased $0.8 million, or 1.3%, compared to the prior year period. The increase is primarily attributable to price increases of $1.3 million and new product sales partially offset by unfavorable fluctuations in foreign currency exchange rates of $1.1 million. Increases in sales volumes of existing products were more than offset by volume declines resulting from the impact of the distributor to direct sales conversion in China. As previously disclosed, we expected to experience a decline in sales and operating profit in our Asia segment during 2017 as our former distributor liquidates its inventory of our products and we implement our new structure to support these sales. During the first quarter 2017, the distributor commenced an arbitration proceeding against us, seeking, among other things, to compel our repurchase of Teleflex products that the distributor alleges are currently held in its inventory. See Note 13 to the condensed consolidated financial statements included in this report for additional information.

Asia net revenues for the six months ended July 2, 2017 increased $0.6 million, or 0.5%, compared to the prior year period. The increase is primarily attributable to price increases of $2.0 million and an increase in new product sales partially offset by a $1.8 million decrease in sales volumes of existing products, resulting from the ~~$1.7~~distributor to direct sales conversion in China discussed above, and unfavorable fluctuations in foreign currency exchange rates.

Asia operating profit for the three and six months ended July 2, 2017 decreased $3.2 million, ~~favorable impact of~~or 14.5%, and $5.4 million or 15.4%, respectively, compared to the ~~suspension of the excise tax under the Affordable Care Act, the $1.4 million impact of~~prior year periods. The decrease was primarily attributable to unfavorable fluctuations in foreign currency exchange rates as well as an increase in selling, general and administrative expenses primarily resulting from distributor to direct sales conversions.

OEM

OEM net revenues for the three months ended July 2, 2017 increased $4.8 million, or 12.0%, compared to the prior year period. The increase is primarily attributable to net revenues generated by an acquired business of ~~higher margin products~~$3.0 million and ~~the $1.3 million impact of~~ an increase in sales volumes of existing products of $2.5 million.

OEM net revenues for the six months ended July 2, 2017 increased $14.2 million, or 19.1%, compared to the prior year period. The increase is primarily attributable to an increase in sales volumes of existing products of $9.9 million and net revenues generated by an acquired business of $5.5 million.

OEM operating profit for the three and six months ended July 2, 2017 increased $1.1 million, or 12.2%, and $5.1 million, or 35.1%, respectively, compared to the prior year periods. The increase is primarily attributable to an increase in gross profit resulting from an increase in sales volumes and gross profit generated by an acquired business, partially offset by ~~the $2.1 million impact of unfavorable fluctuations in foreign currency exchange rates, $1.4 million in~~ higher ~~manufacturing costs, a reduction in the benefit~~operating expenses including those resulting from ~~contingent consideration liability reversals~~an acquired business.

All Other

Net revenues for our other operating segments increased $42.3 million, or 73.0%, and $66.0 million, or 59.4%, for the three and six months ended July 2, 2017, respectively, compared to the prior year periods. The increase is primarily attributable to net revenue of ~~$1.2~~$45.0 million and a$66.7 million for the three and six months ended July 2, 2017, respectively, generated by Vascular Solutions' product sales.

Operating profit for our other operating segments for the three months ended July 2, 2017 increased $3.9 million, or 51.5%, compared to the prior year period. The increase is primarily attributable to operating profit generated by Vascular Solutions' product sales.

Operating profit for our other operating segments decreased $8.1 million or 62.3% for the six months ended July 2, 2017, compared to the prior year period. The decrease is primarily attributable to higher operating expenses resulting from the Vascular Solutions acquisition, including transaction fees and related expenses, which were partially offset by an increase in ~~research and development expense.~~gross profit.

