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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_________________________________________________
FORM 10-K
_________________________________________________

(Mark One)
☒
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2019 or
☐
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 East Swedesford Road, Suite 400, Wayne, Pennsylvania
 
19087
(Address of principal executive offices)   (Zip Code)
Registrant’s telephone number, including area code: (610) 225-6800

Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock, par value $1.00 per share
TFX
New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:
NONE
_________________________________________________ 
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  ý     No  ¨
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.     Yes  ¨    No  ý
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x     No  ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files).    Yes  x    No  ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer x
 
Accelerated filer ¨
 
Non-accelerated filer ¨
 
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 Act). Yes  ☐   No  x
The aggregate market value of the Common Stock of the registrant held by non-affiliates of the registrant (27,449,837 shares) on June 28, 2019 (the last business day of the registrant’s most recently completed fiscal second quarter) was $9,090,013,523(1). The aggregate market value was computed by reference to the closing price of the Common Stock on such date, as reported by the New York Stock Exchange.
The registrant had 46,363,711.00 shares of Common Stock outstanding as of February 18, 2020
DOCUMENT INCORPORATED BY REFERENCE:
Certain provisions of the registrant’s definitive proxy statement in connection with its 2020 Annual Meeting of Stockholders, to be filed within 120 days of the close of the registrant’s fiscal year, are incorporated by reference in Part III hereof.
(1) For purposes of this computation only, the registrant has defined “affiliate” as including executive officers and directors of the registrant and owners of more than five percent of the common stock of the registrant, without conceding that all such persons are “affiliates” for purposes of the federal securities laws.




TELEFLEX INCORPORATED
ANNUAL REPORT ON FORM 10-K
FOR THE YEAR ENDED DECEMBER 31, 2019
TABLE OF CONTENTS
 
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2

Information Concerning Forward-Looking Statements
All statements made in this Annual Report on Form 10-K, other than statements of historical fact, are forward-looking statements. The words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “will,” “would,” “should,” “guidance,” “potential,” “continue,” “project,” “forecast,” “confident,” “prospects” and similar expressions typically are used to identify forward-looking statements. Forward-looking statements are based on the then-current expectations, beliefs, assumptions, estimates and forecasts about our business and the industry and markets in which we operate. These statements are not guarantees of future performance and are subject to risks and uncertainties, which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or implied by these forward-looking statements due to a number of factors, including:
•changes in business relationships with and purchases by or from major customers or suppliers;
•delays or cancellations in shipments;
•demand for and market acceptance of new and existing products;
•our inability to provide products to our customers, which may be due to, among other things, events that impact key distributors, suppliers and vendors that sterilize our products;
•our inability to integrate acquired businesses into our operations, realize planned synergies and operate such businesses profitably in accordance with our expectations;
•our inability to effectively execute our restructuring programs;
•our inability to realize anticipated savings resulting from restructuring plans and programs;
•the impact of enacted healthcare reform legislation and proposals to amend, replace or repeal the legislation;
•changes in Medicare, Medicaid and third-party coverage and reimbursements;
•the impact of tax legislation and related regulations;
•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, trade disputes, sovereign debt issues and the impact of the United Kingdom's departure from the European Union, commonly referred to as "Brexit";
•public health epidemics including the novel coronavirus (referred to as COVID-19);
•difficulties entering new markets; and
•general economic conditions.
For a further discussion of the risks relating to our business, see Item 1A, “Risk Factors” in this Annual Report on Form 10-K. We expressly disclaim any obligation to update these forward-looking statements, except as otherwise explicitly stated by us or as required by law or regulation.

3

PART I
ITEM 1. BUSINESS
Teleflex Incorporated is referred to herein as “we,” “us,” “our,” “Teleflex” and the “Company.”
THE COMPANY
Teleflex is a global provider of medical technology products that enhance clinical benefits, improve patient and provider safety and reduce total procedural costs. We primarily design, develop, manufacture and supply single-use medical devices used by hospitals and healthcare providers for common diagnostic and therapeutic procedures in critical care and surgical applications. We market and sell our products to hospitals and healthcare providers worldwide through a combination of our direct sales force and distributors. Because our products are used in numerous markets and for a variety of procedures, we are not dependent upon any one end-market or procedure. We manufacture our products at approximately 35 manufacturing sites, with major manufacturing operations located in the Czech Republic, Germany, Malaysia, Mexico and the United States (the "U.S.").
We are focused on achieving consistent, sustainable and profitable growth and improving our financial performance by increasing our market share and improving our operating efficiencies through:
•development of new products and product line extensions;
•investment in new technologies and broadening the application of our existing technologies;
•expansion of the use of our products in existing markets and introduction of our products into new geographic markets;
•achievement of economies of scale as we continue to expand by utilizing our direct sales force and distribution network to sell new products, as well as by increasing efficiencies in our sales and marketing organizations, research and development activities and manufacturing and distribution facilities; and
•expansion of our product portfolio through select acquisitions, licensing arrangements and business partnerships that enhance, expand or expedite our development initiatives or our ability to increase our market share.
Our research and development capabilities, commitment to engineering excellence and focus on low-cost manufacturing enable us to bring to market cost effective, innovative products that improve the safety, efficacy and quality of healthcare. Our research and development initiatives focus on developing these products for both existing and new therapeutic applications, as well as developing enhancements to, and product line extensions of, existing products. During 2019 we introduced several product line extensions and five new products. Our portfolio of existing products and products under development consists primarily of Class I and Class II medical devices, most of which require 510(k) clearance by the U.S. Food and Drug Administration ("FDA") for sale in the U.S., and some of which are exempt from the requirement to obtain 510(k) clearance. We believe that seeking 510(k) clearance or qualifying for 510(k)-exempt status reduces our research and development costs and risks, and typically results in a shorter timetable for new product introductions as compared to the premarket approval, or PMA, process that would be required for Class III medical devices. See "Government Regulation" below for additional information.
HISTORY AND RECENT DEVELOPMENTS
Teleflex was founded in 1943 as a manufacturer of precision mechanical push/pull controls for military aircraft. From this original single market, single product orientation, we expanded and evolved through entries into new businesses, development of new products, introduction of products into new geographic or end-markets and acquisitions and dispositions of businesses. Throughout our history, we have continually focused on providing innovative, technology-driven, specialty-engineered products that help our customers meet their business requirements.
Beginning in 2007, we significantly changed the composition of our portfolio of businesses, expanding our presence in the medical device industry, while divesting all of our other businesses, which served the aerospace, automotive, industrial and marine markets. Following the divestitures of our marine business and cargo container and systems businesses in 2011, we became exclusively a medical device company.
In 2017, we completed two large scale acquisitions: NeoTract, Inc. ("NeoTract") and Vascular Solutions, Inc. (“Vascular Solutions”). NeoTract was a medical device company that developed and commercialized the UroLift System, a minimally invasive medical device for treating lower urinary tract symptoms due to benign prostatic
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hyperplasia, or BPH. Vascular Solutions was a medical device company that developed and marketed clinical products for use in minimally invasive coronary and peripheral vascular procedures.
We expect to continue to increase the size of our business through a combination of acquisitions and organic growth initiatives.
Restructuring programs
We continue to execute our footprint realignment and other restructuring programs designed to improve efficiencies in our manufacturing and distribution facilities and, to a lesser extent, our sales and marketing and research and development organizations. See Note 5 to the consolidated financial statements included in this Annual Report on Form 10-K for additional information.
OUR SEGMENTS
During 2019, our chief operating decision maker (our Chief Executive Officer) changed the manner in which he reviews financial information for purposes of assessing business performance and allocating resources by focusing on the geographic location of all non-OEM operations. As a result, we changed our segment presentation. Specifically, the Vascular North America, Interventional North America, Anesthesia North America, Surgical North America, Interventional Urology North America, Respiratory North America and Latin America operating segments were combined into a new Americas segment. We now have four segments: Americas, EMEA (Europe, the Middle East and Africa), Asia (Asia Pacific) and OEM (Original Equipment Manufacturer and Development Services).
Each of our three geographic segments provides a comprehensive portfolio of medical technology products used by hospitals and healthcare providers. However, certain of our products are more heavily concentrated within certain segments. For example, most of our urology products are sold by our EMEA segment and most of our interventional urology products are sold by our Americas segment. Our product portfolio is described in the products section below.
Our OEM segment designs, manufactures and supplies devices and instruments for other medical device manufacturers. Our OEM division, which includes the TFX OEM and Deknatel OEM brands, provides custom-engineered extrusions, diagnostic and interventional catheters, balloons and balloon catheters, sheath/dilator sets (introducers) and kits, sutures, performance fibers and bioresorbable resins and fibers.
The following charts depict our net revenues by reportable operating segment as a percentage of our total consolidated net revenues for the years ended December 31, 2019, 2018 and 2017.
TFX-20191231_G1.JPG
OUR PRODUCTS

Our product categories within our geographic segments include vascular access, anesthesia, interventional, surgical, interventional urology, respiratory and urology. Each of these categories and the key products sold therein are described in more detail below.

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Vascular Access: Our Vascular Access product category offers devices that facilitate a variety of critical care therapies and other applications with a primary focus on helping reduce vascular-related complications. These products primarily consist of our Arrow branded catheters and related devices including catheter positioning systems in addition to our intraosseous, or in the bone, access systems.
Our catheters are used in a wide range of procedures, including the administration of intravenous therapies, the measurement of blood pressure and the withdrawal of blood samples through a single puncture site. Many of our catheters provide antimicrobial and antithrombogenic catheter protection technology and provide clinical benefits that have shown to reduce the risk of catheter related bloodstream infections and to reduce microbial colonization and thrombus accumulation on catheter surfaces.
Our intraosseous access systems are designed for the delivery of medications and fluids when traditional vascular access is difficult or impossible. Our products offer a method for vascular access that can be administered quickly and effectively in hospital and pre-hospital emergency situations and include the EZ-IO Intraosseous Vascular Access System and Arrow FAST1 Sternal IO System.
Interventional: Our Interventional product category offers devices that facilitate a variety of applications to diagnose and deliver treatment via the vascular system of the body. These products primarily consist of a variety of coronary catheters, structural heart therapies, peripheral intervention products and cardiac assist products that are used by interventional cardiologists, interventional radiologists and vascular surgeons. Clinical benefits of our products include increased vein and artery access and increased support during complex medical procedures. Our product offerings consists of a portfolio of Arrow branded catheters, Guideline and Trapliner catheters, the Manta Vascular Closure and Arrow Oncontrol devices.

Anesthesia: Our Anesthesia product category is comprised of airway and pain management product lines that support hospital, emergency medicine and military channels.
Our airway management products and related devices are designed to enable use of standard and advanced anesthesia techniques in both pre-hospital emergency and hospital settings. Our key products include laryngoscopes, supraglottic airways, endotracheal tubes and atomization devices, which are branded under our LMA, Rusch and MAD tradenames.

Our pain management product line includes catheters and disposable pain pumps for regional anesthesia, designed to improve patients’ post-operative pain experience, which are branded under our Arrow tradename.

Surgical: Our Surgical product category consists of single-use and reusable products designed to provide surgeons with devices for use in a variety of surgical procedures. These products primarily consist of metal and polymer ligation clips, fascial closure surgical systems used in laparoscopic surgical procedures, percutaneous surgical systems and other surgical instruments. Our significant surgical brands include Weck, Minilap, Pleur-Evac, Deknatel, KMedic and Pilling.
Interventional Urology: Our interventional urology product category includes the UroLift System, a minimally invasive technology for treating lower urinary tract symptoms due to benign prostatic hyperplasia, or BPH. The UroLift System involves the placement of permanent implants, typically through a transurethral outpatient procedure, that hold the prostate lobes apart to relieve compression on the urethra without cutting, heating or removing prostate tissue. Our Interventional Urology product portfolio is most heavily weighted in our Americas segment.
Respiratory: Our respiratory products are used in a variety of care settings and include oxygen therapy products, aerosol therapy products, spirometry products and ventilation management products marketed under the Hudson RCI brand name.
Urology: Our urology product portfolio provides bladder management for patients in the hospital and individuals in the home care markets. The product portfolio consists principally of a wide range of catheters (including Foley, intermittent, external and suprapubic), urine collectors, catheterization accessories and products for operative endourology, which are marketed under the Rusch brand name. Our urology product portfolio is most heavily weighted in our EMEA segment.
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OUR MARKETS
We generally serve three end-markets: hospitals and healthcare providers, medical device manufacturers and home care. These markets are affected by a number of factors, including demographics, utilization and reimbursement patterns. The following charts depict the percentage of net revenues for the years ended December 31, 2019, 2018 and 2017 derived from each of our end markets.
TFX-20191231_G2.JPG
GOVERNMENT REGULATION
We are subject to comprehensive government regulation both within and outside the U.S. relating to the development, manufacture, sale and distribution of our products.
Regulation of Medical Devices in the U.S
All of our medical devices manufactured or distributed in the U.S. are subject to the Federal Food, Drug, and Cosmetic Act (“FDC Act”), and its implementing regulations, which are enforced by the FDA. The FDA and, in some cases, other government agencies administer requirements for the methods used in, and the facilities and controls used for, the design, manufacture, packaging, labeling, storage, installation, servicing, marketing, importing and exporting of all finished devices intended for human use. Additional FDA requirements include premarket clearance and approval, advertising and promotion, distribution, post-market surveillance, import and export of our medical devices.
Unless an exemption, pre-amendment grandfather status or FDA enforcement discretion applies, each medical device that we market in the U.S. must first receive either clearance as a Class I or, typically, a Class II device (by submitting a premarket notification (“510(k)”) or approval as a Class III device (by filing a premarket approval application (“PMA”)) from the FDA pursuant to the FDC Act. To obtain 510(k) clearance, a manufacturer must demonstrate that the proposed device is substantially equivalent to a legally marketed device (a 510(k)-cleared device, pre-amendment device for which FDA has not called for PMAs or a device with a de novo authorization), referred to as the "predicate device." Substantial equivalence is established by the applicant showing that the proposed device has the same intended use as the predicate device, and it either has the same technological characteristics or has been shown to be equally safe and effective and does not raise different questions of safety and effectiveness as compared to the predicate device.  The FDA’s 510(k) clearance process requires regulatory competence to execute and usually takes four to nine months, but it can last longer. A device that is not eligible for the 510(k) process because there is no predicate device may be reviewed through the de novo process (the process for granting marketing authorization when no substantially equivalent device exists) if the FDA agrees it is a low to moderate risk device. A device not eligible for 510(k) clearance or de novo authorization is categorized as Class III and must follow the PMA approval pathway, which requires proof of the safety and effectiveness of the device to the FDA’s satisfaction.  The process of obtaining PMA approval also requires specific regulatory competence and is more costly, lengthy and uncertain than the 510(k) or de novo process. It generally takes from one to three years or even longer. Our portfolio of existing products and pipeline of potential new products consist primarily of Class I (510(k) exempt) and Class II devices that require 510(k) clearance, although a few are 510(k)-exempt.  In addition, certain modifications made to devices after they receive clearance or approval may require a new 510(k) clearance or approval of a PMA or PMA supplement. We cannot be sure that 510(k) clearance or PMA approval will be obtained in a timely matter if at all for any device that we propose to market.
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A clinical trial is almost always required to support a PMA application and is sometimes required for a 510(k) clearance or a de novo authorization.  The sponsor of a clinical study must comply with and conduct the study in accordance with the applicable federal regulations, including FDA’s requirements for investigational device exemptions (“IDE”) requirements and good clinical practice (“GCP”).  Clinical trials must also be approved by an institutional review board ("IRB"), which is an appropriately constituted group that has been formally designated to review biomedical research involving human subjects and which has the authority to approve, require modifications in, or disapprove research to protect the rights, safety, and welfare of the human research subject.  The FDA may order the temporary, or permanent, hold or discontinuation of a clinical trial at any time, or impose other sanctions, if it believes that the clinical trial either is not being conducted in accordance with FDA requirements or presents an unacceptable risk to the clinical trial subjects.  An IRB may also require the clinical trial to be halted at a given clinical trial site for failure to comply with the IRB’s requirements or failure to adequately ensure the protection of human subjects, or may impose other conditions. Conducting medical device clinical trials is a complex and costly activity and frequently requires the use of outsourced resources that specialize in planning and conducting the clinical trial for the medical device manufacturer.
A device placed on the market must comply with numerous regulatory requirements. Those regulatory requirements include the following:
•device listing and establishment registration;
•adherence to the Quality System Regulation (“QSR”), which requires stringent design, testing, control, documentation, complaint handling and other quality assurance procedures;
•labeling requirements;
•prohibitions against the promotion of off-label uses or indications;
•adverse event and malfunction reporting (Medical Device Reports or "MDRs");
•post-approval restrictions or conditions, potentially including post-approval clinical trials or other required testing;
•post-market surveillance requirements;
•the FDA’s recall authority, whereby it can require or request the recall of products from the market; and
•reporting and documentation of voluntary corrections or removals.
The FDA has issued final regulations regarding the Unique Device Identification (“UDI”) System, which requires manufacturers to label or mark certain medical devices and/or their packaging with unique identifiers. Although the FDA expects that the UDI System will help track products during recalls and improve patient safety, it has required us to make changes to our manufacturing and labeling, which could increase our costs. The UDI System is being implemented in stages based on device risk, with the first requirements having taken effect in September 2014 and the last taking effect in September 2022.
Certain of our medical devices are sold in kits that include a drug component, such as lidocaine. These types of kits are generally regulated as combination products within the Center for Devices and Radiological Health ("CDRH") under the device regulations because the device provides the primary mode of action of the kit. Although the kit as a whole is regulated as a medical device, it may be subject to certain drug requirements such as current good manufacturing practices (“cGMPs”) and adverse drug experience reporting requirements, to the extent applicable to the drug-component repackaging activities and subject to inspection to verify compliance with cGMPs as well as other regulatory requirements.
Our manufacturing facilities, as well as those of certain of our suppliers, are subject to periodic and for-cause inspections by FDA personnel to verify compliance with the QSR (21 CFR Part 820) as well as other regulatory requirements. Similar inspections are performed by Notified Bodies to verify compliance to applicable ISO standards (e.g. ISO 13485:2016), requirements under the Medical Device Single Audit Program ("MDSAP") applicable to regulatory requirements Australia, Brazil, Canada, Japan and the U.S. and/or medical device regulations and requirements from the countries in which we distribute product and other specified audits by regulatory authorities. If the FDA were to find that we or certain of our suppliers have failed to comply with applicable regulations, it could institute a wide variety of enforcement actions, ranging from issuance of a warning or untitled letter to more severe sanctions, such as product recalls or seizures, civil penalties, consent decrees, injunctions, criminal prosecution, operating restrictions, partial suspension or total shutdown of production, refusal to
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permit importation or exportation, refusal to grant, or delays in granting, clearances or approvals or withdrawal or suspension of existing clearances or approvals. The FDA also has the authority under certain circumstances to request repair, replacement or refund of the cost of any medical device manufactured or distributed by us.  Any of these actions could have an adverse effect on our business.
Regulation of Medical Devices Outside of the U.S.
Medical device laws also are in effect in many of the markets outside of the U.S. in which we do business. These laws range from comprehensive device approval requirements for some or all of our products to requests for product data or certifications. Inspection of and controls over manufacturing, as well as monitoring of device-related adverse events, are components of most of these regulatory systems. Manufacturing certification requirements and audits through the MDSAP program or other regulatory authority inspections also apply. In addition, the European Union (“EU”) has adopted the EU Medical Device Regulation (the “EU MDR”), which imposes stricter requirements for the marketing and sale of medical devices (as compared to the predecessor Medical Device Directive), including in the area of clinical evaluation requirements, quality systems, economic operators and post-market surveillance. Manufacturers of currently marketed medical devices will have until May 2020 to meet the requirements of the EU MDR. Failure to meet these requirements could adversely impact our business in the EU and other regions that tie their product registrations to the EU requirements.
Healthcare Laws
We are subject to various federal, state and local laws in the U.S. targeting fraud and abuse in the healthcare industry.  These laws prohibit us from, among other things, soliciting, offering, receiving or paying any remuneration to induce the referral or use of any item or service reimbursable under Medicare, Medicaid or other federally or state financed healthcare programs.  Violations of these laws are punishable by imprisonment, criminal fines, civil monetary penalties and exclusion from participation in federal healthcare programs.  In addition, we are subject to federal and state false claims laws in the U.S. that prohibit the submission of false payment claims under Medicare, Medicaid or other federally or state funded programs.  Certain marketing practices, such as off-label promotion, and violations of federal anti-kickback laws may also constitute violations of these laws.
We are also subject to various federal and state reporting and disclosure requirements related to the healthcare industry.  Rules issued by the Centers for Medicare & Medicaid Services ("CMS") require us to collect and report information on payments or transfers of value to physicians and teaching hospitals, as well as investment interests held by physicians and their immediate family members. Effective January 2022, we will also be required to collect and report information on payments or transfers of value to physician assistants, nurse practitioners, clinical nurse specialists, certified registered nurse anesthetists and certified nurse-midwives. The reported data is available to the public on the CMS website. Failure to submit required information may result in civil monetary penalties.  In addition, several states now require medical device companies to report expenses relating to the marketing and promotion of device products and to report gifts and payments to individual physicians in these states.  Other states prohibit various other marketing-related activities.  The federal government and certain other states require the posting of information relating to clinical studies and their outcomes. The shifting commercial compliance environment and the need to build and maintain robust and expandable systems to comply with the different compliance and/or reporting requirements among a number of jurisdictions increases the possibility that a healthcare company may violate one or more of the requirements, resulting in increased compliance costs that could adversely impact our results of operations.
Other Regulatory Requirements
We are also subject to the U.S. Foreign Corrupt Practices Act and similar anti-bribery laws applicable in jurisdictions outside the U.S. that generally prohibit companies and their intermediaries from improperly offering or paying anything of value to non-U.S. government officials for the purpose of obtaining or retaining business. Because of the predominance of government-sponsored healthcare systems around the world, most of our customer relationships outside of the U.S. are with government entities and are therefore subject to such anti-bribery laws. Our policies mandate compliance with these anti-bribery laws. We operate in many parts of the world that have experienced government corruption to some degree, and in certain circumstances strict compliance with anti-bribery laws may conflict with local customs and practices. In the sale, delivery and servicing of our medical devices and software outside of the U.S., we must also comply with various export control and trade embargo laws and regulations, including those administered by the Department of Treasury’s Office of Foreign Assets Control (“OFAC”) and the Department of Commerce’s Bureau of Industry and Security (“BIS”) which may require licenses or
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other authorizations for transactions relating to certain countries and/or with certain individuals identified by the U.S. government. Despite our global trade and compliance program, our internal control policies and procedures may not always protect us from reckless or criminal acts committed by our employees, distributors or other agents. Violations of these requirements are punishable by criminal or civil sanctions, including substantial fines and imprisonment.
COMPETITION
The medical device industry is highly competitive. We compete with many companies, ranging from small start-up enterprises to companies that are larger and more established than us and have access to significantly greater financial resources. Furthermore, extensive product research and development and rapid technological advances characterize the market in which we compete. We must continue to develop and acquire new products and technologies for our businesses to remain competitive. We believe that we compete primarily on the basis of clinical superiority and innovative features that enhance patient benefit, product reliability, performance, customer and sales support, and cost-effectiveness.
SALES AND MARKETING
Our product sales are made directly to hospitals, healthcare providers, distributors and to original equipment manufacturers of medical devices through our own sales forces, independent representatives and independent distributor networks.
BACKLOG
Most of our products are sold to hospitals or healthcare providers on orders calling for delivery within a few days or weeks, with longer order times for products sold to medical device manufacturers. Therefore, our backlog of orders is not indicative of revenues to be anticipated in any future 12-month period.
PATENTS AND TRADEMARKS
We own a portfolio of patents, patents pending and trademarks. We also license various patents and trademarks. Patents for individual products extend for varying periods based upon the date of patent filing or grant and the legal term of patents in the various countries where patent protection is obtained. Trademark rights may potentially extend for longer periods of time and are dependent upon national laws and use of the marks. All product names throughout this document are trademarks owned by, or licensed to, us or our subsidiaries. Although these have been of value and are expected to continue to be of value in the future, we do not consider any single patent or trademark, except for the Teleflex and Arrow brands, to be essential to the operation of our business.
SUPPLIERS AND MATERIALS
Materials used in the manufacture and sterilization of our products are purchased from a large number of suppliers in diverse geographic locations. We are not dependent on any single supplier for a substantial amount of the materials used, the components supplied and the sterilization services provided for our overall operations. Most of the materials, components and sterilization services we utilize are available from multiple sources, and where practical, we attempt to identify alternative suppliers. However, our ability to establish alternate sources of supply of materials and sterilization services may be delayed due to FDA and other regulatory authority requirements regarding the manufacture and sterilization of our products. Volatility in commodity prices, particularly with respect to aluminum, steel and plastic resins, can have a significant impact on the cost of producing certain of our products. We may not be able to successfully pass cost increases through to all of our customers, particularly original equipment manufacturers.
RESEARCH AND DEVELOPMENT
We are engaged in both internal and external research and development. Our research and development efforts support our strategic objectives to provide innovative new, safe and effective products that enhance clinical value by reducing infections, improving patient and clinician safety, enhancing patient outcomes and enabling less invasive procedures.
We also acquire or license products and technologies that are consistent with our strategic objectives and enhance our ability to provide a full range of product and service options to our customers.
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SEASONALITY
Portions of our revenues are subject to seasonal fluctuations. Incidence of flu and other disease patterns and, to a lesser extent, the frequency of elective medical procedures affect revenues related to single-use products.  Historically, we have experienced higher sales in the fourth quarter as a result of these factors.
EMPLOYEES
We employed approximately 14,400 full-time and temporary employees at December 31, 2019. Of these employees, approximately 3,900 were employed in the U.S. and 10,500 in countries other than the U.S. Approximately 13% of our employees in the U.S. and in other countries were covered by union contracts or collective-bargaining arrangements. We believe we have good relationships with our employees.
ENVIRONMENTAL
We are subject to various environmental laws and regulations both within and outside the U.S. Our operations, like those of other medical device companies, involve the use of substances regulated under environmental laws, primarily in manufacturing and sterilization processes. While we continue to devote resources to compliance with existing environmental laws and regulations, we cannot ensure that our costs of complying with current or future environmental protection, health and safety laws and regulations will not exceed our estimates or will not have a material adverse effect on our business, financial condition, results of operations and cash flows. Further, we cannot ensure that we will not be subject to environmental claims for personal injury or cleanup in the future based on our past, present or future business activities.
INVESTOR INFORMATION
We are subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Therefore, we file reports, proxy statements and other information with the Securities and Exchange Commission (SEC). The SEC maintains a website (http://www.sec.gov) that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC.
You can access financial and other information about us in the Investors section of our website, which can be accessed at www.teleflex.com. We make available through our website, free of charge, copies of our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed with or furnished to the SEC under Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after electronically filing or furnishing such material to the SEC. The information on our website is not part of this Annual Report on Form 10-K. The reference to our website address is intended to be an inactive textual reference only.
We are a Delaware corporation incorporated in 1943. Our executive offices are located at 550 East Swedesford Road, Suite 400, Wayne, PA 19087.
INFORMATION ABOUT OUR EXECUTIVE OFFICERS
The names and ages of our executive officers and the positions and offices held by each such officer are as follows:
Name Age Positions and Offices with Company
Liam J. Kelly 53    President and Chief Executive Officer
Thomas E. Powell 58    Executive Vice President and Chief Financial Officer
Cameron P. Hicks 55    Corporate Vice President, Human Resources and Communications
James J. Leyden 53    Corporate Vice President, General Counsel and Secretary
Mario Wijker 52    Corporate Vice President, QA/RA
James Winters 47    Corporate Vice President, Manufacturing and Supply Chain
Mr. Kelly has been our President and Chief Executive Officer since January 2018. From May 2016 to December 31, 2017, Mr. Kelly served as our President and Chief Operating Officer. From April 2015 to April 2016, he served as Executive Vice President and Chief Operating Officer. From April 2014 to April 2015, Mr. Kelly served as Executive Vice President and President, Americas. From June 2012 to April 2014 Mr. Kelly served as Executive Vice President and President, International. He also has held several positions with regard to our EMEA segment, including President from June 2011 to June 2012, Executive Vice President from November 2009 to June 2011, and
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Vice President of Marketing from April 2009 to November 2009. Prior to joining Teleflex, Mr. Kelly held various senior level positions with Hill-Rom Holdings, Inc., a medical device company, from October 2002 to April 2009, serving as its Vice President of International Marketing and R&D from August 2006 to February 2009.
Mr. Powell has been our Executive Vice President and Chief Financial Officer since February 2013. From March 2012 to February 2013, Mr. Powell was Senior Vice President and Chief Financial Officer. He joined Teleflex in August 2011 as Senior Vice President, Global Finance. Prior to joining Teleflex, Mr. Powell served as Chief Financial Officer and Treasurer of Tomotherapy Incorporated, a medical device company, from June 2009 until June 2011. In 2008, he served as Chief Financial Officer of Textura Corporation, a software provider. From April 2001 until January 2008, Mr. Powell was employed by Midway Games, Inc., a software provider, serving as its Executive Vice President, Chief Financial Officer and Treasurer from September 2001 until January 2008. Mr. Powell has also held leadership positions with Dade Behring, Inc. (now Siemens Healthcare Diagnostics), PepsiCo, Bain & Company, Tenneco Inc. and Arthur Andersen & Company.
Mr. Hicks has been our Corporate Vice President, Human Resources and Communications since April 2013. Prior to joining Teleflex, Mr. Hicks served as Executive Vice President of Human Resources & Organizational Effectiveness for Harlan Laboratories, Inc., a private global provider of pre-clinical and non-clinical research services, from July 2010 to March 2013. From April 1990 to January 2010, Mr. Hicks held various leadership roles with MDS Inc., a provider of products and services for the development of drugs and the diagnosis and treatment of disease, including Senior Vice President of Human Resources for MDS’ global Pharma Services division from November 2000 to January 2010.
Mr. Leyden has been our Corporate Vice President, General Counsel and Secretary since February 2014. He previously held the positions of Acting General Counsel from November 2013 to February 2014, Deputy General Counsel from February 2013 to November 2013 and Associate General Counsel from December 2004 to February 2013. Prior to joining Teleflex, Mr. Leyden served as general counsel of InfraSource Services, Inc., a utility infrastructure construction company, from April 2004 to December 2004. From February 2002 to April 2004, he served as Associate General Counsel of Aramark Corporation, a provider of food, facility and uniform services.

Mr. Wijker has been our Corporate Vice President, QA/RA since January 2019. Prior to joining Teleflex, Mr. Wijker served as Global Vice President Quality and Regulatory for Mölnlycke Health Care AB, a medical device company, from May 2016 to December 2018. From April 2014 to January 2016, Mr. Wijker served as Senior Director Global Regulatory Affairs for Boston Scientific Corporation, a medical device company. From January 2012 to March 2014, he held the position of Director Quality and Regulatory Affairs International for the American Medical Systems division of Endo International plc, a pharmaceutical company. From September 2003 to December 2011, Mr. Wijker held various regulatory affairs and quality assurance positions with Life Technologies Corporation, a life sciences and in vitro diagnostics company.

Mr. Winters has been our Corporate Vice President, Manufacturing and Supply Chain since February 2020. He previously held the position of Global Head of Manufacturing from March 2018 to January 2020. Prior to joining Teleflex, Mr. Winters held various senior management and operational roles with the DePuy Synthes division of Johnson & Johnson, a healthcare company, from August 2005 to February 2018. Most recently, Mr. Winters served as Vice President Global Manufacturing, Joint Reconstruction for DePuy Synthes from February 2015 to February 2018.
Our officers are elected annually by our board of directors. Each officer serves at the discretion of the board.

ITEM 1A. RISK FACTORS
In addition to the other information set forth in this Annual Report on Form 10-K, you should carefully consider the following factors which could have a material adverse effect on our business, financial condition, results of operations, cash flows or stock price. The risks below are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also adversely affect our business, financial condition, results of operations or stock price.
We face strong competition. Our failure to successfully develop and market new products could adversely affect our business.
The medical device industry is highly competitive. We compete with many domestic and foreign medical device companies ranging from small start-up enterprises that might sell only a single or limited number of competitive
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products or compete only in a specific market segment, to companies that are larger and more established than us, have a broad range of competitive products, participate in numerous markets and have access to significantly greater financial and marketing resources than we do.
In addition, the medical device industry is characterized by extensive product research and development and rapid technological advances. The future success of our business will depend, in part, on our ability to design and manufacture new competitive products and enhance existing products. Our product development efforts may require us to make substantial investments. There can be no assurance that we will be able to successfully develop new products, enhance existing products or achieve market acceptance of our products, due to, among other things, our inability to:
•identify viable new products;
•maintain sufficient liquidity to fund our investments in research and development and product acquisitions;
•obtain adequate intellectual property protection;
•gain market acceptance of new products; or
•successfully obtain regulatory approvals.
In addition, our competitors currently may be developing, or may develop in the future, products that provide better features, clinical outcomes or economic value than those that we currently offer or subsequently develop. Our failure to successfully develop and market new products or enhance existing products could have a material adverse effect on our business, financial condition and results of operations.
Our customers depend on third party coverage and reimbursements, and the failure of healthcare programs to provide sufficient coverage and reimbursement for our medical products could adversely affect us.
The ability of our customers to obtain coverage and reimbursement for our products is important to our business. Demand for many of our existing and new medical products is, and will continue to be, affected by the extent to which government healthcare programs and private health insurers reimburse our customers for patients’ medical expenses in the countries where we do business. Even when we develop or acquire a promising new product, demand for the product may be limited unless reimbursement approval is obtained from private and government third party payors. Internationally, healthcare reimbursement systems vary significantly. In some countries, medical centers are constrained by fixed budgets, regardless of the volume and nature of patient treatment. Other countries require application for, and approval of, government or third party reimbursement. Without both favorable coverage determinations by, and the financial support of, government and third party insurers, the market for many of our medical products would be adversely affected. In this regard, we cannot be sure that third party payors will maintain the current level of coverage and reimbursement to our customers for use of our existing products. Adverse coverage determinations, including reductions in the amount of reimbursement, could harm our business by discouraging customers’ selection of, and reducing the prices they are willing to pay for, our products.
In addition, as a result of their purchasing power, third party payors have implemented and are continuing to implement cost cutting measures such as seeking discounts, price reductions or other incentives from medical products suppliers and imposing limitations on coverage and reimbursement for medical technologies and procedures. These trends could compel us to reduce prices for our products and could cause a decrease in the size of the market or a potential increase in competition that could negatively affect our business, financial condition and results of operations.
We are subject to extensive government regulation, which may require us to incur significant expenses to ensure compliance. Our failure to comply with those regulations could have a material adverse effect on our business, results of operations, financial condition and cash flows.
Our products are medical devices and are subject to extensive regulation in the U.S. by the FDA and by comparable government agencies in other countries. The regulations govern, among other things, the development, design, clinical testing, premarket clearance and approval, manufacturing, labeling, importing and exporting and sale and marketing of many of our products. Moreover, these regulations are subject to future change.
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In the U.S., before we can market a new medical device, or a new use of, or claim for, or significant modification to, an existing product, we generally must first receive either 510(k) clearance or de novo authorization or approval of a premarket approval application, or PMA, from the FDA. Similarly, most major markets for medical devices outside the U.S. also require clearance, approval or compliance with certain standards before a product can be commercially marketed. In the EU, the EU MDR will, when it enters into full force in May 2020, include significant additional pre- and post-market requirements. The process of obtaining regulatory clearances and approvals to market a medical device, particularly from the FDA and certain foreign government authorities, can be costly and time consuming, and clearances and approvals might not be granted for new products on a timely basis, if at all. In addition, once a device has been cleared or approved, a new clearance or approval may be required before the device may be modified or its labeling changed. Furthermore, the FDA or a foreign government authority may make its review and clearance or approval process more rigorous, which could require us to generate additional clinical or other data, and expend more time and effort, in obtaining future product clearances or approvals. The regulatory clearance and approval process may result in, among other things, delayed realization of product revenues, substantial additional costs or limitations on indicated uses of products, any one of which could have a material adverse effect on our financial condition and results of operations. Even after a product has received marketing approval or clearance, such product approval or clearance can be withdrawn or limited due to unforeseen problems with the device or issues relating to its application.
Failure to comply with applicable regulations could lead to adverse effects on our business, which could include:
•partial suspension or total shutdown of manufacturing;
•product shortages;
•delays in product manufacturing;
•warning or untitled letters;
•fines or civil penalties;
•delays in or restrictions on obtaining new regulatory clearances or approvals;
•withdrawal or suspension of required clearances, approvals or licenses;
•product seizures or recalls;
•injunctions;
•criminal prosecution;
•advisories or other field actions;
•operating restrictions; and
•prohibitions against exporting of products to, or importing products from, countries outside the U.S.
We could be required to expend significant financial and human resources to remediate failures to comply with applicable regulations and quality assurance guidelines. In addition, civil and criminal penalties, including exclusion under Medicaid or Medicare, could result from certain regulatory violations. Any one or more of these events could have a material adverse effect on our business, financial condition and results of operations.
Medical devices are cleared or approved for one or more specific intended uses and performance claims must be adequately substantiated. Promoting a device for a use outside of the cleared or approved intended use or population, that is, an off-label use, or making false, misleading or unsubstantiated claims could result in government enforcement action.
Furthermore, our facilities are subject to periodic inspection by the FDA and other federal, state and foreign government authorities, which require manufacturers of medical devices to adhere to certain regulations, including the FDA’s Quality System Regulation ("QSR"), which requires, among other things, periodic audits, design controls, quality control testing and documentation procedures, as well as complaint evaluations and investigation. In addition, any facilities assembling kits that include drug components and are registered as drug repackaging establishments are also subject to current good manufacturing practices requirements for drugs. The FDA also requires the reporting of certain adverse events and product malfunctions and requires the reporting of certain recalls or other field safety corrective actions for medical devices. Issues identified through such inspections and reports may result in FDA enforcement action through any of the actions discussed above. Moreover, issues identified through such inspections and reports may require significant resources to resolve.
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We are subject to healthcare fraud and abuse laws, regulation and enforcement; our failure to comply with those laws could have a material adverse effect on our results of operations and financial condition.
We are subject to healthcare fraud and abuse regulation and enforcement by the federal government and the governments of those states and foreign countries in which we conduct our business. The laws that may affect our ability to operate include:
•the federal healthcare anti-kickback statute, which, among other things, prohibits persons from knowingly and willfully offering or paying remuneration, one purpose of which is to induce either the referral of an individual for, or the purchase, order or recommendation of, any good or service for which payment may be made under federal healthcare programs such as Medicare and Medicaid, or soliciting payment for such referrals, purchases, orders and recommendations;
•federal false claims laws which, among other things, prohibit individuals or entities from knowingly presenting, or causing to be presented, false or fraudulent claims for payment from the federal government, including Medicare, Medicaid or other third-party payors;
•the federal Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), which prohibits schemes to defraud any healthcare benefit program and false statements relating to healthcare matters; and
•state law equivalents of each of the above federal laws, such as anti-kickback and false claims laws which may apply to items or services reimbursed by any third-party payor, including commercial insurers.
If our operations are found to be in violation of any of these laws or any other government regulations, we may be subject to penalties, including civil and criminal penalties, damages, fines, the curtailment or restructuring of our operations, the exclusion from participation in federal and state healthcare programs and imprisonment of personnel, any of which could adversely affect our ability to operate our business and our financial results. The risk of our being found to have violated these laws is increased by the fact that many of them have not been fully interpreted by the regulatory authorities or the courts, and their provisions are open to a variety of interpretations.
Further, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act (collectively, the “Affordable Care Act”), imposed annual reporting and disclosure requirements on device manufacturers for any “transfer of value” made or distributed to physicians or teaching hospitals. Effective January 2022, we will also be required to collect and report information on payments or transfers of value to physician assistants, nurse practitioners, clinical nurse specialists, certified registered nurse anesthetists and certified nurse-midwives. The reported information is made publicly available in a searchable format. In addition, device manufacturers are required to report and disclose any investment interests held by physicians and their immediate family members during the preceding calendar year. Failure to submit required information may result in civil monetary penalties for each payment, transfer of value or ownership or investment interests not reported in an annual submission, up to an aggregate of $150,000 per year (and up to an aggregate of $1 million per year for “knowing failures”).
In addition, there has been a recent trend of increased federal and state regulation of payments made to healthcare providers. Some states, such as California, Connecticut, Nevada and Massachusetts, mandate implementation of compliance programs that include the tracking and reporting of gifts, compensation for consulting and other services, and other remuneration to healthcare providers. The shifting commercial compliance environment and the need to build and maintain robust and expandable systems to comply with the different compliance and/or reporting requirements among a number of jurisdictions increases the possibility that we may inadvertently violate one or more of the requirements, resulting in increased compliance costs that could adversely impact our results of operations.
We may not be successful in achieving expected operating efficiencies and sustaining or improving operating expense reductions, and may experience business disruptions associated with restructuring, facility consolidations, realignment, cost reduction and other strategic initiatives.
Over the past several years we have implemented a number of restructuring, realignment and cost reduction initiatives, including facility consolidations, organizational realignments and reductions in our workforce, and we may engage in similar efforts in the future. While we have realized some efficiencies from these initiatives, we may not realize the benefits of these or future initiatives to the extent we anticipated. Further, such benefits may be realized later than expected, and the ongoing difficulties in implementing these measures may be greater than anticipated, which could cause us to incur additional costs or result in business disruptions. In addition, if these measures are not successful or sustainable, we may be compelled to undertake additional restructuring, realignment and cost
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reduction efforts, which could result in significant additional charges. Moreover, if our restructuring, realignment and cost reduction efforts prove ineffective, our ability to achieve our strategic and business plan goals may be adversely affected.
In addition, as part of our efforts to increase operating efficiencies, we have implemented a number of initiatives over the past several years to consolidate our enterprise resource planning, or ERP, systems. Most recently, we upgraded the ERP system used by our EMEA segment to our global ERP system in 2019. To date, we have not experienced any significant disruptions to our business or operations in connection with these initiatives. However, as we continue our efforts to further consolidate our ERP systems, we could experience business disruptions, which could adversely affect customer relationships and divert the attention of management away from daily operations. In addition, any delays in the implementation of these initiatives could cause us to incur additional unexpected costs. Should we experience such difficulties, our business, cash flows and results of operations could be adversely affected.
Disruptions in sterilization of our products or regulatory initiatives further restricting the use of ethylene oxide in sterilization facilities could adversely affect our results of operations and financial condition.
Many of our products require sterilization prior to sale. A common method for sterilizing medical products involves the use of ethylene oxide, which is listed as a hazardous air pollutant under the Clean Air Act, as amended, and emissions of which are regulated by the U.S. Environmental Protection Agency and other regulatory authorities. One of our contract sterilizers, Sterigenics U.S., LLC, uses ethylene oxide in its sterilization process, including at its facility in Smyrna, Cobb County, Georgia, which has sterilized some of our surgical, intermittent catheter and OEM products. During the fourth quarter of the year ended December 31, 2019, operations at the Smyrna facility were suspended by state and local officials due to issues associated with the facility's use of ethylene oxide in its sterilization operations. During the suspension, our ability to provide affected products to our customers was impaired. While we have secured alternate sterilization facilities for the affected product, based on currently available information, we believe that the disruption in the supply of our product will adversely affect our 2020 revenues by $5 million to $7 million. Our 2020 revenues may be further adversely affected if we experience any significant difficulties or delays in accessing the sterilization capacity at the alternate facilities.
In addition, on October 10, 2019, the attorneys general of 15 states and the District of Columbia sent a letter to the EPA urging that the EPA promptly propose and finalize stricter standards for ethylene oxide emissions. Among other things, the attorneys general stated that the current EPA standard for ethylene oxide fails to adequately protect workers and communities, and that the use of ethylene oxide, particularly in the medical device sterilization industry, must be reduced. We are unable to predict the manner in which the EPA will respond to the letter. Any additional regulatory restrictions on the emission of ethylene oxide by sterilization facilities might impair our ability to provide sufficient quantities of sterilized products to our customers and compel us to seek sterilization alternatives that do not entail the use of ethylene oxide. We cannot assure that we would be able to identify such alternatives.
In the event we were to experience any further disruptions in our ability to sterilize our products, whether due to capacity constraints or regulatory or other impediments (including, among other things, regulatory initiatives directed generally to sterilization facilities that utilize ethylene oxide), or we are unable to transition to alternative facilities in a timely or cost effective manner, we could experience a material adverse impact with respect to our results of operations and financial condition.
A significant portion of our U.S. revenues is derived from sales to distributors, and “destocking” activity by these distributors can adversely affect our revenues and results of operations.
A significant portion of our revenues in the U.S. is derived from sales to distributors, which, in turn, sell our products to hospitals and other health care institutions. From time to time, these distributors may decide to reduce their levels of inventory with regard to certain of our products, a practice we refer to as “destocking.” A distributor's decision to reduce inventory levels with respect to our products may be based on a number of factors, such as distributor expectations regarding demand for a particular product, distributor buying decisions (including decisions to purchase competing products), changes in distributor policies regarding the maintenance of inventory levels, economic conditions and other factors. For example, during the third quarter of 2016, we experienced a decline in purchases by our U.S. distributors that adversely affected our revenues and results of operations. We believe the reduction resulted from the distributors' expectations of a less severe 2016-2017 flu season, which resulted in reduced levels of purchasing with respect to certain of our products that are used for treatment of hospitalized patients suffering from the flu. Following such instances of reduced purchases, distributors may revert to previous
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purchasing levels; nevertheless, we cannot assure that distributors will, in fact, increase purchases of our products in this manner. A decline in the level of product purchases by our U.S. distributors in the future could have a material adverse effect on our revenues and results of operations during a reporting period, and an extended decline in such product purchases could have a longer term material adverse effect.
We may incur material losses and costs as a result of product liability and warranty claims, as well as product recalls, any of which may adversely affect our results of operations and financial condition. Furthermore, our reputation as a medical device company may be damaged if one or more of our products are, or are alleged to be, defective.
Our businesses expose us to potential product liability risks that are inherent in the design, manufacture and marketing of our products. In particular, our medical device products are often used in surgical and intensive care settings for procedures involving seriously ill patients. In addition, many of our products are designed to be implanted in the human body for varying periods of time. Product defects or inadequate disclosure of product-related risks with respect to products we manufacture or sell could result in patient injury or death. Product liability and warranty claims often involve very large or indeterminate amounts, including punitive damages. The magnitude of potential losses from product liability lawsuits may remain unknown for substantial periods of time, and the related legal defense costs may be significant. We could experience material warranty or product liability losses in the future and incur significant costs to defend these claims.
In addition, if any of our products are, or are alleged to be, defective, we may voluntarily conduct, or be required by regulatory authorities to conduct, a recall of that product. In the event of a recall, we may lose sales and be exposed to individual or class-action litigation claims. Moreover, negative publicity regarding a quality or safety issue, whether accurate or inaccurate, could harm our reputation, decrease demand for our products, lead to product withdrawals or impair our ability to successfully launch and market our products in the future. Product liability, warranty and recall costs may have a material adverse effect on our business, financial condition, results of operations and cash flows.
The ongoing volatility in the domestic and global financial markets, combined with a continuation of constrained global credit markets, could adversely impact our results of operations, financial condition and liquidity.
We are subject to risks arising from adverse changes in general domestic and global economic conditions. The economic slowdown and disruption of credit markets that occurred several years ago led to recessionary conditions and depressed levels of consumer and commercial spending, resulting in reductions, delays or cancellations of purchases of our products and services. Despite improvements in recent years, particularly in the U.S., economic conditions continue to cause disruption in some financial markets, resulting in, among other things, diminished liquidity and credit availability. We cannot predict the duration or extent of any economic recovery or the extent to which our customers will return to more typical spending behaviors. The continuation in a number of markets of weak economic growth, constricted credit, public sector austerity measures in response to public budget deficits and foreign currency volatility, particularly with respect to the euro, could have a material adverse effect on our results of operations, financial condition and liquidity.
Although we maintain allowances for doubtful accounts to cover the estimated losses which may occur when customers cannot make their required payments, we cannot assure that the loss rate will not increase in the future given the volatility in the worldwide economy. If our allowance for doubtful accounts is insufficient to address receivables we ultimately determine are uncollectible, we would be required to incur additional charges, which could materially adversely affect our results of operations. Moreover, our inability to collect outstanding receivables could adversely affect our financial condition and cash flow from operations.
In addition, adverse economic and financial market conditions may result in future impairment charges with respect to our goodwill and other intangible assets, which would not directly affect our liquidity but could have a material adverse effect on our reported financial results.
Our strategic initiatives, including acquisitions, may not produce the intended growth in revenue and operating income, which could have a material adverse effect on our operating results.
Our strategic initiatives include making significant investments designed to achieve revenue growth and to enable us to meet or exceed margin improvement targets. If we do not achieve the expected benefits from these investments or otherwise fail to execute on our strategic initiatives, we may not achieve the growth improvement we are targeting and our results of operations may be adversely affected.
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In addition, as part of our strategy for growth, we have made, and may continue to make, acquisitions and divestitures and enter into strategic alliances such as joint ventures and joint development agreements. However, we may not be able to identify suitable acquisition candidates, complete acquisitions or integrate acquisitions successfully, and our joint ventures or strategic alliances may not prove to be successful. In this regard, acquisitions involve numerous risks, including difficulties in the integration of acquired operations, technologies, services and products and the diversion of management’s attention from other business concerns. Moreover, the products and technologies that we acquire may not be successful or may require us to devote significantly greater development, marketing and other resources, as well as significantly greater investments, than we anticipated. We could also experience negative effects on our results of operations and financial condition from acquisition-related charges, amortization of intangible assets, asset impairment charges and other matters that could arise in connection with the acquisition of a company or business, including matters related to internal control over financial reporting and regulatory compliance, as well as the short-term effects of increased costs on results of operations.  Although our management will endeavor to evaluate the risks inherent in any particular transaction, there can be no assurance that we will identify all such risks or the magnitude of the risks. In addition, prior acquisitions have resulted, and future acquisitions could result, in the incurrence of substantial additional indebtedness and expenditures. Future acquisitions may also result in potentially dilutive issuances of equity securities. There can be no assurance that difficulties encountered in connection with acquisitions will not have a material adverse effect on our business, financial condition and results of operations.

In connection with certain of our completed acquisitions, we have agreed to pay consideration that is contingent upon the achievement of specified objectives, such as receipt of regulatory approval, commercialization of a product or achievement of sales targets. As of the acquisition date, we record a contingent liability representing the estimated fair value of the contingent consideration we expect to pay. On a quarterly basis, we reassess these obligations and, in the event our estimate of the fair value of the contingent consideration changes, we record increases or decreases in the fair value as an adjustment to operating earnings, which could have a material impact on our results of operations. As of December 31, 2019, we accrued $219.9 million of contingent consideration, most of which related to our acquisition of NeoTract. In addition, actual payments may differ materially from the amount of the contingent liability , which could have a material impact on our results of operations, cash flows and liquidity. For information regarding assumptions related to our contingent consideration liabilities, see “Critical Accounting Policies and Estimates” under Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations included in this Annual Report on Form 10-K. For additional information regarding our acquisitions, see Note 4 to the consolidated financial statements included in this Annual Report on Form 10-K.
Health care reform may have a material adverse effect on our industry and our business.

Political, economic and regulatory developments have effected fundamental changes in the healthcare industry. The Affordable Care Act substantially changed the way health care is financed by both government and private insurers. It also encourages improvements in the quality of health care products and services and significantly impacts the U.S. pharmaceutical and medical device industries. Among other things, the Affordable Care Act:
•established a new Patient-Centered Outcomes Research Institute to oversee, identify priorities in and conduct comparative clinical effectiveness research;
•implemented payment system reforms, including a national pilot program to encourage hospitals, physicians and other providers to improve the coordination, quality and efficiency of certain health care services through bundled payment models; and
•created an independent payment advisory board that will submit recommendations to reduce Medicare spending if projected Medicare spending exceeds a specified growth rate.
We cannot predict at this time the full impact of the Affordable Care Act or other healthcare reform measures that may be adopted in the future on our financial condition, results of operations and cash flows. In this regard, several legislative initiatives to repeal and replace the Affordable Care Act were proposed, but not adopted in 2017. However, U.S. tax legislation adopted in December 2017 and commonly referred to as the Tax Cuts and Jobs Act ("TCJA") eliminated the individual mandate under the Affordable Care Act, which has resulted in increased uncertainty regarding insurance premium prices for participants in insurance exchanges under the act, and may have other effects. Moreover, on December 14, 2018, the U.S. District Court for the Northern District of Texas ruled that the individual mandate provision of the Affordable Care Act is unconstitutional and the remainder of the act is invalid, although the Court stayed its ruling pending appeal. The nature and effect of any modification or repeal of, or legislative substitution for, the Affordable Care Act, or any court decision regarding the act's validity, is uncertain,
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and we cannot predict the effect that any of these events would have on the longer-term viability of the act, or on our financial condition, results of operations or cash flows.
We are subject to risks associated with our non-U.S. operations.

