Condensed consolidating guarantor financial information | Condensed consolidating guarantor financial information The 2024 and 2026 Notes are issued by Teleflex Incorporated (the “Parent Company”), and payment of the Parent Company's obligations under the 2024 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 and condensed consolidating statements of cash flows for the years ended December 31, 2016, 2015 and 2014 and condensed consolidating balance sheets as of December 31, 2016 and 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 are used by the Parent Company and each of its subsidiaries in connection with the condensed consolidating financial information, except for the use of the equity method of accounting to reflect ownership interests in subsidiaries, which are eliminated upon consolidation. Consolidating entries and eliminations in the following condensed consolidated financial statements represent adjustments to (a) eliminate intercompany transactions between or among the Parent Company, the Guarantor Subsidiaries and the Non-Guarantor Subsidiaries, (b) eliminate the investments in subsidiaries and (c) record consolidating entries. TELEFLEX INCORPORATED AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME Year Ended December 31, 2016 Parent Company Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Condensed Consolidated (Dollars in thousands) Net revenues $ — $ 1,112,464 $ 1,124,958 $ (369,395 ) $ 1,868,027 Cost of goods sold — 652,442 588,110 (368,725 ) 871,827 Gross profit — 460,022 536,848 (670 ) 996,200 Selling, general and administrative expenses 43,602 328,263 191,916 (473 ) 563,308 Research and development expenses 547 33,080 24,952 — 58,579 Restructuring and other impairment charges 173 50,183 8,871 — 59,227 Gain on sale of assets (2,707 ) (155 ) (1,505 ) — (4,367 ) (Loss) income from continuing operations before interest, loss on extinguishment of debt and taxes (41,615 ) 48,651 312,614 (197 ) 319,453 Interest, net 153,830 (103,465 ) 4,102 — 54,467 Loss on extinguishment of debt 19,261 — — — 19,261 (Loss) income from continuing operations before taxes (214,706 ) 152,116 308,512 (197 ) 245,725 (Benefit) taxes on (loss) income from continuing operations (78,478 ) 46,758 39,875 (81 ) 8,074 Equity in net income of consolidated subsidiaries 374,048 243,987 528 (618,563 ) — Income from continuing operations 237,820 349,345 269,165 (618,679 ) 237,651 Operating (loss) income from discontinued operations (1,300 ) — 378 — (922 ) Tax benefit on (loss) income from discontinued operations (857 ) — (255 ) — (1,112 ) (Loss) income from discontinued operations (443 ) — 633 — 190 Net income 237,377 349,345 269,798 (618,679 ) 237,841 Less: Income from continuing operations attributable to noncontrolling interest — — 464 — 464 Net income attributable to common shareholders 237,377 349,345 269,334 (618,679 ) 237,377 Other comprehensive loss attributable to common shareholders (66,761 ) (76,098 ) (80,700 ) 156,798 (66,761 ) Comprehensive income attributable to common shareholders $ 170,616 $ 273,247 $ 188,634 $ (461,881 ) $ 170,616 Year Ended December 31, 2015 Parent Company Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Condensed Consolidated (Dollars in thousands) Net revenues $ — $ 1,079,180 $ 1,107,565 $ (377,055 ) $ 1,809,690 Cost of goods sold — 646,427 593,855 (374,995 ) 865,287 Gross profit — 432,753 513,710 (2,060 ) 944,403 Selling, general and administrative expenses 42,435 336,049 191,029 (531 ) 568,982 Research and development