Liquidity and Capital Resources

We believe our cash flow from operations, available cash and cash equivalents, and borrowings under our revolving credit facility and ~~borrowings under~~ our 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. We have net cash provided by United States based operating activities as well as non-United States sources of cash available to help fund our debt service requirements in the United States. 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. We are not aware of any restrictions on repatriation of these funds and, subject to cash

payment of additional United States income taxes or foreign withholding taxes, these funds could be repatriated, if necessary. Any resulting additional taxes could be offset, at least in part, by foreign tax credits. The amount of any taxes required to be paid, which could be significant, and the application of tax credits would be determined based on income tax laws in effect at the time of such repatriation. We do not expect any such repatriation to result in additional tax expense because taxes have been provided for on unremitted foreign earnings that we do not consider permanently reinvested.

To date, 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 additional operating needs. However, although there have been recent improvements in certain countries, global financial markets remain volatile and the global credit markets are constrained, which creates a risk that our customers and suppliers may be unable to access liquidity. Consequently, we continue to monitor our credit risk, particularly ~~related~~with respect to ~~certain countries~~customers in ~~Europe.~~Greece, Italy, Portugal and Spain, and consider other mitigation strategies. As of ~~September 25,~~July 2, 2017 and December 31, 2016, our net ~~current and long-term~~ trade accounts receivable from publicly funded hospitals in Italy, Spain, Portugal and

Greece were ~~$34.7~~$26.8 million ~~compared to $37.4~~and $29.2 million, asrespectively. As of July 2, 2017 and December 31, ~~2015.~~2016, our net trade accounts receivable from customers in these countries were approximately 17.5% and 19.3%, respectively of our consolidated net trade accounts receivable. For the ~~nine~~six months ended ~~September 25,~~July 2, 2017 and June 26, 2016, ~~and September 27, 2015,~~ net revenues from customers in these countries were 6.3% and 7.1% of total net revenues, respectively, and average days that current and long-term trade accounts ~~receivables~~receivable were outstanding were ~~190~~162 days and ~~229~~206 days, respectively. As of September 25, 2016 and December 31, 2015, net current and long-term accounts receivables from these countries were approximately 22.9% and 23.9%, 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 ~~2016~~2017 and future years. In January 2017, we sold $16.1 million of receivables payable from publicly funded hospitals in Italy for $16.0 million.

Cash Flows

Cash flows from operating activities from continuing operations provided net cash of approximately ~~$301.6~~$197.7 million for the ~~nine~~six months ended ~~September 25, 2016~~July 2, 2017 as compared to ~~$176.8~~$181.5 million for the ~~nine~~six months ended ~~September 27, 2015.~~June 26, 2016. The ~~$124.8~~$16.2 million increase is attributable to ~~improved operating results,~~ a net favorable impact from changes in working capital and ~~a reduction in income tax payments. The~~favorable operating results, partially offset by an increase in the net cash ~~inflow~~outflow for income taxes resulting from fewer refunds during the first half of 2017 as compared to the first half of 2016.

The decrease in the net cash outflow from working capital is primarily the result of an increase in the cash inflow for accounts receivable as well as a cash inflow for accounts payable and accrued expenses partially offset by a ~~decrease in accounts receivable and a decrease in~~ cash outflow for inventories. The cash inflow for accounts receivable was $5.1 million for the six months ended July 2, 2017 as compared to an outflow of $10.2 million for the six months ended June 26, 2016. The increase is primarily attributable to the sale of receivables due from publicly funded hospitals in Italy, as described above. The cash inflow for accounts payable and accrued expenses was ~~$17.4~~$6.5 million for the ~~nine~~six months ended ~~September 25, 2016 as~~July 2, 2017 compared to an outflow of ~~$2.9~~$3.5 million for the ~~nine~~six months ended ~~September 27, 2015.~~June 26, 2016. The ~~decrease in~~ cash ~~outflows~~inflow for accounts payable and accrued expenses ~~excluding the net~~is attributable to an increase in ~~the restructuring reserve of $7.9 million, is primarily the result of higher~~ accrued interest due to the timing of interest payments ~~associated with the 2026 Notes~~ and ~~certain non-recurring accrued expense payments made during the nine months ended September 27, 2015, partially offset by a reduction~~an increase in ~~the~~legal and other accruals. The net cash outflow for ~~accounts payable related to the reduced need for inventory builds~~purchases of inventories for the ~~nine~~six months ended ~~September 25, 2016 as~~July, 2, 2017 was $12.2 million compared to ~~the nine months ended September 27, 2015. The cash inflow for accounts receivable was $4.3~~$3.3 million for the ~~nine~~six months ended ~~September 25, 2016 as compared to an outflow of $8.7 million for the nine months ended September 27, 2015.~~June 26, 2016. The increase is attributable to improved collections. The net cash outflow for purchase of inventories for the nine months ended September 25, 2016 was $5.6 million as compared to $19.9 million for the nine months ended September 27, 2015. The decrease is primarily attributable to a reduced need for inventory builds into support ~~of distributor to direct conversions~~our Footprint realignment restructuring plans and ~~our 2014 manufacturing footprint realignment plan.~~achieve desired safety stock levels.