We have significant manufacturing and distribution facilities, research and development facilities, sales personnel and customer support operations in a number of countries outside the U.S., including Belgium, the Czech Republic, Germany, Ireland, Malaysia and Mexico. In addition, a significant portion of our non-U.S. revenues are derived from sales to third party distributors. As of December 31, 2019, 73% of our full-time and temporary employees were employed in countries outside of the U.S., and approximately 45% of our net property, plant and equipment was located outside the U.S. In addition, for the years ended December 31, 2019, 2018 and 2017 38%, 41% and 42%, respectively, of our net revenues (based on the Teleflex entity generating the sale) were derived from operations outside the U.S.

Our international operations are subject to risks inherent in doing business outside the U.S., including:

•exchange controls, currency restrictions and fluctuations in currency values;
•trade protection measures, tariffs and other duties, especially in light of trade disputes between the U.S. and several foreign countries, including China;
•potentially costly and burdensome import or export requirements;
•laws and business practices that favor local companies;
•changes in foreign medical reimbursement policies and procedures;
•subsidies or increased access to capital for firms that currently are or may emerge as competitors in countries in which we have operations;
•substantial non-U.S. tax liabilities, including potentially negative consequences resulting from changes in tax laws;
•restrictions and taxes related to the repatriation of non-U.S. earnings;
•differing labor regulations;
•additional U.S. and foreign government controls or regulations;
•the impact of the United Kingdom's departure from the European Union, commonly referred to as "Brexit";
•public health epidemics;
•difficulties in the protection of intellectual property; and
•unsettled political and economic conditions and possible terrorist attacks against American interests.
In addition, the U.S. Foreign Corrupt Practices Act (the “FCPA”) prohibits companies and their intermediaries from making improper payments to non-U.S. officials for the purpose of obtaining or retaining business. Similar anti-bribery laws are in effect in several foreign jurisdictions. The FCPA also imposes accounting standards and requirements on publicly traded U.S. corporations and their foreign affiliates, which, among other things, are intended to prevent the diversion of corporate funds to the payment of bribes and other improper payments to government officials, and to prevent the establishment of “off the books” slush funds from which such improper payments can be made. Because of the predominance of government-sponsored health care systems around the world, many of our customer relationships outside of the U.S. are with government entities and are therefore subject to such anti-bribery laws. Our policies mandate compliance with these anti-bribery laws. However, we operate in many parts of the world that have experienced government corruption to some degree.  Despite meaningful measures that we undertake to facilitate lawful conduct, which include training and compliance programs and internal control policies and procedures, we may not always prevent reckless or criminal acts by our employees, distributors or other agents. In addition, we may be exposed to liability due to pre-acquisition conduct of employees, distributors or other agents of businesses or operations we acquire. Violations of anti-bribery laws, or allegations of such violations, could disrupt our operations, involve significant management distraction and have a material adverse effect on our business, financial condition, results of operations and cash flows. We also could be subject to severe penalties and other adverse consequences, including criminal and civil penalties, disgorgement, substantial expenditures related to further enhancements to our procedures, policies and controls, personnel changes and other remedial actions, as well as harm to our reputation.

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

Our results of operations and financial condition may be adversely affected by public health epidemics, including the novel coronavirus reported to have originated in Wuhan, China.

Our results of operations and financial condition may be adversely affected if a public health epidemic, including the novel coronavirus (referred to as COVID-19) reported to have originated in Wuhan, China, interferes with our ability, or that of our employees, contractors, suppliers, customers and other business partners to perform our and their respective responsibilities and obligations relative to the conduct of our business. A public health epidemic, including the coronavirus, poses the risk that we or our employees, contractors, suppliers, customers and other business partners may be prevented from conducting business activities for an indefinite period of time, including due to shutdowns that may be requested or mandated by governmental authorities. We face similar risks if a public health epidemic, including the coronavirus, affects other geographic areas where our employees, contractors, suppliers, customers and other business partners are located.
Foreign currency exchange rate, commodity price and interest rate fluctuations may adversely affect our results.

We are exposed to a variety of market risks, including the effects of changes in foreign currency exchange rates, commodity prices and interest rates. Products manufactured in, and sold into, foreign markets represent a significant portion of our operations. Our consolidated financial statements reflect translation of financial statements denominated in non-U.S. currencies to U.S. dollars, our reporting currency, as well as the foreign currency exchange gains and losses resulting from the remeasurement of assets and liabilities and from transactions denominated in currencies other than the primary currency of the country in which the entity operates, which we refer to as "non-functional currencies." A strengthening or weakening of the U.S. dollar in relation to the foreign currencies of the countries in which we sell or manufacture our products, such as the euro, will affect our U.S. dollar-reported revenue and income. Although we have entered into forward contracts with several major financial institutions to hedge a portion of our monetary assets and liabilities and projected cash flows denominated in non-functional currencies in order to reduce the effects of currency rate fluctuations, changes in the relative values of currencies may, in some instances, have a significant effect on our results of operations.
Many of our products have significant plastic resin content. We also use quantities of other commodities, such as aluminum and steel. Increases in the prices of these commodities could increase the costs of our products and services. We may not be able to pass on these costs to our customers, particularly with respect to those products we sell under group purchase agreements, which could have a material adverse effect on our results of operations and cash flows.
Increases in interest rates may adversely affect the financial health of our customers and suppliers, thereby adversely affecting their ability to buy our products and supply the components or raw materials we need. In addition, our borrowing costs have been adversely affected by recent interest rate increases, and could be further affected if interest rates continue to increase. Any of these events could have a material adverse effect on our financial condition, results of operations and cash flows.
Under our cross-currency swap agreements, a meaningful decline in the U.S. dollar to euro exchange rate could have a material adverse effect on our cash flows.
In 2018 and 2019, we entered into cross-currency swap agreements with several financial institutions to hedge against the effect of variability in the U.S. dollar to euro exchange rate. The swap agreements require an exchange of the notional amounts between us and the counterparties upon expiration or earlier termination of the
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agreements. If, at the expiration or earlier termination of the swap agreements, the U.S. dollar to euro exchange rate has declined from the rate in effect on the execution date, we are required to pay the counterparties an amount equal to the excess of the U.S. dollar value over the euro principal amount (we and the counterparties have agreed to a net settlement with regard to the exchange of the notional amounts at the date of expiration or earlier termination of the agreements). In the event of a significant decline in the U.S. dollar to euro exchange rate, our payment obligations to the counterparties could have a material adverse effect on our cash flows. In this regard, if, at the expiration or earlier termination of our swap agreements, the U.S. dollar to euro exchange rate has declined by 10% from the rate in effect at the inception of our agreements, we would be required to pay approximately $75 million to the counterparties in respect of the notional settlement. To the extent we enter into additional cross-currency swap agreements, a decline in the relevant exchange rates could further adversely affect our cash flows.
Fluctuations in our effective tax rate and changes to tax laws may adversely affect us.
As a global company, we are subject to taxation in numerous countries, states and other jurisdictions. Our effective tax rate is derived from a combination of applicable tax rates in the various countries, states and other jurisdictions in which we operate. In preparing our financial statements, we estimate the amount of tax that will become payable in each of these jurisdictions. Our effective tax rate may, however, differ from the estimated amount due to numerous factors, including a change in the mix of our profitability from country to country and changes in tax laws (including the impact of the enactment of the TCJA). Any of these factors could cause us to experience an effective tax rate significantly different from previous periods or our current expectations, which could have an adverse effect on our business, financial condition, results of operations and cash flows.
An interruption in our manufacturing or distribution operations or our supply of raw materials may adversely affect our business.
Many of our key products are manufactured at or distributed from single locations, and the availability of alternate facilities is limited. If operations at one or more of our facilities is suspended due to natural disasters or other events, we may not be able to timely manufacture or distribute one or more of our products at previous levels or at all. Furthermore, our ability to establish replacement facilities or to substitute suppliers may be delayed due to regulations and requirements of the FDA and other regulatory authorities regarding the manufacture of our products. In addition, in the event of delays or cancellations in shipments of raw materials by our suppliers, we may not be able to timely manufacture or supply the affected products at previous levels or at all. The manufacture of our products is highly exacting and complex, due in part to strict regulatory requirements. Problems in the manufacturing process, including equipment malfunction, failure to follow specific protocols and procedures, defective raw materials and environmental factors, could lead to delays in product releases, product shortages, unanticipated costs, lost revenues and damage to our reputation. A failure to identify and address manufacturing problems prior to the release of products to our customers may also result in quality or safety issues.  A reduction or interruption in manufacturing or distribution, or our inability to secure suitable alternative sources of raw materials or components, could have a material adverse effect on our business, results of operations, financial condition and cash flows.
Our ability to attract, train, develop and retain key employees is important to our success.
Our success depends, in part, on our ability to continue to retain key personnel, including our executive officers and other members of our senior management team. Our success also depends, in part, on our ability to attract, train, develop and retain other key employees, including research and development, sales, marketing and operations personnel. We may experience difficulties in retaining executives and other employees due to many factors, including:
•the intense competition for skilled personnel in our industry;
•fluctuations in global economic and industry conditions;
•changes in our organizational structure;
•our restructuring initiatives;
•competitors’ hiring practices; and
•the effectiveness of our compensation programs.
Our inability to attract, train, develop and retain such personnel could have an adverse effect on our business, results of operations, financial condition and cash flows.
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Our failure to maintain strong relationships with physicians and other health care professionals could adversely affect us.
We depend on our ability to maintain strong working relationships with physicians and other healthcare professionals in connection with research and development for some of our products. We rely on these professionals to provide us with considerable knowledge and advice regarding the development and use of these products. Physicians assist us as researchers, product consultants, inventors and public speakers. If we fail to maintain our working relationships with physicians and, as a result, no longer have the benefit of their knowledge and advice, our products may not be developed in a manner that is responsive to the needs and expectations of the professionals who use and support our products, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.
Our technology is important to our success, and our failure to protect our intellectual property rights could put us at a competitive disadvantage.
We rely on the patent, trademark, copyright and trade secret laws of the U.S. and other countries to protect our proprietary rights. Although we own numerous U.S. and foreign patents and have submitted numerous patent applications, we cannot be assured that any pending patent applications will issue, or that any patents, issued or pending, will provide us with any competitive advantage or will not be challenged, invalidated or circumvented by third parties. In addition, we rely on confidentiality and non-disclosure agreements with employees and take other measures to protect our know-how and trade secrets. The steps we have taken may not prevent unauthorized use of our technology by competitors or other persons who may copy or otherwise obtain and use these products or technology, particularly in foreign countries where the laws may not protect our proprietary rights to the same extent as in the U.S. We cannot assure that current and former employees, contractors and other parties will not breach their confidentiality agreements with us, misappropriate proprietary information, copy or otherwise obtain and use our information and proprietary technology without authorization or otherwise infringe on our intellectual property rights. Our inability to protect our proprietary technology could adversely affect our business, financial condition, results of operations and cash flows. Moreover, there can be no assurance that others will not independently develop know-how and trade secrets comparable to ours or develop better technology than our own, which could reduce or eliminate any competitive advantage we have developed.
Our products or processes may infringe the intellectual property rights of others, which may cause us to pay unexpected litigation costs or damages or prevent us from selling our products.
We cannot be certain that our products do not and will not infringe issued patents or other intellectual property rights of third parties. We may be subject to legal proceedings and claims in the ordinary course of our business, including claims of alleged infringement of the intellectual property rights of third parties. Any such claims, whether or not meritorious, could result in litigation and divert the efforts of our personnel. If we are found liable for infringement, we may be compelled to enter into licensing agreements (which may not be available on acceptable terms or at all) or to pay damages or cease making or selling certain products. We may need to redesign some of our products or processes to avoid future infringement liability. Any of the foregoing events could be detrimental to our business.
Other pending and future litigation may involve significant costs and adversely affect our business.
We are party to various lawsuits and claims arising in the normal course of business involving, among other things, contracts, intellectual property, import and export regulations, and employment and environmental matters. The defense of these lawsuits may divert our management’s attention, and may involve significant legal expenses. In addition, we may be required to pay damage awards or settlements, or become subject to injunctions or other equitable remedies, that could have a material adverse effect on our financial condition and results of operations. While we do not believe that any litigation in which we are currently engaged would have such an adverse effect, the outcome of litigation, including regulatory matters, is often difficult to predict, and we cannot assure that the outcome of pending or future litigation will not have a material adverse effect on our business, financial condition, results of operations or cash flows.
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Our substantial indebtedness could adversely affect our business, financial condition or results of operations.
As of December 31, 2019, we had total consolidated indebtedness of $1.9 billion.
Our substantial level of indebtedness increases the risk that we may be unable to generate cash sufficient to satisfy our debt obligations. It could also have significant effects on our business. For example, it could:
•increase our vulnerability to general adverse economic and industry conditions;
•require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness, thereby reducing the availability of our cash flow to fund capital expenditures, research and development efforts and other general corporate expenditures;
•limit our ability to borrow additional funds for general corporate purposes;
•limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;
•restrict us from pursuing business opportunities; and
•place us at a disadvantage compared to competitors that have less indebtedness.
If we do not generate sufficient cash flow from operations or if future borrowings are not available to us in an amount sufficient to pay our indebtedness when due or to fund our other liquidity needs, we may be forced to:
•refinance all or a portion of our indebtedness;
•sell assets;
•reduce or delay capital expenditures; or
•seek to raise additional capital.
We may not be able to effect any of these actions on commercially reasonable terms or at all. Our ability to refinance our indebtedness will depend on our financial condition at the time, the restrictions in the instruments governing our outstanding indebtedness and other factors, including market conditions.
Our inability to generate sufficient cash flow to satisfy our debt service obligations, or to refinance or restructure our obligations on commercially reasonable terms or at all, could have a material adverse effect on our business, financial condition and results of operations.
Our debt agreements impose restrictions on our business, which could prevent us from pursuing business opportunities and taking other desirable corporate actions, and may adversely affect our ability to respond to changes in our business and manage our operations.
Our senior credit agreement and the indentures governing our 4.875% senior notes due 2026 (the "2026 Notes") and our 4.625% senior notes due 2027 (the "2027 Notes" and, together with the 2026 Notes, the "Senior Notes") contain covenants that, among other things, impose significant restrictions on our business. The restrictions that these covenants place on us and our restricted subsidiaries collectively include limitations on our and their ability to, among other things:
•incur additional indebtedness or issue preferred stock or otherwise disqualified stock;
•create liens;
•pay dividends, make investments or make other restricted payments;
•sell assets;
•merge, consolidate, sell or otherwise dispose of all or substantially all of our assets; and
•enter into transactions with our affiliates.
In addition, our senior credit agreement also contains financial covenants, including covenants requiring maintenance of a consolidated leverage ratio, a secured leverage ratio and a consolidated interest coverage ratio, calculated in accordance with the terms of the senior credit agreement. A breach of any covenants under any one or more of our debt agreements could result in a default, which if not cured or waived, could result in the acceleration
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of all of our debt. In addition, any debt agreements we enter into in the future may further limit our ability to enter into certain types of transactions.
We may issue additional shares of our common stock or instruments convertible into our common stock, which could cause the price of our common stock to decline.
We are not restricted from issuing additional shares of our common stock or other instruments convertible into our common stock. As of December 31, 2019, we had outstanding approximately 46.0 million shares of our common stock, options to purchase 1.3 million shares of our common stock (of which approximately 1.0 million were vested as of that date), restricted stock units covering 0.2 million shares of our common stock (which are expected to vest over the next three years), performance stock units covering a maximum of 46,660 shares of our common stock (which may vest in early 2021, depending on our performance with regard to specified financial measures and market performance of our common stock compared to designated public companies) and 1,767 shares of our common stock to be distributed from our deferred compensation plan. As of December 31, 2019, 3.4 million shares of our common stock were reserved for issuance upon the exercise of stock options. We cannot predict the size of future issuances or the effect, if any, that they may have on the market price for our common stock.
If we issue additional shares of our common stock or instruments convertible into our common stock, such issuances may materially and adversely affect the price of our common stock. Furthermore, our issuance of shares upon the exercise of some or all of the outstanding stock options, as well as the vesting of restricted stock units and some or all of the performance stock units will dilute the ownership interests of existing stockholders, and the subsequent sale in the public market of such shares of our common stock could adversely affect prevailing market prices of our common stock.
Disruption of critical information systems or material breaches in the security of our systems may adversely affect our business and customer relationships.
We rely on information technology systems to process, transmit, and store electronic information in our day-to-day operations. We also rely on our technology infrastructure, among other functions, to enable us to interact with customers and suppliers, fulfill orders, generate invoices, collect and make payments, ship products, provide support to customers, fulfill contractual obligations and otherwise perform business functions. Our internal information technology systems, as well as those systems maintained by third-party providers, may be subjected to computer viruses or other malicious codes, unauthorized access attempts, and cyber-attacks, any of which could result in data leaks or otherwise compromise our confidential or proprietary information and disrupt our operations. Cyber-attacks are becoming more sophisticated and frequent, and in some cases have caused significant harm. Although we have taken numerous measures to protect our information systems and enhance data security, we cannot assure that these measures will prevent security breaches that could have a significant impact on our business, reputation and financial results. If we fail to monitor, maintain or protect our information technology systems and data integrity effectively or fail to anticipate, plan for or manage significant disruptions to these systems, we could, among other things, lose customers, have difficulty preventing fraud, have disputes with customers, physicians and other health care professionals, be subject to regulatory sanctions or penalties, incur expenses, lose revenues or suffer other adverse consequences.  Any of these events could have a material adverse effect on our business, results of operations, financial condition or cash flows.
Regulations related to conflict minerals have caused us to incur additional costs and may adversely affect our business.
In 2012, the SEC promulgated rules under the Dodd-Frank Wall Street Reform and Consumer Protection Act regarding disclosure of the use of tin, tantalum, tungsten and gold, known as "conflict minerals," included in components of products either manufactured by public companies or for which public companies have contracted to manufacture. These rules require that we undertake due diligence efforts to determine whether such minerals originated from the Democratic Republic of Congo (the “DRC”) or an adjoining country and, if so, whether such minerals helped finance armed conflict in the DRC or an adjoining country. In accordance with applicable regulations, we have filed conflict minerals reports annually, beginning in 2014. As discussed in these reports, we have determined that certain of our products contain the specified minerals, and we have undertaken, and continue to undertake, efforts to identify where such minerals originated.  We have incurred, and expect to continue to incur, costs associated with complying with these disclosure requirements, including costs related to determining the sources of the specified minerals used in our products. These rules could adversely affect the sourcing, supply and pricing of materials used in our products. Our customers may require that our products be free of conflict minerals, and our revenues and margins may be adversely affected if we are unable to provide assurances to our customers
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that our products are “DRC conflict free” (generally, the product does not contain conflict minerals originating in the DRC or an adjoining country that directly or indirectly finance or benefit specified armed groups) due to, among other things, our inability to procure conflict free minerals at a reasonable price, or at all. Moreover, we may be adversely affected if we are unable to pass through any increased costs associated with meeting customer demands that we provide products that are DRC conflict free.  We also may face reputational challenges if our due diligence efforts do not enable us to verify the origins of all conflict minerals or to determine that any conflict minerals used in products we manufacture or in products manufactured by others for us are DRC conflict-free.
Our operations expose us to the risk of material environmental and health and safety liabilities.
We are subject to numerous foreign, federal, state and local environmental protection and health and safety laws governing, among other things:
•the generation, storage, use and transportation of hazardous materials;
•emissions or discharges of substances into the environment; and
•the health and safety of our employees.
These laws and regulations are complex, change frequently and have tended to become more stringent over time. We cannot provide assurance that our costs of complying with current or future environmental protection and health and safety laws, or our liabilities arising from past or future releases of, or exposures to, hazardous substances, which may include claims for personal injury or cleanup, will not exceed our estimates or will not adversely affect our financial condition and results of operations.
Our workforce covered by collective bargaining and similar agreements could cause interruptions in our provision of products and services.
As of December 31, 2019, approximately 13% of our employees in the U.S. and in other countries were covered by union contracts or collective bargaining arrangements. It is likely that a portion of our workforce will remain covered by collective bargaining and similar agreements for the foreseeable future. Strikes or work stoppages could occur that would adversely impact our relationships with our customers and our ability to conduct our business.
We may not pay dividends on our common stock in the future.
Holders of our common stock are entitled to receive dividends only as our board of directors may declare out of funds legally available for such payments. The declaration and payment of future dividends to holders of our common stock will be at the discretion of our board of directors and will depend upon many factors, including our financial condition, earnings, requirements under covenants in our debt instruments, legal requirements and other factors as our board of directors deems relevant. We cannot assure that our cash dividend will not be reduced, or eliminated, in the future.
Certain provisions of our corporate governing documents, Delaware law and our senior notes could discourage, delay, or prevent a merger or acquisition.
Provisions of our certificate of incorporation and bylaws could impede a merger, takeover or other business combination involving us or discourage a potential acquirer from making a tender offer for our common stock. For example, our certificate of incorporation authorizes our board of directors to determine the number of shares in a series, the consideration, dividend rights, liquidation preferences, terms of redemption, conversion or exchange rights and voting rights, if any, of unissued series of preferred stock, without any vote or action by our stockholders. Thus, our board of directors can authorize and issue shares of preferred stock with voting or conversion rights that could adversely affect the voting or other rights of holders of our common stock. We are also subject to Section 203 of the Delaware General Corporation Law, which imposes restrictions on mergers and other business combinations between us and any holder of 15% or more of our common stock. These provisions could have the effect of delaying or deterring a third party from acquiring us even if an acquisition might be in the best interest of our stockholders, and accordingly could reduce the market price of our common stock.
Certain provisions in the indentures governing the Senior Notes could make it more difficult or more expensive for a third party to acquire us. If an acquisition event constitutes a “change of control,” as defined in the indentures governing the Senior Notes, holders of such notes will have the right to require us to purchase their notes in cash (in the case of the 2027 Notes, the right will apply only if the change in control is coupled with a ratings downgrade).
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Our obligations under the Senior Notes could increase the cost of acquiring us or otherwise discourage a third party from acquiring us or removing incumbent management, and accordingly could cause a reduction in the market price of our common stock.

ITEM 1B. UNRESOLVED STAFF COMMENTS
Not applicable.
ITEM 2. PROPERTIES
We own or lease approximately 90 properties consisting of plants, engineering and research centers, distribution warehouses, offices and other facilities. We believe that the properties are maintained in good operating condition and are suitable for their intended use. In general, our facilities meet current operating requirements for the activities currently conducted within the facilities.
Our major facilities (those with 50,000 or greater square feet) at December 31, 2019 are as follows:
Location Square
Footage 		Owned or
Leased
Olive Branch, MS 627,000    Leased
Kamunting, Malaysia 286,000    Owned
Nuevo Laredo, Mexico 277,000    Leased
Asheboro, NC 204,000    Owned
Morrisville, NC 162,000    Leased
Chihuahua, Mexico 153,000    Owned
Maple Grove, MN 129,000    Owned
Zdar Nad Sazauou, Czech Republic 108,000    Owned
Chihuahua, Mexico 100,000    Leased
Tecate, Mexico 102,000    Owned
Hradec Kralove, Czech Republic 92,000    Owned
Chelmsford, MA 91,000    Leased
Kulim, Malaysia 90,000    Owned
Kernen, Germany 86,000    Leased
Arlington Heights, IL 86,000    Leased
Wayne, PA 84,000    Leased
Jaffrey, NH 81,000    Owned
Kamunting, Malaysia 77,000    Leased
Pleasanton, CA 76,000    Leased
Chihuahua, Mexico 68,000    Leased
Chihuahua, Mexico 63,000    Owned
Reading, PA 63,000    Leased
Limerick, Ireland 59,000    Owned
Mansfield, MA 57,000    Leased
Bad Liebenzell, Germany 53,000    Leased
Operations in each of our business segments are conducted at locations both in and outside of the U.S. Of the facilities listed above, with the exception of Jaffrey, NH, Mansfield, MA, and Limerick, Ireland, which are used solely for the OEM segment, our facilities generally serve more than one business segment and are often used for multiple purposes, such as administrative/sales, manufacturing and warehousing/distribution.
In addition to the properties listed above, we own or lease approximately 750,000 square feet of additional warehousing, manufacturing and office space in the North America, South America, Europe, Asia and Africa.

ITEM 3. LEGAL PROCEEDINGS
We are party to various lawsuits and claims arising in the normal course of business. These lawsuits and claims include actions involving product liability and product warranty, intellectual property, contracts, employment
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and environmental matters. As of December 31, 2019 and 2018, we accrued liabilities of $0.4 million and $0.6 million respectively, in connection with these matters, representing our best estimate of the cost within the range of estimated possible loss that will be incurred to resolve these matters. Based on information currently available, advice of counsel, established reserves and other resources, we do not believe that any such actions are likely to be, individually or in the aggregate, material to our business, financial condition, results of operations or cash flows. However, in the event of unexpected further developments, it is possible that the ultimate resolution of these matters, or other similar matters, if unfavorable, may be materially adverse to our business, financial condition, results of operations or cash flows. See Note 17 to the consolidated financial statements included in this Annual Report on Form 10-K for additional information.

ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.

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PART II

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

Our common stock is listed on the New York Stock Exchange under the symbol “TFX.” As of February 18, 2020, we had 436 holders of record of our common stock. A substantially greater number of holders of our common stock are beneficial owners whose shares are held by brokers and other financial institutions for the accounts of beneficial owners.
Stock Performance Graph
The following graph provides a comparison of five year cumulative total stockholder returns of Teleflex common stock, the Standard & Poor’s (S&P) 500 Stock Index and the S&P 500 Healthcare Equipment & Supply Index. The annual changes for the five-year period shown on the graph are based on the assumption that $100 had been invested in Teleflex common stock and each index on December 31, 2014 and that all dividends were reinvested.
TFX-20191231_G3.JPG
MARKET PERFORMANCE
Company / Index 2014 2015 2016 2017 2018 2019
Teleflex Incorporated 100    116    143    222    232    340   
S&P 500 Index 100    101    114    138    132    174   
S&P 500 Healthcare Equipment & Supply Index
100    106    113    148    169    219   

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ITEM 6. SELECTED FINANCIAL DATA
2019(1)
2018(1)
2017(1)
2016(1)
2015(1)
  (Dollars in thousands, except per share)
Statement of Income Data:
Net revenues $ 2,595,362    $ 2,448,383    $ 2,146,303    $ 1,868,027    $ 1,809,690   
Income from continuing operations before interest, loss on extinguishment of debt and taxes
$ 427,254    $ 321,704    $ 372,279    $ 319,453    $ 315,891   
Income from continuing operations
$ 461,981    $ 196,432    $ 155,263    $ 237,651    $ 236,808   
Amounts attributable to common shareholders for income from continuing operations
$ 461,981    $ 196,432    $ 155,263    $ 237,187    $ 235,958   
Per Share Data:
Income from continuing operations — basic
$ 10.00    $ 4.30    $ 3.45    $ 5.47    $ 5.68   
Income from continuing operations — diluted
$ 9.81    $ 4.20    $ 3.33    $ 4.98    $ 4.91   
Cash dividends
$ —    $ 1.36    $ 1.36    $ 1.36    $ 1.36   
Balance Sheet Data:
Total assets
$ 6,309,820    $ 6,277,991    $ 6,181,492    $ 3,891,213    $ 3,871,774   
Long-term borrowings
$ 1,858,943    $ 2,072,200    $ 2,162,927    $ 850,252    $ 641,850   
Shareholders’ equity
$ 2,979,320    $ 2,539,978    $ 2,430,531    $ 2,137,517    $ 2,009,272   
Statement of Cash Flows Data:
Net cash provided by operating activities from continuing operations
$ 437,068    $ 435,086    $ 426,301    $ 410,590    $ 303,446   
Net cash used in investing activities from continuing operations
$ (73,481)   $ (196,394)   $ (1,832,855)   $ (56,974)   $ (154,848)  
Net cash (used in) provided by financing activities from continuing operations
$ (418,836)   $ (206,433)   $ 1,141,259    $ (118,692)   $ (85,583)  
Supplemental Data:
Free cash flow(2)
$ 334,373    $ 354,291    $ 355,398    $ 357,455    $ 241,998   

Certain financial information is presented on a rounded basis, which may cause minor differences.
(1) Amounts include the impact of businesses acquired and disposed of during the period, commencing on the respective acquisition or disposition dates. See Note 4 to the consolidated financial statements included in this Annual Report on Form 10-K for additional information related to the acquisitions and dispositions for the years ended December 31, 2019, 2018 and 2017.
(2) Free cash flow is calculated by subtracting capital expenditures from cash provided by operating activities from continuing operations. Free cash flow is a non-GAAP financial measure. This financial measure is used in addition to and in conjunction with results presented in accordance with generally accepted accounting principles in the U.S., or GAAP, and should not be considered a substitute for net cash provided by operating activities from continuing operations, the most comparable GAAP financial measure. Management believes that free cash flow is a useful measure to investors because it facilitates an assessment of funds available to satisfy current and future obligations, pay dividends and fund acquisitions. We also use this financial measure for internal managerial purposes and to evaluate period-to-period comparisons. Free cash flow is not a measure of cash available for discretionary expenditures since we have certain non-discretionary obligations, such as debt service, that are not deducted from the measure. We strongly encourage investors to review our financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure. The following is a reconciliation of free cash flow to the most comparable GAAP measure.
  2019 2018 2017 2016 2015
  (Dollars in thousands)
Net cash provided by operating activities from continuing operations
$ 437,068    $ 435,086    $ 426,301    $ 410,590    $ 303,446   
Less: Capital expenditures
102,695    80,795    70,903    53,135    61,448   
Free cash flow
$ 334,373    $ 354,291    $ 355,398    $ 357,455    $ 241,998   

 

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ITEM 7.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Overview
We are a global provider of medical technology products focused on enhancing clinical benefits, improving patient and provider safety and reducing total procedural costs. We primarily design, develop, manufacture and supply single-use medical devices used by hospitals and healthcare providers for common diagnostic and therapeutic procedures in critical care and surgical applications. We market and sell our products worldwide through a combination of our direct sales force and distributors. Because our products are used in numerous markets and for a variety of procedures, we are not dependent upon any one end-market or procedure. We are focused on achieving consistent, sustainable and profitable growth by increasing our market share and improving our operating efficiencies.
We evaluate our portfolio of products and businesses on an ongoing basis to ensure alignment with our overall objectives. Based on our evaluation, we may identify opportunities to expand our margins through strategic divestitures of existing businesses and product lines that do not meet our objectives. In addition, we may seek to optimize utilization of our facilities through restructuring initiatives designed to further reduce our cost base and enhance our competitive position. Finally, we may continue to explore opportunities to expand the size of our business and improve our margins through a combination of acquisitions and distributor to direct sales conversions, which generally involve our elimination of a distributor from the sales channel, either by acquiring the distributor or terminating the distributor relationship (in some instances, particularly in Asia, the conversions involve our acquisition or termination of a master distributor and the continued sale of our products through sub-distributors). Our distributor to direct sales conversions are designed to facilitate improved product pricing and more direct access to the end users of our products within the sales channel.
In February 2019 and May 2018, we initiated restructuring plans primarily involving the relocation of certain manufacturing operations to existing lower-cost locations and related workforce reductions (the “2019 Footprint realignment plan" and the "2018 Footprint realignment plan," respectively). The 2019 Footprint realignment and the 2018 Footprint realignment plan are expected to be substantially completed during 2022 and 2024, respectively. For additional information on both of these plans and a discussion of our other ongoing restructuring programs, see "Restructuring and impairment charges" under “Results of Operations” below.
Disruption in Sterilization Services
During the fourth quarter of the year ended December 31, 2019, operations at the Smyrna, Cobb County, Georgia facility of one of our contract sterilizers, Sterigenics U.S., LLC, were suspended by state and local officials due to issues associated with the facility’s use of ethylene oxide in its sterilization operations. The suspension of operations at the Smyrna facility resulted in a disruption in supply with respect to some of our surgical, intermittent catheter and OEM products. We utilized various measures to enable us to continue to provide the affected products to our customers, including alternate sterilization facilities, provisioning substitute products and instituting targeted global inventory management procedures. Nevertheless, we estimate the adverse impact from the suspension of operations at Sterigenics’ Smyrna facility adversely affected our 2019 revenues by approximately $7 million during the fourth quarter of 2019. While we have secured alternate sterilization facilities for the affected products, based on currently available information, we believe that the disruption in the supply of our product will adversely affect our 2020 revenues by $5 million to $7 million. Our 2020 revenues may be further adversely affected if we experience any significant difficulties or delays in accessing the sterilization capacity at the alternate facilities. For additional information see “Risk Factors” in Part I, Item 1A. of this report.
U.S. Tax Legislation
U.S. tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “TCJA”) was enacted on December 22, 2017. The legislation significantly changed U.S. tax law by, among other things, reducing the U.S. corporate income tax rate from a maximum of 35% to 21%; implementing a territorial tax system, generally providing for, among other things, a dividends received deduction on the foreign source portion of dividends received from a non-U.S. corporation if specified conditions are met; and imposing a one-time repatriation tax on undistributed post-1986 earnings and profits of non-U.S. subsidiaries, which will be deemed repatriated for purposes of the tax.
On December 22, 2017, the SEC staff issued Staff Accounting Bulletin No. 118 (“SAB 118”) to address the application of U.S. GAAP in situations where a company does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income
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tax effects of the TCJA. SAB 118 states that in these circumstances, if we can determine a reasonable estimate for the income tax effects, the SEC staff would not object if the company includes in its financial statements the reasonable estimate it has determined (and the SEC staff also expressed its belief that it would not be appropriate for a company to exclude a reasonable estimate from its financial statements to the extent a reasonable estimate has been determined). We included a provisional $107.9 million net tax expense related to the deemed repatriated earnings and the revaluation of deferred tax assets and liabilities in our consolidated financial statements for the year ended December 31, 2017.
During 2018, due to additional analysis, changes in interpretations and in our assumptions, and the issuance of additional regulatory guidance, we made a $0.2 million adjustment to the provisional amount for taxes on deemed repatriated earnings and a $2.1 million adjustment related to the revaluation of deferred tax assets and liabilities. As prescribed under SAB 118, these adjustments were identified and recorded as discrete adjustments in the period in which such changes were made. We completed our accounting for these provisional amounts during 2018 and we made no further adjustments to them during 2019.
Health Care Reform
In 2010, the Patient Protection and Affordable Care Act (as amended, the "Affordable Care Act") was signed into law. The legislation is far-reaching and is intended to expand access to health insurance coverage and improve the quality and reduce the costs of healthcare. For medical device companies such as Teleflex, the expansion of medical insurance coverage should lead to greater utilization of the products we manufacture, but the provisions of the legislation designed to contain the cost of healthcare could negatively affect pricing of our products and encourage patient outcome driven results. The overall impact of the Affordable Care Act on our business is yet to be determined, mainly due to uncertainties around future customer behaviors, which we believe will be affected by reimbursement factors such as insurance coverage, statistics, patient outcomes and patient satisfaction. Several legislative initiatives to repeal the Affordable Care Act and adopt a form of replacement legislation were proposed, but not adopted, in 2017. However, the TCJA eliminated the individual mandate under the Affordable Care Act, which generally required most Americans to maintain a minimum level of health insurance coverage. As a result, the level of insurance premium prices for participants in insurance exchanges under the Affordable Care Act is subject to increased uncertainty. Moreover, on December 14, 2018, the U.S. District Court for the Northern District of Texas ruled that the individual mandate provision of the Affordable Care Act is unconstitutional and the remainder of the act is invalid, although the Court stayed its ruling pending appeal. The nature and effect of any modification or repeal of, or legislative substitution for, the Affordable Care Act, any court decision regarding the act's validity and, generally, the longer-term viability of the act, is uncertain.
Global Economic Conditions
Global economic conditions in the past decade have had an adverse impact on market activities due to, among other things, failure of financial institutions, falling asset values, diminished liquidity, reduced demand for products and services and significant fluctuations in foreign currency exchange rates. In response, we adjusted production levels and engaged in new restructuring activities. We continue to review and evaluate our manufacturing, warehousing and distribution processes to maximize efficiencies through the elimination of redundancies in our operations and the consolidation of facilities. Although, on a consolidated basis, the consequences of economic conditions, other than fluctuations in foreign currency exchange rates, have not had a significant adverse impact on our financial position, results of operations or liquidity, healthcare policies and practice trends vary by country, and the impact of the global economic downturn was felt to varying degrees in each of our regional markets over the last several years. While there generally has been some improvement in economic conditions recently, the degree of improvement has been uneven among our regional markets, and the continuation of economic trends of uncertain economic growth, constricted credit, public sector austerity measures in response to public budget deficits and foreign currency volatility, particularly with respect to the euro, could have a material adverse effect on our results of operations and our liquidity.
In recent years, hospitals in some regions of the U.S. experienced a decline in admissions, a weaker payor mix, and a reduction in elective procedures.  Consequently, hospitals took actions to reduce their costs, including limiting their capital spending. Despite recent improvements in the economic environment, challenges persist, particularly in some European countries, as discussed below. Approximately 95% of our net revenues come from single-use products primarily used in critical care and surgical applications, and our sales volume could be negatively impacted if hospital admission rates or payor mix change. Conversely, our sales volume could increase due to the greater number of insured individuals as a result of the Affordable Care Act, which has had the effect of facilitating medical insurance coverage for many persons who previously were not covered, although, as noted above, the Affordable
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Care Act may be subject to repeal, a final court determination of invalidity, further modification or replacement; therefore, the longer-term viability of the act is uncertain.
The economy in Europe has weakened over the past year. Europe has seen a slowdown in external demand and a contraction in manufacturing, which is starting to impact other parts of the economy. While the solid performance of the labor market has helped to sustain private consumption and domestic demand, GDP growth is expected to remain flat over the near term. The economy in Europe is not likely to rebound in the near term as international trade in goods remains relatively stagnant and the risks of an increase in trade tensions, growing geopolitical conflicts and high uncertainties related to trade policies and the impact of Brexit remain uncertain.
In Asia, we believe the economic outlook for the healthcare sector generally is positive. However, an ongoing slowdown in the Chinese economy and U.S. - China trade tensions, as well as the public health epidemic relating to the novel coronavirus (referred to as COVID-19) reported to have originated in Wuhan, China, have increased uncertainties within Asia. In addition, we continue to confront government-implemented price management and reimbursement controls, particularly in Australia, China and India. There continue to be government initiatives to help local manufacturers access a bigger share of the local market. Moreover, many countries in the region have become more proactive with respect to regulatory requirements, and as a result, we expect longer, costlier and more complicated regulatory approval processes in these countries.
In Latin America, some highly regulated economies such as Argentina, Brazil and Mexico have experienced unusually high inflation rates and weakening currencies. This has impacted the budgets of the public healthcare systems resulting in reduced spending on necessary medical supplies and creating delays in the importation of medical devices. Although Latin America does not represent a significant portion of our business, our operations in this region may be adversely affected by these factors.

Results of Operations
As used in this discussion, "new products" are products for which commercial sales have commenced within the past 36 months, and “existing products” are products for which commercial sales commenced more than 36 months ago. Discussion of results of operations items that reference the effect of one or more acquired businesses (except as noted below with respect to acquired distributors) generally reflects the impact of the acquisitions within the first 12 months following the date of the acquisition. In addition to increases and decreases in the per unit selling prices of our products to our customers, our discussion of the impact of product price increases and decreases also reflects the impact on the pricing of our products resulting from any elimination of distributors, either through acquisition or termination of the distributor, from the sales channel.
Certain financial information is presented on a rounded basis, which may cause minor differences.
For a discussion of our results of operations comparison for 2018 and 2017, refer to our Annual Report on Form 10-K for the fiscal year ended December 31, 2018 filed on February 21, 2019. Discussion of our reportable segment results of operations comparison for 2018 and 2017 is included below within this Annual Report on Form 10-K to reflect the changes in our segment presentation, which occurred during the first quarter of 2019.
Comparison of 2019 and 2018
Revenues
  2019 2018 2017
  (Dollars in millions)
Net Revenues $ 2,595.4    $ 2,448.4    $ 2,146.3   
Net revenues for the year ended December 31, 2019 increased 6.0%, or $147.0 million, compared to the prior year. The increase was primarily attributable to a $142.8 million increase in sales volumes of existing products and, to a lesser extent, an increase in new product sales, which were partially offset by unfavorable fluctuations in foreign currency exchange rates of $46.8 million.
Gross profit
  2019 2018 2017
  (Dollars in millions)
Gross profit
$ 1,491.6    $ 1,384.4    $ 1,171.8   
Percentage of revenues
57.5  % 56.5  % 54.6  %
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For the year ended December 31, 2019, gross margin increased 100 basis points, or 1.8%, compared to the prior year period. The increase was primarily attributable to favorable product mix, an increase in sales volumes of existing products and benefits from cost improvement initiatives partially offset by incremental tariffs and higher logistics and distribution costs.
Selling, general and administrative
  2019 2018 2017
  (Dollars in millions)
Selling, general and administrative
$ 934.4    $ 878.7    $ 700.0   
Percentage of revenues
36.0  % 35.9  % 32.6  %
Selling, general and administrative expenses increased $55.7 million for the year ended December 31, 2019 compared to the prior year. The increase was primarily attributable to an increase in selling and marketing expenses incurred to support higher sales and expenses incurred by our acquired businesses. The increases were partially offset by favorable fluctuations in foreign currency exchange rates.
Research and development
  2019 2018 2017
  (Dollars in millions)
Research and development
$ 113.9    $ 106.2    $ 84.8   
Percentage of revenues
4.4  % 4.3  % 3.9  %
The increase in research and development expenses for the year ended December 31, 2019 compared to the prior year was primarily attributable to new product development costs for several of our product lines and European Union Medical Device Regulation ("EU MDR") related costs.
Restructuring and impairment charges
Anticipated charges and pre-tax savings related to restructuring programs and other similar cost savings initiatives
We have ongoing restructuring programs primarily related to the consolidation of our manufacturing operations (referred to as our 2019, 2018 and 2014 Footprint realignment plans). We also have similar ongoing activities to relocate certain manufacturing operations within our OEM segment (the "OEM initiative") that do not meet the criteria for a restructuring program under applicable accounting guidance; nevertheless, the activities should result in cost savings (we expect only minimal costs to be incurred in connection with the OEM initiative). With respect to our currently ongoing restructuring programs and the OEM initiative, the table below summarizes charges incurred or estimated to be incurred and estimated annual pre-tax savings to be realized as follows: (1) with respect to charges (a) the estimated total charges that will have been incurred once the restructuring programs and OEM initiative are completed; (b) the charges incurred through December 31, 2019; and (c) the estimated charges to be incurred from January 1, 2020 through the last anticipated completion date of the restructuring programs and OEM initiative, December 31, 2026 and (2) with respect to estimated annual pre-tax savings, (a) the estimated total annual pre-tax savings to be realized once the restructuring programs and OEM initiative are completed; (b) the estimated annual pre-tax savings realized based on the progress of the restructuring programs and OEM initiative through December 31, 2019; and (c) the estimated additional annual pre-tax savings to be realized from January 1, 2020 through the last anticipated completion date of the restructuring programs and the OEM initiative, December 31, 2026.
Estimated charges and pre-tax savings are subject to change based on, among other things, the nature and timing of restructuring activities and similar activities, changes in the scope of restructuring programs and the OEM initiative, unanticipated expenditures and other developments, the effect of additional acquisitions or dispositions, the failure to realize anticipated savings from a supply contract related to a component included in certain kits sold by our Americas segment and other factors that were not reflected in the assumptions made by management in previously estimating restructuring and restructuring related charges and estimated pre-tax savings. Moreover, estimated pre-tax savings constituting efficiencies with respect to increased costs that otherwise would have resulted from business acquisitions involve, among other things, assumptions regarding the cost structure and integration of businesses that previously were not administered by our management, which are subject to a particularly high degree of risk and uncertainty. It is likely that estimates of charges and pre-tax savings will change from time to time, and the table below may reflect changes from amounts previously estimated. In addition, the table below does not include estimated charges and pre-tax savings related to substantially completed programs such as
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the 2017 Vascular Solutions integration program, the 2017 EMEA program, the 2016 Footprint realignment plan and other 2016 restructuring programs, which were substantially completed prior to or during 2019. Additional details, including estimated charges expected to be incurred in connection with our restructuring programs, are described in Note 5 to the consolidated financial statements included in this Annual Report on Form 10-K.

Pre-tax savings can also be affected by increases or decreases in sales volumes generated by the businesses impacted by the consolidation of manufacturing operations; such variations in revenues can increase or decrease pre-tax savings generated by the consolidation of manufacturing operations. For example, an increase in sales volumes generated by the impacted businesses, although likely to increase manufacturing costs, may generate additional savings with respect to costs that otherwise would have been incurred if the manufacturing operations were not consolidated.
Restructuring programs and other similar cost saving initiatives
Estimated Total Through
December 31, 2019 		Estimated Remaining from January 1, 2020 through
December 31, 2026
(Dollars in millions)
Restructuring charges $95 - $114    $83    $12 - $31   
Restructuring related charges (1)
110 - 141    46    64 - 95   
Total charges $205 - $255    $129    $76 - $126   
OEM initiative pre-tax savings $6 - $7    $1    $5 - $6   
Pre-tax savings (2)
63 - 73    25    38 - 48   
Total pre-tax savings $69 - $80    $26    $43 - $54   
(1)Restructuring related charges represent costs that are directly related to the programs and principally constitute costs to transfer manufacturing operations to the new locations, project management costs and accelerated depreciation, as well as a charge associated with our exit from facilities that is expected to be imposed by the taxing authority in the affected jurisdiction. Most of these changes (other than the tax charge) are expected to be recognized in cost of goods sold.
(2)Substantially all of the pre-tax savings are expected to result in reductions to cost of goods sold.
The following discussion provides additional details with respect to our ongoing significant restructuring programs:
2019 Footprint realignment plan
In February 2019, we initiated a restructuring plan primarily involving the relocation of certain manufacturing operations to existing lower-cost locations and related workforce reductions (the “2019 Footprint realignment plan"). These actions are expected to be substantially completed during 2022.
We estimate that we will incur aggregate pre-tax restructuring and restructuring related charges in connection with the 2019 Footprint realignment plan of $56 million to $70 million, of which we estimate that $53 million to $66 million of these charges will result in future cash outlays. Additionally, we expect to incur $29 million to $35 million in aggregate capital expenditures under the plan, most of which we expect to be incurred by the end of 2021.
We expect to begin realizing plan-related savings in 2021 and expect to achieve annual pre-tax savings of $12 million to $14 million once the plan is fully implemented.
2018 Footprint realignment plan
In May 2018, we initiated a restructuring plan involving the relocation of certain European manufacturing operations to existing lower-cost locations, the outsourcing of certain European distribution operations and related workforce reductions. These actions commenced in the second quarter 2018 and are expected to be substantially completed by the end of 2024.
We estimate that we will incur aggregate pre-tax restructuring and restructuring related charges in connection with the 2018 Footprint realignment plan of $102 million to $133 million, of which, we estimate that $99 million to $127 million of these charges will result in future cash outlays. Additionally, we expect to incur $19 million to $23 million in aggregate capital expenditures under the plan, most of which we expect to be incurred by the end of 2021.
We began realizing plan-related savings in 2018 and expect to achieve annual pre-tax savings of $25 million to $30 million once the plan is fully implemented.
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2014 Footprint realignment plan
In April 2014, we initiated a restructuring 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. We estimate that we will incur aggregate pre-tax charges in connection with the 2014 Footprint realignment plan of $47 million to $52 million. Additionally, we estimate that we will achieve annual pre-tax savings of $26 million to $29 million and we expect the plan will be substantially complete by the end of 2021.
The following table provides information regarding restructuring charges we have incurred with respect to each of our restructuring programs, as well as impairment charges, for the years ended December 31, 2019, 2018, and 2017. The restructuring charges listed in the table primarily consist of termination benefits.
  2019 2018 2017
  (Dollars in millions)
2019 Footprint realignment plan $ 13.8    $ —    $ —   
2018 Footprint realignment plan (0.9)   55.0    —   
2014 Footprint realignment plan 0.3    0.8    0.7   
Other restructuring programs (1)
2.0    4.3    14.1   
Impairment charges (2)
7.0    19.1    —   
Total $ 22.2    $ 79.2    $ 14.8   
(1)Includes activity primarily related to a restructuring program initiated in the third quarter of 2019 that is designed to reduce costs and improve efficiencies through reorganizations within several businesses and certain corporate functions, the Vascular solutions integration program and EMEA restructuring program, both of which were initiated in 2017, in addition to the 2016 Footprint realignment plan, and other 2016 restructuring programs.
(2)Impairment charges recognized in 2019 and 2018 included $7.0 million and $17.2 million, respectively, related to our decision to abandon certain intellectual property and other assets associated with products that were eliminated from our interventional product portfolio.
Interest expense 
2019 2018 2017
(Dollars in millions)
Interest expense
$ 80.3    $ 103.0    $ 82.5   
Average interest rate on debt during the year
3.47  % 4.25  % 3.70  %
The decrease in interest expense for the year ended December 31, 2019 compared to the prior year was primarily due to a reduction in our average interest rate as a result of our cross-currency swap agreements.
Loss on extinguishment of debt 
2019 2018 2017
(Dollars in millions)
Loss on extinguishment of debt
$ 8.8    $ —    $ 5.6   
On November 15, 2019, we prepaid the $250 million aggregate outstanding principal amount under our 2024 Notes. In addition to our prepayment of principal, we paid to the holders of the 2024 Notes a $6.5 million prepayment make-whole amount plus accrued and unpaid interest. We recorded the prepayment make-whole amount and a $2.3 million write-off of unamortized debt issuance costs as a loss on extinguishment of debt.
Gain on sale of assets
  2019 2018 2017
  (Dollars in millions)
Gain on sale of assets
$ 6.1    $ 1.4    $ —   
During the year ended December 31, 2019, we recognized a gain related to the sale of two buildings and our vein catheter reprocessing business. During the year ended December 31, 2018 we recognized a gain related to the sale of a land parcel.
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Taxes on income from continuing operations 
  2019 2018 2017
Effective income tax rate
(35.9) % 10.6  % 45.5  %
We generate substantial earnings from our non-U.S. operations. Most of the non-U.S. jurisdictions in which we file tax returns historically have had statutory tax rates that are lower than the U.S. statutory tax rate; as a result, our consolidated effective income tax rate for 2019 and earlier years (excluding the one-time impacts of the TCJA) has been substantially below the U.S. statutory tax rate. The principal non-U.S. jurisdictions in which the statutory tax rate in 2019 and earlier years was lower than the U.S. statutory tax rate and from which we derive substantial earnings included Ireland and Bermuda.
Comparison of 2019 and 2018
The effective income tax rate for 2019 was (35.9)% compared to 10.6% for 2018. Taxes (benefit) on income from continuing operations in 2019 were ($122.1) million compared to $23.2 million in 2018. The effective income tax rate for 2019 reflected a tax benefit of $129 million resulting from a non-U.S. legal entity restructuring that eliminated the requirement to provide for withholding taxes on the future repatriation of certain non-permanently reinvested earnings. Additionally, the effective tax rate for 2019 was affected by a tax benefit relating to the revaluation of state deferred tax assets and liabilities due to business integrations and other changes. The effective tax rates for both 2019 and 2018 reflect a net excess tax benefit related to share-based compensation and a tax cost associated with a non-deductible contingent consideration expense recognized in connection with an increase in the fair value of the NeoTract contingent consideration liability. See Note 15 to the consolidated financial statements included in this Annual Report on Form 10-K for additional information.