expenses — 30,359 21,760 — 52,119 Restructuring charges — 6,731 1,088 — 7,819 Gain on sale of assets — — (408 ) — (408 ) (Loss) income from continuing operations before interest, loss on extinguishment of debt and taxes (42,435 ) 59,614 300,241 (1,529 ) 315,891 Interest, net 132,711 (76,873 ) 4,953 — 60,791 Loss on extinguishment of debt 10,454 — — — 10,454 (Loss) income from continuing operations before taxes (185,600 ) 136,487 295,288 (1,529 ) 244,646 (Benefit) taxes on (loss) income from continuing operations (66,264 ) 27,260 46,804 38 7,838 Equity in net income of consolidated subsidiaries 355,138 235,810 1,086 (592,034 ) — Income from continuing operations 235,802 345,037 249,570 (593,601 ) 236,808 Operating (loss) income from discontinued operations (1,734 ) — 4 — (1,730 ) (Benefit) taxes on (loss) income from discontinued operations (10,795 ) — 160 — (10,635 ) Income (loss) from discontinued operations 9,061 — (156 ) — 8,905 Net income 244,863 345,037 249,414 (593,601 ) 245,713 Less: Income from continuing operations attributable to noncontrolling interests — — 850 — 850 Net income attributable to common shareholders 244,863 345,037 248,564 (593,601 ) 244,863 Other comprehensive loss attributable to common shareholders (110,229 ) (110,604 ) (120,439 ) 231,043 (110,229 ) Comprehensive income attributable to common shareholders $ 134,634 $ 234,433 $ 128,125 $ (362,558 ) $ 134,634 Year Ended December 31, 2014 Parent Company Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Condensed Consolidated (Dollars in thousands) Net revenues $ — $ 1,078,851 $ 1,132,152 $ (371,171 ) $ 1,839,832 Cost of goods sold — 652,742 608,256 (363,594 ) 897,404 Gross profit — 426,109 523,896 (7,577 ) 942,428 Selling, general and administrative expenses 42,829 326,282 209,930 (384 ) 578,657 Research and development expenses — 40,546 20,494 — 61,040 Restructuring charges — 10,189 7,680 — 17,869 (Loss) income from continuing operations before interest and taxes (42,829 ) 49,092 285,792 (7,193 ) 284,862 Interest, net 144,869 (85,886 ) 5,769 — 64,752 (Loss) income from continuing operations before taxes (187,698 ) 134,978 280,023 (7,193 ) 220,110 (Benefit) taxes on (loss) income from continuing operations (68,307 ) 68,690 28,159 108 28,650 Equity in net income of consolidated subsidiaries 308,396 233,827 252 (542,475 ) — Income from continuing operations 189,005 300,115 252,116 (549,776 ) 191,460 Operating loss from discontinued operations (2,196 ) — (1,211 ) — (3,407 ) (Benefit) taxes on loss from discontinued operations (870 ) — 172 — (698 ) Loss from discontinued operations (1,326 ) — (1,383 ) — (2,709 ) Net income 187,679 300,115 250,733 (549,776 ) 188,751 Less: Income from continuing operations attributable to noncontrolling interests — — 1,072 — 1,072 Net income attributable to common shareholders 187,679 300,115 249,661 (549,776 ) 187,679 Other comprehensive loss attributable to common shareholders (150,040 ) (105,872 ) (126,317 ) 232,189 (150,040 ) Comprehensive income attributable to common shareholders $ 37,639 $ 194,243 $ 123,344 $ (317,587 ) $ 37,639 TELEFLEX INCORPORATED AND SUBSIDIARIES CONDENSED CONSOLIDATING BALANCE SHEETS December 31, 2016 Parent Company Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Condensed Consolidated (Dollars in thousands) ASSETS Current assets Cash and cash equivalents $ 14,571 $ 1,031 $ 528,187 $ — $ 543,789 Accounts receivable, net 2,551 8,768 255,815 4,859 271,993 Accounts receivable from consolidated subsidiaries 4,861 2,176,059 309,149 (2,490,069 ) — Inventories, net — 200,852 140,406 (25,087 ) 316,171 Prepaid expenses and other current assets 14,239 5,332 17,474 3,337 40,382 Prepaid taxes — — 7,766 413 8,179 Assets held for sale — — 2,879 — 2,879 Total current assets 36,222 2,392,042 1,261,676 (2,506,547 ) 1,183,393 Property, plant and equipment, net 2,566 163,847 136,486 — 302,899 Goodwill — 708,546 568,174 — 1,276,720 Intangibles assets, net — 640,999 450,664 — 1,091,663 Deferred tax assets 73,051 — 5,185 (76,524 ) 1,712 Notes receivable and other amounts due from consolidated subsidiaries 1,387,615 2,085,538 — (3,473,153 ) — Other assets 6,044,337 1,525,285 29,962 (7,564,758 ) 34,826 Total assets $ 7,543,791 $ 7,516,257 $ 2,452,147 $ (13,620,982 ) $ 3,891,213 LIABILITIES AND EQUITY Current liabilities Current borrowings $ 133,071 $ — $ 50,000 $ — $ 183,071 Accounts payable 4,540 30,924 33,936 — 69,400 Accounts payable to consolidated subsidiaries 2,242,814 214,203 33,052 (2,490,069 ) — Accrued expenses 16,827 18,126 30,196 — 65,149 Current portion of contingent consideration — 587 — — 587 Payroll and benefit-related liabilities 20,610 26,672 35,397 — 82,679 Accrued interest 10,429 — 21 — 10,450 Income taxes payable 1,246 — 6,577 85 7,908 Other current liabilities 2,262 3,643 2,497 — 8,402 Total current liabilities 2,431,799 294,155 191,676 (2,489,984 ) 427,646 Long-term borrowings 850,252 — — — 850,252 Deferred tax liabilities — 316,526 31,375 (76,524 ) 271,377 Pension and postretirement benefit liabilities 85,645 31,561 15,856 — 133,062 Noncurrent liability for uncertain tax positions 1,169 13,684 2,667 — 17,520 Notes payable and other amounts due to consolidated subsidiaries 2,011,737 1,264,004 197,412 (3,473,153 ) — Other liabilities 23,848 15,695 12,472 — 52,015 Total liabilities 5,404,450 1,935,625 451,458 (6,039,661 ) 1,751,872 Convertible notes - redeemable equity component (Note 19) 1,824 — — — 1,824 Mezzanine Equity 1,824 — — — 1,824 Total common shareholders' equity 2,137,517 5,580,632 2,000,689 (7,581,321 ) 2,137,517 Total liabilities and equity $ 7,543,791 $ 7,516,257 $ 2,452,147 $ (13,620,982 ) $ 3,891,213 December 31, 2015 Parent Company Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Condensed Consolidated (Dollars in thousands) ASSETS Current assets Cash and cash equivalents $ 21,612 $ — $ 316,754 $ — $ 338,366 Accounts receivable, net 2,538 4,326 251,166 4,386 262,416 Accounts receivable from consolidated subsidiaries 5,276 2,412,079 289,697 (2,707,052 ) — Inventories, net — 205,163 149,705 (24,593 ) 330,275 Prepaid expenses and other current assets 10,511 4,702 16,037 3,665 34,915 Prepaid taxes 16,686 — 14,622 (413 ) 30,895 Assets held for sale 2,901 — 4,071 — 6,972 Total current assets 59,524 2,626,270 1,042,052 (2,724,007 ) 1,003,839 Property, plant and equipment, net 2,931 174,674 138,518 — 316,123 Goodwill — 705,753 590,099 — 1,295,852 Intangibles assets, net — 762,084 437,891 — 1,199,975 Deferred tax assets 91,432 — 8,042 (97,133 ) 2,341 Notes receivable and other amounts due from consolidated subsidiaries 1,358,446 1,658,092 — (3,016,538 ) — Other assets 5,746,828 1,366,660 47,340 (7,107,184 ) 53,644 Total assets $ 7,259,161 $ 7,293,533 $ 2,263,942 $ (12,944,862 ) $ 3,871,774 LIABILITIES AND EQUITY Current liabilities Current borrowings $ 374,050 $ — $ 43,300 $ — $ 417,350 Accounts payable 1,945 27,527 36,833 — 66,305 Accounts payable to consolidated subsidiaries 2,478,109 201,400 27,543 (2,707,052 ) — Accrued expenses 15,399 22,281 26,337 — 64,017 Current