Net cash used in investing activities from continuing operations was ~~$40.2 million~~$1.0 billion for the ~~nine~~six months ended ~~September 25, 2016,~~July 2, 2017, primarily resulting from the $993.5 million payment for businesses acquired, principally Vascular Solutions, and capital expenditures of ~~$35.9~~$36.8 million, ~~and payments for businesses and intangibles acquired of $14.0 million including CarTika and certain distributor acquisitions in New Zealand,~~ which ~~were comprised primarily of intangible assets, including goodwill, and inventory. These payments~~ were partially offset by proceeds of $6.3 million from ~~asset sales, primarily~~the sale of two ~~buildings,~~properties, one of ~~$9.8 million.~~which was a building that had been classified as held for sale.

Net cash used in financing activities from continuing operations was ~~$97.9~~$917.7 million for the ~~nine~~six months ended ~~September 25, 2016,~~July 2, 2017, primarily resulting from ~~dividends paid~~a net increase in borrowings of ~~$44.0 million,~~$966.2 million. There was a net increase in borrowings under the Credit Agreement, which was utilized to finance the Vascular Solutions acquisition, partially offset by a $91.7 million reduction in borrowings ~~of $42.8 million~~under the Convertible Notes resulting from ~~a $50~~the Exchange Transactions. Net cash used in financing activities from continuing operations was also impacted by dividend payments of $30.6 million ~~repayment~~and debt issuance and amendment fees of ~~borrowings under our revolving credit agreement as well as borrowing activity described~~$19.1 million, which included fees paid in ~~Note 7 to~~connection with the ~~condensed consolidated financial statements included in this report, a $9.2 million payment for the acquisition~~signing of the ~~remaining 26% noncontrolling interest of our Indian affiliate~~Credit Agreement and ~~debt extinguishment~~a bridge facility and ~~issuance fees, including transaction fees associated~~backstop commitment that was put in place to assist with the ~~issuance~~financing of the ~~2026 Notes, of $9.0 million, partially offset by $7.6 million of net proceeds from shared based compensation plans and~~Vascular Solutions acquisition, but was never utilized because the ~~related tax benefits, primarily stock option exercises~~.required financing was provided under the Credit Agreement.

Borrowings

Our 3.875% Convertible Senior Subordinated Notes due 2017 (the "Convertible Notes") ~~are~~matured on August 1, 2017 (the "Maturity Date"). The Convertible Notes were convertible under certain circumstances, as described in Note 8 to the consolidated financial statements included in our annual report on Form 10-K for the year ended December 31, ~~2015.~~2016. Since the fourth quarter 2013, our closing stock price has exceeded the threshold for ~~conversion~~conversion. Moreover, commencing on May 1, 2017 and ~~accordingly,~~through July 28, 2017, the Convertible Notes were convertible regardless of the closing price of our stock. Accordingly, the Convertible Notes were classified as a current liability as of ~~September 25, 2016~~July 2, 2017 and December 31, ~~2015.~~2016. We ~~have~~ elected a net settlement method to satisfy our conversion obligations, under which we ~~settle~~settled the principal amount of the Convertible Notes in cash and ~~settle~~settled the excess of the conversion value of the Convertible Notes over the principal amount of the notes in shares; however, cash ~~will be~~was paid in lieu of fractional shares.