Segment Results
Segment Net Revenues
  Year Ended December 31 % Increase/(Decrease)
  2019 2018 2017 2019 vs 2018 2018 vs 2017
  (Dollars in millions)  
Americas $ 1,492.3    $ 1,351.7    $ 1,141.4    10.4    18.4   
EMEA 588.1    603.8    552.7    (2.6)   9.2   
Asia 294.3    286.9    269.2    2.6    6.6   
OEM 220.7    206.0    183.0    7.2    12.6   
Segment Net Revenues $ 2,595.4    $ 2,448.4    $ 2,146.3    6.0    14.1   

Segment Operating Profit
  Year Ended December 31, % Increase/(Decrease)
  2019 2018 2017 2019 vs 2018 2018 vs 2017
  (Dollars in millions)  
Americas $ 319.9    $ 255.8    $ 241.0    25.1    6.1   
EMEA 94.4    106.1    92.4    (11.0)   14.8   
Asia 73.1    78.1    75.6    (6.5)   3.3   
OEM 58.0    50.3    41.6    15.3    21.0   
Segment Operating Profit (1)
$ 545.4    $ 490.3    $ 450.6    11.2    8.8   
(1)See Note 18 to the consolidated financial statements included in this Annual Report on Form 10-K for a reconciliation of segment operating profit to our consolidated income from continuing operations before interest, loss on extinguishment of debt and taxes.
Comparison of 2019 and 2018
Americas
Americas net revenues for the year ended December 31, 2019 increased $140.6 million, or 10.4%, compared to the prior year. The increase was primarily attributable to a $115.3 million increase in sales volumes of existing products and an increase in new product sales.
Americas operating profit for the year ended December 31, 2019 increased $64.1 million, or 25.1%, compared to the prior year. The increase was primarily attributable to an increase in gross profit resulting from higher sales
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partially offset by higher operating expenses, principally higher selling expenses incurred to support higher sales, as well as higher general and administrative expenses.
EMEA
EMEA net revenues for the year ended December 31, 2019 decreased $15.7 million, or 2.6%, compared to the prior year. The decrease was primarily attributable to unfavorable fluctuations of foreign currency exchange rates of $31.1 million partially offset by an increase in new product sales and net revenues generated by acquired businesses.
EMEA operating profit for the year ended December 31, 2019 decreased $11.7 million, or 11.0%, compared to the prior year. The decrease was primarily attributable to higher operating expenses, inclusive of higher EU MDR and information technology related costs, and unfavorable fluctuations in foreign currency exchange rates partially offset by the gross profit generated from higher sales.
Asia
Asia net revenues for the year ended December 31, 2019 increased $7.4 million, or 2.6%, compared to the prior year. The increase was primarily attributable to an increase of $7.5 million in sales volumes of existing products and price increases partially offset by unfavorable fluctuations in foreign currency exchange rates of $11.3 million.
Asia operating profit for the year ended December 31, 2019 decreased $5.0 million, or 6.5%, compared to the prior year. The decrease was primarily attributable to higher operating costs, the impact of increased tariffs in China and unfavorable fluctuations in foreign currency exchange rates. The decreases in operating profit were partially offset by an increase in gross profit generated from higher sales.
OEM
OEM net revenues for the year ended December 31, 2019 increased $14.7 million, or 7.2%, compared to the prior year. The increase was primarily attributable to an increase in sales volumes of existing products.
OEM operating profit for the year ended December 31, 2019 increased $7.7 million, or 15.3%, compared to the prior year. The increase was primarily attributable to an increase in gross profit resulting from higher sales and favorable product mix partially offset by higher operating costs.
Comparison of 2018 and 2017
Americas
Americas net revenues for the year ended December 31, 2018 increased $210.3 million, or 18.4%, compared to the prior year. The increase was primarily attributable to net revenues of $154.4 million generated by acquired businesses, primarily NeoTract and Vascular Solutions, a $30.2 million increase in sales volumes of existing products and, to a lesser extent, an increase in new product sales.
Americas operating profit for the year ended December 31, 2018 increased $14.8 million, or 6.1%, compared to the prior year. The increase was primarily attributable to gross profit generated by Vascular Solutions and NeoTract partially offset by higher expenses related to contingent consideration liabilities in addition to an increase in selling and amortization expenses.
EMEA
EMEA net revenues for the year ended December 31, 2018 increased $51.1 million, or 9.2%, compared to the prior year. The increase was primarily attributable to favorable fluctuations in foreign currency exchange rates of $24.5 million as well as price increases of $13.8 million.
EMEA operating profit for the year ended December 31, 2018 increased $13.7 million, or 14.8%, compared to the prior year. The increase was primarily attributable to an increase in gross profit reflecting higher sales and favorable fluctuations in foreign currency exchange rates. The increases in gross profit were partially offset by higher operating costs, including selling and amortization expenses.
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Asia
Asia net revenues for the year ended December 31, 2018 increased $17.7 million, or 6.6%, compared to the prior year. The increase was primarily attributable to a $9.3 million increase in sales volumes of existing products, a $6.0 million increase in new product sales and net revenues generated by acquired businesses.
Asia operating profit for the year ended December 31, 2018 increased $2.5 million, or 3.3%, compared to the prior year. The increase was primarily attributable to an increase in gross profit resulting from higher sales as well as favorable fluctuations in foreign currency exchange rates, partially offset by unfavorable product mix and higher operating costs.
OEM
OEM net revenues for the year ended December 31, 2018 increased $23.0 million, or 12.6%, compared to the prior year. The increase was primarily attributable to a $16.5 million increase in sales volumes of existing products and an acceleration in the timing of revenue recognition in accordance with newly-adopted accounting guidance.
OEM operating profit for the year ended December 31, 2018 increased $8.7 million, or 21.0%, compared to the prior year. The increase was primarily attributable to an increase in gross profit resulting from higher sales partially offset by higher manufacturing costs.

Liquidity and Capital Resources
We assess our liquidity in terms of our ability to generate cash to fund our operating, investing and financing activities. Our principal source of liquidity is operating cash flows. In addition to operating cash flows, other significant factors that affect our overall management of liquidity include: capital expenditures, acquisitions, pension funding, dividends, taxes, scheduled principal and interest payments with respect to outstanding indebtedness, adequacy of available bank lines of credit and access to capital markets.
We believe our cash flow from operations, available cash and cash equivalents and borrowings under our revolving credit facility (which is provided for under the Credit Agreement) and accounts receivable securitization facility will enable us to fund our operating requirements, capital expenditures and debt obligations for the next 12 months and the foreseeable future.
Of our $301.1 million of cash and cash equivalents at December 31, 2019, $231.4 million was held at non-U.S. subsidiaries. We manage our worldwide cash requirements by monitoring the funds available among our subsidiaries and determining the extent to which we can access those funds on a cost effective basis.
On November 15, 2019, we prepaid $250 million aggregate principle amount of our 2024 Notes using available borrowings under our revolving credit agreement.
We have entered into cross-currency swap agreements with different financial institution counterparties to hedge against the effect of variability in the U.S. dollar to euro exchange rate. Under the terms of the cross-currency swap agreements, we notionally exchanged in the aggregate $750 million for €653.1 million. The swap agreements, which begin to expire in October 2023, are designated as net investment hedges and require an exchange of the notional amounts upon expiration or the earlier termination of the agreements. We and the counterparties have agreed to effect the exchange through a net settlement. As a result, we may be required to pay (or be entitled to receive) an amount equal to the difference, on the expiration or earlier termination dates, between the U.S. dollar equivalent of the €653.1 million notional amount and the $750 million notional amount. If, at the expiration or earlier termination of the swap agreements, the U.S. dollar to euro exchange rate has increased or declined by 10% from the rate in effect at the inception of these agreements, we would receive from or be required to pay to the counterparties an aggregate of approximately $75 million in respect of the notional settlement. The swap agreements entail risk that the counterparties will not fulfill their obligations under the agreements. However, we believe the risk is reduced because we have entered into separate agreements with different counterparties, all of which are large, well-established financial institutions.
On February 18, 2020, we acquired IWG High Performance Conductors, Inc., a privately-held original equipment manufacturer of minimally invasive medical products and high performance conductors, for $260 million. The acquisition, which will complement our OEM product portfolio, was financed using borrowings under our revolving credit facility.
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We may at any time, from time to time, repurchase our outstanding debt securities in open market purchases, via tender offers or in privately negotiated transactions, exchange transactions or otherwise, at such price or prices as we deem appropriate. Such purchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors and may be commenced or suspended at any time.
See "Financing Arrangements" below as well as Note 10 and Note 11 to the consolidated financial statements included in this Annual Report on Form 10-K for further information related to our borrowings and financial instruments.

Cash Flows
The following table provides a summary of our cash flows for the periods presented:
Year Ended December 31,
2019 2018 2017
(Dollars in millions)
Cash flows from continuing operations provided by (used in):
Operating activities
$ 437.1    $ 435.1    $ 426.3   
Investing activities
(73.5)   (196.4)   (1,832.9)  
Financing activities
(418.8)   (206.4)   1,141.3   
Cash flows used in discontinued operations
2.5    2.3    (6.4)  
Effect of exchange rate changes on cash and cash equivalents
(3.4)   (11.0)   61.5   
Increase (decrease) in cash and cash equivalents
$ (56.1)   $ 23.6    $ (210.2)  
Comparison of 2019 and 2018

Cash Flow from Operating Activities
Net cash provided by operating activities from continuing operations was $437.1 million during 2019 and $435.1 million during 2018. The $2.0 million increase was primarily attributable to favorable operating results partially offset by the net unfavorable impact of changes in working capital and contingent consideration payments of $26.1 million. The unfavorable change in working capital was primarily attributable to an increase in accounts receivable due to timing of collections and higher sales during the fourth quarter of 2019 and an increase in inventory purchases required to achieve desired safety stock levels and to support ongoing business growth.

Cash Flow from Investing Activities
Net cash used in investing activities from continuing operations was $73.5 million during 2019, which included capital expenditures of $102.7 million partially offset by proceeds from cross-currency swap agreements designated as net investment hedges of $18.3 million and proceeds from sales of businesses and assets of $14.3 million.
Cash Flow from Financing Activities
Net cash used for financing activities from continuing operations was $418.8 million during 2019, which reflected a net decrease in borrowings of $253.5 million, contingent consideration payments of $112.1 million and dividend payments of $62.8 million.
For a discussion of our cash flow comparison for 2018 and 2017, refer to our Annual Report on Form 10-K for the fiscal year ended December 31, 2018.
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Financing Arrangements
 
The following table provides our net debt to total capital ratio:
2019 2018
(Dollars in millions)
Net debt includes:
Current borrowings $ 50.0    $ 86.6   
Long-term borrowings 1,858.9    2,072.2   
Unamortized debt issuance costs 14.1    17.7   
Total debt 1,923.0    2,176.5   
Less: Cash and cash equivalents 301.1    357.2   
Net debt 1,621.9    1,819.3   
Total capital includes:    
Net debt 1,621.9    1,819.3   
Shareholders’ equity 2,979.3    2,540.0   
Total capital $ 4,601.2    $ 4,359.3   
Percent of net debt to total capital 35.2  % 41.7  %
Fixed rate debt comprised 46.8% and 52.8% of total debt at December 31, 2019 and 2018, respectively. The decrease in fixed rate borrowings as a percentage of total borrowings as of December 31, 2019 compared to the prior year was due to the prepayment of the 2024 Notes.
Senior credit facility
On April 5, 2019, we entered into a second amended and restated credit agreement (the "Credit Agreement"), which provides for a $1.0 billion revolving credit facility and a $700 million term loan facility, each of which matures on April 5, 2024. The Credit Agreement replaces a previous credit agreement under which we were provided a $1.0 billion credit facility and a $750 million term loan facility, due 2022 (the “prior term loan”). The $700 million term loan facility under the Credit Agreement principally was applied against the remaining $675 million principal balance of the prior term loan.

At our option, loans under the Credit Agreement will bear interest at a rate equal to adjusted LIBOR plus an applicable margin ranging from 1.25% to 2.00% or at an alternate base rate, which is defined as the highest of (i) the “Prime Rate” in the U.S. last quoted by The Wall Street Journal, (ii) 0.50% above the greater of the federal funds rate and the rate comprised of both overnight federal funds and overnight eurodollar borrowings and (iii) 1.00% above adjusted LIBOR for a one month interest period, plus in each case an applicable margin ranging from 0.125% to 1.00%, in each case subject to adjustments based on our consolidated total net leverage ratio (generally, Consolidated Total Funded Indebtedness (which is net of “Qualified Cash”), as defined in the Credit Agreement, on the date of determination to Consolidated EBITDA, as defined in the Credit Agreement, for the four most recent fiscal quarters ending on or preceding the date of determination). Overdue loans will bear interest at the rate otherwise applicable to such loans plus 2.00%.
At December 31, 2019, we had $300.0 million in borrowings outstanding and $2.1 million in outstanding standby letters of credit under our $1.0 billion revolving credit facility.
The Credit Agreement contains covenants that, among other things and subject to certain exceptions, place limitations on our ability, and the ability of our subsidiaries, to incur additional indebtedness; create additional liens; enter into a merger, consolidation or amalgamation or other defined "fundamental changes," dispose of certain assets, make certain investments or acquisitions, pay dividends, or make other restricted payments, enter into swap agreements or enter into transactions with our affiliates. Additionally, the Credit Agreement contains financial covenants that, subject to specified exceptions, require us to maintain a consolidated total net leverage ratio of not more than 4.50 to 1.00 and 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. As of December 31, 2019, we were in compliance with the covenants in the Credit Agreement.
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See Note 10 to the consolidated financial statements included in this Annual Report on Form 10-K for additional information regarding the Credit Agreement.
2026 and 2027 Senior Notes
As of December 31, 2019, the outstanding principal amount of our 4.875% senior notes due 2026 (the "2026 Notes") and 4.625% senior notes due 2027 (the "2027 Notes" and collectively, the "Senior Notes") was $400.0 million and $500.0 million, respectively. The indentures governing the 2026 Notes contain covenants that, among other things and subject to certain exceptions, 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, merge, consolidate, or dispose of certain assets pay dividends, make investments or make other restricted payments, or enter into transactions with our affiliates. The indenture governing the 2027 Notes contains covenants that, among other things and subject to certain exceptions, limit or restrict our ability, and the ability of our subsidiaries, to create liens; consolidate, merge or dispose of certain assets; and enter into sale leaseback transactions. The obligations under the Senior Notes are fully and unconditionally guaranteed, jointly and severally, by each of our existing and future 100% owned domestic subsidiaries that are a guarantor or other obligor under the Credit Agreement and by certain of our other 100% owned domestic subsidiaries. As of December 31, 2019, we were in compliance with all of the terms of our Senior Notes.
Accounts receivable securitization
We have an accounts receivable securitization facility under which we sell an undivided interest in domestic accounts receivable for consideration of up to $50.0 million to a commercial paper conduit. As of December 31, 2019, and 2018 we borrowed the maximum amount available of $50.0 million under this facility. This facility is utilized to provide increased flexibility in funding short term working capital requirements. The agreement governing the accounts receivable securitization facility contains certain covenants and termination events. An occurrence of an event of default or a termination event under this facility may give rise to the right of our counterparty to terminate this facility. As of December 31, 2019, we were in compliance with the covenants and none of the termination events had occurred.
For additional information regarding our indebtedness, see Note 10 to the consolidated financial statements included in this Annual Report on Form 10-K.
Contractual Obligations 
Contractual obligations at December 31, 2019 were as follows:
  Payments due by period
Total Less than
1 year 		1-3
years 		3-5
years 		More than
5 years
  (Dollars in thousands)
Total borrowings $ 1,923,000    $ 50,000    $ 60,500    $ 912,500    $ 900,000   
Interest obligations (1)
442,375    76,229    148,934    123,103    94,109   
Operating lease obligations 144,115    25,323    46,747    31,341    40,704   
Purchase and other obligations (2)
229,218    225,861    3,357    —    —   
Tax on deemed repatriation of non-U.S. earnings (3)
128,977    12,284    24,567    53,740    38,386   
Pension and other postretirement benefits 45,095    6,701    11,700    9,077    17,617   
Total contractual obligations $ 2,912,780    $ 396,398    $ 295,805    $ 1,129,761    $ 1,090,816   

(1)Interest payments on floating rate debt are based on the interest rate in effect on December 31, 2019.
(2)Purchase and other obligations are defined as unconditional commitments to purchase goods or services that are legally binding and that specify all significant terms, including: quantities to be purchased; price provisions; and the approximate timing of the transaction. The amounts include commitments for inventory purchases and capital expenditures (which, at the time we entered into the commitments, did not exceed our projected requirements in the normal course of business) and penalties due upon cancellation of cancellable agreements; the amounts exclude operating lease obligations, which are addressed elsewhere in the table.
(3)As permitted by the TCJA, we have elected to pay the tax in annual installments over eight years.

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Our noncurrent liability for uncertain tax positions was $10.3 million and $10.7 million as of December 31, 2019 and 2018, respectively. Due to uncertainties regarding the ultimate resolution of ongoing or future tax examinations, we are not able to reasonably estimate the amount of any income tax payments that will be required to settle uncertain income tax positions or the periods in which any such payments will be made; as a result, these amounts are excluded from the contractual obligations table above.
Our contingent consideration liabilities were $219.9 million and $304.2 million as of December 31, 2019 and 2018, respectively, of which $148.1 million and $136.9 million, respectively, were recorded as the current portion of contingent consideration. We expect most of the current portion to be paid during the first quarter 2020 as result of the achievement of certain sales milestones. Due to uncertainty regarding the timing and amount of future payments related to these liabilities, these amounts are excluded from the contractual obligations table above.
See Note 12, Note 15 and Note 16 to the consolidated financial statements included in this Annual Report on Form 10-K for additional information.

Critical Accounting Policies and Estimates
 
The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from the amounts derived from those estimates and assumptions. 
We have identified the following as critical accounting estimates, which are defined as those that are reflective of significant judgments and uncertainties, are the most pervasive and important to the presentation of our financial condition and results of operations and could potentially result in materially different results under different assumptions and conditions. The following discussion should be considered in conjunction with the description of our accounting policies in Note 1 to the consolidated financial statements in this Annual Report on Form 10-K.

Allowance for Doubtful Accounts
 
In the ordinary course of business, we grant non-interest bearing trade credit to our customers on normal credit terms.  In an effort to reduce our credit risk, we (i) establish credit limits for all of our customer relationships, (ii) perform ongoing credit evaluations of our customers’ financial condition, (iii) monitor the payment history and aging of our customers’ receivables, and (iv) monitor open orders against an individual customer’s outstanding receivable balance.
An allowance for doubtful accounts is maintained for trade accounts receivable based on the expected collectability of accounts receivable, after considering our historical collection experience, the length of time an account is outstanding, the financial position of the customer and information provided by credit rating services. The adequacy of this allowance is reviewed each reporting period and adjusted as necessary. Our allowance for doubtful accounts was $9.1 million and $9.3 million at December 31, 2019 and 2018, respectively, which constituted 2.1% and 2.4% of gross trade accounts receivable at December 31, 2019 and 2018, respectively.
Although we maintain allowances for doubtful accounts to cover the estimated losses which may occur when customers cannot make their required payments, we cannot be assured that the allowances will be sufficient to cover future losses given the volatility in the worldwide economy and the possibility that other, unanticipated events may adversely affect collectability of the accounts.  If our allowance for doubtful accounts is insufficient to address receivables we ultimately determine are uncollectible, we would be required to incur additional charges, which could materially adversely affect our results of operations.  Moreover, our inability to collect outstanding receivables could adversely affect our financial condition and cash flow from operations.
Distributor Rebates
We offer rebates to certain distributors and record a reserve with respect to the estimated amount of the rebates as a reduction of revenues at the time of sale. In estimating rebates, we consider the lag time between the point of sale and the payment of the distributor’s rebate claim, distributor-specific trend analyses, contractual commitments, including stated rebate rates, historical experience and other relevant information. When necessary, we adjust the reserves, with a corresponding adjustment to revenue, to reflect differences between estimated and actual experience. Historical adjustments to recorded reserves have not been significant and we do not expect
42

significant revisions to the estimated rebates in the future. The reserve for estimated rebates was $21.6 million and $18.1 million at December 31, 2019 and 2018, respectively. We expect to pay amounts subject to the reserve as of December 31, 2019 within 90 days subsequent to year-end.

Inventory Utilization
 
Inventories are valued at the lower of cost or net realizable value. Factors utilized in the determination of estimated net realizable value and whether a reserve is required include (i) current sales data and historical return rates, (ii) estimates of future demand, (iii) competitive pricing pressures, (iv) new product introductions, (v) product expiration dates, and (vi) component and packaging obsolescence.
We review the net realizable value of inventory each reporting period and adjusted as necessary.  We regularly compare inventory quantities on hand against historical usage or forecasts related to specific items in order to evaluate obsolescence and excessive quantities. In assessing historical usage, we also qualitatively assess business trends to evaluate the reasonableness of using historical information in estimating future usage.

Long-Lived Assets
 
We assess the remaining useful life and recoverability of long-lived assets whenever events or circumstances indicate the carrying value of an asset may not be recoverable. For example, such an assessment may be initiated if, as a result of a change in expectations, we believe it is more likely than not that the asset will be sold or disposed of significantly before the end of its useful life or if an adverse change occurs in the business employing the asset. Significant judgments in this area involve determining whether such events or circumstances have occurred and determining the appropriate asset group requiring evaluation. The recoverability evaluation is based on various analyses, including undiscounted cash flow projections, which involve significant management judgment. Any impairment loss, if indicated, equals the amount by which the carrying amount of the asset exceeds the estimated fair value of the asset.
Goodwill and Other Intangible Assets
 
Intangible assets include indefinite-lived assets (such as goodwill, certain trade names and in-process research and development ("IPR&D")), as well as finite-lived intangibles (such as trade names that do not have indefinite lives, customer relationships, intellectual property, distribution rights and non-competition agreements) and are, generally, obtained through acquisition. Intangible assets acquired in a business combination are measured at fair value and we allocate any excess purchase price over the fair value of the net tangible and intangible assets acquired in a business combination to goodwill.
The costs of finite-lived intangibles are amortized to expense over their estimated useful life. Determining the useful life of an intangible asset requires considerable judgment as different types of intangible assets typically will have different useful lives. Goodwill and other indefinite-lived intangible assets are not amortized; we test these assets annually for impairment during the fourth quarter, using the first day of the quarter as the measurement date, or earlier upon the occurrence of certain events or substantive changes in circumstances that indicate an impairment may have occurred. Such conditions may include an economic downturn in a geographic market or a change in the assessment of future operations.  Our impairment testing for goodwill is performed separately from our impairment testing of indefinite-lived intangibles.
Considerable management judgment is necessary in making the assumptions used in the estimated fair value of intangible assets acquired in a business combination and in the goodwill and other indefinite-lived intangible asset impairment analyses, including evaluating the impact of operating and macroeconomic conditions and estimating future cash flows. Assumptions we use in our acquisition date fair value estimates and in our impairment evaluations include the discount rate and forecasted growth rates, which are consistent with our internal projections and operating plans, when applicable. We believe these assumptions and estimates are comparable to those that would be used by other marketplace participants.  
Goodwill
 
Goodwill impairment assessments are performed at a reporting unit level. For purposes of this assessment, a reporting unit is an operating segment, or a business one level below that operating segment. During 2019, in conjunction with our segment change, we determined it appropriate to aggregate certain North American reporting
43

units because they were economically similar and as a result, we have six reporting units. No impairment was recorded as a result of the annual goodwill impairment testing performed during the fourth quarter of 2019.
In applying the goodwill impairment test, we may assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. Qualitative factors may include, but are not limited to, macroeconomic conditions, industry conditions, the competitive environment, changes in the market for our products and services, regulatory and political developments, and entity specific factors such as strategies and financial performance. If, after completing the qualitative assessment, we determine it is more likely than not that the fair value of a reporting unit is less than its carrying value, we proceed to a two-step quantitative impairment test, described below test, described below. Alternatively, we may test goodwill for impairment through the two-step quantitative impairment test without conducting the qualitative analysis.
The first step of the two-step impairment test is to compare the fair value of a reporting unit to the carrying value. In performing the first step, we calculate the fair value of the reporting unit using equal weighting of two methods; one which estimates the discounted cash flows of the reporting unit based on projected earnings in the future (the Income Approach) and one which is based on sales of similar businesses to those of the reporting unit in actual transactions (the Market Approach).  If the fair value of the reporting unit exceeds the carrying value, there is no impairment. If the reporting unit carrying value exceeds the fair value, we recognize an impairment loss based on the amount by which the carrying value of goodwill exceeds its implied fair value, which we determine in the second step of the two-step test. The implied fair value of goodwill is determined by deducting the fair value of a reporting unit's identifiable assets and liabilities from the fair value of the reporting unit as a whole, as if that reporting unit had just been acquired and the fair value of the individual assets acquired and liabilities assumed were being determined initially.
Determining fair value requires the exercise of significant judgment. The more significant judgments and assumptions used in the Income Approach include (1) the amount and timing of expected future cash flows, which are based primarily on our estimates of future sales, operating income, industry trends and the regulatory environment of the individual reporting units, (2) the expected long-term growth rates for each of our reporting units, which approximate the expected long-term growth rate of the global economy and of the medical device industry, and (3) discount rates that are used to discount future cash flows to their present values, which are based on an assessment of the risk inherent in the future cash flows of the respective reporting units along with various market based inputs. The more significant judgments and assumptions used in the Market Approach include (1) determination of appropriate revenue and EBITDA multiples used to estimate a reporting unit’s fair value and (2) the selection of appropriate comparable companies to be used for purposes of determining those multiples. There were no changes to the underlying methods used in 2019 as compared to the valuations of our reporting units in the past several years.
Our expected future growth rates estimated for purposes of the goodwill impairment test are based on our estimates of future sales, operating income and cash flow and are consistent with our internal budgets and business plans, which reflect a modest amount of core revenue growth coupled with the successful launch of new products each year; the effect of these growth indicators more than offset volume losses from products that are expected to reach the end of their life cycle. Changes in assumptions underlying the Income Approach could cause a reporting unit's carrying value to exceed its fair value. While we believe our assumed growth rates of sales and cash flows are reasonable, the possibility remains that the revenue growth of a reporting unit may not be as high as expected, and, as a result, the estimated fair value of that reporting unit may decline. In this regard, if our strategy and new products are not successful and we do not achieve anticipated core revenue growth in the future with respect to a reporting unit, the goodwill in the reporting unit may become impaired and, in such case, we may incur material impairment charges. Moreover, changes in revenue and EBITDA multiples in actual transactions from those historically present could result in an assessment that a reporting unit’s carrying value exceeds its fair value, in which case we also may incur material impairment charges.
Other Intangible Assets
 
Intangible assets are assets acquired that lack physical substance and that meet the specified criteria for recognition apart from goodwill. Management tests indefinite-lived intangible assets for impairment annually, and more frequently if events or changes in circumstances indicate that an impairment may have occurred. Similar to the goodwill impairment test process, we may assess qualitative factors to determine whether it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying value. If, after completing the qualitative assessment, we determine it is more likely than not that the fair value of the indefinite-lived intangible asset is greater than its carrying amount, the asset is not impaired. If we conclude it is more likely than not that the fair value of the indefinite-lived intangible asset is less than the carrying value, we then proceed to a quantitative
44

impairment test, which consists of a comparison of the fair value of the intangible asset to its carrying amount. Alternatively, we may elect to forgo the qualitative analysis and test the indefinite-lived intangible asset for impairment through the quantitative impairment test.
In connection with intangible assets acquired in a business combination and the quantitative impairment tests, since quoted market prices are seldom available for intangible assets, we utilize several present value techniques to estimate fair value. The fair value of trade names and IPR&D is estimated by the use of a relief from royalty method, a form of income approach that values an intangible asset by estimating the royalties saved through the ownership of an asset. Under this method, an owner of an intangible asset determines the arm’s length royalty that likely would have been charged if the owner had to license the asset from a third party. The value of the hypothetical royalty, which is based on the estimated royalty rate applied against forecasted sales, is tax-effected and discounted to present value using a discount rate commensurate with the relative risk of achieving the cash flow attributable to the asset. Management must estimate the volume of sales, hypothetical royalty rate, discount rate, and terminal growth rate to estimate the hypothetical royalty associated with the asset.  Discount rate assumptions are based on an assessment of the risk inherent in the future cash flows generated from the intangible asset. Assumptions about royalty rates are based on the rates at which similar intangible assets are being licensed in the marketplace.
During the year ended December 31, 2019 and 2018, we recognized impairment charges of $7.0 million and $16.9 million, respectively, related to our decision to abandon certain intellectual property intangible assets. See "Restructuring and impairment charges" within "Result of Operations" above as well as Note 5 to the consolidated financial statements included in this Annual Report on Form 10-K for additional information on these charges.
Pensions and Other Postretirement Benefits
 
We provide a range of benefits to eligible employees and retired employees, including under plans that provide pension and postretirement healthcare benefits. Several statistical and other factors that are designed to project future events are used in calculating the expense and liability related to these plans. These factors include actuarial assumptions about discount rates, expected rates of return on plan assets, compensation increases, turnover rates and healthcare cost trend rates. We review the actuarial assumptions on an annual basis and make modifications to the assumptions based on current rates and trends when appropriate.
Significant differences in our actual experience or significant changes in our assumptions may materially affect our pension and other postretirement obligations and our future expense. The following table shows the sensitivity of plan expenses and benefit obligations to changes in the weighted average assumptions:
Assumed Discount Rate Expected Return on Plan Assets Assumed Healthcare Trend Rate
50 Basis Point Increase 50 Basis Point Decrease 50 Basis Point Change 1.0% Increase 1.0% Decrease
(Dollars in millions)
Net periodic pension and postretirement healthcare expense $ —    $ (0.1)   $ 1.8    $ 0.1    $ (0.1)  
Projected benefit obligation $ (29.7)   $ 32.9    N/A    $ 1.9    $ (1.7)  
For additional information on assumptions pertaining to pension and other postretirement benefit plans, refer to Note 16 to the consolidated financial statements included in this Annual Report on Form 10-K.

Share-based Compensation
 
We estimate the fair value of share-based awards on the date of grant and recognize as expense the value of the portion of the award that is ultimately expected to vest over the requisite service periods. Share-based compensation expense related to stock options is measured using a Black-Scholes option pricing model that takes into account subjective and complex assumptions with respect to expected life of options, volatility, risk-free interest rate and expected dividend yield. The expected life of options granted represents the period of time that options are expected to be outstanding, which is derived from the vesting period of the award, as well as historical exercise behavior. Expected volatility is based on a blend of historical volatility and implied volatility derived from publicly traded options to purchase our common stock, which we believe is more reflective of market conditions and a better indicator of expected volatility than solely using historical volatility. The risk-free interest rate is the implied yield currently available on U.S. Treasury zero-coupon issues with a remaining term equal to the expected life of the option. Share-based compensation expense related to non-vested restricted stock units is measured based on the market price of the underlying stock on the grant date discounted for the risk free interest rate and the present value
45

of expected dividends over the vesting period. Share based compensation expense for 2019 and 2018 was $26.9 million and $22.4 million, respectively.
Contingent Consideration Liabilities
 
In connection with an acquisition, we may be required to pay future consideration that is contingent upon the achievement of specified objectives, such as receipt of regulatory approval, commercialization of a product or achievement of sales targets. As of the acquisition date, we record a contingent liability representing the estimated fair value of the contingent consideration we expect to pay. We determined the fair value of the contingent consideration liabilities related to the NeoTract and Essential Medical acquisitions which represented most of our contingent consideration liabilities at December 31, 2019 and 2018, using a Monte Carlo valuation approach, which simulates future revenues during the earn out-period using management's best estimates. We determined the fair value of our other contingent consideration liabilities using other probability-weighted discounted cash flow analysis. Significant judgment is required in determining the assumptions used to calculate the fair value of the contingent consideration. Increases in projected revenues and probabilities of payment may result in significantly higher fair value measurements; decreases in these items may have the opposite effect. Increases in discount rates in the periods prior to payment may result in significantly lower fair value measurements; decreases may have the opposite effect. See Note 12 to the consolidated financial statements included in this Annual Report on Form 10-K for additional information.
We remeasure our contingent consideration liabilities each reporting period and recognize the change in the liabilities' fair value within selling, general and administrative expenses in our consolidated statement of income. As of December 31, 2019 and 2018, we accrued $219.9 million and $304.2 million of contingent consideration, respectively.
Income Taxes
Our annual provision for income taxes and determination of the deferred tax assets and liabilities require management to assess uncertainties, make judgments regarding outcomes and utilize estimates. The difficulties inherent in such assessments, judgments and estimates are particularly challenging because we conduct a broad range of operations around the world, subjecting us to complex tax regulations in numerous international jurisdictions. As a result, we are at times subject to tax audits, disputes with tax authorities and potential litigation, the outcome of which is uncertain. In connection with its estimates of our tax assets and liabilities, management must, among other things, make judgments about the outcome of these uncertain matters.

Deferred tax assets and liabilities are measured and recorded using currently enacted tax rates that are expected to apply to taxable income in the years in which differences between the financial statement carrying amounts of existing assets and liabilities and their tax bases are recovered or settled. The likelihood of a material change in our expected realization of these assets is dependent on future taxable income, our ability to use foreign tax credit carryforwards and carrybacks, final U.S. and non-U.S. tax settlements, changes in tax law, and the effectiveness of our tax planning strategies in the various relevant jurisdictions. While management believes that its judgments and interpretations regarding income taxes are appropriate, significant differences in actual experience may require future adjustments to our tax assets and liabilities, which could be material.  
In assessing the realizability of our deferred tax assets, we evaluate positive and negative evidence and use judgments regarding past and future events, including results of operations and available tax planning strategies that could be implemented to realize the deferred tax assets. Based on this assessment, we determine when it is more likely than not that all or some portion of our deferred tax assets may not be realized, in which case we apply a valuation allowance to offset the amount of such deferred tax assets.  To the extent facts and circumstances change in the future, adjustments to the valuation allowances may be required. The valuation allowance for deferred tax assets of $119.2 million and $144.0 million at December 31, 2019 and 2018, respectively, relates principally to the uncertainty of the utilization of tax loss and credit carryforwards in various jurisdictions.
Significant judgment is required in determining income tax provisions and in evaluating tax positions. We establish additional provisions for income taxes when, despite the belief that tax positions are supportable, there remain certain positions that do not meet the minimum probability threshold, which is a tax position that is more likely than not to be sustained upon examination by the applicable taxing authority. In the normal course of business, we are examined by various federal, state and non-U.S. tax authorities. We regularly assess the potential outcomes of these examinations and any future examinations for the current or prior years in determining the adequacy of our provision for income taxes. We adjust the income tax provision, the current tax liability and deferred
46

taxes in any period in which we become aware of facts that necessitate an adjustment. We are currently under examination in Germany. The ultimate outcome of this examination could result in increases or decreases to our recorded tax liabilities, which would affect our financial results. See Note 15 to the consolidated financial statements in this Annual Report on Form 10-K for additional information regarding our uncertain tax positions.
As noted above, the TCJA significantly changed U.S. tax law. As a result of the enactment of the TCJA, our consolidated financial statements as of, and for the year ended December 31, 2017, included provisional amounts with respect to the deemed repatriated earnings and the revaluation of deferred tax assets and liabilities. For the year ended December 31, 2018, as permitted by SAB 118, we recorded adjustments to the provisional amounts related to the TCJA included in our December 31, 2017 financial statements. For the year ended December 31, 2019, we made no adjustments to the provisional amounts. See Note 15 to the consolidated financial statements included in this Annual Report on Form 10-K for additional information.

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

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to certain financial risks, specifically fluctuations in market interest rates, foreign currency exchange rates and, to a lesser extent, commodity prices. We address these risks through a risk management program that includes the use of derivative financial instruments. We do not enter into derivative instruments for trading or speculative purposes. We manage our exposure to counterparty risk on derivative instruments by entering into contracts with a diversified group of major financial institutions and by actively monitoring outstanding positions.
We also are exposed to changes in the market trading price of our common stock as it influences the valuation of stock options and their effect on earnings.
Interest Rate Risk
We are exposed to changes in interest rates as a result of our borrowing activities and our cash balances. The table below provides information regarding the interest rates by year of maturity for our fixed and variable rate debt obligations. Variable interest rates on December 31, 2019 were determined using a base rate of the one-month LIBOR rate plus the applicable spread.
Year of Maturity    
2020 2021 2022 2023 2024 Thereafter Total
(Dollars in thousands)
Fixed rate debt $ —    $ —    $ —    $ —    $ —    $ 900,000    $ 900,000   
Average interest rate —  % —  % —  % —  % —  % 4.736  % 4.736  %
Variable rate debt $ 50,000    $ 25,500    $ 35,000    $ 43,750    $ 868,750    $ —    $ 1,023,000   
Average interest rate 2.513  % 3.174  % 3.174  % 3.174  % 3.157  % —  % 3.127  %
A change of 1.0% in variable interest rates would increase or decrease annual interest expense by $10.2 million based on our outstanding debt as of December 31, 2019.
Foreign Currency Risk
The global nature of our operations exposes us to foreign currency risks. These risks include exposure from the effect of fluctuating exchange rates on payables and receivables as well as intercompany loans relating to transactions that are denominated in currencies other than a location’s functional currency and exposure that arises from translating the results of our worldwide operations to the U.S. dollar at exchange rates that have fluctuated from the beginning of a reporting period. Our principal currency exposures relate to the Euro, Chinese Renminbi, Mexican Peso, Canadian Dollar, Malaysian Ringgit, Czech Koruna, British Pound, Australian Dollar and South Korean Won. We utilize foreign currency forward exchange contracts and cross-currency interest rate swap contracts to attempt to minimize our exposure to these risks. Gains and losses on these contracts substantially offset losses and gains on the underlying hedged transactions.
47

As of December 31, 2019, the total notional amount for the foreign currency forward exchange contracts and cross-currency interest rates swap contracts, expressed in U.S. dollars, was $277.1 million and $750.0 million, respectively. A sensitivity analysis of changes in fair value of these contracts outstanding as of December 31, 2019, while not predictive in nature, indicated that a hypothetical 10% increase/decrease in the value of the U.S. dollar against all currencies would increase/decrease the fair value of these contracts by $83.1 million, the majority of which relates to the cross-currency interest rate swap contracts.
See Note 11 to the consolidated financial statements included in this Annual Report on Form 10-K for information regarding the accounting treatment of our foreign currency forward exchange contracts and cross-currency interest rates swap contracts.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The financial statements and supplementary data required by this Item are included herein, commencing on page F-1.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.

ITEM 9A. CONTROLS AND PROCEDURES
(a) Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures as of the end of the period covered by this report were functioning effectively to provide reasonable assurance that the information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934 is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to our management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding disclosure. A controls system cannot provide absolute assurance, however, that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.
(b) Management’s Report on Internal Control Over Financial Reporting
Our management’s report on internal control over financial reporting is set forth on page F-2 of this Annual Report on Form 10-K and is incorporated by reference herein.
(c) Change in Internal Control over Financial Reporting
At the beginning of the fourth quarter of 2019, we integrated the enterprise resource planning, or ERP, system used by our EMEA segment with our global ERP system. This conversion impacts certain interfaces with our customers and suppliers, resulting in changes to the tools we use to take orders, remit billings, make payments and perform other business functions. We believe that the expanded utilization of the ERP system and related changes to processes and internal controls will enhance our internal control over financial reporting by improving the efficiency of certain financial and related transaction processes while providing us with the ability to scale our business.
Other than the ERP system upgrade discussed above, 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.
 
ITEM 9B. OTHER INFORMATION
None.

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PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
For the information required by this Item 10 with respect to our Executive Officers, see Part I, Item 1. of this report. For the other information required by this Item 10, see “Election Of Directors,” “Nominees for Election to the Board of Directors,” “Corporate Governance” and “Section 16(a) Beneficial Ownership Reporting Compliance,” in the Proxy Statement for our 2020 Annual Meeting, which information is incorporated herein by reference. The Proxy Statement for our 2020 Annual Meeting will be filed within 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K.

ITEM 11. EXECUTIVE COMPENSATION
For the information required by this Item 11, see “Compensation Discussion and Analysis,” “Compensation Committee Report,” and “Executive Compensation” in the Proxy Statement for our 2020 Annual Meeting, which information is incorporated herein by reference.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
For the information required by this Item 12 with respect to beneficial ownership of our common stock, see “Security Ownership of Certain Beneficial Owners and Management” in the Proxy Statement for our 2020 Annual Meeting, which information is incorporated herein by reference.
The following table sets forth certain information as of December 31, 2019 regarding our equity plans :
Plan Category
Number of Securities
to be Issued Upon
Exercise of
Outstanding Options, Warrants and Rights (1)
Weighted-Average
Exercise Price of
Outstanding Options, Warrants and Rights 		Number of Securities
Remaining Available for
Future Issuance Under
Equity Compensation
Plans (Excluding
Securities Reflected in Column (A))
  (A) (B) (C)
Equity compensation plans approved by security holders
1,325,532    $161.91    3,357,048   
(1) The number of securities in column (A) include 46,660 shares of common stock underlying performance stock units if maximum performance levels are achieved; the actual number of shares, if any, to be issued with respect to the performance stock units will be based on performance with respect to specified financial and relative stock price measures.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
For the information required by this Item 13, see “Certain Transactions” and “Corporate Governance” in the Proxy Statement for our 2020 Annual Meeting, which information is incorporated herein by reference.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
For the information required by this Item 14, see “Audit and Non-Audit Fees” and “Audit Committee Pre-Approval Procedures” in the Proxy Statement for our 2020 Annual Meeting, which information is incorporated herein by reference.

49

PART IV
 
 ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

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

(a)Exhibits:

The following exhibits are filed as part of, or incorporated by reference into, this report (unless otherwise
indicated, the file number with respect to each filed document is 1-5353):
Exhibit No. Description
*3.1.1 —
*3.1.2 —
*3.1.3 —
*3.2 —
*4.1.1 —
*4.1.2 —
*4.1.3 —
*4.1.4 —
*4.1.5 —
*4.2.1 —
*4.2.2 —
4.3 —

+*10.1 —
+10.2.1 —
+10.2.2 —
*10.3.1 —
*10.3.2 —
50

Exhibit No. Description
*10.3.3 —
*10.3.4 —
*10.3.5 —
*10.3.6 —
 +*10.3.7 —
+*10.4.1 —
+*10.4.2 —
+*10.5.1 —
+*10.5.2 —
*10.5.3 —
+*10.5.4 —
+*10.5.5 —
+*10.6 —
+*10.7 —
+*10.8 —
+*10.9 —
+*10.10 —
+*10.11 —
+*10.12 —
+*10.14 —
51

Exhibit No. Description
+*10.15 —
+*10.16 —
+*10.17 —
+*10.18 —
+*10.19 —
+*10.22 —
+*10.23 —
*10.24.1 —
+*10.25 —
21 —
23 —
31.1 —
31.2 —
32.1 —
32.2 —
101.1 — The following materials from our Annual Report on Form 10-K for the year ended December 31, 2019, formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Statements of Income for the years ended December 31, 2019, December 31, 2018 and December 31, 2017; (ii) the Consolidated Statements of Comprehensive Income for the years ended December 31, 2019, December 31, 2018 and December 31, 2017; (iii) the Consolidated Balance Sheets as of December 31, 2019 and December 31, 2018; (iv) the Consolidated Statements of Cash Flows for the years ended December 31, 2019, December 31, 2018 and December 31, 2017; (v) the Consolidated Statements of Changes in Equity for the years ended December 31, 2019, December 31, 2018 and December 31, 2017; and (vi) Notes to Consolidated Financial Statements.
104.1 — The cover page of the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, formatted in inline XBRL (included in Exhibit 101.1).
_____________________________________________________
* Previously filed with the Securities and Exchange Commission as part of the filing indicated and incorporated herein by reference.
+ Indicates management contract or compensatory plan or arrangement required to be filed pursuant to Item 15(b) of this report.

 ITEM 16. FORM 10-K SUMMARY
Registrants may voluntarily include a summary of information required by Form 10-K under this Item 16. We have elected not to include such summary information.
52

SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Annual Report to be signed on its behalf by the undersigned, thereunto duly authorized as of the date indicated below.
TELEFLEX INCORPORATED
By: /s/ Liam J. Kelly
Liam J. Kelly
President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and as of the date indicated below.
 
By: /s/ Liam J. Kelly By: /s/ Thomas E. Powell
Liam J. Kelly Thomas E. Powell
President, Chief Executive Officer and Director
Executive Vice President and Chief 
Financial Officer
(Principal Executive Officer) (Principal Financial Officer)
By: /s/ John R. Deren
John R. Deren
Vice President and Chief Accounting Officer
(Principal Accounting Officer)

By: /s/ George Babich, Jr. By: /s/ Andrew A. Krakauer
George Babich, Jr.
Director 		Andrew A. Krakauer
Director
By: /s/ Candace H. Duncan By: /s/ Richard A. Packer
Candace H. Duncan
Director 		Richard A. Packer
Director
By: /s/ Gretchen R. Haggerty By: /s/ Stuart A. Randle
Gretchen R. Haggerty
Director
Stuart A. Randle
Director
By: /s/ John C. Heinmiller By: /s/ Benson F. Smith
John C. Heinmiller
Director 		Benson F. Smith
Chairman and Director
By: /s/ Dr. Stephen K. Klasko
Dr. Stephen K. Klasko
Director
Dated: February 21, 2020

53

TELEFLEX INCORPORATED
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

 
  Page
Management's Report on Internal Control over Financial Reporting
F-2
Report of Independent Registered Public Accounting Firm
F-3
Consolidated Statements of Income for the years ended December 31, 2019, 2018 and 2017
F-6
Consolidated Statements of Comprehensive Income for the years ended December 31, 2019, 2018 and 2017
F-7
Consolidated Balance Sheets as of December 31, 2019 and December 31, 2018
F-8
Consolidated Statements of Cash Flows for the years ended December 31, 2019, 2018 and 2017
F-9
Consolidated Statements of Changes in Shareholders' Equity as of and for the years ended December 31, 2019, 2018 and 2017
Notes to Consolidated Financial Statements
Quarterly Data
FINANCIAL STATEMENT SCHEDULE
 
  Page
Schedule II Valuation and qualifying accounts as of and for the years ended December 31, 2019, 2018 and 2017
70

F-1

MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
The management of Teleflex Incorporated and its subsidiaries (the “Company”) is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is a process designed by, or under the supervision of our Chief Executive Officer and Chief Financial Officer and effected by the Company's board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2019. In making this assessment, management used the framework established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). As a result of this assessment and based on the criteria in the COSO framework, management has concluded that, as of December 31, 2019, the Company’s internal control over financial reporting was effective.
The effectiveness of the Company’s internal control over financial reporting as of December 31, 2019 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which appears herein.
 
/s/ Liam J. Kelly /s/ Thomas E. Powell
Liam J. Kelly
 
President and Chief Executive Officer
Thomas E. Powell
 
Executive Vice President and Chief Financial Officer
February 21, 2020

F-2

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Teleflex Incorporated

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the consolidated financial statements, including the related notes and financial statement schedule, of Teleflex Incorporated and its subsidiaries (the “Company”) as listed in the accompanying index (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2019 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

Change in Accounting Principle
As discussed in Note 2 to the consolidated financial statements, the Company changed the manner in which it accounts for leases in 2019.

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

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

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

Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made
F-3

only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

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

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that (i) relate to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
Valuation of Contingent Consideration

As described in Notes 1 and 12 to the consolidated financial statements, the Company had $219.9 million of contingent consideration liabilities as of December 31, 2019, of which a significant portion related to NeoTract and Essential Medical. During 2019, contingent consideration liability revaluations were $53.9 million. In connection with an acquisition, the Company may be required to pay future consideration that is contingent upon the achievement of specified objectives, such as receipt of regulatory approval, commercialization of a product or achievement of sales targets. Upon acquisition, the Company records a contingent liability representing the estimated fair value of the contingent consideration that it expects to pay. Management determines the fair value of NeoTract and Essential Medical contingent consideration liabilities upon acquisition using a Monte Carlo valuation approach, which simulates future revenues during the earn out-period. The contingent consideration fair value measurement is based on significant inputs not observable in the market and therefore constitute Level 3 inputs within the fair value hierarchy. Contingent consideration liabilities are remeasured to fair value each reporting period using assumptions including estimated revenues, discount rates, probability of payment, and projected payment dates.

The principal considerations for our determination that performing procedures relating to valuation of contingent consideration related to NeoTract and Essential Medical is a critical audit matter are (i) there was significant judgment by management when determining the fair value measurements each reporting period, which in turn led to a high degree of auditor judgment, subjectivity, and effort in performing procedures and in evaluating audit evidence for the fair value measurements relating to the contingent consideration and assumptions, including the estimated revenues, discount rates, probability of payment, and projected payment dates used in the Monte Carlo valuation model and (ii) the audit effort involved the use of professionals with specialized skill and knowledge to assist in performing procedures and evaluating the audit evidence obtained.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to management’s remeasurement of the contingent consideration to fair value each reporting period. These procedures also included, among others, testing management’s process for determining the fair value measurement of the contingent consideration each reporting period, including evaluating the assumptions used by management, including the estimated revenues, discount rates, probability of payment, and projected payment dates. Evaluating the assumptions related to estimated revenues, probability of payment and projected payment dates involved evaluating whether the assumptions used were reasonable considering consistency with external data sources and the product’s historical revenue performance. Professionals with specialized skill and knowledge were used to assist in evaluating the appropriateness of the Company’s valuation model and certain significant assumptions, including discount rates.
Income Taxes – Tax Planning Strategies

As described in Notes 1 and 15 to the consolidated financial statements, the Company recorded an income tax benefit from continuing operations of $122.1 million for the year ended December 31, 2019, deferred tax assets of $163.3 million (net of a valuation allowance of $119.2 million), deferred tax liabilities of $597.3 million, and liabilities associated with unrecognized tax benefits of $10.3 million as of December 31, 2019. As disclosed by management,
F-4

the Company conducts a broad range of operations around the world subjecting the Company to complex tax regulations in numerous international jurisdictions, resulting at times in tax audits, disputes with tax authorities and potential litigation, the outcome of which is uncertain. As disclosed by management, significant judgment is required in determining income tax provisions and in evaluating tax positions. Additional judgment is required to assess the implications of changes in tax law across various jurisdictions and the implications of the Company’s tax planning strategies. Management regularly assesses the potential outcomes of examinations and any future examinations for the current or prior years in determining the adequacy of the provision for income taxes, the current tax liability and deferred taxes. Management establishes additional provisions for income taxes when, despite the belief that tax positions are supportable, there remain certain positions that do not meet the minimum probability threshold, which is a tax position that is more likely than not to be sustained upon examination by the applicable taxing authority.