portion of contingent consideration — 7,291 — — 7,291 Payroll and benefit-related liabilities 21,617 29,305 33,736 — 84,658 Accrued interest 7,455 — 25 — 7,480 Income taxes payable — — 8,144 (85 ) 8,059 Other current liabilities 1,300 2,679 4,981 — 8,960 Total current liabilities 2,899,875 290,483 180,899 (2,707,137 ) 664,120 Long-term borrowings 641,850 — — — 641,850 Deferred tax liabilities — 376,738 36,378 (97,133 ) 315,983 Pension and postretirement benefit liabilities 100,355 32,274 16,812 — 149,441 Noncurrent liability for uncertain tax positions 1,151 17,722 21,527 — 40,400 Notes payable and other amounts due to consolidated subsidiaries 1,585,727 1,253,189 177,622 (3,016,538 ) — Other liabilities 20,931 15,685 12,271 — 48,887 Total liabilities 5,249,889 1,986,091 445,509 (5,820,808 ) 1,860,681 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 TELEFLEX INCORPORATED AND SUBSIDIARIES CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS Year Ended December 31, 2016 Parent Guarantor Non-Guarantor Eliminations Condensed (Dollars in thousands) Net cash (used in) provided by operating activities from continuing operations $ (85,088 ) $ 169,400 $ 328,553 $ (2,275 ) $ 410,590 Cash flows from investing activities of continuing operations: Expenditures for property, plant and equipment (279 ) (24,753 ) (28,103 ) — (53,135 ) Payments for businesses and intangibles acquired, net of cash acquired — (10,305 ) (50,572 ) 46,837 (14,040 ) Proceeds from sale of assets 5,607 49,571 1,860 (46,837 ) 10,201 Investments in affiliates — (5,600 ) — 5,600 — Net cash provided by (used in) investing activities from continuing operations 5,328 8,913 (76,815 ) 5,600 (56,974 ) Cash flows from financing activities of continuing operations: Proceeds from new borrowings 665,000 — 6,700 — 671,700 Reduction in borrowings (714,565 ) — — — (714,565 ) Debt extinguishment, issuance and amendment fees (8,958 ) — — — (8,958 ) Proceeds from share based compensation plans and the related tax impacts 9,068 — — — 9,068 Payments to noncontrolling interest shareholders — — (464 ) — (464 ) Payments for acquisition of noncontrolling interest — — (9,231 ) — (9,231 ) Payments for contingent consideration — (7,282 ) — — (7,282 ) Proceeds from issuance of shares — — 5,600 (5,600 ) — Dividends paid (58,960 ) — — — (58,960 ) Intercompany transactions 183,244 (170,000 ) (13,244 ) — — Intercompany dividends paid — — (2,275 ) 2,275 — Net cash provided by (used in) financing activities from continuing operations 74,829 (177,282 ) (12,914 ) (3,325 ) (118,692 ) Cash flows from discontinued operations: Net cash used in operating activities (2,110 ) — — — (2,110 ) Net cash used in discontinued operations (2,110 ) — — — (2,110 ) Effect of exchange rate changes on cash and cash equivalents — — (27,391 ) — (27,391 ) Net (decrease) increase in cash and cash equivalents (7,041 ) 1,031 211,433 — 205,423 Cash and cash equivalents at the beginning of the year 21,612 — 316,754 — 338,366 Cash and cash equivalents at the end of the year $ 14,571 $ 1,031 $ 528,187 $ — $ 543,789 Year Ended December 31, 2015 Parent Company Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Condensed Consolidated (Dollars in thousands) Net cash (used in) provided by operating activities from continuing operations $ (147,704 ) $ 134,817 $ 320,145 $ (3,812 ) $ 303,446 Cash flows from investing activities of continuing operations: Expenditures for property, plant and equipment (124 ) (32,797 ) (28,527 ) — (61,448 ) Payments for businesses and