In ~~April 2016,~~January 2017, we ~~exchanged $219.2 million in cash and 2.17 million shares of our common stock for $219.2~~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 ~~$219.2 million~~ cash portion of the consideration paid ~~in connection with the Exchange Transactions~~ through borrowings under our revolving credit facility. ~~In addition, during~~On the ~~second quarter of 2016,~~Maturity Date, we ~~delivered~~repaid the remaining $44.3 million in ~~cash and 0.4 million shares of our common stock to holders of $44.3 million~~ aggregate principal amount of the Convertible Notes ~~who exercised their conversion rights under~~outstanding, together with unpaid interest due and owing on the Convertible ~~Notes.~~Notes (the “Cash Payment”). In connection with 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, in addition to the Cash Payment, we delivered to the holders of the Converted Notes, in the aggregate, 0.5 million shares of our common stock. We funded the ~~cash portion of the conversion obligation~~Cash Payment through borrowings under our revolving credit ~~agreement.~~facility.

~~In May 2016,~~On January 20, 2017, we ~~issued $400.0 million~~entered into the Credit Agreement, which provides for a five-year revolving credit facility of ~~the 2026 Notes in~~$1.0 billion and a ~~public offering. We used the net proceeds from the offering to repay borrowings~~term loan facility of $750.0 million. The availability of loans under our revolving credit ~~facility.~~

~~See Note 7~~facility is dependent upon our ability to maintain continued compliance with the ~~condensed consolidated~~ financial ~~statements included~~and other covenants contained in ~~this report for~~the Credit Agreement. Moreover, additional ~~information regarding~~borrowings would be prohibited if an event resulting in a Material Adverse Effect (as defined in the ~~Exchange Transactions, the conversions and the 2026 Notes.~~

~~While~~Credit Agreement) were to occur. Notwithstanding these restrictions, we believe ~~we have sufficient liquidity to repay the outstanding principal amounts of the Convertible Notes due through a combination of~~ our ~~existing cash on hand and borrowings under our~~revolving credit facility provides us with significant flexibility to meet our ~~use of these funds could adversely affect our results of operations and liquidity.~~foreseeable working capital needs.

~~Our senior credit agreement~~The Credit Agreement and the indentures under which we issued our 5.25% Senior Notes due 2024 (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 additional debt or issue preferred stock or other disqualified stock; create liens; pay dividends, make investments or make other restricted payments; sell assets; merge, consolidate, sell or otherwise dispose of all or substantially all of our assets; or enter into transactions with our affiliates. ~~Our senior credit agreement~~The Credit Agreement also requires us to maintain a consolidated total leverage ratio (generally, ~~the ratio of~~ Consolidated Total Funded Indebtedness, as defined in the Credit Agreement, on the date of determination to Consolidated EBITDA, ~~each~~ as defined in ~~our senior credit agreement)~~the Credit Agreement, for the four most recent quarters ending on or preceding the date of determination) of not more than ~~4.0:1~~4.50 to 1.00, and a maximum 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 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, ~~each~~ as defined in the ~~senior credit agreement)~~Credit Agreement, paid in cash for such period) of not less than ~~3.50:1 as of the last day of any period of four consecutive fiscal quarters calculated in accordance with the definitions and methodology set forth in the senior credit agreement.~~ 3.50 to 1.00.