The principal considerations for our determination that performing procedures relating to income taxes - tax planning strategies is a critical audit matter are (i) there was significant judgment by management when determining the income tax implications resulting from tax planning strategies across various taxing jurisdictions, and (ii) the significant impact to the financial statements if the income tax implications were not appropriately determined. This in turn led to a high degree of auditor judgment, subjectivity, and effort in performing procedures and in evaluating audit evidence relating to the income tax implications of management’s tax planning strategies. In addition, the audit effort involved the use of professionals with specialized skill and knowledge to assist in performing procedures and evaluating the audit evidence obtained.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to the key judgments, inputs, and assumptions relating to the determination of the income tax implications of tax planning strategies. These procedures also included, among others, (i) evaluating the information, including third party opinions, tax law, and other relevant evidence used by management to support the Company’s position regarding the income tax implications of the tax planning strategies, and (ii) evaluating the income tax implications of the tax planning strategies and management’s assessment of the potential impact on the provision for income taxes, the current tax liability and deferred taxes. Professionals with specialized skill and knowledge were used to assist in the evaluation of the tax planning strategies, as well as the application of local income tax law.
/s/ PricewaterhouseCoopers LLP
Philadelphia, Pennsylvania
February 21, 2020

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

F-5

TELEFLEX INCORPORATED
CONSOLIDATED STATEMENTS OF INCOME
  Year Ended December 31,
  2019 2018 2017
 
(Dollars and shares in thousands, except
 per share)
Net revenues
$ 2,595,362    $ 2,448,383    $ 2,146,303   
Cost of goods sold, excluding intangible asset amortization
1,103,750    1,063,941    974,501   
Gross profit
1,491,612    1,384,442    1,171,802   
Selling, general and administrative expenses
934,373    878,688    699,963   
Research and development expenses
113,857    106,208    84,770   
Restructuring and impairment charges 22,205    79,230    14,790   
Gain on sale of assets (6,077)   (1,388)   —   
Income from continuing operations before interest, loss on extinguishment of debt and taxes 427,254    321,704    372,279   
Interest expense
80,270    103,020    82,546   
Interest income
(1,741)   (944)   (771)  
Loss on extinguishment of debt 8,822    —    5,593   
Income from continuing operations before taxes 339,903    219,628    284,911   
(Benefit) taxes on income from continuing operations (122,078)   23,196    129,648   
Income from continuing operations 461,981    196,432    155,263   
(Loss) income from discontinued operations (828)   5,643    (4,534)  
(Benefit) taxes on (loss) income from discontinued operations (313)   1,273    (1,801)  
(Loss) income on discontinued operations (515)   4,370    (2,733)  
Net income $ 461,466    $ 200,802    $ 152,530   
Earnings per share:
Basic:
Income from continuing operations $ 10.00    $ 4.30    $ 3.45   
(Loss) income on discontinued operations (0.01)   0.09    (0.06)  
Net income $ 9.99    $ 4.39    $ 3.39   
Diluted:
Income from continuing operations $ 9.81    $ 4.20    $ 3.33   
(Loss) income on discontinued operations (0.01)   0.09    (0.06)  
Net income $ 9.80    $ 4.29    $ 3.27   
Weighted average shares outstanding:
Basic 46,200    45,689    45,004   
Diluted 47,090    46,801    46,664   
The accompanying notes are an integral part of the consolidated financial statements.
F-6

TELEFLEX INCORPORATED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Year Ended December 31,
  2019 2018 2017
  (Dollars in thousands)
Net income
$ 461,466    $ 200,802    $ 152,530   
Other comprehensive income, net of tax:
Foreign currency:
Foreign currency translation continuing operations adjustments, net of tax of $(6,270), $(1,047) and $(29,448), respectively
4,195    (83,889)   173,074   
Foreign currency translation, net of tax
4,195    (83,889)   173,074   
Pension and other postretirement benefits plans:
Prior service cost recognized in net periodic cost, net of tax of $(20), $(23) and $(39), respectively
62    71    66   
Unamortized (loss) gain arising during the period, net of tax of $3,817, $(447) and $1,677, respectively
(12,767)   1,116    (5,419)  
Plan amendments, curtailments, and settlements, net of tax of $0, $(137) and $74, respectively
—    511    (223)  
Net loss recognized in net periodic cost, net of tax of $(1,611), $(1,588) and $(2,457), respectively
5,319    5,231    4,447   
Foreign currency translation, net of tax of $15, $(183) and $413, respectively
(44)   499    (1,083)  
Pension and other postretirement benefits plans adjustment, net of tax
(7,430)   7,428    (2,212)  
Derivatives qualifying as hedges:
Unrealized gain (loss) on derivatives arising during the period, net of tax $(85), $(268) and $(631), respectively
1,062    2,574    2,775   
Reclassification adjustment on derivatives included in net income, net of tax of $150, $163 and $83, respectively
(1,134)   (2,107)   (11)  
Derivatives qualifying as hedges, net of tax
(72)   467    2,764   
 Other comprehensive (loss) income, net of tax
(3,307)   (75,994)   173,626   
 Comprehensive income
$ 458,159    $ 124,808    $ 326,156   
  


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

F-7

TELEFLEX INCORPORATED
CONSOLIDATED BALANCE SHEETS
December 31,
2019 2018
(Dollars and shares in thousands, except per share)
ASSETS
Current assets
Cash and cash equivalents
$ 301,083    $ 357,161   
Accounts receivable, net
418,673    366,286   
Inventories
476,557    427,778   
Prepaid expenses and other current assets
97,943    72,481   
Prepaid taxes
12,076    12,463   
Total current assets 1,306,332    1,236,169   
Property, plant and equipment, net
430,719    432,766   
Operating lease assets 113,160    —   
Goodwill
2,245,305    2,246,579   
Intangibles assets, net
2,156,285    2,325,052   
Deferred tax assets
5,572    2,446   
Other assets
52,447    34,979   
Total assets $ 6,309,820    $ 6,277,991   
LIABILITIES AND EQUITY
Current liabilities
Current borrowings
$ 50,000    $ 86,625   
Accounts payable
102,916    106,709   
Accrued expenses
100,466    97,551   
Current portion of contingent consideration
148,090    136,877   
Payroll and benefit-related liabilities
115,981    104,670   
Accrued interest
5,514    6,031   
Income taxes payable
6,692    5,943   
Other current liabilities
33,396    38,050   
Total current liabilities 563,055    582,456   
Long-term borrowings
1,858,943    2,072,200   
Deferred tax liabilities
439,558    608,221   
Pension and postretirement benefit liabilities
82,719    92,914   
Noncurrent liability for uncertain tax positions
10,294    10,718   
Noncurrent contingent consideration 71,818    167,370   
Noncurrent operating lease liabilities 101,372    —   
Other liabilities
202,741    204,134   
Total liabilities 3,330,500    3,738,013   
Commitments and contingencies
Shareholders’ equity
Common shares, $1 par value Issued: 2019 — 47,536 shares; 2018 — 47,248 shares
47,536    47,248   
Additional paid-in capital
616,980    574,761   
Retained earnings
2,824,916    2,427,599   
Accumulated other comprehensive loss
(344,392)   (341,085)  
  3,145,040    2,708,523   
Less: Treasury stock, at cost
165,720    168,545   
Total shareholders' equity 2,979,320    2,539,978   
Total liabilities and shareholders' equity $ 6,309,820    $ 6,277,991   
The accompanying notes are an integral part of the consolidated financial statements.
F-8

TELEFLEX INCORPORATED
CONSOLIDATED STATEMENTS OF CASH FLOWS
  Year Ended December 31,
  2019 2018 2017
  (Dollars in thousands)
Cash flows from operating activities of continuing operations:
Net income $ 461,466    $ 200,802    $ 152,530   
Adjustments to reconcile net income to net cash provided by operating activities:
Loss (Income) from discontinued operations 515    (4,370)   2,733   
Depreciation expense 64,088    60,494    56,497   
Amortization expense of intangible assets 149,974    149,486    98,766   
Amortization expense of deferred financing costs and debt discount 4,307    4,734    5,075   
Loss on extinguishment of debt 8,822    —    5,593   
Fair value step up of acquired inventory sold —    —    10,442   
Changes in contingent consideration 53,915    52,977    3,575   
Impairment of long-lived assets 6,966    19,110    —   
Stock-based compensation 26,940    22,438    19,407   
Net gain on sales of businesses and assets (6,077)   (1,388)   —   
Deferred income taxes, net (168,594)   (6,097)   (41,822)  
Payments for contingent consideration (26,092)   (2,100)   —   
Interest benefit on swaps designated as net investment hedges (18,866)   (3,277)   —   
Other (5,800)   (13,426)   (18,469)  
Changes in operating assets and liabilities, net of effects of acquisitions and disposals:
Accounts receivable (59,793)   (23,412)   (11,039)  
Inventories (53,170)   (37,198)   (22,363)  
Prepaid expenses and other current assets (31,023)   (10,351)   547   
Accounts payable, accrued expenses and other liabilities 36,021    62,404    39,001   
Income taxes receivable and payable, net (6,531)   (35,740)   125,828   
Net cash provided by operating activities from continuing operations 437,068    435,086    426,301   
Cash flows from investing activities of continuing operations:
Expenditures for property, plant and equipment (102,695)   (80,795)   (70,903)  
Payments for businesses and intangibles acquired, net of cash acquired (3,462)   (121,025)   (1,768,284)  
Proceeds from sales of businesses and assets 14,345    3,878    6,332   
Net interest proceeds on swaps designated as net investment hedges 18,331    1,548    —   
Net cash used in investing activities from continuing operations (73,481)   (196,394)   (1,832,855)  
Cash flows from financing activities of continuing operations:
Proceeds from new borrowings 275,000    35,000    2,463,500   
Reduction in borrowings (528,500)   (128,500)   (1,239,576)  
Debt extinguishment, issuance and amendment fees (11,635)   (188)   (26,664)  
Proceeds from share based compensation plans and the related tax impacts 21,206    22,655    5,571   
Payments for contingent consideration (112,079)   (73,235)   (335)  
Dividends (62,828)   (62,165)   (61,237)  
Net cash (used in) provided by financing activities from continuing operations (418,836)   (206,433)   1,141,259   
Cash flows from discontinued operations:
Net cash provided by (used in) operating activities 2,457    2,292    (6,416)  
Net cash provided by (used in) discontinued operations 2,457    2,292    (6,416)  
Effect of exchange rate changes on cash and cash equivalents (3,286)   (10,948)   61,480   
Net (decrease) increase in cash and cash equivalents (56,078)   23,603    (210,231)  
Cash and cash equivalents at the beginning of the year 357,161    333,558    543,789   
Cash and cash equivalents at the end of the year $ 301,083    $ 357,161    $ 333,558   
The accompanying notes are an integral part of the consolidated financial statements.
F-9

TELEFLEX INCORPORATED
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
Common Stock
Additional
Paid in
Capital
Retained
Earnings
Accumulated
Other Comprehensive
Income (loss)
Treasury Stock Total Shareholders' Equity
  Shares Dollars Shares Dollars
  (Dollars and shares in thousands, except per share amounts)
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
152,530    152,530   
Cash dividends ($1.36 per share)
(61,237)   (61,237)  
Other comprehensive income 173,626    173,626   
Settlement of convertible notes 928    928    (48,375)   (503)   52,279    4,832   
Settlement of note hedges associated with convertible notes 112,901    516    (112,908)   (7)  
Shares issued under compensation plans
129    129    20,395    (48)   2,658    23,182   
 Deferred compensation
(2)   88    88   
Balance at December 31, 2017 46,871    46,871    591,721    2,285,886    (265,091)   1,704    (228,856)   2,430,531   
Cumulative effect adjustment resulting from the adoption of new accounting standards 3,076    3,076   
Net income
200,802    200,802   
Cash dividends ($1.36 per share)
(62,165)   (62,165)  
Other comprehensive loss (75,994)   (75,994)  
Settlement of warrants (56,115)   (412)   56,075    (40)  
Shares issued under compensation plans
377    377    38,756    (50)   3,766    42,899   
 Deferred compensation
399    (10)   470    869   
Balance at December 31, 2018 47,248    47,248    574,761    2,427,599    (341,085)   1,232    (168,545)   2,539,978   
Cumulative effect adjustment resulting from the adoption of new accounting standards (1,321)   (1,321)  
Net income 461,466    461,466   
Cash dividends ($1.36 per share)
(62,828)   (62,828)  
Other comprehensive loss (3,307)   (3,307)  
Shares issued under compensation plans 288    288    42,092    (46)   2,572    44,952   
Deferred compensation 127    (4)   253    380   
Balance at December 31, 2019 47,536    $ 47,536    $ 616,980    $ 2,824,916    $ (344,392)   1,182    $ (165,720)   $ 2,979,320   

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

F-10

TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
Note 1 — Summary of significant accounting policies
Consolidation: The consolidated financial statements include the accounts of Teleflex Incorporated and its subsidiaries (referred to herein as “we,” “us,” “our” and “Teleflex"). Intercompany transactions are eliminated in consolidation. These consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP") and reflect management’s estimates and assumptions that affect the recorded amounts.
Use of estimates: The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of net revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash and cash equivalents: All highly liquid debt instruments with an original maturity of three months or less are classified as cash equivalents. The carrying value of cash equivalents approximates the current market value.
Accounts receivable: Accounts receivable represent amounts due from customers related to the sale of products and provision of services. An allowance for doubtful accounts is maintained and represents our estimate of the amount of uncollectible receivables. The allowance is provided at such time as management believes reasonable doubt exists that such balances will be collected within a reasonable period of time. The allowance is based on our historical collection experience with respect to the customer, the length of time an account is outstanding, the financial position of the customer and information provided by credit rating services. The allowance for doubtful accounts as of December 31, 2019 and December 31, 2018 was $9.1 million and $9.3 million, respectively. The current portion of the allowance for doubtful accounts, which was $5.3 million and $4.4 million as of December 31, 2019 and December 31, 2018, respectively, was recognized as a reduction of accounts receivable, net.
Inventories: Inventories are valued at the lower of cost or net realizable value. The cost of our inventories is determined using the average cost method. Elements of cost in inventory include raw materials, direct labor, and manufacturing overhead. In estimating net realizable value, we evaluate inventory for excess and obsolete quantities based on estimated usage and sales, among other factors.

Property, plant and equipment: Property, plant and equipment are stated at cost, net of accumulated depreciation. Costs incurred to develop internal-use computer software during the application development stage generally are capitalized. Costs of enhancements to internal-use computer software are capitalized, provided that these enhancements result in additional functionality. Other additions and those improvements which increase the capacity or lengthen the useful lives of the assets are also capitalized. Composite useful lives for categories of property, plant and equipment, which are depreciated on a straight-line basis, are as follows: buildings — 30 years; machinery and equipment — 3 to 15 years; computer equipment and software — 3 to 5 years. Leasehold improvements are depreciated over the lesser of the useful lives of the leasehold improvements or the remaining lease term. Repairs and maintenance costs are expensed as incurred.
Goodwill and other intangible assets: Goodwill and other indefinite-lived intangible assets are not amortized but are tested for impairment annually during the fourth quarter or more frequently if events or changes in circumstances indicate that an impairment may exist. Impairment losses, if any, are included in income from operations. The goodwill impairment test is applied to each of our reporting units. For purposes of this assessment, a reporting unit is an operating segment, or a business one level below an operating segment (also known as a component) if discrete financial information is prepared for that business and regularly reviewed by segment management. However, separate components are aggregated as a single reporting unit if they have similar economic characteristics.
In performing the goodwill impairment test, we may assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. Qualitative factors may include, but are not limited to, macroeconomic conditions, industry conditions, the competitive environment, changes in the market for our products and services, regulatory and political developments, and entity specific factors such as strategies and financial performance. If, after completing the qualitative assessment, we determine it is more likely than not that the fair value of a reporting unit is less than its carrying value, we proceed to a two-step quantitative
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impairment test, described below. Alternatively, we may elect to bypass the qualitative assessment and perform the two-step quantitative impairment test. The first step of the two-step impairment test is to compare the fair value of a reporting unit to its carrying value. If the reporting unit fair value exceeds the carrying value, there is no impairment. If the reporting unit carrying value exceeds the fair value, we would perform the second step of the goodwill impairment test, in which we would measure the amount of an impairment loss, if any, based on the amount by which the carrying value of goodwill exceeds its implied fair value. The implied fair value of goodwill is determined by deducting the fair value of a reporting unit's identifiable assets and liabilities from the fair value of the reporting unit as a whole, as if that reporting unit had just been acquired and the fair value of the individual assets acquired and liabilities assumed were being determined initially. We did not record a goodwill impairment charge for the year ended December 31, 2019.
Our intangible assets consist of customer relationships, intellectual property, distribution rights, in-process research and development ("IPR&D"), trade names and non-competition agreements. We define IPR&D as the value of technology acquired for which the related projects have substance and are incomplete. IPR&D acquired in a business acquisition is recognized at fair value and is required be capitalized as an indefinite-lived intangible asset until completion of the IPR&D project or upon abandonment. Upon completion of the development project (generally when regulatory approval to market the product that utilizes the technology is obtained), an impairment assessment is performed prior to amortizing the asset over its estimated useful life. If the IPR&D projects are abandoned, the related IPR&D assets would be written off. 
We test our indefinite-lived intangible assets for impairment annually, or more frequently if events or changes in circumstances indicate that an impairment may have occurred. Similar to the goodwill impairment test process, we may elect to perform a qualitative assessment. If, after completing the qualitative assessment, we determine it is more likely than not that the fair value of the indefinite-lived intangible asset is greater than its carrying amount, the asset is not impaired. If we conclude it is more likely than not that the fair value of the indefinite-lived intangible asset is less than the carrying value, we then proceed to a quantitative impairment test, which consists of a comparison of the fair value of the intangible asset to its carrying amount.
Intangible assets that do not have indefinite lives, consisting of intellectual property, customer relationships, distribution rights, certain trade names and non-competition agreements, are amortized over their estimated useful lives, which are as follows: intellectual property, 5 to 20 years; customer relationships, 8 to 27 years; distribution rights, 10 to 17 years; trade names, 5 to 30 years; non-competition agreements, 3 to 6 years. The weighted average remaining amortization period with respect to our intangible assets is approximately 15 years. We periodically evaluate the reasonableness of the useful lives of these assets.
For the year ended December 31, 2019, we recognized a $7.0 million impairment charges related to the abandonment of certain intellectual property intangible assets associated with our interventional product portfolio. See Note 5 for further information.
Long-lived assets: We assess the remaining useful life and recoverability of long-lived assets whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. The assessment is based on various analyses, including undiscounted cash flow and profitability projections that incorporate, as applicable, the impact of the asset on the existing business. Therefore, the evaluation involves significant management judgment. Any impairment loss, if indicated, is measured as the amount by which the carrying amount of the asset exceeds the estimated fair value of the asset.
Foreign currency translation: Assets and liabilities of subsidiaries with non-United States dollar denominated functional currencies are translated into United States dollars at the rates of exchange at the balance sheet date; income and expenses are translated at the average rates of exchange prevailing during the year. The translation adjustments are reported as a component of accumulated other comprehensive loss.
Derivative financial instruments: We use derivative financial instruments primarily for purposes of hedging exposures to fluctuations in foreign currency exchange rates. All instruments are entered into for other than trading purposes. All derivatives are recognized on the balance sheet at fair value. Changes in the fair value of derivatives are recorded in the consolidated statement of comprehensive income as other comprehensive income (loss), if the instrument is designated as part of a hedge transaction. Gains or losses on derivative instruments reported in other comprehensive income (loss) are reclassified to the consolidated statement of income in the period in which earnings are affected by the underlying hedged item. Gains or losses on derivative instruments representing hedge ineffectiveness or hedge components excluded from the assessment of effectiveness, if any, are recognized in the consolidated statement of income for the period in which such gains and losses occur. If the hedging relationship
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

ceases to be highly effective or it becomes probable that an expected transaction will no longer occur, gains or losses on the derivative instrument are recorded in the consolidated statement of income for the period in which either such event occurs. For non-designated derivatives, gains and losses are reported as selling, general and administrative expenses in the consolidated statement of income. Cash flows from derivatives are recognized in the consolidated statements of cash flows in a manner consistent with recognition of the underlying transactions.
Share-based compensation: We estimate the fair value of share-based awards on the date of grant using an option pricing model. The value of the portion of the award that is ultimately expected to vest, which is derived, in part, following consideration of estimated forfeitures, is recognized as expense over the requisite service periods. Share-based compensation expense related to stock options is measured using a Black-Scholes option pricing model that takes into account subjective and complex assumptions with respect to the expected life of the options, volatility, risk-free interest rate and expected dividend yield. The expected life of options granted is derived from the vesting period of the award, as well as historical exercise behavior, and represents the period of time that options granted are expected to be outstanding. Expected volatility is based on a blend of historical volatility and implied volatility derived from publicly traded options to purchase our common stock, which we believe is more reflective of market conditions and a better indicator of expected volatility than would be the case if we only used historical volatility. The risk-free interest rate is the implied yield currently available on United States (or "U.S.") Treasury zero-coupon issues with a remaining term equal to the expected life of the option. Forfeitures are estimated at the time of grant based on management’s expectations regarding the extent to which awards ultimately will vest and are adjusted for actual forfeitures when they occur.
Income taxes: The provision for income taxes is determined using the asset and liability approach of accounting for income taxes. Under this approach, deferred tax assets and liabilities are recognized to reflect the future tax consequences attributable to the differences between the financial statement carrying amounts of existing assets and liabilities and their tax bases, and to reflect operating loss and tax credit carryforwards. The provision for income taxes represents income taxes paid or payable for the current year plus the change in deferred taxes during the year. Provision has been made for income taxes on unremitted earnings of subsidiaries and affiliates, except to the extent that such earnings are deemed to be permanently reinvested.
Significant judgment is required in determining income tax provisions and in evaluating tax positions. We establish additional provisions for income taxes when, despite the belief that tax positions are supportable, there remain certain positions that do not meet the minimum probability threshold, which is a tax position that is more likely than not to be sustained upon examination by the applicable taxing authority. In the normal course of business, we are examined by various federal, state and non-U.S. tax authorities. We regularly assess the potential outcomes of these examinations and any future examinations for the current or prior years in determining the adequacy of its provision for income taxes. Interest accrued with respect to unrecognized tax benefits and income tax related penalties are both included in taxes on income from continuing operations. We periodically assess the likelihood and amount of potential adjustments and adjusts the income tax provision, the current tax liability and deferred taxes in the period in which the facts that give rise to an adjustment become known.
Pensions and other postretirement benefits: We provide a range of benefits to eligible employees and retired employees, including benefits available pursuant to pension and postretirement healthcare benefits plans. We record annual amounts relating to these plans based on calculations which include various actuarial assumptions such as discount rates, expected rates of return on plan assets, compensation increases, turnover rates and healthcare cost trend rates. We review our actuarial assumptions on an annual basis and makes modifications to the assumptions based on current rates and trends when appropriate. The effect of the modifications is generally amortized over future periods.
Restructuring costs: Restructuring costs, which include termination benefits, facility closure costs, contract termination costs and other restructuring costs, are recorded at estimated fair value. Other restructuring costs include facility closure, contract termination, employee relocation, equipment relocation and outplacement costs. Key assumptions used in calculating the restructuring costs include the terms of, and payments under, agreements to terminate certain contractual obligations and the timing of reductions in force.
Contingent consideration related to business acquisitions: In connection with business acquisitions, we may be required to pay future consideration that is contingent upon the achievement of specified objectives such as receipt of regulatory approval, commercialization of a product or achievement of sales targets. As of the acquisition date, we record a contingent liability representing the estimated fair value of the contingent consideration that we expect to pay. We remeasure the fair value of our contingent consideration arrangements each reporting period and, based on new developments, records changes in fair value until either the contingent consideration obligation is
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TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

satisfied through payment upon the achievement of, or the obligation no longer exists due to the failure to achieve, the specified objectives. The change in the fair value is recorded in selling, general and administrative expenses in the consolidated statement of income. A contingent consideration payment is classified as a financing activity in the consolidated statement of cash flows to the extent it was recorded as a liability as of the acquisition date. Any additional amount paid in excess of the amount initially accrued is classified as an operating activity in the consolidated statement of cash flows.
Revenue recognition: We primarily generate revenue from the sale of medical devices including single use disposable devices and, to a lesser extent, reusable devices, instruments and capital equipment. Revenue is recognized when obligations under the terms of a contract with our customer are satisfied; this occurs upon the transfer of control of the products. Generally, transfer of control to the customer occurs at the point in time when our products are shipped from the manufacturing or distribution facility. For the OEM segment, most revenue is recognized over time because the OEM segment generates revenue from the sale of custom products that have no alternative use and we have an enforceable right to payment to the extent that performance has been completed. We market and sell products through our direct sales force and distributors to customers within the following end markets: (1) hospitals and healthcare providers; (2) other medical device manufacturers; and (3) home care providers such as pharmacies, which represented 88%, 9% and 3% of our consolidated net revenues, respectively, for the 12 months ended December 31, 2019. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods. With respect to the custom products sold in the OEM segment, revenue is measured using the units produced output method. Payment is generally due 30 days from the date of invoice.

We have made the following revenue accounting policy elections and elected to use certain practical expedients: (1) we account for amounts collected from customers for sales and other taxes, net of related amounts remitted to tax authorities; (2) we do not adjust the promised amount of consideration for the effects of a significant financing component because, at contract inception, we expect the period between the time when we transfer a promised good or service to the customer and the time when the customer pays for that good or service will be one year or less; (3) we expense costs to obtain a contract as they are incurred if the expected period of benefit, and therefore the amortization period, is one year or less; (4) we account for shipping and handling activities that occur after control transfers to the customer as a fulfillment cost rather than an additional promised service; (5) we classify shipping and handling costs within cost of goods sold; and (6) with respect to the OEM segment, we have applied the practical expedient to exclude disclosure of remaining performance obligations as the contracts typically have a term of one year or less.
The amount of consideration we receive and revenue we recognize varies as a result of changes in customer sales incentives, including discounts and rebates, and returns offered to customers. The estimate of revenue is adjusted upon the earlier of the following events: (i) the most likely amount of consideration expected to be received changes or (ii) the consideration becomes fixed. Our policy is to accept returns only in cases in which the product is defective and covered under our standard warranty provisions. When we give customers the right to return products, we estimate the expected returns based on an analysis of historical experience. The liability for returns and allowances was $7.2 million and $4.2 million as of December 31, 2019 and 2018, respectively. In estimating customer rebates, we consider the lag time between the point of sale and the payment of the customer’s rebate claim, customer-specific trend analyses, contractual commitments, including stated rebate rates, historical experience with respect to specific customers (as we have a history of providing similar rebates on similar products to similar customers) and other relevant information. The reserve for customer incentive programs, including customer rebates, was $21.6 million and $18.1 million at December 31, 2019 and 2018, respectively. We expect the amounts subject to the reserve as of December 31, 2019 to be paid within 90 days subsequent to period-end.
Leases: We have made an accounting policy election not to apply the lease accounting recognition provisions to short term leases (leases with a lease term of 12 months or less that do not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise); instead, we will recognize the lease payments for short term leases on a straight-line basis over the lease term. In addition, we have elected to apply certain practical expedients available under the new lease guidance effective January 1, 2019. As a result, and in connection with the transition to the new guidance, we did not reassess (i) whether any expired or existing contracts are or contain leases, (ii) the classification of any expired or existing leases, or (iii) initial direct costs for any existing leases. We applied the practical expedients described above to our entire lease portfolio at the January 1, 2019 adoption date. Furthermore, as permitted under the new guidance, we have made, as a practical expedient, an accounting policy election to not separate lease and non-lease components and instead will account for each separate lease component and the non-lease components associated with that lease component as a single lease component.

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TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 2 — Recently issued accounting standards
In February 2016, the Financial Accounting Standards Board ("FASB") issued guidance that changes the requirements for accounting for leases. Under the new guidance, in connection with a lease as to which an entity is a lessee, the entity generally must recognize a right-to-use asset and a lease liability on the balance sheet, initially measured as the present value of lease payments under the lease. Under previous guidance, operating leases were not recognized on the balance sheet. We adopted the new standard on January 1, 2019 using a modified retrospective transition approach, which requires leases existing at, or entered into after, January 1, 2019 to be recognized and measured in the consolidated balance sheet. We recognized additional net lease assets and lease liabilities of $105.3 million and $106.6 million, respectively, upon adoption of the guidance. The difference between the additional lease assets and lease liabilities was recorded as an adjustment to the opening balance of retained earnings. Prior period amounts have not been adjusted and continue to reflect our historical accounting. Additional information and disclosures required by the new guidance are contained in Note 9.
In February 2018, the FASB issued new guidance to address a narrow-scope financial reporting issue that arose as a consequence of federal tax legislation commonly referred to as the Tax Cuts and Jobs Act ("the TCJA"). Existing guidance requires that deferred tax liabilities and assets be adjusted for a change in tax laws or rates with the effect included in income from continuing operations in the reporting period that includes the enactment date. The guidance is applicable even in situations in which the related income tax effects of items in accumulated other comprehensive income were originally recognized in other comprehensive income (rather than in net income), such as amounts related to benefit plans and hedging activity. As a result, the tax effects of items within accumulated other comprehensive income (referred to as stranded tax effects) do not reflect the appropriate tax rate. The new guidance, which was effective January 1, 2019, permits reclassification of these amounts from accumulated other comprehensive income to retained earnings thereby eliminating the stranded tax effects. The new guidance also requires certain disclosures about the stranded tax effects. We elected not to reclassify stranded tax effects from accumulated other comprehensive income to retained earnings.
In June 2016, the FASB issued new guidance that changes the methodology to be used to measure credit losses for certain financial instruments and financial assets, including trade receivables. Under current guidance, an entity reflects credit losses on financial assets measured on an amortized cost basis only when it is probable that losses have been incurred, generally considering only past events and current conditions in determining incurred loss. The new guidance requires the recognition of an allowance that reflects the current estimate of credit losses expected to be incurred over the life of the financial asset, based not only on historical experience and current conditions, but also on reasonable forecasts. The main objective of the new guidance is to provide financial statement users with more useful information in making decisions about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. The new guidance is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted. We adopted the new guidance on a modified retrospective basis through a cumulative-effect adjustment to retained earnings on January 1, 2020. The adoption of the guidance did not have a material impact on the consolidated financial statements.
In December 2019, the FASB issued new guidance that simplifies various aspects of accounting for income taxes including those related to the step-up in the tax basis of goodwill, intraperiod tax allocations and the interim period effects of changes in tax laws or rates. The new guidance is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. Early adoption is permitted. The majority of the modifications under the new guidance will be applied on a modified retrospective basis through a cumulative-effect adjustment to retained earnings on January 1, 2021. We are currently evaluating the impact the guidance will have on our consolidated financial statements and related disclosures.
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. We adopted this guidance on January 1, 2020 and will apply it, as applicable, to impairment testing we perform in 2020 and future years. The adoption of the guidance did not have an impact on the consolidated financial statements.
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TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

From time to time, new accounting guidance issued by the FASB or other standard setting bodies is adopted as of the specified effective date or, when permitted by the guidance and as determined by us, as of an earlier date. We have assessed recently issued guidance that is not yet effective, except as noted above, and believe the new guidance that we have assessed will not have a material impact on our results of operations, cash flows or financial position.

Note 3 - Net revenues
The following table disaggregates revenue by global product category for the year ended December 31, 2019, 2018 and 2017.
Year Ended December 31
2019 2018 2017
(Dollars in thousands)
Vascular access $ 600,874    $ 575,327    $ 540,234   
Anesthesia 338,413    349,370    344,599   
Interventional 427,563    395,423    324,681   
Surgical 370,074    358,707    356,156   
Interventional urology 290,449    196,735    38,957   
OEM 220,717    205,976    182,967   
Other (1)
347,272    366,845    358,709   
Net revenues (2)
$ 2,595,362    $ 2,448,383    $ 2,146,303   
(1) Revenues in the "Other" category in the table above include revenues generated from sales of our respiratory and urology products (other than interventional urology products).
(2) The product categories listed above are presented on a global basis, while each of our reportable segments other than the OEM reportable segment are defined based on the geographic location of its operations; the OEM reportable segment operates globally. Each of the geographically based reportable segments include net revenues from each of the non-OEM product categories listed above.

Note 4 — Acquisitions and Divestitures

2019 Divestitures
On February 4, 2019, we sold substantially all of the assets related to our vein catheter reprocessing business for $12.6 million. We recognized a $2.7 million pre-tax gain on the sale of assets, which represents the excess of the $9.7 million fair value of consideration received over the carrying value of the assets sold. In connection with the sale, the purchaser of the assets issued a secured promissory note to us in the principal amount of $10.5 million. The purchaser's obligations under the notes are secured by a lien on substantially all of the purchaser's assets. The purchaser is obligated to repay the principal amount of the promissory note in annual installments of $2.1 million on each of the first five anniversaries of the date of sale. On the date of sale, the fair value of the promissory note was $7.6 million, which we calculated by applying a discount rate determined after taking into account the creditworthiness of the purchaser. As of December 31, 2019, we had $6.8 million in receivables related to the promissory note, of which $2.3 million and $4.5 million are included in accounts receivable, net and other assets, respectively, within the consolidated balance sheet.
2018 Acquisitions
In October 2018, we acquired Essential Medical, Inc., a medical device company that developed the MANTA Vascular Closure Device, which is designed for closure of large bore arteriotomies and complements our interventional product portfolio. The fair value of the consideration transferred was $114.7 million, which included an initial payment of $60.4 million and $54.3 million in estimated fair value of contingent consideration. The contingent consideration liability represents the estimated fair value of our obligations (using a Monte Carlo valuation approach), under the acquisition agreement, to make additional payments of up to $100 million if certain sales and regulatory goals are met. See Note 12 for additional information related to the fair value measurement of the contingent consideration. Based on the purchase price allocation, the assets acquired principally consist of $103.2 million of intellectual property, $2.0 million of customer relationship assets and $30.1 million of goodwill. The intangible assets are being amortized over a useful life of 20 years. Goodwill arising from the acquisition represents revenue growth attributable to anticipated increased market penetration from acquired products and future customers and is not tax deductible.

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TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Other acquisitions
During 2018, we also completed acquisitions related to our surgical and interventional product portfolios and distributor to direct sales conversions. The total fair value of the consideration transferred in connection with these transactions was $62.5 million.

Pro forma information for 2018 acquisitions is not presented as the operations of the acquired businesses are not material to our overall operations.

Pro forma combined financial information

The following unaudited pro forma combined financial information for the years ended December 31, 2017 gives effect to the 2017 acquisitions of Vascular Solutions, Inc. ("Vascular Solutions") and NeoTract, Inc ("NeoTract") as if they were completed at the beginning of 2016. The operating results of the Vascular Solutions and NeoTract acquisitions are included in our interventional and interventional urology product categories, respectively. 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 our ownership and management.
2017
(unaudited)  
Net revenue $ 2,255,696   
Net income $ 119,934   
Basic earnings per common share:
Net income $ 2.66   
Diluted earnings per common share:
Net income $ 2.57   
Weighted average common shares outstanding:
Basic 45,004   
Diluted 46,664   

The unaudited pro forma combined financial information presented above includes the accounting effects of the Vascular Solutions and NeoTract acquisitions, including, to the extent applicable, amortization charges from acquired intangible assets; adjustments for depreciation of property, plant and equipment; interest expense; and the related tax effects.
Supplemental cash flow information
Year Ended December 31,
2019 2018 2017
(Dollars in thousands)
Non cash investing and financing activities of continuing operations:
Acquisition of businesses $ —    $ 54,696    $ 261,733   

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TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 5 — Restructuring and impairment charges

We have ongoing restructuring programs related to the relocation of manufacturing operations to existing lower-cost locations and related workforce reductions (referred to as our 2019, 2018 and 2014 Footprint realignment plans). The following tables provide a summary of our cost estimates and other information associated with these ongoing plans:
2019 Footprint realignment plan 2018 Footprint realignment plan 2014 Footprint realignment plan
Program expense estimates: (Dollars in millions)
Termination benefits
$19 to $23
$60 to $70
$12 to $13
Other costs (1)
1 to 2
2 to 4
1 to 2
Restructuring charges
20 to 25
62 to 74
13 to 15
Restructuring related charges (2)
36 to 45
40 to 59
34 to 37
Total restructuring and restructuring related charges
$56 to $70
$102 to $133
$47 to $52
Other program estimates:
Expected cash outlays
$53 to $66
$99 to $127
$38 to $43
Expected capital expenditures
$29 to $35
$19 to $23
$25 to $30
Other program information:
Period initiated February 2019 May 2018 April 2014
Estimated period of substantial completion 2022 2024 2021
Aggregate restructuring charges
$13.8
$54.1
$13.0
Restructuring related charges incurred:
For year ended December 31, 2019
$6.1
$3.0
$3.2
Aggregate restructuring related charges
$6.6
$7.2
$32.2

(1)Includes facility closure, employee relocation, equipment relocation and outplacement costs.
(2)Restructuring related charges represent costs that are directly related to the programs and principally constitute costs to transfer manufacturing operations to the existing lower-cost locations, project management costs and accelerated depreciation. The 2018 Footprint realignment plan also includes a charge associated with our exit from the facilities that is expected to be imposed by the taxing authority in the affected jurisdiction. Excluding this tax charge, substantially all of these charges are expected to be recognized within cost of goods sold.
The following table summarizes the restructuring reserve activity related to our 2019, 2018 and 2014 Footprint realignment plans:
2019 Footprint realignment plan 2018 Footprint realignment plan 2014 Footprint realignment plan
(Dollars in thousands)
Balance at December 31, 2017 $ —    $ —    $ 3,926   
Subsequent accruals —    54,993    830   
Cash payments —    (4,503)   (820)  
Foreign currency translation —    (2,016)   —   
Balance at December 31, 2018 —    48,474    3,936   
Subsequent accruals 13,753    (939)   313   
Cash payments (1,602)   (3,628)   (580)  
Foreign currency translation and other (281)   367    —   
Balance at December 31, 2019 (1)
$ 11,870    $ 44,274    $ 3,669   
(1)The restructuring reserves as of December 31, 2019 , 2018 and 2017 consisted mainly of accruals related to termination benefits. Most of the Other costs (facility closure, employee relocation, equipment relocation and outplacement costs) were expensed and paid in the same period.
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TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The restructuring and impairment charges recognized for the years ended December 31, 2019, 2018, and 2017 consisted of the following:
2019
Termination benefits
Other Costs (1)
Total
(Dollars in thousands)  
2019 Footprint realignment plan $ 13,683    $ 70    $ 13,753   
2018 Footprint realignment plan (1,787)   848    (939)  
Other restructuring programs (2)
787    1,638    2,425   
Total restructuring charges 12,683    2,556    15,239   
Asset impairment charges —    6,966    6,966   
Total restructuring and impairment charges $ 12,683    $ 9,522    $ 22,205   

2018
Termination benefits
Other Costs (1)
Total
(Dollars in thousands)  
2018 Footprint realignment plan $ 53,992    $ 1,001    $ 54,993   
Other restructuring programs (3)
3,820    1,307    5,127   
Total restructuring charges 57,812    2,308    60,120   
Asset impairment charges —    19,110    19,110   
Total restructuring and impairment charges $ 57,812    $ 21,418    $ 79,230   

2017
Termination benefits
Other Costs (1)
Total
(Dollars in thousands)  
2017 Vascular Solutions integration program (4)
$ 5,377    $ 118    $ 5,495   
2017 EMEA restructuring program (5)
4,921    280    5,201   
Other restructuring programs (6)
3,018    1,076    4,094   
Total restructuring charges $ 13,316    $ 1,474    $ 14,790   
(1) Includes facility closure, contract termination and other exit costs.
(2) Includes activity primarily related to a restructuring program initiated in the third quarter of 2019 that is designed to reduce costs and improve efficiencies through reorganizations within several businesses and certain corporate functions and the 2014 Footprint realignment plan.
(3) Includes activity primarily related to the 2016 Footprint realignment plan, which is substantially complete, and the 2014 Footprint realignment plan, as well as the 2017 Vascular Solutions integration program and the 2017 EMEA restructuring program, both of which are described below.
(4) The program was initiated in 2017 and was related to the integration of Vascular Solutions into Teleflex and has been substantially completed.
(5) The program was initiated in 2017 to centralize certain administrative functions in Europe and has been substantially completed.
(6) Includes activity primarily related to the 2016 Footprint realignment plan, the 2014 Footprint realignment plan and the other 2016 restructuring programs.
Impairment Charges
For the year ended December 31, 2019 and 2018, we recorded impairment charges of $7.0 million and $19.1 million, respectively, related to our decision to abandon certain intellectual property and other assets associated with our interventional product portfolio. There were no impairment charges recorded for the year ended December 31, 2017.

F-19
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 6 — Inventories
Inventories at December 31, 2019 and 2018 consist of the following:
  2019 2018
  (Dollars in thousands)
Raw materials
$ 114,302    $ 111,105   
Work-in-process 71,479    62,334   
Finished goods 290,776    254,339   
Inventories $ 476,557    $ 427,778   

Note 7 — Property, plant and equipment
The major classes of property, plant and equipment, at cost, at December 31, 2019 and 2018 were as follows: 
2019 2018
(Dollars in thousands)
Land, buildings and leasehold improvements
$ 248,067    $ 224,605   
Machinery and equipment 443,612    421,873   
Computer equipment and software 158,574    137,899   
Construction in progress 63,991    105,319   
914,244    889,696   
Less: Accumulated depreciation (483,525)   (456,930)  
Property, plant and equipment, net $ 430,719    $ 432,766   

Supplemental cash flow information
Year Ended December 31,
2019 2018 2017
(Dollars in thousands)
Non cash investing and financing activities of continuing operations:
Property, plant and equipment additions due to build-to-suit lease transactions $ —    $ 29,448    $ —   


Note 8 — Goodwill and other intangible assets
Changes in the carrying amount of goodwill, by reportable operating segment, for the years ended December 31, 2019 and 2018 were as follows:
  Americas EMEA Asia OEM Total
  (Dollars in thousands)
Balance as of December 31, 2017
Goodwill
$ 1,859,089    $ 494,548    $ 209,200    $ 4,883    $ 2,567,720   
Accumulated impairment losses
(332,128)   —    —    —    (332,128)  
1,526,961    494,548    209,200    4,883    2,235,592   
Goodwill related to acquisitions
29,345    4,730    6,590    —    40,665   
Translation and other adjustments
(6,772)   (18,663)   (4,243)   —    (29,678)  
Balance as of December 31, 2018
1,549,534    480,615    211,547    4,883    2,246,579   
Goodwill related to acquisitions 439    189    1,205    —    1,833   
Translation and other adjustments 952    (5,032)   973    —    (3,107)  
Balance as of December 31, 2019 $ 1,550,925    $ 475,772    $ 213,725    $ 4,883    $ 2,245,305   
F-20
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Intangible assets at December 31, 2019 and 2018 consisted of the following:
  Gross Carrying Amount Accumulated Amortization
  2019 2018 2019 2018
  (Dollars in thousands)
Customer relationships $ 1,021,852    $ 1,030,194    $ (367,585)   $ (322,972)  
In-process research and development 27,940    28,457    —    —   
Intellectual property 1,351,990    1,363,516    (402,340)   (322,539)  
Distribution rights 23,369    23,465    (18,859)   (17,860)  
Trade names 563,315    565,070    (50,718)   (36,379)  
Non-compete agreements 22,618    23,004    (15,297)   (8,904)  
  $ 3,011,084    $ 3,033,706    $ (854,799)   $ (708,654)  
As of December 31, 2019, trade names having a carrying value of $233.8 million are considered indefinite-lived. Acquired IPR&D is indefinite-lived until the completion of the related development project, at which point amortization of the carrying value of the technology will commence.
Amortization expense related to intangible assets was $150.0 million, $149.5 million, and $98.8 million for the years ended December 31, 2019, 2018 and 2017, respectively. Estimated annual amortization expense for each of the five succeeding years is as follows:
  (Dollars in thousands)
2020 $ 148,800   
2021 147,200   
2022 142,600   
2023 141,600   
2024 139,500   

Note 9 — Leases
We have operating leases for various types of properties, consisting of manufacturing plants, engineering and research centers, distribution warehouses, offices and other facilities, and equipment used in operations. Some leases provide us with an option, exercisable at our sole discretion, to terminate the lease or extend the lease term for one or more years. When measuring assets and liabilities arising from a lease that provides us with an option to extend the lease term, we take into account payments to be made in the optional extension period when it is reasonably certain that we will exercise the option. Total lease cost (all of which related to operating leases) was $30.2 million, $32.6 million and $31.0 million for the years ended December 31, 2019, 2018 and 2017, respectively.

Maturities of lease liabilities
December 31, 2019
(Dollars in thousands)
2020 $ 25,323   
2021 24,263   
2022 22,484   
2023 17,653   
2024 13,688   
2025 and thereafter 40,704   
Total lease payments 144,115   
Less: interest (21,894)  
Present value of lease liabilities $ 122,221   

F-21
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Supplemental information
December 31, 2019
(Dollars in thousands)
Total lease liabilities (1)
$ 122,221   
Cash paid for amounts included in the measurement of lease liabilities within operating cash flows $ 26,458   
Right of use assets obtained in exchange for operating lease obligations $ 37,673   
Weighted average remaining lease term 7.2 years
Weighted average discount rate 4.4  %
(1) The current portion of the operating lease liability is included in other current liabilities.
As of December 31, 2018, minimum lease payments under noncancellable operating leases were expected to be as follows:
December 31, 2018
(Dollars in thousands)
2019 $ 25,294   
2020 23,216   
2021 21,419   
2022 19,460   
2023 17,403   
2024 and thereafter 41,368   

Note 10 — Borrowings
Our borrowings at December 31, 2019 and 2018 were as follows:
2019 2018
(Dollars in thousands)
Senior Credit Facility:
Revolving credit facility, at a rate of 3.12% at December 31, 2019, and 4.27% at December 31, 2018, due 2024
$ 300,000    $ 293,000   
Term loan facility, at a rate of 3.17% at December 31, 2019 and 4.27% at December 31 2018, due 2022
673,000    683,500   
5.25% Senior Notes due 2024
—    250,000   
4.875% Senior Notes due 2026
400,000    400,000   
4.625% Senior Notes due 2027
500,000    500,000   
Securitization program, at a rate of 2.51% at December 31, 2019 and 3.25% at December 31, 2018
50,000    50,000   
  1,923,000    2,176,500   
Less: Unamortized debt issuance costs (14,057)   (17,675)  
  1,908,943    2,158,825   
Current portion of borrowings (50,000)   (86,625)  
Long-term borrowings $ 1,858,943    $ 2,072,200   
Senior credit facility
On April 5, 2019, we amended and restated our existing credit agreement by entering into a Second Amended and Restated Credit Agreement (the "Credit Agreement"), which provides for a five-year revolving credit facility of $1.0 billion and a term loan facility of $700.0 million (the "Credit Agreement"). Our obligations under the Credit Agreement are guaranteed (subject to certain exceptions and limitations) by substantially all of our material domestic subsidiaries. The obligations under the Credit Agreement are secured, subject to certain exceptions and limitations, by a lien on substantially all of the assets owned by us and each guarantor. The maturity date of the revolving credit facility and the term loan facility under the Credit Agreement is April 5, 2024.
F-22
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

At our option, loans under the Credit Agreement will bear interest at a rate equal to adjusted LIBOR plus an applicable margin ranging from 1.25% to 2.00% or at an alternate base rate, which generally is defined as the highest of (i) the “Prime Rate” in the U.S. last quoted by The Wall Street Journal, (ii) 0.5% above the greater of the federal funds rate and the rate comprised of both overnight federal funds and overnight eurodollar borrowings and (iii) 1% above adjusted LIBOR for a one month interest period, plus in each case an applicable margin ranging from 0.125% to 0.0100, in each case subject to adjustments based on our consolidated total net leverage ratio. Overdue loans will bear interest at the rate otherwise applicable to such loans plus 2.00%.
The Credit Agreement contains customary representations and warranties and covenants that, in each case, subject to certain exceptions, qualifications and thresholds, (a) place limitations on us regarding the incurrence of additional indebtedness, additional liens, fundamental changes, dispositions of property, investments and acquisitions, dividends and other restricted payments, transactions with affiliates, restrictive agreements, changes in lines of business and swap agreements, and (b) require us to comply with sanction laws and other laws and agreements, to deliver financial information and certain other information and give notice of certain events, to maintain their existence and good standing, to pay their other obligations, to permit the administrative agent and the lenders to inspect their books and property, to use the proceeds of the Credit Agreement only for certain permitted purposes and to provide collateral in the future. Subject to certain exceptions, we are required to maintain a maximum consolidated total net leverage ratio of 4.50 to 1.00. We are further required to maintain a minimum consolidated interest coverage ratio of 3.50 to 1.00.
We capitalized $4.0 million related to transaction fees, including underwriters' discounts and commissions incurred in connection with the second amendment to the Credit Agreement.
5.25% Senior notes due 2024
On October 31, 2019, we issued a notice of redemption to holders of our outstanding $250 million aggregate principal amount of 5.25% Senior Notes due 2024 (the “2024 Notes”). Pursuant to the notice of redemption, the 2024 Notes were redeemed on November 15, 2019 (the “Redemption Date”) at a redemption price equal to 102.625% of the principal amount of the 2024 Notes plus accrued and unpaid interest up to, but not including, the Redemption Date. We recognized a loss on extinguishment of debt of $8.8 million in 2019 as a result of the redemption of the 2024 Notes.
4.875% Senior notes due 2026
In 2016, we issued $400.0 million of 4.875% Senior Notes due 2026 (the "2026 Notes"). We pay interest on the 2026 Notes semi-annually on June 1 and December 1 at a rate of 4.875% per year. The 2026 Notes mature on June 1, 2026, unless earlier redeemed by us at our option, as described below, or purchased by us at the holder’s option under specified circumstances following a Change of Control or Asset Sale (each as defined in the Indenture related to the 2026 Notes) or upon our election to exercise its optional redemption rights, as described below.
Our obligations under the 2026 Notes are fully and unconditionally guaranteed, jointly and severally, by each of our existing and future 100% owned domestic subsidiaries that is a guarantor or other obligor under the Credit Agreement and by certain of the other 100% owned domestic subsidiaries. See Note 19 for further information regarding the guarantors under the 2026 Notes.
At any time on or after June 1, 2021, we may, on one or more occasions, redeem some or all of the 2026 Notes at a redemption price of 102.438% of the principal amount of the 2026 Notes subject to redemption, declining, in annual increments of 0.813%, to 100% of the principal amount on June 1, 2024, plus accrued and unpaid interest. In addition, at any time prior to June 1, 2021, we may, on one or more occasions, redeem some or all of the 2026 Notes at a redemption price equal to 100% of the principal amount of the 2026 Notes redeemed, plus a “make-whole” premium and any accrued and unpaid interest. The “make-whole” premium is the greater of (a) 1.0% of the principal amount of the 2026 Notes subject to redemption or (b) the excess, if any, over the principal amount of the 2026 Notes of the present value, on the redemption date of the sum of (i) the June 1, 2021 optional redemption price plus (ii) all required interest payments on the 2026 Notes through June 1, 2021 (other than accrued and unpaid interest to the redemption date), generally computed using a discount rate equal to the yield to maturity of U.S. Treasury securities with a constant maturity for the period most nearly equal to the period from the redemption date to June 1, 2021 (unless the period is less than one year, in which case the weekly average yield on traded U.S. Treasury securities adjusted to a constant maturity of one year will be used), plus 50 basis points.
F-23
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The indenture relating to the 2026 Notes contains covenants that, among other things and subject to certain exceptions, limit or restrict our ability to incur additional debt or issue preferred stock or other disqualified stock; create liens; merge, consolidate or dispose of certain assets, make investments or make other restricted payments; or enter into transactions with affiliates.
4.625% Senior notes due 2027
In 2017, we issued $500.0 million of 4.625% Senior Notes due 2027 (the "2027 Notes"). We pay interest on the 2027 Notes semi-annually on May 15 and November 15, commencing on May 15, 2018, at a rate of 4.625% per year. The 2027 Notes mature on November 15, 2027 unless earlier redeemed by us at our option, as described below, or purchased by us at the holder’s option under specified circumstances following a Change of Control or Asset Sale (each as defined in the indenture related to the 2027 Notes), coupled with a downgrade in the ratings of the 2027 Notes, or upon our election to exercise our optional redemption rights, as described below. We incurred transaction fees of $7.9 million, including underwriters’ discounts and commissions, in connection with the offering of the 2027 Notes, which were recorded on the consolidated balance sheet as a reduction to long-term borrowings and are being amortized over the term of the 2027 Notes. We used the net proceeds from the offering to repay borrowings under our revolving credit facility.
Our obligations under the 2027 Notes are fully and unconditionally guaranteed, jointly and severally, by each of our existing and future 100% owned domestic subsidiaries that is a guarantor or other obligor under the Credit Agreement and by certain of our other 100% owned domestic subsidiaries. See Note 19 for further information regarding the guarantors under the 2027 Notes.
At any time on or after November 15, 2022, we may, on one or more occasions, redeem some or all of the 2027 Notes at a redemption price of 102.313% of the principal amount of the 2027 Notes subject to redemption, declining, in annual increments of 0.771%, to 100% of the principal amount on November 15, 2025, plus accrued and unpaid interest. In addition, at any time prior to November 15, 2022, we may, on one or more occasions, redeem some or all of the 2027 Notes at a redemption price equal to 100% of the principal amount of the 2027 Notes redeemed, plus a “make-whole” premium and any accrued and unpaid interest. The “make-whole” premium is the greater of (a) 1.0% of the principal amount of the 2027 Notes subject to redemption or (b) the excess, if any, over the principal amount of the 2027 Notes of the present value, on the redemption date of the sum of (i) the November 15, 2022 optional redemption price plus (ii) all required interest payments on the 2027 Notes through November 15, 2022 (other than accrued and unpaid interest to the redemption date), generally computed using a discount rate equal to the yield to maturity of U.S. Treasury securities with a constant maturity for the period most nearly equal to the period from the redemption date to November 15, 2022 (unless the period is less than one year, in which case the weekly average yield on traded U.S. Treasury securities adjusted to a constant maturity of one year will be used), plus 50 basis points.
In addition, at any time prior to November 15, 2020, we may, on one or more occasions, redeem up to 40% of the aggregate principal amount of the 2027 Notes, using the proceeds of specified types of Company equity offerings and subject to specified conditions, at a redemption price equal to 104.625% of the principal amount of the Notes redeemed, plus accrued and unpaid interest.
The indenture relating to the 2027 Notes contains covenants that, among other things and subject to certain exceptions, limit or restrict our ability to create liens; merge, consolidate, sell or otherwise dispose of all or substantially all of our assets; or enter into sale leaseback transactions.
Securitization program
We have an accounts receivable securitization facility under which accounts receivable of certain domestic subsidiaries are sold on a non-recourse basis to a special purpose entity (“SPE”), which is a bankruptcy-remote, consolidated subsidiary of Teleflex. Accordingly, the assets of the SPE are not available to satisfy the obligations of Teleflex or any of its subsidiaries. The SPE sells undivided interests in those receivables to an asset backed commercial paper conduit for consideration of up to $50.0 million. This facility is utilized from time to time to provide increased flexibility in funding short term working capital requirements. The agreement governing the accounts receivable securitization facility contains certain covenants and termination events. An occurrence of an event of default or a termination event under this facility may give rise to the right of its counterparty to terminate this facility. As of December 31, 2019, we were in compliance with the covenants, and none of the termination events had occurred. As of both December 31, 2019 and 2018, we had $50.0 million (the maximum amount available) of outstanding borrowings under its accounts receivable securitization facility.
F-24
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Fair value of long-term debt
To determine the fair value of our debt for which quoted prices are not available, we use a discounted cash flow technique that incorporates a market interest yield curve with adjustments for duration, optionality and risk profile. Our implied credit rating is a factor in determining the market interest yield curve. The following table provides the fair value of our debt as of December 31, 2019 and 2018, which is valued based on Level 2 inputs within the hierarchy used to measure fair value (see Note 12 to the consolidated financial statements for further information):
December 31, 2019 December 31, 2018
(Dollars in thousands)
Fair value of debt $ 1,974,918    $ 2,145,473   
Debt Maturities
As of December 31, 2019, the aggregate amounts of long-term debt, demand loans and debt under our securitization program that will mature during each of the next four years and thereafter were as follows:
(Dollars in thousands)
2020 $ 50,000   
2021 25,500   
2022 35,000   
2023 43,750   
2024 and thereafter 1,768,750   
Supplemental cash flow information
Year Ended December 31,
2019 2018 2017
(Dollars in thousands)
Cash interest paid $ 95,954    $ 101,790    $ 74,256   

Note 11 — Financial instruments
Foreign currency forward contracts
We use derivative instruments for risk management purposes. Foreign currency forward contracts designated as cash flows hedges are used to manage foreign currency transaction exposure. Foreign currency forward contracts not designated as hedges for accounting purposes are used to manage exposure related to near term foreign currency denominated monetary assets and liabilities. We enter into the non-designated foreign currency forward contracts for periods consistent with its currency exposures, which generally approximate one month. For the years ended December 31, 2019 and 2018, we recognized losses related to non-designated foreign currency forward contracts of $3.8 million and $1.9 million, respectively.
The total notional amount for all open foreign currency forward contracts designated as cash flow hedges as of December 31, 2019 and 2018 was $132.0 million and $115.3 million, respectively. The total notional amount for all open non-designated foreign currency forward contracts as of December 31, 2019 and 2018 was $145.1 million and $125.9 million, respectively. All open foreign currency forward contracts as of December 31, 2019 have durations of 12 months or less.
Cross-currency interest rate swaps
During 2019, we entered into cross-currency swap agreements with five different financial institution counterparties to hedge against the effect of variability in the U.S. dollar to euro exchange rate. Under the terms of the cross-currency swap agreements, we have notionally exchanged $250 million at an annual interest rate of 4.8750% for €219.2 million at an annual interest rate of 2.4595%. The swap agreements are designed as net investment hedges and expire on March 4, 2024.
During 2018, we entered into cross-currency swap agreements with six different financial institution counterparties to hedge against the effect of variability in the U.S. dollar to euro exchange rate. Under the terms of the cross-currency swap agreements, we have notionally exchanged $500 million at an annual interest rate of 4.625% for €433.9 million at an annual interest rate of 1.942%. The swap agreements are designated as net investment hedges and expire on October 4, 2023.
F-25
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The swap agreements described above require an exchange of the notional amounts upon expiration or earlier termination of the agreements. We and the counterparties have agreed to effect the exchange through a net settlement.
The cross-currency swaps are marked to market at each reporting date and any changes in fair value are recognized as a component of accumulated other comprehensive income (loss) ("AOCI") while the accrued interest is recognized in interest expense in the statement of operations. For the years ended December 31, 2019 and 2018, we recognized foreign exchange gain of $20.8 million and $4.0 million, respectively, in foreign currency translation adjustments within AOCI related to the cross-currency swaps. For the years ended December 31, 2019 and 2018, we recognized $18.9 million and $3.3 million, respectively, in interest benefit related to the cross-currency swaps.
Balance sheet presentation
The following table presents the locations in the consolidated balance sheets and fair value of derivative instruments as of December 31, 2019 and 2018:
December 31, 2019 December 31, 2018
Fair Value
(Dollars in thousands)
Asset derivatives:
Designated foreign currency forward contracts $ 1,659    $ 1,216   
Non-designated foreign currency forward contracts 192    106   
Cross-currency interest rate swap 21,575    14,728   
Prepaid expenses and other current assets 23,426    16,050   
Cross-currency interest rate swap 13,066    —   
Other assets 13,066    —   
Total asset derivatives 36,492    16,050   
Liability derivatives:
Designated foreign currency forward contracts 1,285    524   
Non-designated foreign currency forward contracts 102    264   
Other current liabilities 1,387    788   
Cross-currency interest rate swap —    7,793   
Other liabilities —    7,793   
Total liability derivatives $ 1,387    $ 8,581   
See Note 13 for information on the location and amount of gains and losses attributable to derivatives that were reclassified from AOCI to expense (income), net of tax.
For the years ended December 31, 2019, 2018 and 2017, there was no ineffectiveness related to our hedging derivatives.