intangibles acquired, net of cash acquired — (60,336 ) (33,472 ) — (93,808 ) Proceeds from sale of assets 408 — — — 408 Investments in affiliates — — (121,850 ) 121,850 — Net cash provided by (used in) investing activities from continuing operations 284 (93,133 ) (183,849 ) 121,850 (154,848 ) Cash flows from financing activities of continuing operations: Proceeds from new borrowings 288,100 — — — 288,100 Reduction in borrowings (303,757 ) — — — (303,757 ) Debt extinguishment, issuance and amendment fees (9,017 ) — — — (9,017 ) Proceeds from share based compensation plans and related tax impacts 4,994 — — — 4,994 Payments to noncontrolling interest shareholders — — (1,343 ) — (1,343 ) Payments for contingent consideration — (8,028 ) — — (8,028 ) Proceeds from issuance of shares — 121,850 — (121,850 ) — Dividends paid (56,532 ) — — — (56,532 ) Intercompany transactions 219,035 (155,506 ) (63,529 ) — — Intercompany dividends paid — — (3,812 ) 3,812 — Net cash provided by (used in) financing activities from continuing operations 142,823 (41,684 ) (68,684 ) (118,038 ) (85,583 ) Cash flows from discontinued operations: Net cash used in operating activities (1,787 ) — (849 ) — (2,636 ) Net cash used in discontinued operations (1,787 ) — (849 ) — (2,636 ) Effect of exchange rate changes on cash and cash equivalents — — (25,249 ) — (25,249 ) Net (decrease) increase in cash and cash equivalents (6,384 ) — 41,514 — 35,130 Cash and cash equivalents at the beginning of the year 27,996 — 275,240 — 303,236 Cash and cash equivalents at the end of the year $ 21,612 $ — $ 316,754 $ — $ 338,366 Year Ended December 31, 2014 Parent Company Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Condensed Consolidated (Dollars in thousands) Net cash (used in) provided by operating activities from continuing operations $ (105,467 ) $ 347,503 $ 52,634 $ (4,429 ) $ 290,241 Cash flows from investing activities of continuing operations: Expenditures for property, plant and equipment (2,273 ) (30,586 ) (34,712 ) — (67,571 ) Payments for businesses and intangibles acquired, net of cash acquired — (17,241 ) (28,536 ) — (45,777 ) Proceeds from sale of assets and investments 1,669 3,421 161 — 5,251 Investments in affiliates (60 ) 20 — — (40 ) Net cash used in investing activities from continuing operations (664 ) (44,386 ) (63,087 ) — (108,137 ) Cash flows from financing activities of continuing operations: Proceeds from new borrowings 250,000 — — — 250,000 Reduction in borrowings (480,102 ) — — — (480,102 ) Debt issuance and amendment fees (4,494 ) — — — (4,494 ) Proceeds from share based compensation plans and the related tax impacts 4,245 — — — 4,245 Payments to noncontrolling interest shareholders — — (1,094 ) — (1,094 ) Dividends paid (56,258 ) — — — (56,258 ) Intercompany transactions 381,663 (317,617 ) (64,046 ) — — Intercompany dividends paid — — (4,429 ) 4,429 — Net cash provided by (used in) financing activities from continuing operations 95,054 (317,617 ) (69,569 ) 4,429 (287,703 ) Cash flows from discontinued operations: Net cash used in operating activities (3,676 ) — — — (3,676 ) Net cash used in discontinued operations (3,676 ) — — — (3,676 ) Effect of exchange rate changes on cash and cash equivalents — — (19,473 ) — (19,473 ) Net decrease in cash and cash equivalents (14,753 ) (14,500 ) (99,495 ) — (128,748 ) Cash and cash equivalents at the beginning of the year 42,749 14,500 374,735 — 431,984 Cash and cash equivalents at the end of the year $ 27,996 $ — $ 275,240 $ — $ 303,236 |