As of ~~September 25, 2016,~~July 2, 2017, we ~~are~~were in compliance with these covenants. The obligations under the ~~senior credit agreement,~~Credit Agreement, the 2024 Notes and the 2026 Notes are guaranteed (subject to certain exceptions) by substantially all of our material domestic subsidiaries, and the obligations under the ~~senior credit agreement~~Credit Agreement are (subject to certain exceptions and limitations) secured by a ~~pledge~~lien on substantially all of ~~the equity interests~~assets owned by us and each guarantor.

See Note 7 to the condensed consolidated financial statements included in this report for additional information regarding the Exchange Transactions and the Credit Agreement.

Contractual obligations

The following table sets forth our contractual obligations related to our total borrowings and interest as of July 2, 2017 (in thousands), which, as a result of the signing of the Credit Agreement during the first quarter 2017, has significantly changed since December 31, 2016:



			Payments due by period
	Total		Less than 1 year		1-3 years		3-5 years		More than 5 years
			(Dollars in thousands)
Total borrowings	$	2,012,303	$	112,178	$	79,687	$	1,170,438	$	650,000
Interest obligations⁽¹⁾	450,391		75,394		147,255		125,664		102,078


(1)	Interest payments on floating rate debt are based on the interest rate in effect on July 2, 2017 .

New Accounting Standards

See Note 2 to the condensed consolidated financial statements included in this report for a discussion of recently issued accounting standards, including estimated effects, if any, on our financial statements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

See the information set forth in Part II, Item 7A of the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2015.~~2016.

Item 4. 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 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. Management’s assessment of disclosure controls and procedures excluded consideration of Vascular Solutions’ internal control over financial reporting. Vascular Solutions was acquired during the first quarter of 2017, and the exclusion is consistent with guidance provided by the staff of the Securities and Exchange Commission that an assessment of a recently acquired business may be omitted from management’s report on internal control over financial reporting for up to one year from the date of acquisition, subject to specified conditions. Vascular Solutions’ total assets were $1.2 billion as of July 2, 2017; its revenues during the three and six months ended July 2, 2017 were $45.0 million and $66.7 million, respectively.

(b) 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, we are in the process of evaluating Vascular Solutions’ internal controls to determine the extent to which modifications to Vascular Solutions' internal controls would be appropriate.

PART II — OTHER INFORMATION

Item 1. 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 ~~September 25, 2016~~July 2, 2017 and December 31, ~~2015,~~2016, we have accrued liabilities of approximately $2.5 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. Of the $2.5 million accrued at ~~September 25, 2016, $1.5~~July 2, 2017, $1.7 million pertains to discontinued operations. 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 liquidity. See “Litigation” within Note 13 to the condensed consolidated financial statements included in this report for additional information.

Item 1A. Risk Factors

There have been no significant changes in risk factors for the quarter ended ~~September 25, 2016.~~July 2, 2017. See the information set forth in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2015.~~2016.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Not applicable.

Item 3. Defaults Upon Senior Securities

Not applicable.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

Not applicable.

Item 6. Exhibits

The following exhibits are filed as part of this report:



Exhibit No.		Description
31.1	—	Certification of Chief Executive Officer, pursuant to Rule 13a–14(a) under the Securities Exchange Act of 1934.
31.2	—	Certification of Chief Financial Officer, pursuant to Rule 13a–14(a) under the Securities Exchange Act of 1934.
32.1	—	Certification of Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	—	Certification of Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.1	—	The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended ~~September 25, 2016,~~July 2, 2017, formatted in XBRL (eXtensible Business Reporting Language): (i) the Condensed Consolidated Statements of Income for the three and ~~nine~~six months ended ~~September 25, 2016~~July 2, 2017 and ~~September 27, 2015;~~June 26, 2016; (ii) the Condensed Consolidated Statements of Comprehensive Income for the three and ~~nine~~six months ended ~~September 25, 2016~~July 2, 2017 and ~~September 27, 2015;~~June 26, 2016; (iii) the Condensed Consolidated Balance Sheets as of ~~September 25, 2016~~July 2, 2017 and December 31, ~~2015;~~2016; (iv) the Condensed Consolidated Statements of Cash Flows for the ~~nine~~six months ended ~~September 25, 2016~~July 2, 2017 and ~~September 27, 2015;~~June 26, 2016; (v) the Condensed Consolidated Statements of Changes in Equity for the ~~nine~~three and six months ended ~~September 25, 2016~~July 2, 2017 and ~~September 27, 2015;~~June 26, 2016; and (vi) Notes to Condensed Consolidated Financial Statements.