Note 12 — Fair value measurement
Fair value is the price that would be received from the sale of an asset or paid to transfer a liability, using assumptions that market participants would use in pricing an asset or liability. Under GAAP, there is a three-level hierarchy of the inputs (i.e., assumptions that market participants would use in pricing an asset or liability) used to measure fair value. The categorization within the valuation hierarchy is based on the lowest level of input that is significant to the entire fair value measurement.
The levels of inputs within the hierarchy used to measure fair value are as follows:
Level 1 — inputs to the fair value measurement that are quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 — inputs to the fair value measurement that include quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data by correlation or other means.
F-26
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Level 3 — inputs to the fair value measurement that are unobservable inputs for the asset or liability.
The following tables provide information regarding our financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2019 and 2018:
Basis of fair value measurement
December 31, 2019 (Level 1) (Level 2) (Level 3)
(Dollars in thousands)
Investments in marketable securities $ 10,926    $ 10,926    $ —    $ —   
Derivative assets 36,492    —    36,492    —   
Derivative liabilities 1,387    —    1,387    —   
Contingent consideration liabilities 219,908    —    —    219,908   

Basis of fair value measurement
December 31, 2018 (Level 1) (Level 2) (Level 3)
(Dollars in thousands)
Investments in marketable securities $ 8,671    $ 8,671    $ —    $ —   
Derivative assets 16,050    —    16,050    —   
Derivative liabilities 8,581    —    8,581    —   
Contingent consideration liabilities 304,248    —    —    304,248   
There were no transfers of financial assets or liabilities among Level 1, Level 2 or Level 3 within the fair value hierarchy during the years ended December 31, 2019 or 2018.
Valuation Techniques
Our 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.
Our financial assets and liabilities valued based upon Level 2 inputs are comprised of foreign currency forward contracts and cross-currency interest rate swap agreements. We use foreign currency forward contracts and cross-currency interest rate swap agreements to manage foreign currency transaction exposure as well as exposure to foreign currency denominated monetary assets and liabilities. We measure the fair value of the foreign currency forward and cross-currency swap agreements by calculating the amount required to enter into offsetting contracts with similar remaining maturities, based on quoted market prices, and taking into account the creditworthiness of the counterparties.
Our financial liabilities valued based upon Level 3 inputs are comprised of contingent consideration arrangements pertaining to our acquisitions.
Contingent consideration
Contingent consideration liabilities, which primarily consist of payment obligations that are contingent upon the achievement of revenue-based goals, but also can be based on other milestones such as regulatory approvals, are remeasured to fair value each reporting period using assumptions including estimated revenues (based on internal operational budgets and long-range strategic plans), discount rates, probability of payment and projected payment dates.
We determine the fair value of the contingent consideration liabilities related to the NeoTract and Essential Medical acquisitions, which represent most of our contingent consideration liabilities as of December 31, 2019, using a Monte Carlo simulation (which involves a simulation of future revenues during the earn-out period using management's best estimates) or other probability-weighted discounted cash flow analysis. Increases in projected revenues, estimated cash flows and probabilities of payment may result in significantly higher fair value measurements; decreases in these items may have the opposite effect. Increases in the discount rates in periods prior to payment may result in significantly lower fair value measurements and decreases in the discount rates may have the opposite effect. As of December 31, 2019, the maximum amount we could be required to pay under the contingent consideration arrangements related to the NeoTract and Essential Medical acquisitions was $263.2 million.
F-27
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The table below provides additional information regarding the valuation technique and inputs used in determining the fair value of contingent consideration.
Contingent Consideration Liability Valuation Technique Unobservable Input Range
Milestone-based payment
Discounted cash flow Discount rate
2.8% - 3.3%
Projected year of payment 2020 - 2023
Revenue-based
Monte Carlo simulation Revenue volatility
19.0% - 23.5%
 
  Risk free rate Cost of debt structure
Projected year of payment 2020 - 2022
Discounted cash flow Discount rate
10%
Projected year of payment 2020 - 2029
The following table provides information regarding changes in our contingent consideration liabilities for the years ended December 31, 2019 and 2018:
2019 2018
(Dollars in thousands)
Beginning balance – January 1 $ 304,248    $ 272,136   
Initial estimate upon acquisition —    54,696   
Payments (1)
(138,171)   (75,335)  
Revaluations 53,915    52,977   
Translation adjustment (84)   (226)  
Ending balance – December 31 $ 219,908    $ 304,248   
(1) Consists mainly of a $106.8 million payment associated with our acquisition of NeoTract and resulting from the achievement of a revenue-based goal for the period from January 1, 2018 to December 31, 2018 and $30.0 million of payments associated with our acquisition of Essential Medical and resulting from achievement of a regulatory goal.

Note 13 — Shareholders' equity
Our authorized capital is comprised of 200 million common shares, $1 par value, and 500,000 preference shares. No preference shares have been outstanding during the last three years.
Basic earnings per share is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed in the same manner except that the weighted average number of shares is increased to include dilutive securities. The following table provides a reconciliation of basic to diluted weighted average shares outstanding:
  2019 2018 2017
  (Shares in thousands)
Basic 46,200    45,689    45,004   
Dilutive effect of share based awards 890    970    923   
Dilutive effect of convertible notes and warrants —    142    737   
Diluted 47,090    46,801    46,664   
Weighted average shares that were antidilutive and therefore excluded from the calculation of diluted earnings per share were 0.1 million, 0.6 million and 0.6 million for the years ended December 31, 2019, 2018 and 2017, respectively.
In connection with our 2010 issuance of $400 million principal amount of convertible notes that matured in August 2017, and as a component of hedging arrangements between Teleflex and two institutional counterparties, we issued warrants to the counterparties, entitling them to purchase shares of our common stock. At December 31, 2018, all of the warrants were either (a) canceled as a result of warrant unwind agreements between Teleflex and the counterparties or (b) exercised by the counterparties.
F-28
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following tables provides information relating to the changes in accumulated other comprehensive income (loss), net of tax, for the years ended December 31, 2019 and 2018:
 
Cash Flow
Hedges
Pension and
Other
Postretirement
Benefit Plans
Foreign
Currency
Translation
Adjustment
Accumulated
Other
Comprehensive
Income (Loss)
  (Dollars in thousands)
Balance at December 31, 2017 $ 340    $ (138,808)   $ (126,623)   $ (265,091)  
Other comprehensive income (loss) before reclassifications
2,574    1,605    (83,889)   (79,710)  
Amounts reclassified from accumulated other comprehensive income (loss)
(2,107)   5,823    —    3,716   
Net current-year other comprehensive income (loss)
467    7,428    (83,889)   (75,994)  
Balance at December 31, 2018 807    (131,380)   (210,512)   (341,085)  
Other comprehensive income (loss) before reclassifications
1,062    (12,811)   4,195    (7,554)  
Amounts reclassified from accumulated other comprehensive (loss) income
(1,134)   5,381    —    4,247   
Net current-year other comprehensive (loss) income
(72)   (7,430)   4,195    (3,307)  
Balance at December 31, 2019 $ 735    $ (138,810)   $ (206,317)   $ (344,392)  
The following table provides information relating to the losses (gains) recognized in the statements of income including the reclassifications of losses (gains) in accumulated other comprehensive (loss) income into expense/(income), net of tax, for the years ended December 31, 2019, 2018 and 2017:
Year Ended December 31,
2019 2018 2017
(Dollars in thousands)
Losses (gains) on designated foreign exchange forward contracts:
Cost of goods sold $ (1,284)   $ (2,270)   $ (95)  
Total before tax (1,284)   (2,270)   (95)  
Taxes expense (benefit) 150    163    84   
Net of tax $ (1,134)   $ (2,107)   $ (11)  
Amortization of pension and other postretirement benefits items:
Actuarial losses (1)
$ 6,930    $ 7,305    $ 6,904   
Prior-service credits (1)
82    251    105   
Total before tax 7,012    7,556    7,009   
Tax benefit (1,631)   (1,733)   (2,496)  
Net of tax $ 5,381    $ 5,823    $ 4,513   
Impact on income from continuing operations, net of tax $ 4,247    $ 3,716    $ 4,502   
(1)These accumulated other comprehensive (loss) income components are included in the computation of net benefit cost of pension and other postretirement benefit plans (see Note 16 for additional information).
Supplemental cash flow information
Year Ended December 31,
2019 2018 2017
(Dollars in thousands)
Non cash investing and financing activities of continuing operations:
Settlement and exchange of convertible notes with common or treasury stock $ —    $ —    $ 53,207   
Acquisition of treasury stock from settlement and exchange of convertible note hedge and warrants $ —    $ 56,075    $ 141,405   

F-29
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 14 — Stock compensation plans
In May 2014, our stockholders approved the Teleflex Incorporated 2014 Stock Incentive Plan (the "2014 Plan") which replaced the 2008 Stock Incentive Plan and 2000 Stock Compensation Plan (the "Prior Plans"), under which stock options and restricted stock awards previously were granted. The 2014 Plan provides for several different kinds of awards, including stock options, stock appreciation rights, stock awards and other stock-based awards to directors, officers and key employees. Under the 2014 Plan, we are authorized to issue up to 5.3 million shares of common stock, subject to adjustment in accordance with special share counting rules in the 2014 Plan that, among other things, (i) count shares underlying a stock option or stock appreciation right (each, an "option award") as one share and each share underlying any other type of award (a "stock award") as 1.8 shares, (ii) increase the shares we are authorized to issue by one or 1.8 shares for each share underlying an option award or stock award, respectively, under the Prior Plans that have been canceled, expired, settled in cash or forfeited after December 31, 2013 and (iii) decrease the number of shares we are authorized to issue by one share and 1.8 shares for each share underlying an option award or stock award, respectively, granted under the Prior Plans between January 1, 2014 and the May 2, 2014 adoption of the 2014 Plan by our stockholders. Options granted under the 2014 Plan have an exercise price equal to the closing price of the common stock on the date of the grant. In 2019, we granted, under the 2014 Plan, non-qualified options to purchase 162,087 shares of common stock and granted restricted stock units relating to 69,799 shares of common stock under the 2014 Plan. We also granted performance share units (“PSUs”), as described in the following paragraph.
In 2018, we began granting PSUs to specified senior managers. The PSUs are designed to provide further incentive to our senior management with respect to achievement of the long term financial objectives. The PSU component of the equity incentive program is designed to provide shares of our common stock to the holder based upon our achievement of certain financial performance criteria during a designated performance period of three years. The number of shares to be awarded under the PSUs granted are subject to modification based upon our total stockholder return relative to a designated group of public companies. Assuming target performance is achieved, a total of 18,663 shares of common stock would be issuable in respect of the PSUs granted and a maximum of 46,660 shares would be issuable in respect of such PSUs upon achievement of maximum performance levels.
The following table summarizes the share-based compensation activity:
2019 2018 2017
(Dollars in millions)
Share-based compensation expense $ 26.9    $ 22.4    $ 19.4   
Total income tax benefit recognized for share-based compensation arrangements $ 21.1    $ 20.7    $ 12.8   
Net excess tax benefit $ 15.4    $ 15.9    $ 6.6   

The unrecognized compensation expense for all awards granted in 2019 as of the grant date was $34.0 million, which will be recognized over the vesting period of the awards. As of December 31, 2019, 3,357,048 shares were available for future grants under the 2014 Plan.
Option Awards
The fair value of options granted in 2019, 2018 and 2017 was estimated at the date of grant using a Black-Scholes option pricing model. The following weighted-average assumptions were used:
  2019 2018 2017
Risk-free interest rate 2.44  % 2.67  % 1.88  %
Expected life of option 4.99 years 4.98 years 4.94 years
Expected dividend yield 0.47  % 0.54  % 0.71  %
Expected volatility 23.92  % 22.65  % 21.74  %
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TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table summarizes the option activity during 2019:
Shares Subject to Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life In Years
Aggregate
Intrinsic
Value
(Dollars in thousands)
Outstanding, beginning of the year 1,471,449    $ 136.62   
Granted 162,087    288.45   
Exercised (291,696)   99.96   
Forfeited or expired (16,308)   245.65   
Outstanding, end of the year 1,325,532    161.91    6.0 284,371   
Exercisable, end of the year 1,018,703    $ 133.71    5.3 247,275   
The weighted average grant date fair value for options granted during 2019, 2018 and 2017 was $68.22, $58.16 and $39.70, respectively. The total intrinsic value of options exercised during 2019, 2018 and 2017 was $64.3 million, $69.4 million and $15.7 million, respectively.
We recorded $9.6 million of expense related to options during 2019, which is included in cost of goods sold or selling, general and administrative expenses. As of December 31, 2019, the unamortized share-based compensation cost related to non-vested stock options, net of expected forfeitures, was $10.6 million, which is expected to be recognized over a weighted-average period of 1.4 years. Authorized but unissued shares of our common stock are issued upon exercises of options.
Stock Awards
The fair value of PSUs granted in 2019 was determined using a Monte Carlo simulation valuation model. The grant date fair value for these awards was $305.58.
The fair value for restricted stock units granted in 2019, 2018 and 2017 was estimated at the date of grant based on the market price for the underlying stock on the grant date discounted for the risk free interest rate and the present value of expected dividends over the vesting period. The following weighted-average assumptions were used:
2019 2018 2017
Risk-free interest rate 2.41  % 2.41  % 1.47  %
Expected dividend yield 0.46  % 0.53  % 0.71  %
The following table summarizes the non-vested restricted stock unit activity during 2019:
Number of
Non-Vested
Shares
Weighted
Average
Grant-Date
Fair Value
Weighted
Average
Remaining
Contractual
Life
Aggregate
Intrinsic
Value
(In years) (Dollars in thousands)
Outstanding, beginning of the year 201,812    $ 188.10   
Granted 69,799    286.51   
Vested (80,835)   150.83   
Forfeited (13,428)   236.31   
Outstanding, end of the year 177,348    $ 240.17    1.2 $ 66,761   
We issued 69,799, 62,221 and 82,865 of non-vested restricted stock units in 2019, 2018 and 2017, respectively, the majority of which provide for vesting as to all underlying shares on the third anniversary of the grant date. The weighted average grant-date fair value for non-vested restricted stock units granted during 2019, 2018 and 2017 was $286.51, $250.66 and $187.85, respectively.
We recorded $14.1 million of expense related to stock awards during 2019, which is included in cost of goods sold or selling, general and administrative expenses. As of December 31, 2019, the unamortized share-based compensation cost related to non-vested restricted stock units, net of estimated forfeitures, was $18.6 million, which is expected to be recognized over a weighted-average period of 1.2 years. We use treasury stock to provide shares of common stock in connection with vesting of the stock awards.

F-31
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 15 — Income taxes
The following table summarizes the components of the provision for income taxes from continuing operations:
2019 2018 2017
(Dollars in thousands)
Current:
Federal $ 19,374    $ (1,525)   $ 133,621   
State 8,220    1,432    5,213   
Non-U.S. 23,690    29,353    35,444   
Deferred:
Federal (2,041)   (5,124)   (258,247)  
State (28,277)   (5,114)   1,459   
Non-U.S. (143,044)   4,174    212,158   
$ (122,078)   $ 23,196    $ 129,648   
U.S. tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “TCJA”) was enacted on December 22, 2017. The legislation significantly changed U.S. tax law by, among other things, permanently reducing corporate income tax rates from a maximum of 35% to 21%, effective January 1, 2018; implementing a territorial tax system, by generally providing for, among other things, a dividends received deduction on the foreign source portion of dividends received from a non-U.S. corporation if specified conditions are met; and imposing a one-time repatriation tax on undistributed post-1986 non-U.S. subsidiary earnings and profits, which are deemed repatriated for purposes of the tax.

On December 22, 2017, the SEC staff issued Staff Accounting Bulletin No. 118 (“SAB 118”) to address the application of U.S. GAAP in situations where a company does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the TCJA. SAB 118 states that in these circumstances, if a company can determine a reasonable estimate for the income tax effects, the SEC staff would not object if the company includes in its financial statements the reasonable estimate it has determined (and the SEC staff also expressed its belief that it would not be appropriate for a company to exclude a reasonable estimate from its financial statements to the extent a reasonable estimate has been determined).
As a result of the TCJA, we reassessed and revalued our ending net deferred tax liabilities at December 31, 2017 and recognized a $46.1 million provisional tax benefit in our consolidated statement of income for the year ended December 31, 2017. We also recognized a $154.0 million provisional tax expense in our consolidated statement of income for the year ended December 31, 2017, related to the deemed repatriated earnings. We expect to pay this tax over an eight-year period. These two provisional amounts are collectively referred to as the TCJA Provisions.
In accordance with SAB118, during the year ended December 31, 2018, we recognized a net $2.3 million discrete tax benefit for adjustments to the TCJA Provisions, of which, $0.2 million related to the taxes on deemed repatriated earnings and $2.1 million related to the revaluation of deferred tax assets and liabilities; both were the result of additional analysis, changes in interpretations and in our assumptions, and the issuance of additional regulatory guidance. We completed the accounting for the TCJA Provisions in the fourth quarter of 2018 and we made no further adjustments to the TCJA Provisions in 2019.
While the TCJA provides for a territorial tax system, beginning in 2018, it includes new U.S. tax base erosion provisions, including the global intangible low-taxed income (“GILTI”) provision.

The GILTI provisions require us to include, in our U.S. income tax return, non-U.S. subsidiary earnings in excess of an allowable return on the foreign subsidiary’s tangible assets. We were subject to incremental U.S. tax of $10.7 million on GILTI income beginning in 2018. We elected to account for the GILTI tax in the period in which it is incurred.

At December 31, 2019, the cumulative unremitted earnings of subsidiaries outside the U.S. that are considered non-permanently reinvested and for which taxes have been provided approximated $1.7 billion. At December 31, 2019, the cumulative unremitted earnings of subsidiaries outside the U.S. that are considered
F-32
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

permanently reinvested approximated $0.5 billion. Earnings considered permanently reinvested are expected to be reinvested indefinitely and, as a result, no additional deferred tax liability has been recognized with regard to these earnings. It is not practical to determine the deferred income tax liability on these earnings if, in the future, they are remitted to the U.S. because the income tax liability to be incurred, if any, is dependent on circumstances existing when remittance occurs.
The following table summarizes the U.S. and non-U.S. components of income from continuing operations before taxes:
2019 2018 2017
(Dollars in thousands)
U.S. $ 89,021    $ 37,201    $ 37,528   
Non-U.S. 250,882    182,427    247,383   
$ 339,903    $ 219,628    $ 284,911   
Reconciliations between the statutory federal income tax rate and the effective income tax rate are as follows:
2019 2018 2017
Federal statutory rate 21.0  % 21.0  % 35.0  %
Tax effect of international items (11.3)   (3.3)   (25.7)  
Impacts of the TCJA —    (1.0)   37.9   
Legal entity merger - deferred taxes(1)
(38.0)   —    —   
Excess tax benefits related to share-based compensation (4.5)   (7.2)   (2.3)  
State taxes, net of federal benefit (4.9)   (0.1)   0.1   
Uncertain tax contingencies —    (0.4)   (1.8)  
Contingent consideration 3.4    5.3    0.4   
Intellectual property impairment charge —    (2.0)   —   
Research and development tax credit (1.1)   (1.6)   (0.8)  
Other, net (0.5)   (0.1)   2.7   
(35.9) % 10.6  % 45.5  %
(1) During 2019, we recognized a discrete tax benefit of $129 million resulting from a non-U.S. legal entity restructuring that eliminated the requirement to provide for withholding taxes on the future repatriation of certain non-permanently reinvested earnings.
The effective income tax rate for 2019 and 2018 was (35.9)% and 10.6%, respectively. The effective income tax rate for 2019 reflects a tax benefit of $129 million resulting from a non-U.S. legal entity restructuring that eliminated the requirement to provide for withholding taxes on the future repatriation of certain non-permanently reinvested earnings. Additionally, the effective tax rate for 2019 was affected by a tax benefit relating to the revaluation of state deferred tax assets and liabilities due to business integrations and other changes. The effective tax rates for both 2019 and 2018 reflect a net excess tax benefit related to share-based compensation and a tax cost associated with a non-deductible contingent consideration expense recognized in connection with an increase in the fair value of the NeoTract contingent consideration liability.
We are routinely subject to examinations by various taxing authorities. In conjunction with these examinations and as a regular practice, we establish and adjust reserves with respect to its uncertain tax positions to address developments related to those positions. We realized a net benefit of $0.1 million and $0.8 million in 2019 and 2018, respectively, as a result of reducing our reserves with respect to uncertain tax positions, principally due to the expiration of a number of applicable statutes of limitations. We realized a net benefit of $5.2 million in 2017, as a result of reducing our reserves with respect to uncertain tax positions, principally due to the conclusion of a tax audit in Germany and the expiration of various statutes of limitations.
F-33
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table summarizes significant components of our deferred tax assets and liabilities at December 31, 2019 and 2018:
2019 2018
(Dollars in thousands)
Deferred tax assets:
Tax loss and credit carryforwards $ 174,997    $ 234,940   
Lease assets 28,577    —   
Pension 14,971    19,972   
Reserves and accruals 60,799    68,767   
Other 3,207    3,267   
Less: valuation allowances (119,233)   (143,971)  
Total deferred tax assets 163,318    182,975   
Deferred tax liabilities:
Property, plant and equipment 23,053    24,315   
Intangibles — stock acquisitions 441,079    541,445   
Unremitted non-U.S. earnings 81,967    218,769   
Lease liabilities 28,577    —   
Other 22,628    4,221   
Total deferred tax liabilities 597,304    788,750   
Net deferred tax liability $ (433,986)   $ (605,775)  
As a result of enactment of the TCJA, we reassessed and revalued our deferred tax positions, resulting in a $46.1 million decrease in the net deferred tax liability at December 31, 2017. Subsequently, in accordance with SAB 118, adjustments were made to the provisional amounts for the revaluation of deferred tax assets and liabilities due to additional analysis. During 2018, we recognized a net $2.1 million tax benefit as a result of changes in its revaluation of deferred tax assets and liabilities related to the TCJA. The accounting for these changes was completed in the fourth quarter of 2018. We made no further adjustments to the provisional amounts in 2019.
Under the tax laws of various jurisdictions in which we operate, deductions or credits that cannot be fully utilized for tax purposes during the current year may be carried forward, subject to statutory limitations, to reduce taxable income or taxes payable in a future tax year. At December 31, 2019, the tax effect of such carryforwards approximated $175.0 million. Of this amount, $10.9 million has no expiration date, $4.8 million expires after 2019 but before the end of 2024 and $159.3 million expires after 2024. A portion of these carryforwards consists of tax losses and credits obtained by us as a result of acquisitions; the utilization of these carryforwards are subject to an annual limitation imposed by Section 382 of the Internal Revenue Code, which limits a company’s ability to deduct prior net operating losses following a more than 50 percent change in ownership. It is not expected that the Section 382 limitation will prevent us ultimately from utilizing the applicable loss carryforwards. The determination of state net operating loss carryforwards is dependent upon the U.S. subsidiaries’ taxable income or loss, the state’s proportion of each subsidiary's taxable net income and the application of state laws, which can change from year to year and impact the amount of such carryforward.
The valuation allowance for deferred tax assets of $119.2 million and $144.0 million at December 31, 2019 and 2018, respectively, relates principally to the uncertainty of our ability to utilize certain deferred tax assets, primarily tax loss and credit carryforwards in various jurisdictions. The valuation allowance was calculated in accordance with applicable accounting standards, which require that a valuation allowance be established and maintained when it is “more likely than not” that all or a portion of deferred tax assets will not be realized.
F-34
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Uncertain Tax Positions: The following table is a reconciliation of the beginning and ending balances for liabilities associated with unrecognized tax benefits for the years ended December 31, 2019, 2018 and 2017:
 
2019 2018 2017
(Dollars in thousands)
Balance at January 1
$ 8,106    $ 9,336    $ 15,054   
Increase in unrecognized tax benefits related to prior years
351    —    —   
Decrease in unrecognized tax benefits related to prior years
(201)   —    —   
Unrecognized tax benefits related to the current year
1,237    899    895   
Reductions in unrecognized tax benefits due to settlements
—    —    —   
Reductions in unrecognized tax benefits due to lapse of applicable statute of limitations
(1,881)   (1,955)   (6,813)  
Increase (decrease) in unrecognized tax benefits due to foreign currency translation
(51)   (174)   200   
Balance at December 31
$ 7,561    $ 8,106    $ 9,336   
The total liabilities associated with the unrecognized tax benefits that, if recognized, would impact the effective tax rate for continuing operations, were $4.4 million at December 31, 2019.
We accrue interest and penalties associated with unrecognized tax benefits in income tax expense in the consolidated statements of income, and the corresponding liability is included in the consolidated balance sheets. The net interest expense (benefit) and penalties reflected in income from continuing operations for the year ended December 31, 2019 was $0.2 million and $(0.1) million, respectively; for the year ended December 31, 2018 was $0.2 million and $(0.3) million, respectively; and for the year ended December 31, 2017 was $0.2 million and $(0.2) million, respectively. The liabilities in the consolidated balance sheets for interest and penalties at December 31, 2019 were $0.6 million and $2.2 million, respectively, and at December 31, 2018 were $0.6 million and $2.2 million, respectively.
The taxable years for which the applicable statute of limitations remains open by major tax jurisdictions are as follows:
  Beginning Ending
U.S. 2016 2019
Canada 2015 2019
China 2014 2019
Czech Republic 2016 2019
France 2017 2019
Germany 2011 2019
India 2002 2019
Ireland 2015 2019
Italy 2015 2019
Malaysia 2015 2019
Singapore 2015 2019
We are routinely subject to income tax examinations by various taxing authorities. As of December 31, 2019, the most significant tax examination in process was in Germany. The date at which this examination may be concluded and the ultimate outcome of the examination are uncertain. As a result of the uncertain outcome of this ongoing examination, future examinations or the expiration of statutes of limitation, it is reasonably possible that the related unrecognized tax benefits for tax positions taken could materially change from those recorded as liabilities at December 31, 2019. Due to the potential for resolution of certain examinations, and the expiration of various statutes of limitation, it is reasonably possible that our unrecognized tax benefits may change within the next year by a range of zero to $1.5 million.



F-35
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Supplemental cash flow information
Year Ended December 31,
2019 2018 2017
(Dollars in thousands)
Income taxes paid, net of refunds $ 73,632    $ 65,605    $ 49,144   

Note 16 — Pension and other postretirement benefits
We have 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. Our funding policy for U.S. plans is to contribute annually, at a minimum, amounts required by applicable laws and regulations. Obligations under non-U.S. plans are systematically provided for by depositing funds with trustees or by book reserves.  As of December 31, 2019, no further benefits are being accrued under the U.S. defined benefit pension plans and the other postretirement benefit plans, other than certain postretirement benefit plans covering employees subject to a collective bargaining agreement.
Teleflex and certain of our subsidiaries provide medical, dental and life insurance benefits to pensioners or their survivors. The associated plans are unfunded and approved claims are paid from our funds.
The following table provides information regarding the components of the net benefit expense (income) of the pension and postretirement benefit plans for the years ended December 31, 2019, 2018 and 2017:
Pension Other Benefits
2019 2018 2017 2019 2018 2017
(Dollars in thousands)
Service cost $ 2,768    $ 1,500    $ 2,887    $ 9    $ 50    $ 279   
Interest cost 16,000    14,816    15,137    1,391    1,389    1,577   
Expected return on plan assets (27,426)   (29,666)   (26,809)   —    —    —   
Net amortization and deferral 7,013    6,777    6,734    (1)   136    275   
Curtailments —    —    —    —    677    —   
Settlements —    486    —    —    —    —   
Net benefit expense (income) $ (1,645)   $ (6,087)   $ (2,051)   $ 1,399    $ 2,252    $ 2,131   
Net benefit expense (income) is primarily included in selling, general and administrative expenses within the consolidated statements of income.
The following table provides the weighted average assumptions for U.S. and foreign plans used in determining net benefit cost:
Pension Other Benefits
2019 2018 2017 2019 2018 2017
Discount rate 4.3  % 3.6  % 4.2  % 4.2  % 3.6  % 4.1  %
Rate of return 7.7  % 7.8  % 8.1  %
Initial healthcare trend rate 7.4  % 7.8  % 7.9  %
Ultimate healthcare trend rate 5.0  % 5.0  % 5.0  %
F-36
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table provides summarized information with respect to the pension and postretirement benefit plans, measured as of December 31, 2019 and 2018:
Pension Other Benefits
2019 2018 2019 2018
Under Funded Under Funded
(Dollars in thousands)
Benefit obligation, beginning of year $ 416,470    $ 462,158    $ 42,115    $ 48,903   
Service cost 2,768    1,500    9    50   
Interest cost 16,000    14,816    1,391    1,389   
Actuarial (gain) loss 57,525    (38,446)   1,551    (6,058)  
Currency translation 229    (1,780)   —    —   
Benefits paid (20,350)   (19,314)   (5,090)   (2,790)  
Medicare Part D reimbursement —    —    66    101   
Plan amendments —    157    —    —   
Curtailments —    (162)   —    520   
Settlements —    (1,420)   —    —   
Administrative costs (2,406)   (1,039)   —    —   
Projected benefit obligation, end of year 470,236    416,470    40,042    42,115   
Fair value of plan assets, beginning of year 362,807    386,307   
Actual return on plan assets 69,918    (13,275)  
Contributions 12,695    12,687   
Benefits paid (20,350)   (19,314)  
Settlements —    (1,420)  
Administrative costs (2,406)   (1,039)  
Currency translation 636    (1,139)  
Fair value of plan assets, end of year 423,300    362,807   
Funded status, end of year $ (46,936)   $ (53,663)   $ (40,042)   $ (42,115)  
The following table sets forth the amounts recognized in the consolidated balance sheet with respect to the pension and postretirement plans:
Pension Other Benefits
2019 2018 2019 2018
(Dollars in thousands)
Other assets $ 2,449    $ 2,837    $ —    $ —   
Payroll and benefit-related liabilities (1,617)   (1,729)   (5,091)   (3,972)  
Pension and postretirement benefit liabilities (47,768)   (54,771)   (34,951)   (38,143)  
Accumulated other comprehensive loss 213,989    205,910    1,916    364   
$ 167,053    $ 152,247    $ (38,126)   $ (41,751)  
F-37
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following tables set forth the amounts recognized in accumulated other comprehensive loss with respect to the plans:
Pension
Prior Service
Cost
Net (Gain)
or Loss
Deferred
Taxes
Accumulated Other Comprehensive
Loss, Net of Tax
(Dollars in thousands)
Balance at December 31, 2017 $ 51    $ 209,314    $ (75,277)   $ 134,088   
Reclassification adjustments related to components of Net Periodic Benefit Cost recognized during the period:
Net amortization and deferral (17)   (6,760)   1,579    (5,198)  
Settlements —    (486)   83    (403)  
Amounts arising during the period:
Actuarial changes in benefit obligation —    4,495    (1,012)   3,483   
Curtailments —    (162)   42    (120)  
Plan amendments 157    —    (27)   130   
Impact of currency translation —    (682)   183    (499)  
Balance at December 31, 2018 191    205,719    (74,429)   131,481   
Reclassification adjustments related to components of Net Periodic Benefit Cost recognized during the period:
Net amortization and deferral (18)   (6,995)   1,631    (5,382)  
         Settlements —    —    —    —   
Amounts arising during the period:
Actuarial changes in benefit obligation —    15,033    (3,457)   11,576   
Curtailments —    —    —    —   
Plan amendments —    —    —    —   
Settlements —    —    —    —   
Impact of currency translation —    59    (15)   44   
Balance at December 31, 2019 $ 173    $ 213,816    $ (76,270)   $ 137,719   
 
Other Benefits
Prior Service
Cost
Net (Gain) or
Loss
Deferred
Taxes
Accumulated Other Comprehensive
Loss, Net of Tax
(Dollars in thousands)
Balance at December 31, 2017 $ 305    $ 6,410    $ (1,995)   $ 4,720   
Reclassification adjustments related to components of Net Periodic Benefit Cost recognized during the period:
Net amortization and deferral (77)   (59)   32    (104)  
Curtailments (157)   —    39    (118)  
Amounts arising during the period:
Actuarial changes in benefit obligation —    (6,058)   1,459    (4,599)  
Plan amendments —    —    —    —   
Balance at December 31, 2018 71    293    (465)   (101)  
Reclassification adjustments related to components of Net Periodic Benefit Cost recognized during the period:
Net amortization and deferral (64)   65    —    1   
Amounts arising during the period:
Actuarial changes in benefit obligation —    1,551    (360)   1,191   
Balance at December 31, 2019 $ 7    $ 1,909    $ (825)   $ 1,091   
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table provides the weighted average assumptions for U.S. and foreign plans used in determining benefit obligations:
Pension Other Benefits
2019 2018 2019 2018
Discount rate 3.2  % 4.3  % 3.1  % 4.2  %
Rate of compensation increase 2.8  % 2.6  %
Initial healthcare trend rate 6.6  % 7.4  %
Ultimate healthcare trend rate 5.0  % 5.0  %
The discount rate represents the interest rate used to determine the present value of future cash flows currently expected to be required to settle the pension and other benefit obligations. The weighted average discount rates for U.S. pension plans and other benefit plans of 3.31% and 3.05%, respectively, were established by comparing the projection of expected benefit payments to the AA Above Median yield curve as of December 31, 2019. The expected benefit payments are discounted by each corresponding discount rate on the yield curve. For payments beyond 30 years, we extend the curve assuming that the discount rate derived in year 30 is extended to the end of the plan’s payment expectations. Once the present value of the string of benefit payments is established, we determine the single rate on the yield curve that, when applied to all obligations of the plan, will exactly match the previously determined present value.
As part of the evaluation of pension and other postretirement assumptions, we applied assumptions for mortality and healthcare cost trends that incorporate generational white and blue collar mortality trends. In determining its benefit obligations, we used generational tables that take into consideration increases in plan participant longevity.
Our assumption for the expected return on plan assets is primarily based on the determination of an expected return for its current portfolio. This determination is made using assumptions for return and volatility of the portfolio. Asset class assumptions are set using a combination of empirical and forward-looking analysis. To the extent historical results have been affected by unsustainable trends or events, the effects of those trends are quantified and removed. We apply a variety of models for filtering historical data and isolating the fundamental characteristics of asset classes. These models provide empirical return estimates for each asset class, which are then reviewed and combined with a qualitative assessment of long term relationships between asset classes before a return estimate is finalized. The qualitative analysis is intended to provide an additional means for addressing the effect of unrealistic or unsustainable short-term valuations or trends, resulting in return levels and behavior we believe are more likely to prevail over long periods. Effective in 2020, we changed the expected return on plan assets of the U.S. pension plans from 8.0% to 7.75% due to modifications to the investment strategy in order to gradually reduce portfolio risk. The change had no impact on the results for the year ended December 31, 2019.
An increase in the assumed healthcare trend rate of 1% would increase the benefit obligation at December 31, 2019 by $1.9 million and would increase the 2019 benefit expense by $0.1 million. Decreasing this assumed rate by 1% would decrease the benefit obligation at December 31, 2019 by $1.7 million and would decrease the 2019 benefit expense by $0.1 million.
The accumulated benefit obligation for all U.S. and foreign defined benefit pension plans was $469.6 million and $415.9 million for 2019 and 2018, respectively. All of the pension plans had accumulated benefit obligations in excess of their respective plan assets as of December 31, 2019 and 2018, with the exception of one foreign plan that had plan assets of $2.4 million and $2.8 million in excess of the accumulated benefit obligation as of December 31, 2019 and 2018, respectively.
Our investment objective is to achieve an enhanced long-term rate of return on plan assets, subject to a prudent level of portfolio risk, for the purpose of enhancing the availability of benefits for participants. These investments are primarily comprised of equity and fixed income mutual funds. Our other investments are largely comprised of a hedge fund of funds and a structured credit fund. The equity funds are diversified in terms of domestic and international equity securities, as well as small, middle and large capitalization stocks. Our target allocation percentage is as follows: equity securities (40%); fixed-income securities (50%) and other securities (10%). Equity funds are held for their expected return over inflation. Fixed-income funds are held for diversification relative to equities and as a partial hedge of interest rate risk with respect to plan liabilities. The other investments are held to further diversify assets within the plans and are designed to provide a mix of equity and bond like return with a bond like risk profile. The plans may also hold cash to meet liquidity requirements. Actual performance may not be consistent with the respective investment strategies. Investment risks and returns are measured and
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

monitored on an ongoing basis through annual liability measurements and investment portfolio reviews to determine whether the asset allocation targets continue to represent an appropriate balance of expected risk and reward.
The following table provides the fair values of the pension plan assets at December 31, 2019 by asset category:
Fair Value Measurements
Asset Category (a) Total
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
Significant
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
(Dollars in thousands)
Cash $ 650    $ 650    —    —   
Money market funds 5    5    —    —   
Equity securities:
Managed volatility (b) 72,334    72,334    —    —   
U.S. small/mid-cap equity (c) 10,014    10,014    —    —   
World equity (excluding U.S.) (d) 48,285    48,285    —    —   
Common equity securities – Teleflex Incorporated 38,359    38,359    —    —   
Fixed income securities:
Intermediate duration fund (e) 38,500    38,500    —    —   
Long duration bond fund (f) 107,143    107,143    —    —   
Corporate bond fund (g) 13,107    13,107    —    —   
Global credit fund (h) 929    929    —    —   
Emerging markets debt fund (i) 9,974    9,974    —    —   
Corporate, government and foreign bonds 29,714    29,714    —    —   
Asset backed – home loans 316    —    $ 316    —   
Other types of investments:
Multi asset funds  (j) 8,246    4,759    3,487    —   
Contract with insurance company (k) 9,849    —    —    $ 9,849   
Other 5    —    —    5   
Total investments at fair value $ 387,430    $ 373,773    $ 3,803    $ 9,854   
Investments measured at net asset value (l) 35,870   
Total $ 423,300   






















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TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table provides the fair values of the pension plan assets at December 31, 2018 by asset category:
  Fair Value Measurements
Asset Category (a) Total
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
Significant
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
  (Dollars in thousands)
Cash $ 627    $ 627    —    —   
Money market funds 7    7    —    —   
Equity securities:
Managed volatility (b) 71,306    71,306    —    —   
U.S. small/mid-cap equity (c) 15,379    15,379    —    —   
World equity (excluding U.S.) (d) 24,589    24,589    —    —   
Common equity securities – Teleflex Incorporated 30,216    30,216    —    —   
Fixed income securities:
Intermediate duration fund (e) 26,958    26,958    —    —   
Long duration bond fund (f) 90,661    90,661    —    —   
Corporate bond fund (g) 12,162    12,162    —    —   
Global credit fund (h) 647    647    —    —   
Emerging markets debt fund (i) 7,923    7,923    —    —   
Corporate, government and foreign bonds 30,418    30,418    —    —   
Asset backed – home loans 367    —    $ 367    —   
Other types of investments:
Multi asset funds  (j) 6,905    3,676    3,229   
Contract with insurance company (k) 10,092    —    —    $ 10,092   
Other 5    —    —    5   
Total investments at fair value $ 328,262    $ 314,569    $ 3,596    $ 10,097   
Investments measured at Net asset value (l) 34,545   
Total $ 362,807   
a.Information on asset categories described in notes (b)-(k) is derived from prospectuses and other material provided by the respective funds comprising the respective asset categories.
b.This category comprises mutual funds that invest in securities of U.S. and non-U.S. companies of all capitalization ranges that exhibit relatively low volatility.
c.This category comprises a mutual fund that invests at least 80% of its net assets in equity securities of small and mid-sized companies. The fund invests in common stocks or exchange traded funds holding common stock of U.S. companies with market capitalizations in the range of companies in the Russell 2500 Index.
d.This category comprises a mutual fund that invests at least 80% of its net assets in equity securities of foreign companies. These securities may include common stocks, preferred stocks, warrants, exchange traded funds based on an international equity index, derivative instruments whose value is based on an international equity index and derivative instruments whose value is based on an underlying equity security or a basket of equity securities. The fund invests in securities of foreign issuers located in developed and emerging market countries. However, the fund will not invest more than 35% of its assets in the common stocks or other equity securities of issuers located in emerging market countries.
e.This category comprises a mutual fund that invests in instruments or derivatives having economic characteristics similar to fixed income securities. The fund invests in investment grade fixed income instruments, including U.S. and foreign corporate obligations, fixed income securities issued by sovereigns or agencies in both developed and emerging foreign markets, debt obligations issued by governments or other municipalities, and securities issued or guaranteed by the U.S. Government and its agencies. The fund will seek to maintain an effective average duration between three and ten years, and uses derivative instruments, including interest rate swap agreements and credit default swaps, for the purpose of managing the overall duration and yield curve exposure of the Fund’s portfolio of fixed income securities.
f.This category comprises a mutual fund that invests in instruments or derivatives having economic characteristics similar to fixed income securities. The fund invests in investment grade fixed income instruments, including securities issued or guaranteed by the U.S. Government and its agencies and instrumentalities, corporate bonds, asset-backed securities, exchange traded funds, mortgage-backed securities and collateralized mortgage-backed securities. The fund invests primarily in long duration government and corporate fixed income securities, and uses derivative instruments, including
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TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

interest rate swap agreements and Treasury futures contracts, for the purpose of managing the overall duration and yield curve exposure of the Fund’s portfolio of fixed income securities.
g.This category comprises funds that invest primarily in higher-yielding fixed income securities, including corporate bonds and debentures, convertible and preferred securities and zero coupon obligations.
h.This category comprises a fund that invests primarily in a range of debt securities, including those issued by governments, institutions, or companies from a number of countries.
i.This category comprises a mutual fund that invests at least 80% of its net assets in fixed income securities of emerging market issuers, primarily in U.S. dollar-denominated debt of foreign governments, government-related and corporate issuers in emerging market countries and entities organized to restructure the debt of those issuers.
j.This category comprises funds that may invest in equities, bonds, or derivatives.
k.This category comprises the asset established out of an agreement to purchase a bulk-annuity policy from an insurer to fully cover the liabilities for members of the pension plan. The asset value is based on the fair value of the contract as determined by the insurance company using inputs that are not observable.
l.This category comprises pooled institutional investments, primarily collective investment trusts. These funds are not listed on an exchange or traded in an active market and these investments are valued using their net asset value, which is generally based on the underlying asset values of the pooled investments held in the trusts. This category comprises the following funds:
•a fund that invests primarily in collateralized debt obligations and other structured credit vehicles and may include fixed income securities, loan participations, credit-linked notes, medium-term notes, pooled investment vehicles and derivative instruments.
•a hedge fund that invests in various other hedge funds.
•funds that invest in underlying funds that acquire, manage, and dispose of real estate properties, with a focus on properties in the U.S. and the UK markets.
Our contributions to U.S. and foreign pension plans during 2020 are expected to be approximately $12.6 million. Contributions to postretirement healthcare plans during 2020 are expected to be approximately $5.1 million.
The following table provides information about the expected benefit payments under its U.S. and foreign plans for each of the five succeeding years and the aggregate of the five years thereafter, net of the annual average Medicare Part D subsidy of approximately $0.1 million:
Pension Other Benefits
(Dollars in thousands)
2020 $ 21,226    $ 5,084   
2021 21,820    4,555   
2022 22,653    4,013   
2023 23,187    3,344   
2024 23,875    3,139   
Years 2025 — 2029 127,256    11,623   
The amounts in AOCI expected to be recognized into net periodic benefit cost over the next fiscal year for the pension benefit plan is $7.3 million. We do not expect any amounts in AOCI to be recognized into net periodic benefit cost over the next fiscal year for the postretirement benefit plan.
We maintain a number of defined contribution savings plans covering eligible U.S. and non-U.S. employees. We partially match employee contributions. Costs related to these plans were $17.5 million, $15.6 million and $12.5 million for 2019, 2018 and 2017, respectively.
 
Note 17 — Commitments and contingent liabilities
Environmental:  We are subject to contingencies as a result of environmental laws and regulations that in the future may require us to take further action to correct the effects on the environment of prior disposal practices or releases of chemical or petroleum substances by us 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 us to undertake certain investigative and remedial activities at sites where we conduct or once conducted operations or at sites where Company-generated waste was disposed.
Remediation activities vary substantially in duration and cost from site to site. The nature of these activities, and their associated costs, depend on the mix of unique site characteristics, evolving remediation technologies, the regulatory agencies involved and their enforcement policies, as well as the presence or absence of other potentially responsible parties. At December 31, 2019 and 2018, we have recorded $0.7 million and $0.8 million, respectively,
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TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

in accrued liabilities and $6.2 million and $5.6 million, respectively in other liabilities relating to these matters. Considerable uncertainty exists with respect to these liabilities, and if adverse changes in circumstances occur, potential liability may exceed the amount accrued as of December 31, 2019. The time frame over which the accrued amounts may be paid out, based on past history, is estimated to be 10-15 years.
Litigation:  We are a party to various lawsuits and claims arising in the normal course of business. These lawsuits and claims include actions involving product liability, intellectual property, employment, environmental and other matters. As of December 31, 2019 and 2018, we have recorded accrued liabilities of $0.4 million and $0.6 million, respectively, in connection with such contingencies, representing its best estimate of the cost within the range of estimated possible losses that will be incurred to resolve these matters.
Based on information currently available, advice of counsel, established reserves and other resources, we do not believe that the outcome of any outstanding litigation and claims is 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. Legal costs such as outside counsel fees and expenses are charged to selling, general and administrative expenses in the period incurred.

Note 18 — Business segments and other information
An operating segment is a component (a) that engages in business activities from which it may earn revenues and incur expenses, (b) whose operating results are regularly reviewed by the 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. We do not evaluate our operating segments using discrete asset information.
During 2019, our chief operating decision maker (our Chief Executive Officer) changed the manner in which he reviews financial information for purposes of assessing business performance and allocating resources by focusing on the geographic location of all non-OEM operations. As a result, we changed our segment presentation. Specifically, the Vascular North America, Interventional North America, Anesthesia North America, Surgical North America, Interventional Urology North America, Respiratory North America and Latin America operating segments were combined into a new Americas segment. We now have four reportable segments: Americas, EMEA (Europe, the Middle East and Africa), Asia (Asia Pacific) and OEM (Original Equipment Manufacturer and Development Services).
Our reportable segments, other than the OEM segment, design, manufacture and distribute medical devices primarily used in critical care and surgical applications and generally serve two end-markets: hospitals and healthcare providers, and home health. The products of these segments are most widely used in the acute care setting for a range of diagnostic and therapeutic procedures and in general and specialty surgical applications. The OEM segment designs, manufactures and supplies devices and instruments for other medical device manufacturers.
The following tables present our segment results for the years ended December 31, 2019, 2018 and 2017:
  Year Ended December 31,
  2019 2018 2017
  (Dollars in thousands)
Americas $ 1,492,274    $ 1,351,699    $ 1,141,406   
EMEA 588,043    603,813    552,722   
Asia 294,328    286,895    269,208   
OEM 220,717    205,976    182,967   
Net revenues $ 2,595,362    $ 2,448,383    $ 2,146,303   

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TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Year Ended December 31,
2019 2018 2017
(Dollars in thousands)
Americas $ 319,933    $ 255,798    $ 240,982   
EMEA 94,424    106,090    92,430   
Asia 73,090    78,135    75,637   
OEM 57,994    50,294    41,578   
Total segment operating profit (1)
545,441    490,317    450,627   
Unallocated expenses (2)
(118,187)   (168,613)   (78,348)  
Income from continuing operations before interest, loss on extinguishment of debt and taxes
$ 427,254    $ 321,704    $ 372,279   
(1) Segment operating profit includes segment net revenues from external customers reduced by its standard cost of goods sold, adjusted for fixed manufacturing cost absorption variances, selling, general and administrative expenses, research and development expenses and an allocation of corporate expenses. Corporate expenses are allocated among the segments in proportion to the respective amounts of one of several items (such as sales, numbers of employees, and amount of time spent), depending on the category of expense involved.
(2) Unallocated expenses primarily include manufacturing variances, with the exception of fixed manufacturing cost absorption variances, restructuring and impairment charges and gain on sale of assets.
  Year Ended December 31,
  2019 2018 2017
  (Dollars in thousands)
Americas $ 153,419    $ 146,016    $ 105,811   
EMEA 44,328    47,171    34,322   
Asia 14,072    12,917    11,868   
OEM 6,550    8,610    8,337   
Consolidated depreciation and amortization $ 218,369    $ 214,714    $ 160,338   

Geographic data
The following tables provide total net revenues and total net property, plant and equipment by geographic region for the years ended December 31, 2019, 2018 and 2017:
Year Ended December 31,
2019 2018 2017
(Dollars in thousands)
Net revenues (based on selling location):
U.S. $ 1,606,248    $ 1,449,426    $ 1,254,825   
Europe 652,069    671,264    591,370   
Asia Pacific 241,278    234,090    220,110   
All other 95,767    93,603    79,998   
$ 2,595,362    $ 2,448,383    $ 2,146,303   
Net property, plant and equipment:
U.S. $ 228,173    $ 258,415    $ 216,568   
Malaysia 53,406    51,952    43,730   
Ireland 40,151    41,223    43,867   
All other 108,989    81,176    78,834   
$ 430,719    $ 432,766    $ 382,999   
 
F-44
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 19 — Condensed consolidating guarantor financial information
Our $400 million principal amount of 4.875% Senior Notes due 2026 (the “2026 Notes”) and $500 million principal amount of 4.625% Senior Notes due 2027 (the “2027 Notes," and together with the 2026 Notes, the "Senior Notes") are issued by Teleflex Incorporated (the “Parent Company”), and payment of the Parent Company's obligations under the Senior Notes is guaranteed, jointly and severally, by certain of the Parent Company’s subsidiaries (each, a “Guarantor Subsidiary” and collectively, the “Guarantor Subsidiaries”). The 2026 Notes and 2027 Notes are guaranteed by the same Guarantor Subsidiaries. The guarantees are full and unconditional, subject to certain customary release provisions. Each Guarantor Subsidiary is directly or indirectly 100% owned by the Parent Company. Our condensed consolidating statements of income and comprehensive income and condensed consolidating statements of cash flows for the years ended December 31, 2019, 2018 and 2017 and condensed consolidating balance sheets as of December 31, 2019, and 2018 provide consolidated information for:
a. Parent Company, the issuer of the guaranteed obligations;

b. Guarantor Subsidiaries, on a combined basis;

c. Non-Guarantor Subsidiaries (i.e., those subsidiaries of the Parent Company that have not guaranteed
payment of the Senior Notes), on a combined basis; and

d. Parent Company and its subsidiaries on a consolidated basis.
In connection with our entry into the Credit Agreement on April 5, 2019 (as described in Note 10), a subsidiary of Teleflex (the "Released Subsidiary") that was a guarantor of Parent Company’s obligations under the previously outstanding credit agreement and under the Senior Notes was removed as a guarantor of Parent Company’s obligations under the Credit Agreement.  Under the indentures governing the Senior Notes, the removal of the Released Subsidiary as a guarantor under the Credit Agreement automatically resulted in the release of the Released Subsidiary from its guarantees of the Senior Notes. Therefore, as of the date of the Credit Agreement, the Released Subsidiary is no longer a Guarantor Subsidiary. The Released Subsidiary has been excluded from the information relating to the Guarantor Subsidiaries and has been included in the information relating to the Non-Guarantor Subsidiaries as of the beginning of the earliest period presented. Additionally, in 2019, we undertook certain steps to reorganize ownership of various subsidiaries. The transactions were entirely among subsidiaries under the common control of Teleflex. The reorganization that constituted a business combination has been reflected as of the beginning of the earliest period presented.
The same accounting policies as described in Note 1 to the consolidated financial statements 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.

F-45
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

TELEFLEX INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
  Year Ended December 31, 2019
Parent
Company
Guarantor
Subsidiaries
Non-Guarantor
Subsidiaries
Eliminations
Condensed
Consolidated
  (Dollars in thousands)
Net revenues
$ —    $ 1,764,446    $ 1,291,637    $ (460,721)   $ 2,595,362   
Cost of goods sold, excluding intangible asset amortization
—    977,840    559,746    (433,836)   1,103,750   
Gross profit
—    786,606    731,891    (26,885)   1,491,612   
Selling, general and administrative expenses
47,215    577,287    310,194    (323)   934,373   
Research and development expenses
1,730    78,432    33,695    —    113,857   
Restructuring and impairment charges
525    7,896    13,784    —    22,205   
Gain on sale of assets
—    (2,289)   (3,788)   —    (6,077)  
(Loss) income from continuing operations before interest, loss on extinguishment of debt and taxes (49,470)   125,280    378,006    (26,562)   427,254   
Interest, net
83,998    (66,834)   61,365    —    78,529   
Loss on extinguishment of debt
8,822    —    —    —    8,822   
(Loss) income from continuing operations before taxes
(142,290)   192,114    316,641    (26,562)   339,903   
(Benefit) taxes on (loss) income from continuing operations
(57,469)   61,074    (121,558)   (4,125)   (122,078)  
Equity in net income of consolidated subsidiaries
546,802    384,609    —    (931,411)   —   
Income from continuing operations
461,981    515,649    438,199    (953,848)   461,981   
Loss from discontinued operations
(828)   —    —    —    (828)  
Tax benefit on loss from discontinued operations (313)   —    —    —    (313)  
Loss from discontinued operations
(515)   —    —    —    (515)  
Net income
461,466    515,649    438,199    (953,848)   461,466   
Other comprehensive (loss) income
(3,307)   19,231    11,160    (30,391)   (3,307)  
Comprehensive income
$ 458,159    $ 534,880    $ 449,359    $ (984,239)   $ 458,159   
 

F-46
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Year Ended December 31, 2018
Parent
Company
Guarantor
Subsidiaries
Non-Guarantor
Subsidiaries
Eliminations
Condensed
Consolidated
(Dollars in thousands)
Net revenues
$ —    $ 1,585,486    $ 1,286,967    $ (424,070)   $ 2,448,383   
Cost of goods sold, excluding intangible asset amortization
—    886,724    596,281    (419,064)   1,063,941   
Gross profit —    698,762    690,686    (5,006)   1,384,442   
Selling, general and administrative expenses
50,866    516,695    311,798    (671)   878,688   
Research and development expenses
1,482    73,773    30,953    —    106,208   
Restructuring and impairment charges
—    20,639    58,591    —    79,230   
Gain on sale of assets
—    (1,388)   —    —    (1,388)  
(Loss) income from continuing operations before interest and taxes (52,348)   89,043    289,344    (4,335)   321,704   
Interest, net
95,173    (58,306)   65,209    —    102,076   
  (Loss) income from continuing operations before taxes
(147,521)   147,349    224,135    (4,335)   219,628   
(Benefit) taxes on (loss) income from continuing operations
(53,401)   49,606    27,226    (235)   23,196   
Equity in net income of consolidated subsidiaries
291,572    175,161    637    (467,370)   —   
Income from continuing operations
197,452    272,904    197,546    (471,470)   196,432   
Income from discontinued operations
4,363    —    1,280    —    5,643   
Tax on income from discontinued operations
1,013    —    260    —    1,273   
   Income from discontinued operations
3,350    —    1,020    —    4,370   
   Net income
200,802    272,904    198,566    (471,470)   200,802   
Other comprehensive loss
(75,994)   (80,030)   (80,512)   160,542    (75,994)  
   Comprehensive income
$ 124,808    $ 192,874    $ 118,054    $ (310,928)   $ 124,808   
 

F-47
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

  Year Ended December 31, 2017
Parent
Company
Guarantor
Subsidiaries
Non-Guarantor
Subsidiaries
Eliminations
Condensed
Consolidated
  (Dollars in thousands)
Net revenues
$ —    $ 1,368,149    $ 1,177,247    $ (399,093)   $ 2,146,303   
Cost of goods sold, excluding intangible asset amortization
—    778,153    594,527    (398,179)   974,501   
Gross profit —    589,996    582,720    (914)   1,171,802   
Selling, general and administrative expenses
47,412    399,563    252,792    196    699,963   
Research and development expenses
1,009    57,614    26,147    —    84,770   
Restructuring charges
—    8,971    5,819    —    14,790   
(Loss) income from continuing operations before interest, loss on extinguishment of debt and taxes (48,421)   123,848    297,962    (1,110)   372,279   
Interest, net
99,371    (36,586)   18,990    —    81,775   
Loss on extinguishment of debt
5,593    —    —    —    5,593   
(Loss) income from continuing operations before taxes
(153,385)   160,434    278,972    (1,110)   284,911   
(Benefit) taxes on (loss) income from continuing operations
(110,921)   (12,730)   253,783    (484)   129,648   
Equity in net income of consolidated subsidiaries
197,727    8,422    (3,135)   (203,014)   —   
Income from continuing operations
155,263    181,586    22,054    (203,640)   155,263   
Loss from discontinued operations
(4,534)   —    —    (4,534)  
Tax benefit on loss from discontinued operations
(1,801)   —    —    —    (1,801)  
Loss from discontinued operations
(2,733)   —    —    —    (2,733)  
Net income
152,530    181,586    22,054    (203,640)   152,530   
Other comprehensive income
173,626    158,490    198,453    (356,943)   173,626   
Comprehensive income
$ 326,156    $ 340,076    $ 220,507    $ (560,583)   $ 326,156   
 
F-48
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

TELEFLEX INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEETS
December 31, 2019
Parent
Company
Guarantor
Subsidiaries
Non-Guarantor
Subsidiaries
Eliminations
Condensed
Consolidated
(Dollars in thousands)
ASSETS
Current assets
Cash and cash equivalents $ 68,928    $ 488    $ 231,667    $ —    $ 301,083   
Accounts receivable, net 3,243    80,528    329,245    5,657    418,673   
Accounts receivable from consolidated subsidiaries
35,629    492,655    500,811    (1,029,095)   —   
Inventories —    306,917    227,451    (57,811)   476,557   
Prepaid expenses and other current assets 40,171    21,896    27,658    8,218    97,943   
Prepaid taxes 6,371    —    5,705    —    12,076   
Total current assets 154,342    902,484    1,322,537    (1,073,031)   1,306,332   
Property, plant and equipment, net 2,936    224,176    203,607    —    430,719   
Operating lease assets 12,356    66,388    34,416    —    113,160   
Goodwill —    1,286,372    958,933    —    2,245,305   
Intangibles assets, net 70    1,291,810    864,405    —    2,156,285   
Investments in affiliates 5,987,577    2,072,038    924,448    (8,984,063)   —   
Deferred tax assets 16,345    —    6,879    (17,652)   5,572   
Notes receivable and other amounts due from consolidated subsidiaries
2,064,309    3,690,788    287,807    (6,042,904)   —   
Other assets 31,974    10,025    10,448    —    52,447   
Total assets $ 8,269,909    $ 9,544,081    $ 4,613,480    $ (16,117,650)   $ 6,309,820   
LIABILITIES AND EQUITY
Current liabilities
Current borrowings $ —    $ —    $ 50,000    $ —    $ 50,000   
Accounts payable 4,641    63,121    35,154    —    102,916   
Accounts payable to consolidated subsidiaries 403,486    418,321    207,288    (1,029,095)   —   
Accrued expenses 8,505    36,325    55,636    —    100,466   
Current portion of contingent consideration —    144,701    3,389    —    148,090   
Payroll and benefit-related liabilities 18,690    50,583    46,708    —    115,981   
Accrued interest 5,482    —    32    —    5,514   
Income taxes payable —    —    6,692    —    6,692   
Other current liabilities 4,224    15,458    13,714    —    33,396   
Total current liabilities 445,028    728,509    418,613    (1,029,095)   563,055   
Long-term borrowings 1,858,943    —    —    —    1,858,943   
Deferred tax liabilities —    357,923    99,287    (17,652)   439,558   
Pension and postretirement benefit liabilities 38,073    27,027    17,619    —    82,719   
Noncurrent liability for uncertain tax positions 625    6,949    2,720    —    10,294   
Notes payable and other amounts due to consolidated subsidiaries
2,804,568    1,978,067    1,260,269    (6,042,904)   —   
Noncurrent contingent consideration —    64,581    7,237    —    71,818   
Noncurrent operating lease liabilities 9,802    65,715    25,855    —    101,372   
Other liabilities 133,550    8,462    60,729    —    202,741   
Total liabilities 5,290,589    3,237,233    1,892,329    (7,089,651)   3,330,500   
Total shareholders' equity 2,979,320    6,306,848    2,721,151    (9,027,999)   2,979,320   
Total liabilities and shareholders' equity $ 8,269,909    $ 9,544,081    $ 4,613,480    $ (16,117,650)   $ 6,309,820   
 
F-49
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

December 31, 2018
Parent
Company
Guarantor
Subsidiaries
Non-Guarantor
Subsidiaries
Eliminations
Condensed
Consolidated
(Dollars in thousands)
ASSETS
Current assets
Cash and cash equivalents $ 49,523    $ 5,364    $ 302,274    $ —    $ 357,161   
Accounts receivable, net 5,885    54,378    300,689    5,334    366,286   
Accounts receivable from consolidated subsidiaries
32,036    1,122,107    365,892    (1,520,035)   —   
Inventories —    267,544    191,188    (30,954)   427,778   
Prepaid expenses and other current assets 30,458    9,740    28,170    4,113    72,481   
Prepaid taxes 7,029    —    5,434    —    12,463   
Total current assets 124,931    1,459,133    1,193,647    (1,541,542)   1,236,169   
Property, plant and equipment, net 3,385    253,913    175,468    —    432,766   
Goodwill —    1,284,900    961,679    —    2,246,579   
Intangibles assets, net 90    1,381,285    943,677    —    2,325,052   
Investments in affiliates 5,984,566    1,507,718    837,899    (8,330,183)   —   
Deferred tax assets —    —    4,822    (2,376)   2,446   
Notes receivable and other amounts due from consolidated subsidiaries
2,337,737    3,347,815    13,242    (5,698,794)   —   
Other assets 17,180    5,874    11,925    —    34,979   
Total assets $ 8,467,889    $ 9,240,638    $ 4,142,359    $ (15,572,895)   $ 6,277,991   
LIABILITIES AND EQUITY
Current liabilities
Current borrowings $ 36,625    $ —    $ 50,000    $ —    $ 86,625   
Accounts payable 3,448    63,497    39,764    —    106,709   
Accounts payable to consolidated subsidiaries 1,058,008    291,952    170,075    (1,520,035)   —   
Accrued expenses 5,659    41,901    49,991    —    97,551   
Current portion of contingent consideration —    106,514    30,363    —    136,877   
Payroll and benefit-related liabilities 17,156    45,136    42,378    —    104,670   
Accrued interest 5,995    —    36    —    6,031   
Income taxes payable —    —    5,943    —    5,943   
Other current liabilities 843    34,916    2,291    —    38,050   
Total current liabilities 1,127,734    583,916    390,841    (1,520,035)   582,456   
Long-term borrowings 2,072,200    —    —    —    2,072,200   
Deferred tax liabilities 87,671    279,417    243,509    (2,376)   608,221   
Pension and postretirement benefit liabilities 49,290    27,454    16,170    —    92,914   
Noncurrent liability for uncertain tax positions 801    7,212    2,705    —    10,718   
Notes payable and other amounts due to consolidated subsidiaries
2,451,784    2,222,580    1,024,430    (5,698,794)   —   
Noncurrent contingent consideration —    131,563    35,807    —    167,370   
Other liabilities 138,431    8,204    57,499    —    204,134   
Total liabilities 5,927,911    3,260,346    1,770,961    (7,221,205)   3,738,013   
Total shareholders' equity 2,539,978    5,980,292    2,371,398    (8,351,690)   2,539,978   
Total liabilities and shareholders' equity $ 8,467,889    $ 9,240,638    $ 4,142,359    $ (15,572,895)   $ 6,277,991   
 
F-50
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

TELEFLEX INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
Year Ended December 31, 2019
Parent
Company 		Guarantor
Subsidiaries 		Non-Guarantor
Subsidiaries 		Eliminations Condensed
Consolidated
(Dollars in thousands)
Net cash (used in) provided by operating activities from continuing operations $ (55,472)   $ 511,092    $ 340,175    $ (358,727)   $ 437,068   
Cash flows from investing activities of continuing operations:
Expenditures for property, plant and equipment (614)   (66,824)   (35,257)   —    (102,695)  
Payments for businesses and intangibles acquired, net of cash acquired —    (1,025)   (2,437)   —    (3,462)  
Proceeds from sale of assets 2,362    13,296    1,049    (2,362)   14,345   
Net interest proceeds on swaps designated as net investment hedges 18,331    —    —    —    18,331   
Investments in affiliates —    (5,946)   —    5,946    —   
Net cash provided by (used in) investing activities from continuing operations 20,079    (60,499)   (36,645)   3,584    (73,481)  
Cash flows from financing activities of continuing operations:
Proceeds from new borrowings 275,000    —    —    —    275,000   
Reduction in borrowings (528,500)   —    —    —    (528,500)  
Debt extinguishment, issuance and amendment fees (11,635)   —    —    —    (11,635)  
Proceeds from share based compensation plans and the related tax impacts 21,206    —    —    —    21,206   
Payments for contingent consideration —    (15,195)   (96,884)   —    (112,079)  
Proceeds from issuance of shares —    —    (5,654)   5,654    —   
Dividends (62,828)   —    —    —    (62,828)  
Intercompany transactions 358,467    (440,274)   79,445    2,362    —   
Intercompany dividends paid —    —    (347,127)   347,127    —   
Net cash provided by (used in) financing activities from continuing operations 51,710    (455,469)   (370,220)   355,143    (418,836)  
Cash flows from discontinued operations:
Net cash provided by (used in) operating activities 3,088    —    (631)   —    2,457   
Net cash provided by (used in) discontinued operations 3,088    —    (631)   —    2,457   
Effect of exchange rate changes on cash and cash equivalents —    —    (3,286)   —    (3,286)  
Net increase (decrease) in cash and cash equivalents 19,405    (4,876)   (70,607)   —    (56,078)  
Cash and cash equivalents at the beginning of the year 49,523    5,364    302,274    —    357,161   
Cash and cash equivalents at the end of the year $ 68,928    $ 488    $ 231,667    $ —    $ 301,083   
 

F-51
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Year Ended December 31, 2018
Parent
Company
Guarantor
Subsidiaries
Non-Guarantor
Subsidiaries
Eliminations
Condensed
Consolidated
(Dollars in thousands)
Net cash (used in) provided by operating activities from continuing operations $ (196,727)   $ 413,579    $ 377,086    $ (158,852)   $ 435,086   
Cash flows from investing activities of continuing operations:
Expenditures for property, plant and equipment (1,881)   (40,399)   (38,515)   —    (80,795)  
Payments for businesses and intangibles acquired, net of cash acquired (100)   (37,010)   (83,915)   —    (121,025)  
Proceeds from sale of assets 28,239    3,878    —    (28,239)   3,878   
Net interest proceeds on swaps designated as net investment hedges 1,548    —    —    —    1,548   
 Investments in affiliates —    (5,700)   —    5,700    —   
Net cash provided by (used in) investing activities from continuing operations 27,806    (79,231)   (122,430)   (22,539)   (196,394)  
Cash flows from financing activities of continuing operations:
Proceeds from new borrowings
35,000    —    —    —    35,000   
Reduction in borrowings
(128,500)   —    —    —    (128,500)  
Debt extinguishment, issuance and amendment fees
(188)   —    —    —    (188)  
Proceeds from share based compensation plans and related tax impacts 22,655    —    —    —    22,655   
Payments for contingent consideration
—    (10,831)   (62,404)   —    (73,235)  
Proceeds from issuance of shares
—    —    5,700    (5,700)   —   
Dividends
(62,165)   —    —    —    (62,165)  
Intercompany transactions
314,386    (322,363)   (20,262)   28,239    —   
Intercompany dividends paid
—    (4,723)   (154,129)   158,852    —   
Net cash provided by (used in) financing activities from continuing operations
181,188    (337,917)   (231,095)   181,391    (206,433)  
Cash flows from discontinued operations:
Net cash (used in) provided by operating activities (547)   —    2,839    —    2,292   
Net cash (used in) provided by discontinued operations (547)   —    2,839    —    2,292   
Effect of exchange rate changes on cash and cash equivalents
—    —    (10,948)   —    (10,948)  
Net increase (decrease) in cash and cash equivalents
11,720    (3,569)   15,452    —    23,603   
Cash and cash equivalents at the beginning of the year
37,803    8,933    286,822    —    333,558   
Cash and cash equivalents at the end of the year
$ 49,523    $ 5,364    $ 302,274    $ —    $ 357,161   
 

F-52
TELEFLEX INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Year Ended December 31, 2017
Parent
Company
Guarantor
Subsidiaries
Non-Guarantor
Subsidiaries
Eliminations
Condensed
Consolidated
(Dollars in thousands)
Net cash (used in) provided by operating activities from continuing operations
$ (50,585)   $ (502,181)   $ 1,040,985    $ (61,918)   $ 426,301   
Cash flows from investing activities of continuing operations:
Expenditures for property, plant and equipment
(240)   (34,912)   (35,751)   —    (70,903)  
Payments for businesses and intangibles acquired, net of cash acquired
(975,524)   —    (792,760)   —    (1,768,284)  
Proceeds from sale of assets
464,982    —    6,332    (464,982)   6,332   
Investments in affiliates
—    (5,900)   —    5,900    —   
Net cash used in investing activities from continuing operations
(510,782)   (40,812)   (822,179)   (459,082)   (1,832,855)  
Cash flows from financing activities of continuing operations:
Proceeds from new borrowings
2,463,500    —    —    —    2,463,500   
Reduction in borrowings
(1,239,576)   —    —    —    (1,239,576)  
Debt extinguishment, issuance and amendment fees
(26,664)   —    —    —    (26,664)  
Proceeds from share based compensation plans and the related tax impacts
5,571    —    —    —    5,571   
Payments for contingent consideration
—    (335)   —    —    (335)  
Proceeds from issuance of shares
—    —    5,900    (5,900)   —   
Dividends
(61,237)   —    —    —    (61,237)  
Intercompany transactions
(550,579)   551,230    (465,633)   464,982    —   
Intercompany dividends paid
—    —    (61,918)   61,918    —   
Net cash provided by (used in) financing activities from continuing operations
591,015    550,895    (521,651)   521,000    1,141,259   
Cash flows from discontinued operations:
Net cash used in operating activities (6,416)   —    —    —    (6,416)  
Net cash used in discontinued operations (6,416)   —    —    —    (6,416)  
Effect of exchange rate changes on cash and cash equivalents
—    —    61,480    —    61,480   
Net increase (decrease) in cash and cash equivalents
23,232    7,902    (241,365)   —    (210,231)  
Cash and cash equivalents at the beginning of the year
14,571    1,031    528,187    —    543,789   
Cash and cash equivalents at the end of the year
$ 37,803    $ 8,933    $ 286,822    $ —    $ 333,558   
 
Note 20 — Subsequent events
On February 18, 2020, we acquired IWG High Performance Conductors, Inc., a privately-held original equipment manufacturer of minimally invasive medical products and high performance conductors, for $260 million. The acquisition, which will complement our OEM product portfolio, was financed using borrowings under our revolving credit facility.
F-53

QUARTERLY DATA (UNAUDITED)
 
First
Quarter 		Second
Quarter 		Third
Quarter 		Fourth
Quarter
(Dollars in thousands, except per share)
2019:
Net revenues
$ 613,584    $ 652,507    $ 648,319    $ 680,952   
Gross profit, excluding intangible asset amortization
344,742    372,924    375,680    398,266   
Income from continuing operations before interest, loss on extinguishment of debt and taxes
75,243    107,458    117,621    126,932   
Income (loss) from continuing operations
41,918    83,328    228,929    107,806   
Income (loss) from discontinued operations (1,021)   47    —    459   
Net income (loss)
40,897    83,375    228,929    108,265   
Earnings per share — basic(1):
Income (loss) from continuing operations
$ 0.91    $ 1.80    $ 4.95    $ 2.33   
Income from discontinued operations (0.02)   0.01    —    0.01   
Net income (loss)
$ 0.89    $ 1.81    $ 4.95    $ 2.34   
Earnings per share — diluted(1):
Income (loss) from continuing operations
$ 0.89    $ 1.77    $ 4.85    $ 2.28   
Income from discontinued operations
(0.02)   —    —    0.01   
Net income (loss)
$ 0.87    $ 1.77    $ 4.85    $ 2.29   
2018:
Net revenues
$ 587,230    $ 609,866    $ 609,672    $ 641,615   
Gross profit, excluding intangible asset amortization
331,270    344,778    342,573    365,821   
Income from continuing operations before interest, loss on extinguishment of debt and taxes
86,843    33,490    82,105    119,266   
Income from continuing operations
54,931    (2,552)   56,540    87,513   
(Loss) income from discontinued operations
1,253    56    (16)   3,077   
Net income (loss)
56,184    (2,496)   56,524    90,590   
Earnings per share — basic(1):
Income (loss) from continuing operations
$ 1.21    $ (0.06)   $ 1.23    $ 1.90   
Income from discontinued operations 0.03    0.01    —    0.07   
Net income (loss)
$ 1.24    $ (0.05)   $ 1.23    $ 1.97   
Earnings per share — diluted(1):
Income (loss) from continuing operations
$ 1.18    $ (0.06)   $ 1.21    $ 1.87   
Income from discontinued operations
0.02    0.01    —    0.06   
Net income (loss)
$ 1.20    $ (0.05)   $ 1.21    $ 1.93   

(1) Each quarter is calculated as a discrete period; the sum of the four quarters may not equal the calculated full year amount.



TELEFLEX INCORPORATED
SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS
(Dollars in thousands)
ALLOWANCE FOR DOUBTFUL ACCOUNTS
 
Balance at
Beginning of
Year
Additions
Charged to
Income
Accounts
Receivable
Write-offs
Translation
and Other
Balance at
End of
Year
December 31, 2019 $ 9,348    $ 1,680    $ (1,739)   $ (234)   $ 9,055   
December 31, 2018 $ 10,255    $ 2,521    $ (2,601)   $ (827)   $ 9,348   
December 31, 2017 $ 8,636    $ 1,949    $ (596)   $ 266    $ 10,255   
DEFERRED TAX ASSET VALUATION ALLOWANCE
Balance at
Beginning of Year
Additions
Charged to
Expense
Reductions
Credited to
Expense
Translation
and Other
Balance at
End of Year
December 31, 2019 $ 143,971    $ 31,564    $ (55,797)   $ (505)   $ 119,233   
December 31, 2018 $ 104,799    $ 43,361    $ (2,871)   $ (1,318)   $ 143,971   
December 31, 2017 $ 104,520    $ 4,657    $ (5,745)   $ 1,367    $ 104,799   



Exhibit 4.3

DESCRIPTION OF SECURITIES
REGISTERED UNDER SECTION 12 OF THE
SECURITIES EXCHANGE ACT OF 1934

Teleflex Incorporated (“Teleflex,” “we,” “us” or “our”) has one class of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended: our common stock, par value $1.00 per share.

The following summary description of our common stock is based on the provisions of our restated certificate of incorporation, as amended (the “Certificate of Incorporation”), as well as our amended and restated bylaws (the “Bylaws”) and the applicable provisions of the Delaware General Corporation Law (the “DGCL”). This information is qualified entirely by reference to the applicable provisions of the Certificate of Incorporation, the Bylaws and the DGCL. The Certificate of Incorporation and Bylaws have previously been filed as exhibits with the Securities and Exchange Commission.

Capital Stock

We are authorized to issue two hundred million five hundred thousand (200,500,000) shares of capital stock, of which (a) five hundred thousand (500,000) are preference stock, par value $1.00 per share, issuable in series and (b) two hundred million (200,000,000) are common stock, par value $1.00 per share.

Common Stock

Voting. Common stockholders shall have the right at every meeting of stockholders to one vote for every share standing in the name of such stockholder on our books that is entitled to vote at such meeting. Common stockholders do not have cumulative voting rights.

The Certificate of Incorporation provides that certain provisions of the Bylaws relating to indemnification rights shall not be altered, amended, supplemented or repealed, and no provision of the Bylaws or of the Certificate of Incorporation inconsistent with such provisions shall be adopted, except by the affirmative vote of the holders of at least 80% of the outstanding shares of our capital stock entitled to vote generally in the election of directors, considered for this purpose as one class, and provides further that such provision shall not be altered, amended, supplemented or repealed, and no provision of the Certificate of Incorporation inconsistent therewith adopted, except by the same vote.

The Certificate of Incorporation further provides that no director shall be removed from office before the end of his term except for cause and (i) upon the affirmative vote of the holders of at least 80% of the outstanding shares of our capital stock entitled to vote generally in the election of directors or (ii) upon the majority vote of our entire board of directors, and provides further that such provision shall not be altered, amended, supplemented or repealed, and no provision of the Certificate of Incorporation inconsistent therewith adopted, except by the same vote.

Dividends and Other Distributions. Holders of our common stock shall be entitled to receive such dividends as may be declared by our board of directors from time to time, except that the we will not declare, pay or set apart for payment any dividend on shares of our common stock (other than dividends payable in shares of our common stock). or directly or indirectly make any distribution on, redeem, purchase or otherwise acquire any such shares, if at the time of such action we are in default with respect to any dividend payable on or any sinking fund or purchase fund requirement relative to shares of our preference stock.

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Distribution on Dissolution. In the event of our voluntary or involuntary liquidation, holders of our common stock shall be entitled to receive pro rata all of our remaining assets available for distribution to its stockholders after all amounts to which the holders of our preference stock are entitled have been paid or set aside in cash for payment.

Other Rights. Our common stock does not carry any preemptive rights enabling a holder to subscribe for, or receive shares of, any class of our common stock or any other securities convertible into shares of any class of our common stock. There are no redemption rights or sinking fund provisions applicable to our common stock.

Anti-takeover Effects of Provisions of Delaware Law and Charter Documents

Delaware Anti-Takeover Law

We are subject to Section 203 of the DGCL (“Section 203”). Section 203 generally prohibits a public Delaware corporation from engaging in a “business combination” with an “interested stockholder” for a period of three years after the date of the transaction in which the person became an interested stockholder, unless:

•prior to the date of the transaction, the board of directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;

•the interested stockholder owned at least 85% of the voting stock of the corporation outstanding upon consummation of the transaction, excluding for purposes of determining the number of shares outstanding (a) shares owned by persons who are directors and also officers and (b) shares owned by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or

•on or subsequent to the consummation of the transaction, the business combination is approved by the board and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding voting stock which is not owned by the interested stockholder.

Section 203 defines a business combination to include:

•any merger or consolidation involving the corporation and the interested stockholder;

•any sale, transfer, pledge or other disposition involving the interested stockholder of 10% or more of the assets of the corporation;

•subject to exceptions, any transaction involving the corporation that has the effect of increasing the proportionate share of the stock of any class or series of the corporation beneficially owned by the interested stockholder;

•subject to exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder; and

•the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits provided by or through the corporation.

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In general, Section 203 defines an interested stockholder as any entity or person beneficially owning 15% or more of the outstanding voting stock of the corporation and any entity or person affiliated with or controlling or controlled by the entity or person.

Certificate of Incorporation

The Certificate of Incorporation (i) provides for a board comprised of three classes of directors with each class serving a staggered three-year term, (ii) authorizes our board of directors to issue preferred stock from time to time, in one or more classes or series, without stockholder approval, (iii) requires the approval of at least two-thirds of the outstanding voting stock to amend certain provisions of our certificate of incorporation, as amended, and our bylaws, as amended, and (iv) does not include a provision for cumulative voting for directors.

The Certificate of Incorporation also provides that, subject to enumerated exceptions, certain transactions with “Related Persons,” defined in the Certificate of Incorporation as any person (other than us or any subsidiary) who is the beneficial owner, directly or indirectly, of 10% or more of the outstanding shares of our capital stock entitled to vote generally in the election of directors, considered for this purpose as one class, shall require approval by the affirmative vote of the holders of at least 80% of the outstanding shares of all classes of our capital stock entitled to vote generally in the election of directors, considered for such purpose as one class, and provides further that such provision shall not be altered, amended, supplemented or repealed, and no provision of the Certificate of Incorporation inconsistent therewith adopted, except by the same vote.

The Certificate of Incorporation also provides that, subject to enumerated exceptions, certain transactions with “Control Persons,” defined in the Certificate of Incorporation as any person (other than us or any subsidiary) who is or at any time within the 36-month period preceding the record date for determination of stockholders entitled to notice of and to vote on a Business Combination (as defined in the Certificate of Incorporation) in which such person is a party to or a participant in such Business Combination in the manner described in the Certificate of Incorporation, was, the beneficial owner, directly or indirectly, of 25% or more of the outstanding shares of Voting Stock of the Corporation, considered for this purpose as one class, shall require approval by the affirmative vote of (i) the holders of at least 90% of the outstanding shares of all classes of our capital stock entitled to vote generally in the election of directors, considered for such purpose as one class, and (ii) the holders of at least 66.7% of such outstanding shares as are not beneficially owned by such other person. The Certificate of Incorporation provides further that such provision shall not be altered, amended, supplemented or repealed, and no provision of the Certificate of Incorporation inconsistent therewith adopted, except by the affirmative vote of the holders of at least 90% of the outstanding shares of all classes of our capital stock entitled to vote generally in the election of directors, considered for such purpose as one class.

These and other provisions contained in the Certificate of Incorporation and Bylaws could delay or discourage transactions involving an actual or potential change in control of us or our management, including transactions in which stockholders might otherwise receive a premium for their shares over then current prices. Such provisions could also limit the ability of stockholders to remove current management or approve transactions that stockholders may deem to be in their best interests and could adversely affect the price of our common stock.

Transfer Agent and Registrar

The transfer agent and registrar for our common stock is American Stock Transfer & Trust Company, LLC. The transfer agent and registrar’s address is 6201 15th Avenue, Brooklyn, New York 11219.

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Listing on the New York Stock Exchange

Our common stock is listed on the New York Stock Exchange under the symbol TFX.
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Exhibit 10.2.2

            


        












Teleflex Incorporated
Deferred Compensation Plan



















Effective Date
November 1, 2019

        
Teleflex Incorporated Deferred Compensation Plan

Article I
        Establishment and Purpose 1

Article II
        Definitions 1

Article III
        Eligibility and Participation 7

Article IV
        Deferrals 7

Article V
        Company Contributions 11

Article VI
        Payments from Accounts 13

Article VII
        Valuation of Account Balances; Investments 16

Article VIII
        Administration 18

Article IX
        Amendment and Termination 20

Article X
        Informal Funding 20

Article XI
        Claims 21

Article XII
        General Provisions 27
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Article I
Establishment and Purpose
Teleflex Incorporated (the “Company”) has adopted this Teleflex Incorporated Deferred Compensation Plan, applicable to Compensation deferred under Compensation Deferral Agreements submitted on and after the Effective Date and Company Contributions credited on or after the Effective Date. In addition to this Plan, the provisions of Section 6.9 (modification elections) and Articles VII through XII will apply to amounts deferred under the terms of the Teleflex Incorporated Deferred Compensation Plan, as amended through January 1, 2016 and predecessor plans that are subject to Code Section 409A (collectively, the “Prior Plans”).

The purpose of the Plan is to attract and retain key employees by providing them with an opportunity to defer receipt of a portion of their salary, bonus and other specified compensation. The Plan is not intended to meet the qualification requirements of Code Section 401(a). The Plan is intended to meet the requirements of Code Section 409A and shall be operated and interpreted consistent with that intent.

The Plan constitutes an unsecured promise by a Participating Employer to pay benefits in the future. Participants in the Plan shall have the status of general unsecured creditors of the Company or the Participating Employer, as applicable. Each Participating Employer shall be solely responsible for payment of the benefits attributable to services performed for it. The Plan is unfunded for Federal tax purposes and is intended to be an unfunded arrangement for eligible employees who are part of a select group of management or highly compensated employees of the Employer within the meaning of Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA and independent contractors. Any amounts set aside to defray the liabilities assumed by the Company or a Participating Employer will remain the general assets of the Company or the Participating Employer and shall remain subject to the claims of the Company’s or the Participating Employer's creditors until such amounts are distributed to the Participants.

Article II
Definitions
2.1 Account. Account means a bookkeeping account maintained by the Committee to record the payment obligation of a Participating Employer to a Participant as determined under the terms of the Plan. The Committee may maintain an Account to record the total obligation to a Participant and component Accounts to reflect amounts payable at different times and in different forms. Reference to an Account means any such Account established by the Committee, as the context requires. Accounts are intended to constitute unfunded obligations within the meaning of Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA.

2.2 Account Balance. Account Balance means, with respect to any Account, the total payment obligation owed to a Participant from such Account as of the most recent Valuation Date.

2.3 Affiliate. Affiliate means a corporation, trade or business that, together with the Company, is treated as a single employer under Code Section 414(b) or (c).

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2.4 Beneficiary. Beneficiary means a natural person, estate, or trust designated by a Participant in accordance with Section 6.5 hereof to receive payments to which a Beneficiary is entitled in accordance with provisions of the Plan.

2.5 Board of Directors. Board of Directors means the board of directors of the Company.

2.6 Business Day. Business Day means each day on which the New York Stock Exchange is open for business.

2.7 Change in Control. Change in Control means, with respect to the Company, any of the following events: (i) a change in the ownership of the Company, (ii) a change in the effective control of the Company, or (iii) a change in the ownership of a substantial portion of the assets of the Company.

Change in Ownership. For purposes of this Section, a change in the ownership of the Company occurs on the date on which any one person, or more than one person acting as a group, acquires ownership of stock of the Company that, together with stock held by such person or group constitutes more than 50% of the total fair market value or total voting power of the stock of the Company. The acquisition by a person or group owning more than 50% of the total fair market value or total voting power of the stock of the Company of additional shares of the Company shall not constitute a “change of the ownership” of the Company.

Change in Effective Control. A change in the effective control of the Company occurs on the date on which either: (i) a person, or more than one person acting as a group, acquires ownership of stock of the Company possessing 30% or more of the total voting power of the stock of the Company, taking into account all such stock acquired during the 12-month period ending on the date of the most recent acquisition, provided that the acquisition by a person or group owning more than 30% of the total fair market value or total voting power of the stock of the Company of additional shares of the Company shall not constitute a “change of effective control” of the Company, or (ii) a majority of the members of the Company’s Board of Directors is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of such Board of Directors prior to the date of the appointment or election, but only if no other corporation is a majority shareholder of the Company.
Change in Ownership of Substantial Portion of Assets. A change in the ownership of a substantial portion of assets occurs on the date on which any one person, or more than one person acting as a group, other than a person or group of persons that is related to the Company, acquires assets from the Company that have a total gross fair market value equal to or more than 40% of the total gross fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions, taking into account all such assets acquired during the 12-month period ending on the date of the most recent acquisition. A transfer of assets shall not be treated as a “change in the ownership of a substantial portion of the assets” when such transfer is made to an entity that is controlled by the shareholders of the transferor corporation as determined under Treas. Reg. section 1.409A-3(i)(5)(vii)(B).

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2.8 Claimant. Claimant means a Participant or Beneficiary filing a claim under Article XI of this Plan.

2.9 Code. Code means the Internal Revenue Code of 1986, as amended from time to time.

2.10 Code Section 409A. Code Section 409A means section 409A of the Code, and regulations and other guidance issued by the Treasury Department and Internal Revenue Service thereunder.

2.11 Committee. Committee means the Company or a committee appointed by the Company to administer the Plan.

2.12 Company. Company means Teleflex Incorporated.

2.13 Company Contribution. Company Contribution means a credit by a Participating Employer to a Participant’s Account(s) in accordance with the provisions of Article V of the Plan. Unless the context clearly indicates otherwise, a reference to Company Contribution shall include Earnings attributable to such contribution.

2.14 Compensation. Compensation means a Participant’s salary, commissions, restricted stock units awarded by the Company and such other cash or equity-based compensation approved by the Committee as Compensation that may be deferred under Section 4.2 of this Plan. Compensation includes (a) pre-tax deferrals to the Teleflex 401(k) Savings Plan, (b) deferrals to any Code Section 125 plan sponsored by the Employer, (c) amounts received from the Company’s annual incentive plan (“AIP Bonus”) and (d) any other bonus that that is not part of base salary and that is considered Performance-Based Compensation.

Subject to the last sentence of this paragraph, Compensation excludes (i) expense reimbursements or other benefits or contributions by the Employer (except items (a) and (b) above); (ii) any bonus other than AIP Bonus or Performance-Based Compensation; (iii) amounts realized (A) from the exercise of a stock option, or (B) from the sale, exchange or other disposition of stock acquired under a qualified stock option; (iv) any compensation that has been previously deferred under this Plan or any other arrangement subject to Code Section 409A; and (v) any compensation that is not U.S. sourced. Notwithstanding the foregoing, in accordance with Section 7.6, Compensation shall include certain equity-based compensation for purposes of Deferrals but not for calculating Company Contributions.

2.15 Compensation Deferral Agreement. Compensation Deferral Agreement means an agreement between a Participant and a Participating Employer that specifies: (i) the amount of each component of Compensation that the Participant has elected to defer to the Plan in accordance with the provisions of Article IV and (ii) the allocation of such Deferrals among one or more of the Participant’s Retirement Account or Flex Accounts.

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2.16 Deferral. Deferral means a credit to a Participant’s Account(s) that records that portion of the Participant’s Compensation that the Participant has elected to defer to the Plan in accordance with the provisions of Article IV. Unless the context of the Plan clearly indicates otherwise, a reference to Deferrals includes Earnings attributable to such Deferrals.
2.17 Earnings. Earnings means an adjustment to the value of an Account in accordance with Article VII.

2.18 Effective Date. Effective Date means November 1, 2019.

2.19 Eligible Employee. Eligible Employee means an Employee who is a member of a select group of management or highly compensated employees or an independent contractor who has been notified during an applicable enrollment of his or her status as an Eligible Employee. The Committee has the discretion to determine which Employees and independent contractors are Eligible Employees for each enrollment.

2.20 Employee. Employee means a common-law employee of an Employer.

2.21 Employer. Employer means the Company and each Affiliate.

2.22 ERISA. ERISA means the Employee Retirement Income Security Act of 1974, as amended from time to time.

2.23 Flex Account. Flex Account means a Separation Account or Specified Date Account established under the terms of a Participant’s Compensation Deferral Agreement. Unless the Committee specifies otherwise, a Participant may maintain no more than five (5) Flex Accounts at any one time.

2.24 Participant. Participant means an individual described in Article III.

2.25 Participating Employer. Participating Employer means the Company and each Affiliate who has adopted the Plan with the consent of the Company. Each Participating Employer shall be identified on Schedule A attached hereto.

2.26 Payment Schedule. Payment Schedule means the date as of which payment of an Account will commence and the form in which payment of such Account will be made under the terms of a payment election in effect for such Account. The Payment Schedule for an Account will be established under the Participant’s Compensation Deferral Agreement that establishes the Account, as may be modified under Section 6.9.

2.27 Performance-Based Compensation. Performance-Based Compensation means Compensation where the amount of, or entitlement to, the Compensation is contingent on the satisfaction of pre-established organizational or individual performance criteria relating to a performance period of at least 12 consecutive months. Organizational or individual performance criteria are considered pre-established if established in writing by not later than 90 days after the commencement of the period of service to which the
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criteria relate, provided that the outcome is substantially uncertain at the time the criteria are established. Performance-Based Compensation shall not include any Compensation payable upon the Participant’s death or disability (as defined in Treas. Section 1.409A-1(e)) without regard to the satisfaction of the performance criteria.

2.28 Plan. Plan means “Teleflex Incorporated Deferred Compensation Plan” as documented herein and as may be amended from time to time hereafter. However, to the extent permitted or required under Code Section 409A, the term Plan may in the appropriate context also means a portion of the Plan that is treated as a single plan under Treas. Reg. Section 1.409A-1(c), or the Plan or portion of the Plan and any other nonqualified deferred compensation plan or portion thereof that is treated as a single plan under such section.

2.29 Plan Year. Plan Year means January 1 through December 31.

2.30 Restricted Stock Award Account. Restricted Stock Award Account means a sub-account of the Retirement Account, a sub-account of a Separation Account or a sub-account of a Specified Date Account that holds a Participant’s deferrals of restricted stock awards.

2.31 Retirement Account. Retirement Account means an Account established by the Committee to record Company Contributions and Deferrals allocated to the Retirement Account pursuant to a Participant’s Compensation Deferral Agreement, payable to a Participant upon Separation from Service in accordance with Section 6.3.

2.32 Separation Account. Separation Account means a Flex Account established by the Committee in accordance with a Participant’s Compensation Deferral Agreement to record Deferrals allocated to such Account by the Participant and which are payable upon the Participant’s Separation from Service as set forth in Section 6.3.

2.33 Separation from Service. Separation from Service means an Employee’s termination of employment with the Employer and all Affiliates.

Except in the case of an Employee on a bona fide leave of absence as provided below, an Employee is deemed to have incurred a Separation from Service if the Employer and the Employee reasonably anticipated that the level of services to be performed by the Employee after a date certain would be reduced to 20% or less of the average services rendered by the Employee during the immediately preceding 36-month period (or the total period of employment, if less than 36 months), disregarding periods during which the Employee was on a bona fide leave of absence.

An Employee who is absent from work due to military leave, sick leave, or other bona fide leave of absence shall incur a Separation from Service on the first date immediately following the later of: (i) the six month anniversary of the commencement of the leave, or (ii) the expiration of the Employee’s right, if any, to reemployment under statute or contract.

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If a Participant ceases to provide services as an Employee and begins providing services as an independent contractor for the Employer, a Separation from Service shall occur only if the parties anticipate that the level of services to be provided as an independent contractor are such that a Separation from Service would have occurred if the Employee had continued to provide services at that level as an Employee. If, in accordance with the preceding sentence, no Separation from Service occurs as of the date the individual’s employment status changes, a Separation from Service shall occur thereafter only upon the 12-month anniversary of the date all contracts with the Employer have expired, provided the Participant does not perform services for the Employer during that time.

For purposes of determining whether a Separation from Service has occurred, the Employer means the Employer as defined in Section 2.21 of the Plan, except that in applying Code sections 1563(a)(1), (2) and (3) for purposes of determining whether another organization is an Affiliate of the Company under Code Section 414(b), and in applying Treasury Regulation Section 1.414(c)-2 for purposes of determining whether another organization is an Affiliate of the Company under Code Section 414(c), “at least 50 percent” shall be used instead of “at least 80 percent” each place it appears in those sections.

The Committee specifically reserves the right to determine whether a sale or other disposition of substantial assets to an unrelated party constitutes a Separation from Service with respect to a Participant providing services to the seller immediately prior to the transaction and providing services to the buyer after the transaction.

2.34 Specified Date Account. Specified Date Account means a Flex Account established by the Committee to record the amounts payable in a future year as specified in the Participant’s Compensation Deferral Agreement.

2.35 Specified Employee. Specified Employee means an officer or stockholder of the Company or an Affiliate that meets the requirements of Code § 409A(a)(2)(B). The determination date for Specified Employees is September 1 of each year and the effective date is the next January 1.

2.36 Substantial Risk of Forfeiture. Substantial Risk of Forfeiture has the meaning specified in Treas. Reg. Section 1.409A-1(d).

2.37 Unforeseeable Emergency. Unforeseeable Emergency means a severe financial hardship to the Participant resulting from an illness or accident of the Participant, the Participant’s spouse, the Participant’s dependent (as defined in Code section 152, without regard to section 152(b)(1), (b)(2), and (d)(1)(B)), or a Beneficiary; loss of the Participant’s property due to casualty (including the need to rebuild a home following damage to a home not otherwise covered by insurance, for example, as a result of a natural disaster); or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant. The types of events which may qualify as an Unforeseeable Emergency may be limited by the Committee.

2.38 Valuation Date. Valuation Date means each Business Day.

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Article III
Eligibility and Participation
3.1 Eligibility and Participation. All Eligible Employees may enroll in the Plan. Eligible Employees become Participants on the first to occur of (i) the date on which the first Compensation Deferral Agreement becomes irrevocable under Article IV, or (ii) the date Company Contributions are credited to an Account on behalf of such Eligible Employee.

3.2 Duration. Only Eligible Employees may submit Compensation Deferral Agreements during an enrollment and receive Company Contributions during the Plan Year. A Participant who is no longer an Eligible Employee but has not incurred a Separation from Service will not be allowed to submit Compensation Deferral Agreements but may otherwise exercise all of the rights of a Participant under the Plan with respect to his or her Account(s). On and after a Separation from Service, a Participant shall remain a Participant as long as his or her Account Balance is greater than zero (0). All Participants, regardless of employment status, will continue to be credited with Earnings and during such time may continue to make allocation elections as provided in Section 7.4 and modification elections under Section 6.9. An individual shall cease being a Participant in the Plan when his Account has been reduced to zero (0).

3.3 Rehires. An Eligible Employee who Separates from Service and who subsequently resumes performing services for an Employer in the same calendar year (regardless of eligibility) will have his or her Compensation Deferral Agreement for such year, if any, reinstated, but his or her eligibility to participate in the Plan in years subsequent to the year of rehire shall be governed by the provisions of Section 3.1.


Article IV
Deferrals

a.Deferral Elections, Generally.

(a)An Eligible Employee may make an initial election to defer Compensation by submitting a Compensation Deferral Agreement during the enrollment periods established by the Committee and in the manner specified by the Committee, but in any event, in accordance with Section 4.2. Unless an earlier date is specified in the Compensation Deferral Agreement, deferral elections with respect to a Compensation source (such as salary, bonus or other Compensation) become irrevocable on the latest date applicable to such Compensation source under Section 4.2.
(b)A Compensation Deferral Agreement that is not timely filed with respect to a service period or component of Compensation, or that is submitted by a Participant who Separates from Service prior to the latest date such agreement would become irrevocable under Section 409A, shall be considered null and void and shall not take effect with respect to such item of Compensation. The
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Committee may modify or revoke any Compensation Deferral Agreement prior to the date the election becomes irrevocable under the rules of Section 4.2.

(c)The Committee may permit different deferral amounts for each component of Compensation and may establish a minimum or maximum deferral amount for each such component. Unless otherwise specified by the Committee in the Compensation Deferral Agreement, Participants may defer from 2% to 100% of their base salary and commissions and from 10% to 100% of annual bonus, stock units, or other incentive Compensation.