SIGNATURES

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



		TELEFLEX INCORPORATED

		By:		/s/ Benson F. Smith
				Benson F. Smith Chairman and Chief Executive Officer (Principal Executive Officer)

		By:		/s/ Thomas E. Powell
				Thomas E. Powell Executive Vice President and Chief Financial Officer (Principal Financial ~~and Accounting~~ Officer)

Dated: ~~October 27, 2016~~August 3, 2017

5148



										Accumulated Other Comprehensive Loss
	Common Stock			Additional Paid In Capital			Retained Earnings						Treasury Stock					Noncontrolling Interest			Total Equity
	Shares	Dollars		Additional Paid In Capital			Retained Earnings						Shares		Dollars			Noncontrolling Interest			Total Equity
	(Dollars and shares in thousands, except per share)
Balance at December 31, 2015	43,517	$	43,517	$	440,127		$	2,016,176		$	(371,124	)	1,908		$	(119,424	)	$	1,821		$	2,011,093
Net income							176,314											464			176,778
Cash dividends ($1.02 per share)							(43,980		)												(43,980		)
Other comprehensive income (loss)										15,806								(43		)	15,763
Distributions to noncontrolling interest shareholders																		(464		)	(464		)
Acquisition of noncontrolling interest				(6,621		)				(832		)						(1,778		)	(9,231		)
Settlements of convertible notes	2,168	2,168		(31,921		)							(429	)	33,051						3,298
Settlements of note hedges associated with convertible notes and warrants				85,909									314		(85,909		)				—
Shares issued under compensation plans	114	114		15,719									(45	)	756						16,589
Deferred compensation													2		76						76
Balance as of September 25, 2016	45,799	$	45,799	$	503,213		$	2,148,510		$	(356,150	)	1,750		$	(171,450	)	$	—		$	2,169,922




Three Months Ended September 27, 2015
	Termination Benefits			Facility Closure Costs			Contract Termination Costs		Other Exit Costs		Total
	(Dollars in thousands)
2015 Restructuring programs	$	(198	)	$	37		$	78	$	9	$	(74	)
2014 Manufacturing footprint realignment plan	619			(3		)	163		52		831
2014 European restructuring plan	(97		)	—			—		—		(97		)
Total restructuring charges	$	324		$	34		$	241	$	61	$	660



	After Tax Gain (Loss) Recognized in OCI
	Three Months Ended						Nine Months Ended
	September 25, 2016			September 27, 2015			September 25, 2016		September 27, 2015
	(Dollars in thousands)
Foreign currency forward contracts	$	(223	)	$	(730	)	$	761	$	(1,489	)



	Pension Three Months Ended						Other Postretirement Benefits Three Months Ended				Pension Nine Months Ended						Other Postretirement Benefits Nine Months Ended
	September 25, 2016			September 27, 2015			September 25, 2016		September 27, 2015		September 25, 2016			September 27, 2015			September 25, 2016		September 27, 2015
	(Dollars in thousands)
Service cost	$	656		$	470		$	44	$	157	$	1,963		$	1,410		$	266	$	371
Interest cost	3,948			4,492			383		452		11,797			13,463			1,196		1,476
Expected return on plan assets	(6,209		)	(6,606		)	—		—		(18,606		)	(19,457		)	—		—
Net amortization and deferral	1,781			1,563			63		8		4,937			4,620			177		162
Net benefits expense (income)	$	176		$	(81	)	$	490	$	617	$	91		$	36		$	1,639	$	2,009