(d)Deferrals of cash Compensation shall be calculated with respect to the gross cash Compensation payable to the Participant prior to any deductions or withholdings, but shall be reduced by the Committee as necessary so as not to exceed 100% of the cash Compensation of the Participant remaining after deduction of all required income and employment taxes, required employee benefit deductions, deferrals to 401(k) plans and other deductions required by law. Changes to payroll withholdings that affect the amount of Compensation being deferred to the Plan shall be allowed only to the extent permissible under Code Section 409A.

(e)The Eligible Employee shall specify on his or her Compensation Deferral Agreement the amount of Deferrals and whether to allocate Deferrals to the Retirement Account or to one or more Flex Accounts. If no designation is made, Deferrals shall be allocated to the Retirement Account.

4.2 Timing Requirements for Compensation Deferral Agreements.

(a) Initial Eligibility. The Committee may permit an Eligible Employee to defer Compensation earned in the first year of eligibility. The Compensation Deferral Agreement must be filed within 30 days after attaining Eligible Employee status and becomes irrevocable not later than the 30th day. A newly hired Employee becomes an Eligible Employee as designated and notified by the Committee during an applicable enrollment period which shall occur 30 days prior to July 1 and January 1 or such other periods established by the Committee.

        A Compensation Deferral Agreement filed under this paragraph applies to Compensation earned after the date that the Compensation Deferral Agreement becomes irrevocable.

If a Participant has ceased being an Eligible Employee (other than the accruals of Earnings on his Account, if any) for any reason, regardless of whether all amounts deferred under the Plan have yet been paid, and subsequently becomes an Eligible Employee, such Participant may be treated as being initially eligible to participate in the Plan and eligible to make a deferral election under this Section 4.2(a) if he has not been eligible to participate in the Plan (other than the accrual of Earnings on his Account, if any) at any time during the 24 month period ending on the date the individual again becomes an Eligible Employee under the Plan.

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(a)Prior Year Election. Except as otherwise provided in this Section 4.2, the Committee may permit an Eligible Employee to defer Compensation by filing a Compensation Deferral Agreement no later than December 31 of the year prior to the year in which the Compensation to be deferred is earned. A Compensation Deferral Agreement filed under this paragraph shall become irrevocable with respect to such Compensation not later than the December 31 filing deadline.

(b)Performance-Based Compensation. The Committee may permit an Eligible Employee to defer Compensation which qualifies as Performance-Based Compensation by filing a Compensation Deferral Agreement no later than the date that is six months before the end of the applicable performance period, provided that:

(i)the Participant performs services continuously from the later of the beginning of the performance period or the date the performance criteria are established through the date the Compensation Deferral Agreement is submitted; and

(ii) the Compensation is not readily ascertainable as of the date the Compensation Deferral Agreement is filed.

Any election to defer Performance-Based Compensation that is made in accordance with this paragraph and that becomes payable as a result of the Participant’s death or disability (as defined in Treas. Reg. Section 1.409A-1(e)) or upon a change in control (as defined in Treas. Reg. Section 1.409A-3(i)(5)) prior to the satisfaction of the performance criteria, will be void unless it would be considered timely under another rule described in this Section.

(c)Short-Term Deferrals. The Committee may permit Compensation that meets the definition of a “short-term deferral” described in Treas. Reg. Section 1.409A-1(b)(4) to be deferred in accordance with the rules of Section 6.9, applied as if the date the Substantial Risk of Forfeiture lapses is the date payments were originally scheduled to commence, provided, however, that the provisions of Section 6.9(b) shall not apply to payments attributable to a change in control (as defined in Treas. Reg. Section 1.409A-3(i)(5)). A Compensation Deferral Agreement submitted in accordance with this paragraph becomes irrevocable on the latest date it could be submitted under Section 6.9.

(d)Restricted Stock Units, LTIP Awards and Other Forfeitable Rights. With respect to a legally binding right to a payment in a subsequent year that is subject to a forfeiture condition requiring the Participant’s continued services for a period of at least 12 months from the date the Participant obtains the legally binding right, the Committee may permit an Eligible Employee to defer such Compensation by filing a Compensation Deferral Agreement on or before the 30th day after the legally binding right to the Compensation accrues, provided that the Compensation Deferral Agreement is submitted at least 12 months in advance of the earliest date on which the forfeiture condition could lapse. The Compensation
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Deferral Agreement described in this paragraph becomes irrevocable not later than such 30th day. If the forfeiture condition applicable to the payment lapses before the end of such 12-month period as a result of the Participant’s death or disability (as defined in Treas. Reg. Section 1.409A-3(i)(4)) or upon a change in control (as defined in Treas. Reg. Section 1.409A-3(i)(5)), the Compensation Deferral Agreement will be void unless it would be considered timely under another rule described in this Section.

(e)“Evergreen” Deferral Elections. The Committee, in its discretion, may provide that Compensation Deferral Agreements will continue in effect for subsequent years or performance periods by communicating that intention to Participants in writing prior to the date Compensation Deferral Agreements become irrevocable under this Section 4.2. An evergreen Compensation Deferral Agreement may be revoked or modified in writing prospectively by the Participant or the Committee with respect to Compensation for which such election remains revocable under this Section 4.2.

A Compensation Deferral Agreement is deemed to be revoked for subsequent years if the Participant is not an Eligible Employee as of the last permissible date for making elections under this Section 4.2 or if the Compensation Deferral Agreement is cancelled in accordance with Section 4.6.

4.3 Allocation of Deferrals. A Compensation Deferral Agreement may allocate Deferrals to the Retirement Account or to one or more Flex Accounts. The Committee may, in its discretion, establish in a written communication during enrollment a minimum deferral period for the establishment of a Specified Date Account (for example, the second Plan Year following the year Compensation is first allocated to such Accounts). In the event a Participant’s Compensation Deferral Agreement allocates a component of Compensation to a Specified Date Account that commences payment in the year such Compensation is earned, the Compensation Deferral Agreement shall be deemed to allocate the Deferral to the Participant’s Specified Date Account having the next earliest payment year. In the event restricted stock units are allocated to a Specified Date Account that commences payment on or before the date restricted stock units vest, the units will be allocated to the Specified Date Account having the next earliest payment year that occurs after the calendar year in which such restricted stock units vest. If the Participant has no other Specified Date Accounts that meet the foregoing requirements, the Committee will allocate the Deferral to the Retirement Account.

4.4 Deductions from Pay. The Committee has the authority to determine the payroll practices under which any component of Compensation subject to a Compensation Deferral Agreement will be deducted from a Participant’s Compensation.

4.5 Vesting. Participant Deferrals of cash Compensation shall be 100% vested at all times. Deferrals of vesting awards of Compensation shall become vested in accordance with the provisions of the underlying award.

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4.6 Cancellation of Deferrals. The Committee may cancel a Participant’s Deferrals: (i) for the balance of the Plan Year in which an Unforeseeable Emergency occurs, and (ii) during periods in which the Participant is unable to perform the duties of his or her position or any substantially similar position due to a mental or physical impairment that can be expected to result in death or last for a continuous period of at least six months (a “disability”), provided cancellation occurs by the later of the end of the taxable year of the Participant or the 15th day of the third month following the date the Participant incurs the disability (as defined in this Section 4.6).

4.7 Automatic Suspension. An election to defer Compensation will be automatically suspended during any unpaid leave of absence or temporary layoff. Any deferral of Compensation suspended in accordance with the provisions of this Section shall be automatically resumed, without the necessity of any action by the Participant, upon return to employment at the expiration of such suspension period within the same Plan Year.


Article V
Company Contributions
5.1 Discretionary Company Contributions. A Participating Employer may, from time to time in its sole and absolute discretion, credit discretionary Company Contributions in the form of matching, profit sharing or other contributions to any Participant in any amount determined by the Participating Employer. Company Contributions are credited to the Participant’s Retirement Account.

Matching Contribution. Discretionary Company Contributions may take the form of matching contributions, at a rate determined by the Participating Employer. Matching contributions are calculated with respect to base salary and AIP Bonus (as defined under Section 2.14). For the avoidance of doubt, matching contributions are not made with respect to deferrals of restricted stock units or any other form of equity-based compensation.

Non-Elective Contributions. Discretionary Company Contributions may take the form of non-elective contributions. All non-elective contributions will be calculated with respect to a Participant’s base salary and AIP Bonus (collectively, “Considered Compensation” as determined by the Committee). The amount of the discretionary non-elective contribution may be an amount reflecting a percentage (as determined by the Committee) multiplied by the excess of Considered Compensation over the limit on compensation imposed by Code Section 401(a)(17).
Discretionary Company Contribution. Discretionary Company Contributions (including matching and non-elective contributions) are credited at the sole discretion of the Participating Employer and the fact that a discretionary Company Contribution is credited in one year shall not obligate the Participating Employer to continue to make such Company Contributions in subsequent years.

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Prior Plan Credits.  If an Eligible Employee was a participant in the Teleflex Incorporated Supplemental Executive Retirement Plan (“SERP”) on December 31, 2008, and had not incurred a Separation from Service before December 31, 2008, the Company credited the lump sum present value of the Participant’s accrued benefit in the SERP as of December 31, 2008 to the Participant’s Account in the Plan.  All amounts credited under this provision to the Accounts of Participants in the Plan, as adjusted for earnings or losses, are referred to as “Prior Plan Credits.”  Amounts credited to a Participant’s Account as Prior Plan Credits shall be paid in accordance with the Participant’s Compensation Deferral Agreement filed by the Participant immediately prior to December 31, 2008.  If the Participant has not elected the time and form of payment by December 31, 2008, the Participant shall be deemed to have elected to receive the portion of his Account attributable to Prior Plan Credits in the form of a lump sum payable in the calendar year next following the calendar year in which Separation from Service occurs. If the payment schedule applicable to Prior Plan Credits is different from the Retirement Account Payment Schedule, an additional Separation Account will be created with a Payment Schedule determined under this paragraph.

5.2 Vesting. A Participant’s Deferrals are always 100% vested. Company Contributions vest according the schedule specified by the Committee on or before the time the contributions are made. If no schedule is specified, matching Company Contributions become 100% vested on the second anniversary of the participant’s date of hire and non-elective Company Contributions become vested on the fifth anniversary of the participant’s date of hire.

All Company Contributions become 100% vested, if while employed by an Employer, a Participant dies, becomes disabled (as defined in Treas. Reg. §1.409A-1(e)), or the Participant attains age 65. In addition, the Participating Employer may accelerate vesting for its Employees in its sole discretion.



Article VI
Payments from Accounts

6.1 General Rules. A Participant’s Accounts become payable upon the first to occur of the payment events applicable to such Account under (i) Sections 6.2 or 6.3 (as elected) and (ii) Sections 6.4 through 6.6.
Payment events and Payment Schedules elected by the Participant shall be set forth in a valid Compensation Deferral Agreement that establishes the Account to which such elections apply in accordance with Article IV or in a valid modification election applicable to such Account as described in Section 6.9.
Payment amounts are based on Account Balances as of the last Valuation Date of the month next preceding the month actual payment is made.

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6.2 Specified Date Accounts.
Commencement. Payment is made or begins in the year designated by the Participant. Form of Payment. Payment will be made in a lump sum, unless the Participant elected to receive annual installments up to 10 years.
The time and form of payment of Specified Date Accounts is unaffected by an earlier Separation from Service described in Section 6.3.

6.3 Separation from Service. Upon a Participant’s Separation from Service other than death, the Participant is entitled to receive his or her vested Retirement Account and vested Separation Accounts.

        Commencement. The Retirement Account and all Separation Accounts commence payment in the calendar year next following the calendar year in which Separation from Service occurs, unless the Participant elected a later year.

Notwithstanding any other provision of this Plan, payment to a Participant who is a Specified Employee will commence no earlier than six months following his or her Separation from Service.

        Form of Payment. The Retirement Account and Separation Accounts will be paid in a single lump sum unless the Participant elected with respect to an Account to receive annual installments up to 15 years.
Change in Control. A Participant who has a Separation from Service within 24 months following a Change in Control will receive his or her Accounts in a single lump sum commencing in the calendar year next following the year in which Separation from Service occurs, regardless of any other Payment Schedule elected by the Participant for such Account.


6.4 Death. Notwithstanding anything to the contrary in this Article VI, upon the death of the Participant (regardless of whether such Participant is an Employee at the time of death), all remaining vested Account Balances shall be paid to his or her Beneficiary in a single lump sum no later than December 31 of the calendar year following the year of the Participant’s death.

(a) Designation of Beneficiary in General. The Participant shall designate a Beneficiary in the manner and on such terms and conditions as the Committee may prescribe. No such designation shall become effective unless filed with the Committee during the Participant’s lifetime. Any designation shall remain in effect until a new designation is filed with the Committee; provided, however, that in the event a Participant designates his or her spouse as a Beneficiary, such designation shall be automatically revoked upon the dissolution of the marriage unless, following such dissolution, the Participant submits a new designation
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naming the former spouse as a Beneficiary. A Participant may from time to time change his or her designated Beneficiary without the consent of a previously-designated Beneficiary by filing a new designation with the Committee.
(b) No Beneficiary. If a designated Beneficiary does not survive the Participant, or if there is no valid Beneficiary designation, amounts payable under the Plan upon the death of the Participant shall be paid to the Participant’s spouse, or if there is no surviving spouse, then to the duly appointed and currently acting personal representative of the Participant’s estate.
6.5 Unforeseeable Emergency. A Participant who experiences an Unforeseeable Emergency may submit a written request to the Committee to receive payment of all or any portion of his or her vested Accounts. If the emergency need cannot be relieved by cessation of Deferrals to the Plan, the Committee may approve an emergency payment therefrom not to exceed the amount reasonably necessary to satisfy the need, taking into account the additional compensation that is available to the Participant as the result of cancellation of deferrals to the Plan, including amounts necessary to pay any taxes or penalties that the Participant reasonably anticipates will result from the payment. The amount of the emergency payment shall be subtracted from the Participant’s Accounts on a pro rata basis. Emergency payments shall be paid in a single lump sum within the 90-day period following the date the payment is approved by the Committee. The Committee may specify that Deferrals will be distributed before any Company Contributions or restricted stock units.

6.6 Administrative Cash-Out of Small Balances. Notwithstanding anything to the contrary in this Article VI, the Committee may at any time and without regard to whether a payment event has occurred, direct in writing an immediate lump sum payment of the Participant’s Accounts if the balance of such Accounts, combined with any other amounts required to be treated as deferred under a single plan pursuant to Code Section 409A, does not exceed the applicable dollar amount under Code Section 402(g)(1)(B), provided any other such aggregated amounts are also distributed in a lump sum at the same time.

6.7 Acceleration of or Delay in Payments. Notwithstanding anything to the contrary in this Article VI, the Committee, in its sole and absolute discretion, may elect to accelerate the time or form of payment of an Account, provided such acceleration is permitted under Treas. Reg. Section 1.409A-3(j)(4). The Committee may also, in its sole and absolute discretion, delay the time for payment of an Account, to the extent permitted under Treas. Reg. Section 1.409A-2(b)(7).

6.8 Rules Applicable to Installment Payments. If a Payment Schedule specifies installment payments, payments will be made beginning as of the payment commencement date for such installments and shall continue to be made in each subsequent payment period until the number of installment payments specified in the Payment Schedule has been paid. The amount of each installment payment shall be determined by dividing (a) by (b), where (a) equals the Account Balance as of the last Valuation Date in the month preceding the month of payment and (b) equals the remaining number of installment payments. For purposes of Section 6.9, installment payments will be treated as a single
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payment. If an Account is payable in installments, the Account will continue to be credited with Earnings in accordance with Article VII hereof until the Account is completely distributed.

6.9 Modifications to Payment Schedules. A Participant may modify the Payment Schedule elected by him or her with respect to an Account, consistent with the permissible Payment Schedules available under the Plan (or payment elections available under the applicable Prior Plan) for the applicable payment event, provided such modification complies with the requirements of this Section 6.9. Modifications of a Payment Schedule do not apply with respect to death benefits (including amounts deferred under a Prior Plan) because such amount shall be paid as a lump sum only in accordance with Section 6.4.

(a) Time of Election. The modification election must be submitted to the Committee not less than 12 months prior to the date payments would have commenced under the Payment Schedule in effect prior to modification (the “Prior Election”).
(b) Date of Payment under Modified Payment Schedule. The date payments are to commence under the modified Payment Schedule must be no earlier than five years after the date payment would have commenced under the Prior Election. Under no circumstances may a modification election result in an acceleration of payments in violation of Code Section 409A. If the Participant modifies only the form, and not the commencement date for payment, payments shall commence on the fifth anniversary of the date payment would have commenced under the Prior Election. This subsection 6.9(b) does not apply to modification of a payment schedule upon death elected under a Prior Plan.

(c) Irrevocability; Effective Date. A modification election is irrevocable when filed and becomes effective 12 months after the filing date.

(d) Effect on Accounts. An election to modify a Payment Schedule is specific to the Account or payment event to which it applies, and shall not be construed to affect the Payment Schedules or payment events of any other Accounts.

Article VII
Valuation of Account Balances; Investments
7.1 Valuation. Deferrals shall be credited to appropriate Accounts on the date such Compensation would have been paid to the Participant absent the Compensation Deferral Agreement. Discretionary Company Contributions will be credited on the dates specified by the Participating Employers. Valuation of Accounts shall be performed under procedures approved by the Committee.

7.2 Earnings Credit. Each Account will be credited with Earnings on each Business Day, based upon the Participant’s investment allocation among a menu of investment options selected in advance by the Committee, in accordance with the provisions of this Article VII (“investment allocation”).

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7.3 Investment Options. Investment options will be determined by the Committee. The Committee, in its sole discretion, shall be permitted to add or remove investment options from the Plan menu from time to time, provided that any such additions or removals of investment options shall not be effective with respect to any period prior to the effective date of such change.

7.4 Investment Allocations. A Participant’s investment allocation constitutes a deemed, not actual, investment among the investment options comprising the investment menu. At no time shall a Participant have any real or beneficial ownership in any investment option included in the investment menu, nor shall the Participating Employer or any trustee acting on its behalf have any obligation to purchase actual securities as a result of a Participant’s investment allocation. A Participant’s investment allocation shall be used solely for purposes of adjusting the value of a Participant’s Account Balances.

A Participant shall specify an investment allocation for each of his Accounts in accordance with procedures established by the Committee. Allocation among the investment options must be designated in increments of 1%. The Participant’s investment allocation will become effective on the same Business Day or, in the case of investment allocations received after a time specified by the Committee, the next Business Day.

A Participant may change an investment allocation on any Business Day, both with respect to future credits to the Plan and with respect to existing Account Balances, in accordance with procedures adopted by the Committee. Changes shall become effective on the same Business Day or, in the case of investment allocations received after a time specified by the Committee, the next Business Day, and shall be applied prospectively.

7.5 Unallocated Deferrals and Accounts. If the Participant fails to make an investment allocation with respect to an Account, such Account shall be invested in an investment option, the primary objective of which is the preservation of capital, as determined by the Committee.

7.6 Company Stock. A Participant’s investment allocation under Section 7.4 may include an allocation to stock units, with each unit equal in value to one share of common stock of Teleflex Incorporated (each a “Unit” and collectively, “Units”). An allocation to Units may occur with respect to Deferrals and Company Contributions only at the time Deferrals and Company Contributions are credited to the Participant’s Account under Section 7.1. Cash Deferrals and Company Contributions allocated to Units will be converted to Units (and fractional Units, as necessary) based on the fair market value of Teleflex Incorporated common stock (“Company Stock”) on the day next preceding the date the Deferral or Company Contribution is credited to the Plan. Deferrals to the Restricted Stock Award Account are automatically credited as Units on a one-for-one basis, consistent with the deferred portion of the Participant’s restricted stock units.

The Restricted Stock Award Account and any portion of a Participant’s cash Deferrals allocated to Units may not be re-allocated to any other investment option under the Plan. No amounts allocated to another investment option in the Plan may be allocated to Units.
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All amounts credited as Units will be paid in shares of Company Stock. The Company may deduct the number of shares payable to the Participant having a value equivalent to the amount of income tax withholding due at the time of payment.

The following provisions shall apply to Units and the Restricted Stock Award Account, as applicable:

(a)Restrictive Covenants. Any restrictive covenants applicable to restricted stock unit awards that may result in forfeiture of units after the vesting date shall continue to apply to any such Units credited to the Restricted Stock Award Account.

(b)Dividend Equivalents. Dividend equivalents paid with respect to Units credited to a Participant as of the dividend record date for Company stock will be credited as Earnings and converted to additional Units in the same manner as cash Deferrals and Company Contributions, set forth above, valued on the date the dividend is paid with respect to Company Stock. The Company retains the sole discretion to pay dividend equivalents in the form of cash, and if cash, may not be allocated to Units, but may be allocated by the Participant among the investment options offered under the Plan as provided in Section 7.4.

(c)Organic Changes. A Participant’s Units will be adjusted to reflect stock-splits, corporate re-organizations and other restructurings as provided in Schedule B.

7.7 Valuations Final After 180 Days. The Participant shall have 180 days following the Valuation Date on which the Participant failed to receive the full amount of Earnings and to file a claim under Article XI for the correction of such error.

Article VIII
Administration
8.1 Plan Administration. This Plan shall be administered by the Committee which shall have discretionary authority to make, amend, interpret and enforce all appropriate rules and regulations for the administration of this Plan and to utilize its discretion to decide or resolve any and all questions, including but not limited to eligibility for benefits and interpretations of this Plan and its terms, as may arise in connection with the Plan. Claims for benefits shall be filed with the Committee and resolved in accordance with the claims procedures in Article XI.

        The members of the Committee, the Company and its officers and directors, shall be entitled to rely upon all valuations, certificates and reports furnished by any funding agent or service provider, upon all certificates and reports made by an accountant, and upon all opinions given by any legal counsel selected or approved by the Committee. The members of the Committee, the Company and its officers and directors shall, except as otherwise provided by law, be fully protected in respect of any action taken or suffered by them in good faith in reliance upon any such valuations, certificates, reports, opinions or other advice of a funding agent, service provider, accountant or counsel.

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8.2 Administration Upon Change in Control. Upon a change in control affecting the Company, the Committee, as constituted immediately prior to such change in control, shall continue to act as the Committee. The Committee, by a vote of a majority of its members, shall have the authority (but shall not be obligated) to appoint an independent third party to act as the Committee. For purposes of this Section 8.2, a “change in control” means a change in control within the meaning of the rabbi trust agreement associated with the Plan or if no such definition is provided, the term shall have the meaning under Code Section 409A.

Upon such change in control, the Company may not remove the Committee or its members, unless a majority of Participants and Beneficiaries with Account Balances consent to the removal and replacement of the Committee. Notwithstanding the foregoing, the Committee shall not have authority to direct investment of trust assets under any rabbi trust described in Section 10.2.

The Participating Employers shall, with respect to the Committee identified under this Section: (i) pay all reasonable expenses and fees of the Committee, (ii) indemnify the Committee (including individuals serving as Committee members) against any costs, expenses and liabilities including, without limitation, attorneys’ fees and expenses arising in connection with the performance of the Committee’s duties hereunder, except with respect to matters resulting from the Committee’s gross negligence or willful misconduct, and (iii) supply full and timely information to the Committee on all matters related to the Plan, any rabbi trust, Participants, Beneficiaries and Accounts as the Committee may reasonably require.

8.3 Withholding. The Participating Employer shall have the right to withhold from any payment due under the Plan (or with respect to any amounts credited to the Plan) any taxes required by law to be withheld in respect of such payment (or credit). Withholdings with respect to amounts credited to the Plan shall be deducted from Compensation that has not been deferred to the Plan.

8.4 Indemnification. The Participating Employers shall indemnify and hold harmless each employee, officer, director, agent or organization, to whom or to which are delegated duties, responsibilities, and authority under the Plan or otherwise with respect to administration of the Plan, including, without limitation, the Committee, its delegees and its agents, against all claims, liabilities, fines and penalties, and all expenses reasonably incurred by or imposed upon him or it (including but not limited to reasonable attorney fees) which arise as a result of his or its actions or failure to act in connection with the operation and administration of the Plan to the extent lawfully allowable and to the extent that such claim, liability, fine, penalty, or expense is not paid for by liability insurance purchased or paid for by the Participating Employer. Notwithstanding the foregoing, the Participating Employer shall not indemnify any person or organization if his or its actions or failure to act are due to gross negligence or willful misconduct or for any such amount incurred through any settlement or compromise of any action unless the Participating Employer consents in writing to such settlement or compromise.

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8.5 Delegation of Authority. In the administration of this Plan, the Committee may, from time to time, employ agents and delegate to them such administrative duties as it sees fit, and may from time to time consult with legal counsel who shall be legal counsel to the Company.

8.6 Binding Decisions or Actions. The decision or action of the Committee in respect of any question arising out of or in connection with the administration, interpretation and application of the Plan and the rules and regulations thereunder shall be final and conclusive and binding upon all persons having any interest in the Plan.

8.7 Company as Agent for Participating Employers. Each corporation which shall become a Participating Employer pursuant to Section 2.25 by so doing shall be deemed to have appointed the Company its agent to exercise on its behalf all of the powers and authority hereby conferred upon the Company by the terms of the Plan, including but not limited to the power to amend and terminate the Plan. The Company’s authority shall continue unless and until the Affiliate terminates its participation in the Plan.

8.8 Assignment and Assumption of Liabilities. In the discretion of the Company, upon the cessation of participation in the Plan by any Participant solely due to the employer of that Participant no longer qualifying as an Affiliate, all liabilities associated with the Account of such Participant may be transferred to and assumed by the Participant’s employer under a deferred compensation plan established by such employer that is substantially identical to this Plan and that preserves the deferral and payment elections in effect for the Participant under this Plan to the extent required by Code Section 409A. Any such Participant shall not be deemed to have incurred a Separation from Service for purposes of the Plan by virtue of his employer’s ceasing to be an Affiliate. The foregoing provision shall be interpreted and administered in compliance with the requirements of Code Section 409A.

Article IX
Amendment and Termination
9.1 Amendment and Termination. The Company may at any time and from time to time amend the Plan or may terminate the Plan as provided in this Article IX. Each Participating Employer may also terminate its participation in the Plan.

9.2 Amendments. The Company, by action taken by its Board of Directors, may amend the Plan at any time and for any reason, provided that any such amendment shall not reduce the vested Account Balances of any Participant accrued as of the date of any such amendment or restatement (as if the Participant had incurred a voluntary Separation from Service on such date). The Board of Directors of the Company may delegate to the Committee the authority to amend the Plan without the consent of the Board of Directors for the purpose of: (i) conforming the Plan to the requirements of law; (ii) facilitating the administration of the Plan; (iii) clarifying provisions based on the Committee’s interpretation of the Plan documents; and (iv) making such other amendments as the Board of Directors may authorize. No amendment is needed to revise the list of
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Participating Employers set forth on Schedule A attached hereto or the procedures set forth under Schedule B attached hereto.

9.3 Termination. The Company, by action taken by its Board of Directors, may terminate the Plan and pay Participants and Beneficiaries their Account Balances in a single lump sum at any time, to the extent and in accordance with Treas. Reg. Section 1.409A-3(j)(4)(ix).

9.4 Accounts Taxable Under Code Section 409A. The Plan is intended to constitute a plan of deferred compensation that meets the requirements for deferral of income taxation under Code Section 409A. The Committee, pursuant to its authority to interpret the Plan, may sever from the Plan or any Compensation Deferral Agreement any provision or exercise of a right that otherwise would result in a violation of Code Section 409A.

Article X
Informal Funding
10.1 General Assets. Obligations established under the terms of the Plan may be satisfied from the general funds of the Participating Employers, or a trust described in this Article X. No Participant, spouse or Beneficiary shall have any right, title or interest whatever in assets of the Participating Employers. Nothing contained in this Plan, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind, or a fiduciary relationship, between the Participating Employers and any Employee, spouse, or Beneficiary. To the extent that any person acquires a right to receive payments hereunder, such rights are no greater than the right of an unsecured general creditor of the Participating Employer.

10.2 Rabbi Trust. A Participating Employer may, in its sole discretion, establish a grantor trust, commonly known as a rabbi trust, as a vehicle for accumulating assets to pay benefits under the Plan. Payments under the Plan may be paid from the general assets of the Participating Employer or from the assets of any such rabbi trust. Payment from any such source shall reduce the obligation owed to the Participant or Beneficiary under the Plan.

If a rabbi trust is in existence upon the occurrence of a “change in control”, as defined in such trust, the Participating Employer shall, upon such change in control, and on each anniversary of the change in control, contribute in cash or liquid securities such amounts as are necessary so that the value of assets after making the contributions exceed 125% of the total value of all Account Balances.

10.3 Payment of Expenses. Payments to Participants under the Plan may be offset on an after-tax basis in an amount equal to any transactional or other direct expenses incurred by the Participant, unless the Company or Participating Employer elects to pay the expenses. Such deductions shall be taken at the time of payment from the Plan or from other compensation not deferred under the Plan.

Article XI
Claims
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11.1 Filing a Claim. Any controversy or claim arising out of or relating to the Plan shall be filed in writing with the Committee which shall make all determinations concerning such claim. Any claim filed with the Committee and any decision by the Committee denying such claim shall be in writing and shall be delivered to the Participant or Beneficiary filing the claim (the “Claimant”). Notice of a claim for payments shall be delivered to the Committee within 90 days of the latest date upon which the payment could have been timely made in accordance with the terms of the Plan and Code Section 409A, and if not paid, the Participant or Beneficiary must file a claim under this Article XI not later than 180 days after such latest date. If the Participant or Beneficiary fails to file a timely claim, the Participant forfeits any amounts to which he or she may have been entitled to receive under the claim.

(a) In General. Notice of a denial of benefits (other than claims based on disability) will be provided within 90 days of the Committee’s receipt of the Claimant's claim for benefits. If the Committee determines that it needs additional time to review the claim, the Committee will provide the Claimant with a notice of the extension before the end of the initial 90-day period. The extension will not be more than 90 days from the end of the initial 90-day period and the notice of extension will explain the special circumstances that require the extension and the date by which the Committee expects to make a decision.

(b) Disability Benefits. Notice of denial of claims based on disability will be provided within forty-five (45) days of the Committee’s receipt of the Claimant’s claim for disability benefits. If the Committee determines that it needs additional time to review the disability claim, the Committee will provide the Claimant with a notice of the extension before the end of the initial 45-day period. If the Committee determines that a decision cannot be made within the first extension period due to matters beyond the control of the Committee, the time period for making a determination may be further extended for an additional 30 days. If such an additional extension is necessary, the Committee shall notify the Claimant prior to the expiration of the initial 30-day extension. Any notice of extension shall indicate the circumstances necessitating the extension of time, the date by which the Committee expects to furnish a notice of decision, the specific standards on which such entitlement to a benefit is based, the unresolved issues that prevent a decision on the claim and any additional information needed to resolve those issues. A Claimant will be provided a minimum of 45 days to submit any necessary additional information to the Committee. In the event that a 30-day extension is necessary due to a Claimant’s failure to submit information necessary to decide a claim, the period for furnishing a notice of decision shall be tolled from the date on which the notice of the extension is sent to the Claimant until the earlier of the date the Claimant responds to the request for additional information or the response deadline.

(c) Contents of Notice. If a claim for benefits is completely or partially denied, notice of such denial shall be in writing. Any electronic notification shall comply with the standards imposed by Department of Labor Regulation 29 CFR 2520.104b-1(c)(1)(i), (iii), and (iv). The notice of denial shall set forth the specific
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reasons for denial in plain language. The notice shall: (i) cite the pertinent provisions of the Plan document, and (ii) explain, where appropriate, how the Claimant can perfect the claim, including a description of any additional material or information necessary to complete the claim and why such material or information is necessary. The claim denial also shall include an explanation of the claims review procedures and the time limits applicable to such procedures, including the right to appeal the decision, the deadline by which such appeal must be filed and a statement of the Claimant’s right to bring a civil action under Section 502(a) of ERISA following an adverse decision on appeal and the specific date by which such a civil action must commence under Section 11.4.
In the case of a complete or partial denial of a disability benefit claim, the notice shall provide such information and shall be communicated in the manner required under applicable Department of Labor regulations.

11.2 Appeal of Denied Claims. A Claimant whose claim has been completely or partially denied shall be entitled to appeal the claim denial by filing a written appeal with a committee designated to hear such appeals (the “Appeals Committee”). A Claimant who timely requests a review of the denied claim (or his or her authorized representative) may review, upon request and free of charge, copies of all documents, records and other information relevant to the denial and may submit written comments, documents, records and other information relating to the claim to the Appeals Committee. All written comments, documents, records, and other information shall be considered “relevant” if the information: (i) was relied upon in making a benefits determination, (ii) was submitted, considered or generated in the course of making a benefits decision regardless of whether it was relied upon to make the decision, or (iii) demonstrates compliance with administrative processes and safeguards established for making benefit decisions. The review shall take into account all comments, documents, records, and other information submitted by the Claimant relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination. The Appeals Committee may, in its sole discretion and if it deems appropriate or necessary, decide to hold a hearing with respect to the claim appeal.

(a)In General. Appeal of a denied benefits claim (other than a disability benefits claim) must be filed in writing with the Appeals Committee no later than 60 days after receipt of the written notification of such claim denial. The Appeals Committee shall make its decision regarding the merits of the denied claim within 60 days following receipt of the appeal (or within 120 days after such receipt, in a case where there are special circumstances requiring extension of time for reviewing the appealed claim). If an extension of time for reviewing the appeal is required because of special circumstances, written notice of the extension shall be furnished to the Claimant prior to the commencement of the extension. The notice will indicate the special circumstances requiring the extension of time and the date by which the Appeals Committee expects to render the determination on review. The review will take into account comments, documents, records and other information submitted by the Claimant relating to the claim without regard
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to whether such information was submitted or considered in the initial benefit determination.

(b)Disability Benefits. Appeal of a denied disability benefits claim must be filed in writing with the Appeals Committee no later than 180 days after receipt of the written notification of such claim denial. The review shall be conducted in accordance with applicable Department of Labor regulations.
The Appeals Committee shall make its decision regarding the merits of the denied claim within 45 days following receipt of the appeal (or within 90 days after such receipt, in a case where there are special circumstances requiring extension of time for reviewing the appealed claim). If an extension of time for reviewing the appeal is required because of special circumstances, written notice of the extension shall be furnished to the Claimant prior to the commencement of the extension. The notice will indicate the special circumstances requiring the extension of time and the date by which the Appeals Committee expects to render the determination on review. Following its review of any additional information submitted by the Claimant, the Appeals Committee shall render a decision on its review of the denied claim.

(c)Contents of Notice. If a benefits claim is completely or partially denied on review, notice of such denial shall be in writing. Any electronic notification shall comply with the standards imposed by Department of Labor Regulation 29 CFR 2520.104b-1(c)(1)(i), (iii), and (iv). Such notice shall set forth the reasons for denial in plain language.

The decision on review shall set forth: (i) the specific reason or reasons for the denial, (ii) specific references to the pertinent Plan provisions on which the denial is based, (iii) a statement that the Claimant is entitled to receive, upon request and free of charge, reasonable access to and copies of all documents, records, or other information relevant (as defined above) to the Claimant’s claim, and (iv) a statement of the Claimant’s right to bring an action under Section 502(a) of ERISA, following an adverse decision on review and the specific date by which such a civil action must commence under Section 11.4.

For the denial of a disability benefit, the notice will also include such additional information and be communicated in the manner required under applicable Department of Labor regulations.

11.3 Claims Appeals Upon Change in Control. Upon a change in control, the Appeals Committee, as constituted immediately prior to such change in control, shall continue to act as the Appeals Committee. The Company may not remove any member of the Appeals Committee, but may replace resigning members if 2/3rds of the members of the Board of Directors of the Company and a majority of Participants and Beneficiaries with Account Balances consent to the replacement. For purposes of this Section 11.3, a “change in control” means a change in control within the meaning of the rabbi trust
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agreement associated with the Plan or if no such definition is provided, the term shall have the meaning under Code Section 409A.

The Appeals Committee shall have the exclusive authority at the appeals stage to interpret the terms of the Plan and resolve appeals under the Claims Procedure.

Each Participating Employer shall, with respect to the Committee identified under this Section: (i) pay its proportionate share of all reasonable expenses and fees of the Appeals Committee, (ii) indemnify the Appeals Committee (including individual committee members) against any costs, expenses and liabilities including, without limitation, attorneys’ fees and expenses arising in connection with the performance of the Appeals Committee hereunder, except with respect to matters resulting from the Appeals Committee’s gross negligence or willful misconduct, and (iii) supply full and timely information to the Appeals Committee on all matters related to the Plan, any rabbi trust, Participants, Beneficiaries and Accounts as the Appeals Committee may reasonably require.

11.4 Legal Action. A Claimant may not bring any legal action, including commencement of any arbitration, relating to a claim for benefits under the Plan unless and until the Claimant has followed the claims procedures under the Plan and exhausted his or administrative remedies under Sections 11.1 and 11.2. No such legal action may be brought more than twelve (12) months following the notice of denial of benefits under Section 11.2, or if no appeal is filed by the applicable appeals deadline, twelve (12) months following the appeals deadline.

If a Participant or Beneficiary prevails in a legal proceeding brought under the Plan to enforce the rights of such Participant or any other similarly situated Participant or Beneficiary, in whole or in part, the Participating Employer shall reimburse such Participant or Beneficiary for all legal costs, expenses, attorneys’ fees and such other liabilities incurred as a result of such proceedings. If the legal proceeding is brought in connection with a change in control as defined in Section 11.3, the Participant or Beneficiary may file a claim directly with the trustee for reimbursement of such costs, expenses and fees. For purposes of the preceding sentence, the amount of the claim shall be treated as if it were an addition to the Participant’s or Beneficiary’s Account Balance and will be included in determining the Participating Employer’s trust funding obligation under Section 10.2.

11.5 Discretion of Appeals Committee. All interpretations, determinations and decisions of the Appeals Committee with respect to any claim shall be made in its sole discretion and shall be final and conclusive.

11.6 Arbitration.

(a)Prior to Change in Control. If, prior to a change in control as defined in Section 11.3, any claim or controversy between a Participating Employer and a Participant or Beneficiary is not resolved through the claims procedure set forth in Article XI, such claim shall be submitted to and resolved exclusively by expedited binding
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arbitration by a single arbitrator administered by the American Arbitration Association (“AAA”). Arbitration shall be conducted in accordance with the following procedures:

The complaining party shall promptly send written notice to the other party identifying the matter in dispute and the proposed remedy. Following the giving of such notice, the parties shall meet and attempt in good faith to resolve the matter. In the event the parties are unable to resolve the matter within 21 days, the parties shall meet and attempt in good faith to select a single arbitrator acceptable to both parties in accordance with the rules of the AAA for selection of a single arbitrator.

Unless the parties agree otherwise, within 60 days of the selection of the arbitrator, a hearing shall be conducted before such arbitrator in Philadelphia, PA unless the parties agree by mutual consent to a different location. The arbitration shall be administered by the AAA and AAA rules shall govern the arbitration except to the extent in conflict with this provision (Article XI 6(a)). In the event the parties are unable to agree upon the date of the arbitration, the date(s) shall be designated by the arbitrator after consultation with the parties. Within 30 days of the conclusion of the arbitration hearing, the arbitrator shall issue an award, accompanied by a written decision explaining the basis for the arbitrator’s award.

In any arbitration hereunder, the administrative fees of the arbitration and all fees of the arbitrator shall be paid equally by the Participating Employer and the Participant or Beneficiary. Each party shall pay its own attorneys’ fees, costs, and expenses, unless the arbitrator orders otherwise. The arbitrator shall have no authority to add to or to modify this Plan, shall apply all applicable law, and shall have no lesser and no greater remedial authority than would a court of law resolving the same claim or controversy. The arbitrator shall, upon an appropriate motion, dismiss any claim without an evidentiary hearing if the party bringing the motion establishes that it would be entitled to summary judgment if the matter had been pursued in court litigation.

The parties shall be entitled to discovery as follows: Each party may take no more than three depositions. The Participating Employer may depose the Participant or Beneficiary plus two other witnesses, and the Participant or Beneficiary may depose the Participating Employer, pursuant to Rule 30(b)(6) of the Federal Rules of Civil Procedure, plus two other witnesses. Each party may make such reasonable document discovery requests as are allowed in the discretion of the arbitrator and be entitled to propound 25 interrogatory questions (including subparts).

The decision of the arbitrator shall be final, binding, and non-appealable, and may be enforced as a final judgment in any court of competent jurisdiction.

This arbitration provision of the Plan shall extend to claims against any parent, subsidiary, or affiliate of each party, and, when acting within such capacity, any
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officer, director, shareholder, Participant, Beneficiary, or agent of any party, or of any of the above, and shall apply as well to claims arising out of state and federal statutes and local ordinances as well as to claims arising under the common law or under this Plan.

Notwithstanding the foregoing, and unless otherwise agreed between the parties, either party may apply to a court for provisional relief, including a temporary restraining order or preliminary injunction, on the ground that the arbitration award to which the applicant may be entitled may be rendered ineffectual without provisional relief.

Any arbitration hereunder shall be conducted in accordance with the Federal Arbitration Act: provided, however, that, in the event of any inconsistency between the rules and procedures of the Act and the terms of this Plan, the terms of this Plan shall prevail. The governing law shall be the law of the Commonwealth of Pennsylvania to the extent the dispute or contract is not governed or preempted by U.S. federal law.

If any of the provisions of this Section 11.6(a) are determined to be unlawful or otherwise unenforceable, in the whole part, such determination shall not affect the validity of the remainder of this section and this section shall be reformed to the extent necessary to carry out its provisions to the greatest extent possible and to insure that the resolution of all conflicts between the parties, including those arising out of statutory claims, shall be resolved by neutral, binding arbitration. If a court should find that the provisions of this Section 11.6(a) are not absolutely binding, then the parties intend any arbitration decision and award to be fully admissible in evidence in any subsequent action, given great weight by any finder of fact and treated as determinative to the maximum extent permitted by law.

The parties do not agree to arbitrate any putative class action or any other representative action. The parties agree to arbitrate only the claims(s) of a single Participant or Beneficiary.

(b)Upon Change in Control. Upon a change in control as defined in Section 11.3, Section 11.6(a) shall not apply and any legal action initiated by a Participant or Beneficiary to enforce his or her rights under the Plan may be brought in any court of competent jurisdiction. Notwithstanding the Appeals Committee’s discretion under Sections 11.3 and 11.5, the court shall apply a de novo standard of review to any prior claims decision under Sections 11.1 through 11.3 or any other determination made by the Company, its Board of Directors, a Participating Employer, the Committee, or the Appeals Committee.

Article XII
General Provisions
12.1 Assignment. No interest of any Participant, spouse or Beneficiary under this Plan and no benefit payable hereunder shall be assigned as security for a loan, and any such purported
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assignment shall be null, void and of no effect, nor shall any such interest or any such benefit be subject in any manner, either voluntarily or involuntarily, to anticipation, sale, transfer, assignment or encumbrance by or through any Participant, spouse or Beneficiary. Notwithstanding anything to the contrary herein, however, the Committee has the discretion to make payments to an alternate payee in accordance with the terms of a domestic relations order (as defined in Code Section 414(p)(1)(B)).

        The Company may assign any or all of its liabilities under this Plan in connection with any restructuring, recapitalization, sale of assets or other similar transactions affecting a Participating Employer without the consent of the Participant.

12.2 No Legal or Equitable Rights or Interest. No Participant or other person shall have any legal or equitable rights or interest in this Plan that are not expressly granted in this Plan. Participation in this Plan does not give any person any right to be retained in the service of the Participating Employer. The right and power of a Participating Employer to dismiss or discharge an Employee is expressly reserved. The Participating Employers make no representations or warranties as to the tax consequences to a Participant or a Participant’s beneficiaries resulting from a deferral of income pursuant to the Plan.

12.3 No Employment Contract. Nothing contained herein shall be construed to constitute a contract of employment between an Employee and a Participating Employer.

12.4 Notice. Any notice or filing required or permitted to be delivered to the Committee under this Plan shall be delivered in writing, in person, or through such electronic means as is established by the Committee. Notice shall be deemed given as of the date of delivery or, if delivery is made by mail, as of the date shown on the postmark on the receipt for registration or certification. Written transmission shall be sent by certified mail to:

Teleflex Incorporated
550 E Swedesford Rd Suite 400
WAyne, PA 19087
attn: Employee Benefits

Any notice or filing required or permitted to be given to a Participant under this Plan shall be sufficient if in writing or hand-delivered, or sent by mail to the last known address of the Participant.

12.5 Headings. The headings of Sections are included solely for convenience of reference, and if there is any conflict between such headings and the text of this Plan, the text shall control.

12.6 Invalid or Unenforceable Provisions. If any provision of this Plan shall be held invalid or unenforceable, such invalidity or unenforceability shall not affect any other provisions hereof and the Committee may elect in its sole discretion to construe such invalid or unenforceable provisions in a manner that conforms to applicable law or as if such provisions, to the extent invalid or unenforceable, had not been included.

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12.7 Lost Participants or Beneficiaries. Any Participant or Beneficiary who is entitled to a benefit from the Plan has the duty to keep the Committee advised of his or her current mailing address. If benefit payments are returned to the Plan or are not presented for payment after a reasonable amount of time, the Committee shall presume that the payee is missing. The Committee, after making such efforts as in its discretion it deems reasonable and appropriate to locate the payee, shall stop payment on any uncashed checks and may discontinue making future payments until contact with the payee is restored. If the Committee is unable to locate the Participant or Beneficiary after five years of the date payment is scheduled to be made, provided that a Participant’s Account shall not be credited with Earnings following the first anniversary of such date on which payment is to be made and further provided, however, that such benefit shall be reinstated, without further adjustment for interest, if a valid claim is made by or on behalf of the Participant or Beneficiary for all or part of the forfeited benefit.

12.8 Facility of Payment to a Minor. If a distribution is to be made to a minor, or to a person who is otherwise incompetent, then the Committee may, in its discretion, make such distribution: (i) to the legal guardian, or if none, to a parent of a minor payee with whom the payee maintains his or her residence, or (ii) to the conservator or committee or, if none, to the person having custody of an incompetent payee. Any such distribution shall fully discharge the Committee, the Company, and the Plan from further liability on account thereof.

12.9 Governing Law. To the extent not preempted by ERISA, the laws of the Commonwealth of Pennsylvania shall govern the construction and administration of the Plan.

12.10 Compliance With Code Section 409A; No Guarantee. This Plan is intended to be administered in compliance with Code Section 409A and each provision of the Plan shall be interpreted consistent with Code Section 409A. Although intended to comply with Code Section 409A, this Plan shall not constitute a guarantee to any Participant or Beneficiary that the Plan in form or in operation will result in the deferral of federal or state income tax liabilities or that the Participant or Beneficiary will not be subject to the additional taxes imposed under Section 409A. No Employer shall have any legal obligation to a Participant with respect to taxes imposed under Code Section 409A.


IN WITNESS WHEREOF, the undersigned executed this Plan as of the 22nd day of November, 2019, to be effective as of the Effective Date.


TELEFLEX INCORPORATED

By: Nicholas Herninko

Its: Director of Benefits, HR Ops and Compliance


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        /s/ Nicholas Herninko    
Schedule A

Participating Employers

Teleflex Incorporated



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Schedule B

Provisions Related to Organic Changes


An “Organic Change” includes (1) a stock split, reverse stock split, share combination, or recapitalization or similar event affecting the capital structure of the Company (each, a “Share Change”), or (2) a merger, consolidation, acquisition of property or shares, separation, spin-off, reorganization, stock rights offering, liquidation or similar event affecting the Company or any of its subsidiaries.

In the event any Organic Change occurs, then the Committee or Board may make such substitutions or adjustments with respect to Units held in a Participant’s Account as it deems appropriate and equitable. Such adjustments may include, without limitation, (a) the division or consolidation of Units on the same basis as any stock split or reverse stock split affecting the common stock of the Company and (b) the conversion of Units to notional cash or the change in the referenced security for each Unit from common stock of the Company to equity shares of a different entity (which may include the equity of an Affiliate of the Company) having an aggregate fair market value equal to the aggregate fair market value of the Units held by the Participant on the day prior to the conversion date, with fair market value in each instance being determined by the Committee or Board. If the assets held in the Participant’s Account immediately after such adjustment are not equity securities, then the Participant shall be permitted to re-direct the investment thereof into the other investment choices then available under this Plan.

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Exhibit 10.2.1

            















Teleflex Incorporated
Directors’ Deferred Compensation Plan



















Effective Date
November 1, 2019

        
Teleflex Incorporated Directors’ Deferred Compensation Plan

Article I
        Establishment and Purpose 1

Article II
        Definitions 1

Article III
        Eligibility and Participation 5

Article IV
        Deferrals 5

Article V
        Vesting 8

Article VI
        Payments from Accounts 8

Article VII
        Valuation of Account Balances; Investments 11

Article VIII
        Administration 13

Article IX
        Amendment and Termination 14

Article X
        Informal Funding 15

Article XI
        Claims 15

Article XII
        General Provisions 21
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Article I
Establishment and Purpose
Teleflex Incorporated (the “Company”) has adopted this Teleflex Incorporated Directors’ Corporation Deferred Compensation Plan, applicable to Compensation deferred under Compensation Deferral Agreements submitted on and after the Effective Date. In addition to this Plan, the provisions of Section 6.9 (modification elections) and Articles VII through XII will apply to amounts deferred under the terms of the Teleflex Incorporated Deferred Compensation Plan, as amended through January 1, 2016 and predecessor plans that are subject to Code Section 409A (collectively, the “Prior Plans”).

The purpose of the Plan is to provide non-employee members of the Board of Directors of the Company with an opportunity to defer receipt of a portion of director fees. The Plan is not intended to meet the qualification requirements of Code Section 401(a). The Plan is intended to meet the requirements of Code Section 409A and shall be operated and interpreted consistent with that intent.

The Plan constitutes an unsecured promise by the Company to pay benefits in the future. Participants in the Plan shall have the status of general unsecured creditors of the Company. The Plan is unfunded for Federal tax purposes. Any amounts set aside to defray the liabilities assumed by the Company will remain the general assets of the Company and shall remain subject to the claims of the Company’s creditors until such amounts are distributed to the Participants.

Article II
Definitions
2.1 Account. Account means a bookkeeping account maintained by the Committee to record the payment obligation of the Company to a Participant as determined under the terms of the Plan. The Committee may maintain an Account to record the total obligation to a Participant and component Accounts to reflect amounts payable at different times and in different forms. Reference to an Account means any such Account established by the Committee, as the context requires. Accounts are intended to constitute unfunded obligations within the meaning of Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA.

2.2 Account Balance. Account Balance means, with respect to any Account, the total payment obligation owed to a Participant from such Account as of the most recent Valuation Date.

2.3 Beneficiary. Beneficiary means a natural person, estate, or trust designated by a Participant in accordance with Section 6.4 hereof to receive payments to which a Beneficiary is entitled in accordance with provisions of the Plan.

2.4 Board of Directors. Board of Directors means the board of directors of the Company.

2.5 Business Day. Business Day means each day on which the New York Stock Exchange is open for business.

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2.6 Change in Control. Change in Control means, with respect to the Company, any of the following events: (i) a change in the ownership of the Company, (ii) a change in the effective control of the Company, or (iii) a change in the ownership of a substantial portion of the assets of the Company.

Change in Ownership. For purposes of this Section, a change in the ownership of the Company occurs on the date on which any one person, or more than one person acting as a group, acquires ownership of stock of the Company that, together with stock held by such person or group constitutes more than 50% of the total fair market value or total voting power of the stock of the Company. The acquisition by a person or group owning more than 50% of the total fair market value or total voting power of the stock of the Company of additional shares of the Company shall not constitute a “change of the ownership” of the Company.

Change in Effective Control. A change in the effective control of the Company occurs on the date on which either: (i) a person, or more than one person acting as a group, acquires ownership of stock of the Company possessing 30% or more of the total voting power of the stock of the Company, taking into account all such stock acquired during the 12-month period ending on the date of the most recent acquisition, provided that the acquisition by a person or group owning more than 30% of the total fair market value or total voting power of the stock of the Company of additional shares of the Company shall not constitute a “change of effective control” of the Company, or (ii) a majority of the members of the Company’s Board of Directors is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of such Board of Directors prior to the date of the appointment or election, but only if no other corporation is a majority shareholder of the Company.
Change in Ownership of Substantial Portion of Assets. A change in the ownership of a substantial portion of assets occurs on the date on which any one person, or more than one person acting as a group, other than a person or group of persons that is related to the Company, acquires assets from the Company that have a total gross fair market value equal to or more than 40% of the total gross fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions, taking into account all such assets acquired during the 12-month period ending on the date of the most recent acquisition. A transfer of assets shall not be treated as a “change in the ownership of a substantial portion of the assets” when such transfer is made to an entity that is controlled by the shareholders of the transferor corporation as determined under Treas. Reg. section 1.409A-3(i)(5)(vii)(B).

2.7 Claimant. Claimant means a Participant or Beneficiary filing a claim under Article XI of this Plan.

2.8 Code. Code means the Internal Revenue Code of 1986, as amended from time to time.

2.9 Code Section 409A. Code Section 409A means section 409A of the Code, and regulations and other guidance issued by the Treasury Department and Internal Revenue Service thereunder.

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2.10 Committee. Committee means the Company or a committee appointed by the Company to administer the Plan.

2.11 Company. Company means Teleflex Incorporated.

2.12 Compensation. Compensation means a Director’s retainer, meeting and committee fees and restricted stock units awarded by the Company.

2.13 Compensation Deferral Agreement. Compensation Deferral Agreement means an agreement between a Participant and the Company that specifies: (i) the amount of each component of Compensation that the Participant has elected to defer to the Plan in accordance with the provisions of Article IV, and (ii) the allocation of such Deferrals among one or more of the Participant’s Retirement Account or Flex Accounts.

2.14 Deferral. Deferral means a credit to a Participant’s Account(s) that records that portion of the Participant’s Compensation that the Participant has elected to defer to the Plan in accordance with the provisions of Article IV. Unless the context of the Plan clearly indicates otherwise, a reference to Deferrals includes Earnings attributable to such Deferrals.

2.15 Director. Director means a non-employee member of the Board of Directors of the Company.
2.16 Earnings. Earnings means an adjustment to the value of an Account in accordance with Article VII.

2.17 Effective Date. Effective Date means November 1, 2019.

2.18  Flex Account. Flex Account means a Separation Account or Specified Date Account established under the terms of a Participant’s Compensation Deferral Agreement. Unless the Committee specifies otherwise, a Participant may maintain no more than five (5) Flex Accounts at any one time.

2.19 Participant. Participant means an individual described in Article III.

2.20 Payment Schedule. Payment Schedule means the date as of which payment of an Account under the Plan will commence and the form in which payment of such Account will be made under the terms of a payment election in effect for such Account. The Payment Schedule for an Account will be established under the Participant’s Compensation Deferral Agreement that establishes the Account, as may be modified under Section 6.9.

2.21 Plan. Plan means “Teleflex Incorporated Directors’ Deferred Compensation Plan” as documented herein and as may be amended from time to time hereafter. However, to the extent permitted or required under Code Section 409A, the term Plan may in the appropriate context also mean a portion of the Plan that is treated as a single plan under Treas. Reg. Section 1.409A-1(c), or the Plan or portion of the Plan and any other
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nonqualified deferred compensation plan or portion thereof that is treated as a single plan under such section.

2.22 Plan Year. Plan Year means January 1 through December 31.

2.23 Restricted Stock Award Account. Restricted Stock Award Account means a sub-account of the Retirement Account, a sub-account of a Separation Account or a sub-account of a Specified Date Account that holds a Participant’s deferrals of restricted stock awards.

2.24 Retirement Account. Retirement Account means an Account established by the Committee to record Deferrals allocated to the Retirement Account pursuant to a Participant’s Compensation Deferral Agreement, payable to a Participant upon Separation from Service in accordance with Section 6.3.

2.25 Separation Account. Separation Account means a Flex Account established by the Committee in accordance with a Participant’s Compensation Deferral Agreement to record Deferrals allocated to such Account by the Participant and which are payable upon the Participant’s Separation from Service as set forth in Section 6.3.

2.26 Separation from Service. Separation from Service means a Director’s termination of service from the Board of Directors. Separation from Service shall be determined in accordance with Code Section 409A.

2.27 Specified Date Account. Specified Date Account means a Flex Account established by the Committee to record the amounts payable in a future year as specified in the Participant’s Compensation Deferral Agreement.

2.29 Substantial Risk of Forfeiture. Substantial Risk of Forfeiture has the meaning specified in Treas. Reg. Section 1.409A-1(d).

2.29 Unforeseeable Emergency. Unforeseeable Emergency means a severe financial hardship to the Participant resulting from an illness or accident of the Participant, the Participant’s spouse, the Participant’s dependent (as defined in Code section 152, without regard to section 152(b)(1), (b)(2), and (d)(1)(B)), or a Beneficiary; loss of the Participant’s property due to casualty (including the need to rebuild a home following damage to a home not otherwise covered by insurance, for example, as a result of a natural disaster); or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant. The types of events which may qualify as an Unforeseeable Emergency may be limited by the Committee.

2.30 Valuation Date. Valuation Date means each Business Day.


Article III
Eligibility and Participation
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3.1 Eligibility and Participation. All Directors may enroll in the Plan in accordance with any procedures established by the Company. Directors become Participants on the date on which the first Compensation Deferral Agreement becomes irrevocable under Article IV.

3.2 Duration. Only Directors may submit Compensation Deferral Agreements during an enrollment. On and after a Separation from Service, a Participant shall remain a Participant as long as his or her Account Balance is greater than zero (0). All Participants, regardless of membership on the Board of Directors, will continue to be credited with Earnings and during such time may continue to make allocation elections as provided in Section 7.4 and modification elections under Section 6.9. An individual shall cease being a Participant in the Plan when his Account has been reduced to zero (0).

Article IV
Deferrals

a.Deferral Elections, Generally.

(a)Directors may make an initial election to defer Compensation by submitting a Compensation Deferral Agreement during the enrollment periods established by the Committee and in the manner specified by the Committee, but in any event, in accordance with Section 4.2. Unless an earlier date is specified in the Compensation Deferral Agreement, deferral elections with respect to a Compensation source become irrevocable on the latest date applicable to such Compensation source under Section 4.2.

(b)A Compensation Deferral Agreement that is not timely filed with respect to a service period or component of Compensation, or that is submitted by a Participant who Separates from Service prior to the latest date such agreement would become irrevocable under Section 409A, shall be considered null and void and shall not take effect with respect to such item of Compensation. The Committee may modify or revoke any Compensation Deferral Agreement prior to the date the election becomes irrevocable under the rules of Section 4.2.

(c)The Committee may permit different deferral amounts for each component of Compensation and may establish a minimum or maximum deferral amount for each such component. Unless otherwise specified by the Committee in the Compensation Deferral Agreement, Participants may defer from 2% to 100% of their fees and from 10% to 100% of stock units.

(d)The Participant shall specify on his or her Compensation Deferral Agreement the amount of Deferrals and whether to allocate Deferrals to the Retirement Account or to one or more Flex Accounts. If no designation is made, Deferrals shall be allocated to the Retirement Account.

4.2 Timing Requirements for Compensation Deferral Agreements.

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(a) Initial Eligibility. Directors may enroll within 30 days after becoming eligible to participate in the Plan as specified by the Committee. A newly seated Director becomes eligible to participate in the Plan as designated and notified by the Committee during an applicable enrollment period which shall occur 30 days prior to July 1 and January 1 or such other periods established by the Committee. The Compensation Deferral Agreement must be filed within 30 days after attaining eligible status and becomes irrevocable not later than the 30th day.

        A Compensation Deferral Agreement filed under this paragraph applies to Compensation earned after the date that the Compensation Deferral Agreement becomes irrevocable.

(a)Prior Year Election. Directors may defer Compensation by filing a Compensation Deferral Agreement no later than December 31 of the year prior to the calendar year in which the Compensation to be deferred is earned. A Compensation Deferral Agreement filed under this paragraph shall become irrevocable with respect to such Compensation not later than the December 31 filing deadline.

(b)Short-Term Deferrals. The Committee may permit Compensation that meets the definition of a “short-term deferral” described in Treas. Reg. Section 1.409A-1(b)(4) to be deferred in accordance with the rules of Section 6.9, applied as if the date the Substantial Risk of Forfeiture lapses is the date payments were originally scheduled to commence, provided, however, that the provisions of Section 6.9(b) shall not apply to payments attributable to a change in control (as defined in Treas. Reg. Section 1.409A-3(i)(5)). A Compensation Deferral Agreement submitted in accordance with this paragraph becomes irrevocable on the latest date it could be submitted under Section 6.9.

(c)Restricted Stock Units and Other Forfeitable Rights. With respect to a legally binding right to a payment in a subsequent year that is subject to a forfeiture condition requiring the Participant’s continued services for a period of at least 12 months from the date the Participant obtains the legally binding right, the Committee may permit an a Director to defer such Compensation by filing a Compensation Deferral Agreement on or before the 30th day after the legally binding right to the Compensation accrues, provided that the Compensation Deferral Agreement is submitted at least 12 months in advance of the earliest date on which the forfeiture condition could lapse. The Compensation Deferral Agreement described in this paragraph becomes irrevocable not later than such 30th day. If the forfeiture condition applicable to the payment lapses before the end of such 12-month period as a result of the Participant’s death or disability (as defined in Treas. Reg. Section 1.409A-3(i)(4)) or upon a change in control (as defined in Treas. Reg. Section 1.409A-3(i)(5)), the Compensation Deferral Agreement will be void unless it would be considered timely under another rule described in this Section.

(d)“Evergreen” Deferral Elections. The Committee, in its discretion, may provide that Compensation Deferral Agreements will continue in effect for subsequent
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years or performance periods by communicating that intention to Participants in writing prior to the date Compensation Deferral Agreements become irrevocable under this Section 4.2. An evergreen Compensation Deferral Agreement may be revoked or modified in writing prospectively by the Participant or the Committee with respect to Compensation for which such election remains revocable under this Section 4.2.

A Compensation Deferral Agreement is deemed to be revoked for subsequent years if the Participant is not a Director as of the last permissible date for making elections under this Section 4.2 or if the Compensation Deferral Agreement is cancelled in accordance with Section 4.5.

4.3 Allocation of Deferrals. A Compensation Deferral Agreement may allocate Deferrals to the Retirement Account or to one or more Flex Accounts. The Committee may, in its discretion, establish in a written communication during enrollment a minimum deferral period for the establishment of a Specified Date Account. In the event a Participant’s Compensation Deferral Agreement allocates a component of Compensation to a Specified Date Account that commences payment in the year such Compensation is earned, the Compensation Deferral Agreement shall be deemed to allocate the Deferral to the Participant’s Specified Date Account having the next earliest payment year. In the event restricted stock units are allocated to a Specified Date Account that commences payment on or before the date restricted stock units vest, the units will be allocated to the Specified Date Account having the next earliest payment year that occurs after the calendar year in which such restricted stock units vest. If the Participant has no other Specified Date Accounts that meet the foregoing requirements, the Committee will allocate the Deferral to the Retirement Account.

4.4 Cancellation of Deferrals. The Committee may cancel a Participant’s Deferrals: (i) for the balance of the Plan Year in which an Unforeseeable Emergency occurs, and (ii) during periods in which the Participant is unable to perform his or her duties due to a mental or physical impairment that can be expected to result in death or last for a continuous period of at least six months (a “disability”), provided cancellation occurs by the later of the end of the taxable year of the Participant or the 15th day of the third month following the date the Participant incurs the disability (as defined in this Section 4.5).


Article V
Vesting
Participant Deferrals of cash Compensation shall be 100% vested at all times. Deferrals of vesting awards of Compensation shall become vested in accordance with the provisions of the underlying award.

Article VI
Payments from Accounts

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6.1 General Rules. A Participant’s Accounts become payable upon the first to occur of the payment events applicable to such Account under (i) Sections 6.2 or 6.3 (as elected) and (ii) Sections 6.4 through 6.6.
Payment events and Payment Schedules elected by the Participant shall be set forth in a valid Compensation Deferral Agreement that establishes the Account to which such elections apply in accordance with Article IV or in a valid modification election applicable to such Account as described in Section 6.9.
Payment amounts are based on Account Balances as of the last Valuation Date of the month next preceding the month actual payment is made.

6.2 Specified Date Accounts.
Commencement. Payment is made or begins in the calendar year designated by the Participant. Form of Payment. Payment will be made in a lump sum, unless the Participant elected to receive annual installments up to 10 years.

The time and form of payment of Specified Date Accounts is unaffected by an earlier Separation from Service described in Section 6.3.

6.3 Separation from Service. Upon a Participant’s Separation from Service other than death, the Participant is entitled to receive his or her vested Retirement Account and vested Separation Accounts.

        Commencement. The Retirement Account and all Separation Accounts commence payment in the calendar year next following the calendar year in which Separation from Service occurs, unless the Participant elected a later year.

        Form of Payment. The Retirement Account and Separation Accounts will be paid in a single lump sum unless the Participant elected with respect to an Account to receive annual installments up to 15 years.
Change in Control. A Participant who has a Separation from Service within 24 months following a Change in Control will receive his or her Accounts in a single lump sum commencing in the calendar year next following the year in which Separation from Service occurs, regardless of any other Payment Schedule elected by the Participant for such Account.

6.4 Death. Notwithstanding anything to the contrary in this Article VI, upon the death of the Participant (regardless of whether such Participant is a Director at the time of death), all remaining vested Account Balances shall be paid to his or her Beneficiary in a single lump sum no later than December 31 of the calendar year following the year of the Participant’s death.

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(a) Designation of Beneficiary in General. The Participant shall designate a Beneficiary in the manner and on such terms and conditions as the Committee may prescribe. No such designation shall become effective unless filed with the Committee during the Participant’s lifetime. Any designation shall remain in effect until a new designation is filed with the Committee; provided, however, that in the event a Participant designates his or her spouse as a Beneficiary, such designation shall be automatically revoked upon the dissolution of the marriage unless, following such dissolution, the Participant submits a new designation naming the former spouse as a Beneficiary. A Participant may from time to time change his or her designated Beneficiary without the consent of a previously-designated Beneficiary by filing a new designation with the Committee.
(b) No Beneficiary. If a designated Beneficiary does not survive the Participant, or if there is no valid Beneficiary designation, amounts payable under the Plan upon the death of the Participant shall be paid to the Participant’s spouse, or if there is no surviving spouse, then to the duly appointed and currently acting personal representative of the Participant’s estate.
6.5 Unforeseeable Emergency. A Participant who experiences an Unforeseeable Emergency may submit a written request to the Committee to receive payment of all or any portion of his or her vested Accounts. If the emergency need cannot be relieved by cessation of Deferrals to the Plan, the Committee may approve an emergency payment therefrom not to exceed the amount reasonably necessary to satisfy the need, taking into account the additional compensation that is available to the Participant as the result of cancellation of deferrals to the Plan, including amounts necessary to pay any taxes or penalties that the Participant reasonably anticipates will result from the payment. The amount of the emergency payment shall be subtracted from the Participant’s Accounts on a pro rata basis. Emergency payments shall be paid in a single lump sum within the 90-day period following the date the payment is approved by the Committee. The Committee may specify that Deferrals will be distributed before any restricted stock units.

6.6 Administrative Cash-Out of Small Balances. Notwithstanding anything to the contrary in this Article VI, the Committee may at any time and without regard to whether a payment event has occurred, direct in writing an immediate lump sum payment of the Participant’s Accounts if the balance of such Accounts, combined with any other amounts required to be treated as deferred under a single plan pursuant to Code Section 409A, does not exceed the applicable dollar amount under Code Section 402(g)(1)(B), provided any other such aggregated amounts are also distributed in a lump sum at the same time.

6.7 Acceleration of or Delay in Payments. Notwithstanding anything to the contrary in this Article VI, the Committee, in its sole and absolute discretion, may elect to accelerate the time or form of payment of an Account, provided such acceleration is permitted under Treas. Reg. Section 1.409A-3(j)(4). The Committee may also, in its sole and absolute discretion, delay the time for payment of an Account, to the extent permitted under Treas. Reg. Section 1.409A-2(b)(7).

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6.8 Rules Applicable to Installment Payments. If a Payment Schedule specifies installment payments, payments will be made beginning as of the payment commencement date for such installments and shall continue to be made in each subsequent payment period until the number of installment payments specified in the Payment Schedule has been paid. The amount of each installment payment shall be determined by dividing (a) by (b), where (a) equals the Account Balance as of the last Valuation Date in the month preceding the month of payment and (b) equals the remaining number of installment payments. For purposes of Section 6.9, installment payments will be treated as a single form of payment. If an Account is payable in installments, the Account will continue to be credited with Earnings in accordance with Article VII hereof until the Account is completely distributed.

6.9 Modifications to Payment Schedules. A Participant may modify the Payment Schedule elected by him or her with respect to an Account, consistent with the permissible Payment Schedules available under the Plan for the applicable payment event, provided such modification complies with the requirements of this Section 6.9. Modifications of a Payment Schedule do not apply with respect to death benefits because such amount shall be paid as a lump sum only in accordance with Section 6.4.

(a) Time of Election. The modification election must be submitted to the Committee not less than 12 months prior to the date payments would have commenced under the Payment Schedule in effect prior to modification (the “Prior Election”).
(b) Date of Payment under Modified Payment Schedule. The date payments are to commence under the modified Payment Schedule must be no earlier than five years after the date payment would have commenced under the Prior Election. Under no circumstances may a modification election result in an acceleration of payments in violation of Code Section 409A. If the Participant modifies only the form, and not the commencement date for payment, payments shall commence on the fifth anniversary of the date payment would have commenced under the Prior Election.
(c) Irrevocability; Effective Date. A modification election is irrevocable when filed and becomes effective 12 months after the filing date.

(d) Effect on Accounts. An election to modify a Payment Schedule is specific to the Account or payment event to which it applies, and shall not be construed to affect the Payment Schedules or payment events of any other Accounts.

Article VII
Valuation of Account Balances; Investments
7.1 Valuation. Deferrals shall be credited to appropriate Accounts on the date such Compensation would have been paid to the Participant absent the Compensation Deferral Agreement. Valuation of Accounts shall be performed under procedures approved by the Committee.

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7.2 Earnings Credit. Each Account will be credited with Earnings on each Business Day, based upon the Participant’s investment allocation among a menu of investment options selected in advance by the Committee, in accordance with the provisions of this Article VII (“investment allocation”).

7.3 Investment Options. Investment options will be determined by the Committee. The Committee, in its sole discretion, shall be permitted to add or remove investment options from the Plan menu from time to time, provided that any such additions or removals of investment options shall not be effective with respect to any period prior to the effective date of such change.

7.4 Investment Allocations. A Participant’s investment allocation constitutes a deemed, not actual, investment among the investment options comprising the investment menu. At no time shall a Participant have any real or beneficial ownership in any investment option included in the investment menu, nor shall the Company or any trustee acting on its behalf have any obligation to purchase actual securities as a result of a Participant’s investment allocation. A Participant’s investment allocation shall be used solely for purposes of adjusting the value of a Participant’s Account Balances.

A Participant shall specify an investment allocation for each of his Accounts in accordance with procedures established by the Committee. Allocation among the investment options must be designated in increments of 1%. The Participant’s investment allocation will become effective on the same Business Day or, in the case of investment allocations received after a time specified by the Committee, the next Business Day.

A Participant may change an investment allocation on any Business Day, both with respect to future credits to the Plan and with respect to existing Account Balances, in accordance with procedures adopted by the Committee. Changes shall become effective on the same Business Day or, in the case of investment allocations received after a time specified by the Committee, the next Business Day, and shall be applied prospectively.

7.5 Unallocated Deferrals and Accounts. If the Participant fails to make an investment allocation with respect to an Account, such Account shall be invested in an investment option, the primary objective of which is the preservation of capital, as determined by the Committee.

7.6 Company Stock. A Participant’s investment allocation under Section 7.4 may include an allocation to stock units, with each unit equal in value to one share of common stock of Teleflex Incorporated (each a “Unit” and collectively, “Units”). An allocation to Units may occur with respect to Deferrals only at the time Deferrals are credited to the Participant’s Account under Section 7.1. Cash Deferrals allocated to Units will be converted to Units (and fractional Units, as necessary) based on the fair market value of Teleflex Incorporated common stock (“Company Stock”) on the day next preceding the date the Deferral is credited to the Plan. Deferrals to the Restricted Stock Award Account are automatically credited as Units on a one-for-one basis, consistent with the deferred portion of the Participant’s restricted stock units.

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The Restricted Stock Award Account and any portion of a Participant’s cash Deferrals allocated to Units may not be re-allocated to any other investment option under the Plan. No amounts allocated to another investment option in the Plan may be allocated to Units. All amounts credited as Units will be paid in shares of Company Stock. The Company may deduct the number of shares payable to the Participant having a value equivalent to the amount of income tax withholding due at the time of payment.

The following provisions shall apply to Units and the Restricted Stock Award Account, as applicable:

(a)Restrictive Covenants. Any restrictive covenants applicable to restricted stock unit awards that may result in forfeiture of units after the vesting date shall continue to apply to any such Units credited to the Restricted Stock Award Account.

(b)Dividend Equivalents. Dividend equivalents paid with respect to Units credited to a Participant as of the dividend record date for Company stock will be credited as Earnings and converted to additional Units in the same manner as cash Deferrals, set forth above, valued on the date the dividend is paid with respect to Company Stock. The Company retains the sole discretion to pay dividend equivalents in the form of cash, and if cash, may not be allocated to Units, but may be allocated by the Participant among the investment options offered under the Plan as provided in Section 7.4.

(c)Organic Changes. A Participant’s Units will be adjusted to reflect stock-splits, corporate re-organizations and other restructurings as provided in Schedule A.

7.7 Valuations Final After 180 Days. The Participant shall have 180 days following the Valuation Date on which the Participant failed to receive the full amount of Earnings and to file a claim under Article XI for the correction of such error.



Article VIII
Administration
8.1 Plan Administration. This Plan shall be administered by the Committee which shall have discretionary authority to make, amend, interpret and enforce all appropriate rules and regulations for the administration of this Plan and to utilize its discretion to decide or resolve any and all questions, including but not limited to eligibility for benefits and interpretations of this Plan and its terms, as may arise in connection with the Plan. Claims for benefits shall be filed with the Committee and resolved in accordance with the claims procedures in Article XI.

The members of the Committee, the Company and its officers and directors, shall be entitled to rely upon all valuations, certificates and reports furnished by any funding agent or service provider, upon all certificates and reports made by an accountant, and upon all opinions given by any legal counsel selected or approved by the Committee.
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The members of the Committee, the Company and its officers and directors shall, except as otherwise provided by law, be fully protected in respect of any action taken or suffered by them in good faith in reliance upon any such valuations, certificates, reports, opinions or other advice of a funding agent, service provider, accountant or counsel.

8.2 Administration Upon Change in Control. Upon a change in control affecting the Company, the Committee, as constituted immediately prior to such change in control, shall continue to act as the Committee. The Committee, by a vote of a majority of its members, shall have the authority (but shall not be obligated) to appoint an independent third party to act as the Committee. For purposes of this Section 8.2, a “change in control” means a change in control within the meaning of the rabbi trust agreement associated with the Plan or if no such definition is provided, the term shall have the meaning under Code Section 409A.

Upon such Change in Control, the Company may not remove the Committee or its members, unless a majority of Participants and Beneficiaries with Account Balances consent to the removal and replacement of the Committee. Notwithstanding the foregoing, the Committee shall not have authority to direct investment of trust assets under any rabbi trust described in Section 10.2.

The Company shall, with respect to the Committee identified under this Section: (i) pay all reasonable expenses and fees of the Committee, (ii) indemnify the Committee (including individuals serving as Committee members) against any costs, expenses and liabilities including, without limitation, attorneys’ fees and expenses arising in connection with the performance of the Committee’s duties hereunder, except with respect to matters resulting from the Committee’s gross negligence or willful misconduct, and (iii) supply full and timely information to the Committee on all matters related to the Plan, any rabbi trust, Participants, Beneficiaries and Accounts as the Committee may reasonably require.

8.3 Withholding. The Company shall have the right to withhold from any payment due under the Plan (or with respect to any amounts credited to the Plan) any taxes required by law to be withheld in respect of such payment (or credit). Withholdings with respect to amounts credited to the Plan shall be deducted from Compensation that has not been deferred to the Plan.

8.4 Indemnification. The Company shall indemnify and hold harmless each employee, officer, director, agent or organization, to whom or to which are delegated duties, responsibilities, and authority under the Plan or otherwise with respect to administration of the Plan, including, without limitation, the Committee, its delegees and its agents, against all claims, liabilities, fines and penalties, and all expenses reasonably incurred by or imposed upon him or it (including but not limited to reasonable attorney fees) which arise as a result of his or its actions or failure to act in connection with the operation and administration of the Plan to the extent lawfully allowable and to the extent that such claim, liability, fine, penalty, or expense is not paid for by liability insurance purchased or paid for by the Company. Notwithstanding the foregoing, the Company shall not indemnify any person or organization if his or its actions or failure to act are due to gross negligence or willful misconduct or for any such amount incurred through any settlement
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or compromise of any action unless the Company consents in writing to such settlement or compromise.

8.5 Delegation of Authority. In the administration of this Plan, the Committee may, from time to time, employ agents and delegate to them such administrative duties as it sees fit, and may from time to time consult with legal counsel who shall be legal counsel to the Company.

8.6 Binding Decisions or Actions. The decision or action of the Committee in respect of any question arising out of or in connection with the administration, interpretation and application of the Plan and the rules and regulations thereunder shall be final and conclusive and binding upon all persons having any interest in the Plan.

Article IX
Amendment and Termination
9.1 Amendment and Termination. The Company may at any time and from time to time amend the Plan or may terminate the Plan as provided in this Article IX. The Company may also terminate its participation in the Plan.

9.2 Amendments. The Company, by action taken by its Board of Directors, may amend the Plan at any time and for any reason, provided that any such amendment shall not reduce the vested Account Balances of any Participant accrued as of the date of any such amendment or restatement (as if the Participant had incurred a voluntary Separation from Service on such date). The Board of Directors of the Company may delegate to the Committee the authority to amend the Plan without the consent of the Board of Directors for the purpose of: (i) conforming the Plan to the requirements of law; (ii) facilitating the administration of the Plan; (iii) clarifying provisions based on the Committee’s interpretation of the Plan documents; and (iv) making such other amendments as the Board of Directors may authorize. No amendment is needed to revise the procedures with respect to Company Stock set forth under Schedule A attached hereto.

9.3 Termination. The Company, by action taken by its Board of Directors, may terminate the Plan and pay Participants and Beneficiaries their Account Balances in a single lump sum at any time, to the extent and in accordance with Treas. Reg. Section 1.409A-3(j)(4)(ix).

9.4 Accounts Taxable Under Code Section 409A. The Plan is intended to constitute a plan of deferred compensation that meets the requirements for deferral of income taxation under Code Section 409A. The Committee, pursuant to its authority to interpret the Plan, may sever from the Plan or any Compensation Deferral Agreement any provision or exercise of a right that otherwise would result in a violation of Code Section 409A.

Article X
Informal Funding
10.1 General Assets. Obligations established under the terms of the Plan may be satisfied from the general funds of the Company, or a trust described in this Article X. No Participant, spouse or Beneficiary shall have any right, title or interest whatever in assets of the
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Company. Nothing contained in this Plan, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind, or a fiduciary relationship, between the Company and any Participant, spouse, or Beneficiary. To the extent that any person acquires a right to receive payments hereunder, such rights are no greater than the right of an unsecured general creditor of the Company.

10.2 Rabbi Trust. The Company may, in its sole discretion, establish a grantor trust, commonly known as a rabbi trust, as a vehicle for accumulating assets to pay benefits under the Plan. Payments under the Plan may be paid from the general assets of the Company or from the assets of any such rabbi trust. Payment from any such source shall reduce the obligation owed to the Participant or Beneficiary under the Plan.

If a rabbi trust is in existence upon the occurrence of a “change in control”, as defined in such trust, the Company shall, upon such change in control, and on each anniversary of the change in control, contribute in cash or liquid securities such amounts as are necessary so that the value of assets after making the contributions exceed 125% of the total value of all Account Balances.

10.3 Payment of Expenses. Payments to Participants under the Plan may be offset on an after-tax basis in an amount equal to any transactional or other direct expenses incurred by the Participant, unless the Company or Participating Employer elects to pay the expenses. Such deductions shall be taken at the time of payment from the Plan or from other compensation not deferred under the Plan.

Article XI
Claims
11.1 Filing a Claim. Any controversy or claim arising out of or relating to the Plan shall be filed in writing with the Committee which shall make all determinations concerning such claim. Any claim filed with the Committee and any decision by the Committee denying such claim shall be in writing and shall be delivered to the Participant or Beneficiary filing the claim (the “Claimant”). Notice of a claim for payments shall be delivered to the Committee within 90 days of the latest date upon which the payment could have been timely made in accordance with the terms of the Plan and Code Section 409A, and if not paid, the Participant or Beneficiary must file a claim under this Article XI not later than 180 days after such latest date. If the Participant or Beneficiary fails to file a timely claim, the Participant forfeits any amounts to which he or she may have been entitled to receive under the claim.

(a) In General. Notice of a denial of benefits (other than claims based on disability) will be provided within 90 days of the Committee’s receipt of the Claimant's claim for benefits. If the Committee determines that it needs additional time to review the claim, the Committee will provide the Claimant with a notice of the extension before the end of the initial 90-day period. The extension will not be more than 90 days from the end of the initial 90-day period and the notice of extension will explain the special circumstances that require the extension and the date by which the Committee expects to make a decision.

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(b) Disability Benefits. Notice of denial of claims based on disability will be provided within forty-five (45) days of the Committee’s receipt of the Claimant’s claim for disability benefits. If the Committee determines that it needs additional time to review the disability claim, the Committee will provide the Claimant with a notice of the extension before the end of the initial 45-day period. If the Committee determines that a decision cannot be made within the first extension period due to matters beyond the control of the Committee, the time period for making a determination may be further extended for an additional 30 days. If such an additional extension is necessary, the Committee shall notify the Claimant prior to the expiration of the initial 30-day extension. Any notice of extension shall indicate the circumstances necessitating the extension of time, the date by which the Committee expects to furnish a notice of decision, the specific standards on which such entitlement to a benefit is based, the unresolved issues that prevent a decision on the claim and any additional information needed to resolve those issues. A Claimant will be provided a minimum of 45 days to submit any necessary additional information to the Committee. In the event that a 30-day extension is necessary due to a Claimant’s failure to submit information necessary to decide a claim, the period for furnishing a notice of decision shall be tolled from the date on which the notice of the extension is sent to the Claimant until the earlier of the date the Claimant responds to the request for additional information or the response deadline.

(c) Contents of Notice. If a claim for benefits is completely or partially denied, notice of such denial shall be in writing. Any electronic notification shall comply with the standards imposed by Department of Labor Regulation 29 CFR 2520.104b-1(c)(1)(i), (iii), and (iv). The notice of denial shall set forth the specific reasons for denial in plain language. The notice shall: (i) cite the pertinent provisions of the Plan document, and (ii) explain, where appropriate, how the Claimant can perfect the claim, including a description of any additional material or information necessary to complete the claim and why such material or information is necessary. The claim denial also shall include an explanation of the claims review procedures and the time limits applicable to such procedures, including the right to appeal the decision, the deadline by which such appeal must be filed and a statement of the Claimant’s right to bring a civil action under Section 502(a) of ERISA following an adverse decision on appeal and the specific date by which such a civil action must commence under Section 11.4.
In the case of a complete or partial denial of a disability benefit claim, the notice shall provide such information and shall be communicated in the manner required under applicable Department of Labor regulations.

11.2 Appeal of Denied Claims. A Claimant whose claim has been completely or partially denied shall be entitled to appeal the claim denial by filing a written appeal with a committee designated to hear such appeals (the “Appeals Committee”). A Claimant who timely requests a review of the denied claim (or his or her authorized representative) may review, upon request and free of charge, copies of all documents, records and other
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information relevant to the denial and may submit written comments, documents, records and other information relating to the claim to the Appeals Committee. All written comments, documents, records, and other information shall be considered “relevant” if the information: (i) was relied upon in making a benefits determination, (ii) was submitted, considered or generated in the course of making a benefits decision regardless of whether it was relied upon to make the decision, or (iii) demonstrates compliance with administrative processes and safeguards established for making benefit decisions. The review shall take into account all comments, documents, records, and other information submitted by the Claimant relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination. The Appeals Committee may, in its sole discretion and if it deems appropriate or necessary, decide to hold a hearing with respect to the claim appeal.

(a)In General. Appeal of a denied benefits claim (other than a disability benefits claim) must be filed in writing with the Appeals Committee no later than 60 days after receipt of the written notification of such claim denial. The Appeals Committee shall make its decision regarding the merits of the denied claim within 60 days following receipt of the appeal (or within 120 days after such receipt, in a case where there are special circumstances requiring extension of time for reviewing the appealed claim). If an extension of time for reviewing the appeal is required because of special circumstances, written notice of the extension shall be furnished to the Claimant prior to the commencement of the extension. The notice will indicate the special circumstances requiring the extension of time and the date by which the Appeals Committee expects to render the determination on review. The review will take into account comments, documents, records and other information submitted by the Claimant relating to the claim without regard to whether such information was submitted or considered in the initial benefit determination.

(b)Disability Benefits. Appeal of a denied disability benefits claim must be filed in writing with the Appeals Committee no later than 180 days after receipt of the written notification of such claim denial. The review shall be conducted in accordance with applicable Department of Labor regulations.

The Appeals Committee shall make its decision regarding the merits of the denied claim within 45 days following receipt of the appeal (or within 90 days after such receipt, in a case where there are special circumstances requiring extension of time for reviewing the appealed claim). If an extension of time for reviewing the appeal is required because of special circumstances, written notice of the extension shall be furnished to the Claimant prior to the commencement of the extension. The notice will indicate the special circumstances requiring the extension of time and the date by which the Appeals Committee expects to render the determination on review. Following its review of any additional information submitted by the Claimant, the Appeals Committee shall render a decision on its review of the denied claim.

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(c)Contents of Notice. If a benefits claim is completely or partially denied on review, notice of such denial shall be in writing. Any electronic notification shall comply with the standards imposed by Department of Labor Regulation 29 CFR 2520.104b-1(c)(1)(i), (iii), and (iv). Such notice shall set forth the reasons for denial in plain language.

The decision on review shall set forth: (i) the specific reason or reasons for the denial, (ii) specific references to the pertinent Plan provisions on which the denial is based, (iii) a statement that the Claimant is entitled to receive, upon request and free of charge, reasonable access to and copies of all documents, records, or other information relevant (as defined above) to the Claimant’s claim, and (iv) a statement of the Claimant’s right to bring an action under Section 502(a) of ERISA, following an adverse decision on review and the specific date by which such a civil action must commence under Section 11.4.

For the denial of a disability benefit, the notice will also include such additional information and be communicated in the manner required under applicable Department of Labor regulations.

11.3 Claims Appeals Upon Change in Control. Upon a change in control, the Appeals Committee, as constituted immediately prior to such change in control, shall continue to act as the Appeals Committee. The Company may not remove any member of the Appeals Committee, but may replace resigning members if 2/3rds of the members of the Board of Directors of the Company and a majority of Participants and Beneficiaries with Account Balances consent to the replacement.

The Appeals Committee shall have the exclusive authority at the appeals stage to interpret the terms of the Plan and resolve appeals under the Claims Procedure.

The Company shall, with respect to the Committee identified under this Section: (i) pay its proportionate share of all reasonable expenses and fees of the Appeals Committee, (ii) indemnify the Appeals Committee (including individual committee members) against any costs, expenses and liabilities including, without limitation, attorneys’ fees and expenses arising in connection with the performance of the Appeals Committee hereunder, except with respect to matters resulting from the Appeals Committee’s gross negligence or willful misconduct, and (iii) supply full and timely information to the Appeals Committee on all matters related to the Plan, any rabbi trust, Participants, Beneficiaries and Accounts as the Appeals Committee may reasonably require.

11.4 Legal Action. A Claimant may not bring any legal action, including commencement of any arbitration, relating to a claim for benefits under the Plan unless and until the Claimant has followed the claims procedures under the Plan and exhausted his or administrative remedies under Sections 11.1 and 11.2. No such legal action may be brought more than twelve (12) months following the notice of denial of benefits under Section 11.2, or if no appeal is filed by the applicable appeals deadline, twelve (12) months following the appeals deadline.

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If a Participant or Beneficiary prevails in a legal proceeding brought under the Plan to enforce the rights of such Participant or any other similarly situated Participant or Beneficiary, in whole or in part, the Company shall reimburse such Participant or Beneficiary for all legal costs, expenses, attorneys’ fees and such other liabilities incurred as a result of such proceedings. If the legal proceeding is brought in connection with a change in control (including a “change in control” as defined in a rabbi trust described in Section 10.2) the Participant or Beneficiary may file a claim directly with the trustee for reimbursement of such costs, expenses and fees. For purposes of the preceding sentence, the amount of the claim shall be treated as if it were an addition to the Participant’s or Beneficiary’s Account Balance and will be included in determining the Company’s trust funding obligation under Section 10.2.

11.5 Discretion of Appeals Committee. All interpretations, determinations and decisions of the Appeals Committee with respect to any claim shall be made in its sole discretion, and shall be final and conclusive.

11.6 Arbitration.

(a)Prior to Change in Control. If, prior to a change in control as defined in Section 11.3, any claim or controversy between a Participating Employer and a Participant or Beneficiary is not resolved through the claims procedure set forth in Article XI, such claim shall be submitted to and resolved exclusively by expedited binding arbitration by a single arbitrator administered by the American Arbitration Association (“AAA”). Arbitration shall be conducted in accordance with the following procedures:

The complaining party shall promptly send written notice to the other party identifying the matter in dispute and the proposed remedy. Following the giving of such notice, the parties shall meet and attempt in good faith to resolve the matter. In the event the parties are unable to resolve the matter within 21 days, the parties shall meet and attempt in good faith to select a single arbitrator acceptable to both parties in accordance with the rules of the AAA for selection of a single arbitrator.

Unless the parties agree otherwise, within 60 days of the selection of the arbitrator, a hearing shall be conducted before such arbitrator in Philadelphia, PA unless the parties agree by mutual consent to a different location. The arbitration shall be administered by the AAA and AAA rules shall govern the arbitration except to the extent in conflict with this provision (Article XI 6(a)). In the event the parties are unable to agree upon the date of the arbitration, the date(s) shall be designated by the arbitrator after consultation with the parties. Within 30 days of the conclusion of the arbitration hearing, the arbitrator shall issue an award, accompanied by a written decision explaining the basis for the arbitrator’s award.

In any arbitration hereunder, the administrative fees of the arbitration and all fees of the arbitrator shall be paid equally by the Participating Employer and the Participant or Beneficiary. Each party shall pay its own attorneys’ fees, costs, and
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expenses, unless the arbitrator orders otherwise. The arbitrator shall have no authority to add to or to modify this Plan, shall apply all applicable law, and shall have no lesser and no greater remedial authority than would a court of law resolving the same claim or controversy. The arbitrator shall, upon an appropriate motion, dismiss any claim without an evidentiary hearing if the party bringing the motion establishes that it would be entitled to summary judgment if the matter had been pursued in court litigation.

The parties shall be entitled to discovery as follows: Each party may take no more than three depositions. The Participating Employer may depose the Participant or Beneficiary plus two other witnesses, and the Participant or Beneficiary may depose the Participating Employer, pursuant to Rule 30(b)(6) of the Federal Rules of Civil Procedure, plus two other witnesses. Each party may make such reasonable document discovery requests as are allowed in the discretion of the arbitrator and be entitled to propound 25 interrogatory questions (including subparts).

The decision of the arbitrator shall be final, binding, and non-appealable, and may be enforced as a final judgment in any court of competent jurisdiction.

This arbitration provision of the Plan shall extend to claims against any parent, subsidiary, or affiliate of each party, and, when acting within such capacity, any officer, director, shareholder, Participant, Beneficiary, or agent of any party, or of any of the above, and shall apply as well to claims arising out of state and federal statutes and local ordinances as well as to claims arising under the common law or under this Plan.

Notwithstanding the foregoing, and unless otherwise agreed between the parties, either party may apply to a court for provisional relief, including a temporary restraining order or preliminary injunction, on the ground that the arbitration award to which the applicant may be entitled may be rendered ineffectual without provisional relief.

Any arbitration hereunder shall be conducted in accordance with the Federal Arbitration Act: provided, however, that, in the event of any inconsistency between the rules and procedures of the Act and the terms of this Plan, the terms of this Plan shall prevail. The governing law shall be the law of the Commonwealth of Pennsylvania to the extent the dispute or contract is not governed or preempted by U.S. federal law.

If any of the provisions of this Section 11.6(a) are determined to be unlawful or otherwise unenforceable, in the whole part, such determination shall not affect the validity of the remainder of this section and this section shall be reformed to the extent necessary to carry out its provisions to the greatest extent possible and to insure that the resolution of all conflicts between the parties, including those arising out of statutory claims, shall be resolved by neutral, binding arbitration. If a court should find that the provisions of this Section 11.6(a) are not absolutely
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binding, then the parties intend any arbitration decision and award to be fully admissible in evidence in any subsequent action, given great weight by any finder of fact and treated as determinative to the maximum extent permitted by law.

The parties do not agree to arbitrate any putative class action or any other representative action. The parties agree to arbitrate only the claims(s) of a single Participant or Beneficiary.

(b)Upon Change in Control. Upon a change in control as defined in Section 11.3, Section 11.6(a) shall not apply and any legal action initiated by a Participant or Beneficiary to enforce his or her rights under the Plan may be brought in any court of competent jurisdiction. Notwithstanding the Appeals Committee’s discretion under Sections 11.3 and 11.5, the court shall apply a de novo standard of review to any prior claims decision under Sections 11.1 through 11.3 or any other determination made by the Company, its Board of Directors, a Participating Employer, the Committee, or the Appeals Committee.

Article XII
General Provisions
12.1 Assignment. No interest of any Participant, spouse or Beneficiary under this Plan and no benefit payable hereunder shall be assigned as security for a loan, and any such purported assignment shall be null, void and of no effect, nor shall any such interest or any such benefit be subject in any manner, either voluntarily or involuntarily, to anticipation, sale, transfer, assignment or encumbrance by or through any Participant, spouse or Beneficiary. Notwithstanding anything to the contrary herein, however, the Committee has the discretion to make payments to an alternate payee in accordance with the terms of a domestic relations order (as defined in Code Section 414(p)(1)(B)).

        The Company may assign any or all of its liabilities under this Plan in connection with any restructuring, recapitalization, sale of assets or other similar transactions affecting the Company without the consent of the Participant.

12.2 No Legal or Equitable Rights or Interest. No Participant or other person shall have any legal or equitable rights or interest in this Plan that are not expressly granted in this Plan. Participation in this Plan does not give any person any right to be retained a Director. The Company makes no representations or warranties as to the tax consequences to a Participant or a Participant’s beneficiaries resulting from a deferral of income pursuant to the Plan.

12.3 No Employment Contract. Nothing contained herein shall be construed to constitute a contract of employment between a Director and the Company.

12.4 Notice. Any notice or filing required or permitted to be delivered to the Committee under this Plan shall be delivered in writing, in person, or through such electronic means as is established by the Committee. Notice shall be deemed given as of the date of delivery or,
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if delivery is made by mail, as of the date shown on the postmark on the receipt for registration or certification. Written transmission shall be sent by certified mail to:

Teleflex Incorporated
550 E Swedesford Rd Suite 400
WAyne, PA 19087
attn: Employee benefits

Any notice or filing required or permitted to be given to a Participant under this Plan shall be sufficient if in writing or hand-delivered, or sent by mail to the last known address of the Participant.

12.5 Headings. The headings of Sections are included solely for convenience of reference, and if there is any conflict between such headings and the text of this Plan, the text shall control.

12.6 Invalid or Unenforceable Provisions. If any provision of this Plan shall be held invalid or unenforceable, such invalidity or unenforceability shall not affect any other provisions hereof and the Committee may elect in its sole discretion to construe such invalid or unenforceable provisions in a manner that conforms to applicable law or as if such provisions, to the extent invalid or unenforceable, had not been included.

12.7 Lost Participants or Beneficiaries. Any Participant or Beneficiary who is entitled to a benefit from the Plan has the duty to keep the Committee advised of his or her current mailing address. If benefit payments are returned to the Plan or are not presented for payment after a reasonable amount of time, the Committee shall presume that the payee is missing. The Committee, after making such efforts as in its discretion it deems reasonable and appropriate to locate the payee, shall stop payment on any uncashed checks and may discontinue making future payments until contact with the payee is restored. If the Committee is unable to locate the Participant or Beneficiary after five years of the date payment is scheduled to be made, provided that a Participant’s Account shall not be credited with Earnings following the first anniversary of such date on which payment is to be made and further provided, however, that such benefit shall be reinstated, without further adjustment for interest, if a valid claim is made by or on behalf of the Participant or Beneficiary for all or part of the forfeited benefit.

12.8 Facility of Payment to a Minor. If a distribution is to be made to a minor, or to a person who is otherwise incompetent, then the Committee may, in its discretion, make such distribution: (i) to the legal guardian, or if none, to a parent of a minor payee with whom the payee maintains his or her residence, or (ii) to the conservator or committee or, if none, to the person having custody of an incompetent payee. Any such distribution shall fully discharge the Committee, the Company, and the Plan from further liability on account thereof.

12.9 Governing Law. To the extent not preempted by ERISA, the laws of the Commonwealth of Pennsylvania shall govern the construction and administration of the Plan.

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12.10 Compliance With Code Section 409A; No Guarantee. This Plan is intended to be administered in compliance with Code Section 409A and each provision of the Plan shall be interpreted consistent with Code Section 409A. Although intended to comply with Code Section 409A, this Plan shall not constitute a guarantee to any Participant or Beneficiary that the Plan in form or in operation will result in the deferral of federal or state income tax liabilities or that the Participant or Beneficiary will not be subject to the additional taxes imposed under Section 409A. The Company has no legal obligation to a Participant with respect to taxes imposed under Code Section 409A.

[Signature page follows.]


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IN WITNESS WHEREOF, the undersigned executed this Plan as of the 22nd day of November, 2019, to be effective as of the Effective Date.


TELEFLEX INCORPORATED

By: Nicholas Herninko

Its: Director of Benefits, HR Ops and Compliance


        /s/ Nicholas Herninko    



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Schedule A

Provisions Related to Organic Changes


An “Organic Change” includes (1) a stock split, reverse stock split, share combination, or recapitalization or similar event affecting the capital structure of the Company (each, a “Share Change”), or (2) a merger, consolidation, acquisition of property or shares, separation, spin-off, reorganization, stock rights offering, liquidation or similar event affecting the Company or any of its subsidiaries.

In the event any Organic Change occurs, then the Committee or Board may make such substitutions or adjustments with respect to Units held in a Participant’s Account as it deems appropriate and equitable. Such adjustments may include, without limitation, (a) the division or consolidation of Units on the same basis as any stock split or reverse stock split affecting the common stock of the Company and (b) the conversion of Units to notional cash or the change in the referenced security for each Unit from common stock of the Company to equity shares of a different entity (which may include the equity of an Affiliate of the Company) having an aggregate fair market value equal to the aggregate fair market value of the Units held by the Participant on the day prior to the conversion date, with fair market value in each instance being determined by the Committee or Board. If the assets held in the Participant’s Account immediately after such adjustment are not equity securities, then the Participant shall be permitted to re-direct the investment thereof into the other investment choices then available under this Plan.

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Exhibit 21
Subsidiaries of Teleflex Incorporated
as of December 31, 2019
Entity Name Jurisdiction of Formation
1. 1902 Federal Road, LLC Delaware
2. Arrow Internacional de Chihuahua, S.A. de C.V. Mexico
3. Arrow Internacional de Mexico, S.A. de C.V. Mexico
4. Arrow International CR, a.s. Czech Republic
5. Arrow International, Inc. Pennsylvania
6. Arrow Interventional, Inc. Delaware
7. Daqing Medical Device (Tianjin) Co., Ltd. China
8. Distribuidora Arrow, S.A. de C.V. Mexico
9. EON Surgical Ltd. Israel
10. Essential Medical, Inc. Delaware
11. Hudson Respiratory Care Tecate, S. de R.L. de C.V. Mexico
12.
ICOR AB 1
Sweden
13. Inmed Manufacturing Sdn. Bhd. Malaysia
14. LMA Urology Limited Seychelles
15. Medical Innovation B.V. Netherlands
16. Medical Service GmbH Germany
17. NeoTract Australia Pty Ltd Australia
18. NeoTract International, Inc. Delaware
19. NeoTract, Inc. Delaware
20. Pyng Medical Corp. Canada
21.
Rusch Asia Pacific Sdn. Bhd. 2
Malaysia
22. Rüsch Austria GmbH Austria
23. Rusch Mexico, S.A. de C.V. Mexico
24. Rusch Uruguay Ltda. Uruguay
25. Simal SA Belgium
26. Sometec Holdings SAS France
27. T.K. India Private Ltd. India
28.
Teleflex Care 3
Bermuda
29. Teleflex Commercial Designated Activity Company Ireland
30. Teleflex Development Unlimited Company Ireland
31. Teleflex Euro LLC Delaware
32. Teleflex Funding LLC Delaware
33.
Teleflex Global Holdings LLC 4
Delaware
34. Teleflex Health Ltd. Bermuda
35. Teleflex Holding Netherlands B.V. Netherlands
36. Teleflex Korea Ltd. South Korea
37. Teleflex Life Sciences Limited Malta
38. Teleflex Life Sciences LLC Delaware


39.
Teleflex Life Sciences Pte. Ltd. 5
Singapore
40.
Teleflex Life Sciences Unlimited Company 6
Ireland
41. Teleflex LLC Delaware
42. Teleflex Lux Holding S.à r.l. Luxembourg
43. Teleflex Manufacturing Unlimited Company Ireland
44.
Teleflex Medical (Proprietary) Limited 7
South Africa
45. Teleflex Medical (Thailand) Ltd. Thailand
46.
Teleflex Medical Asia Pte. Ltd. 8
Singapore
47.
Teleflex Medical Australia Pty Ltd 9
Australia
48. Teleflex Medical B.V. Netherlands
49. Teleflex Medical Brasil Serviços e Comércio de Produtos Médicos Ltda. Brazil
50.
Teleflex Medical BVBA 10
Belgium
51.
Teleflex Medical Canada Inc. 11
Canada
52. Teleflex Medical Chile SpA Chile
53. Teleflex Medical Colombia S.A.S. Colombia
54. Teleflex Medical de Mexico, S. de R.L. de C.V. Mexico
55. Teleflex Medical Devices S.à r.l. Luxembourg
56.
Teleflex Medical EDC BVBA 12
Belgium
57. Teleflex Medical Europe Limited Ireland
58. Teleflex Medical GmbH Germany
59.
Teleflex Medical GmbH 13
Switzerland
60.
Teleflex Medical Hellas s.a. 14
Greece
61.
Teleflex Medical Incorporated 15
California
62.
Teleflex Medical Japan, Ltd. 16
Japan
63.
Teleflex Medical New Zealand 17
New Zealand
64. Teleflex Medical OEM LLC Delaware
65. Teleflex Medical Private Limited India
66. Teleflex Medical S.r.l. Italy
67.
Teleflex Medical SAS 18
France
68.
Teleflex Medical Sdn. Bhd. 19
Malaysia
69. Teleflex Medical Taiwan Ltd. Taiwan
70. Teleflex Medical Technology Ltd Cyprus
71. Teleflex Medical Trading (Shanghai) Co., Ltd. China
72.
Teleflex Medical Tuttlingen GmbH 20
Germany
73.
Teleflex Medical, S.A. 21
Spain
74. Teleflex Medical, s.r.o. Czech Republic
75.
Teleflex Medical, s.r.o. 22
Slovakia
76. Teleflex Polska sp. z o.o. Poland
77. Teleflex Production Unlimited Company Ireland
78. Teleflex Properties Ireland Limited Ireland
79. Teleflex Research S.à r.l. Luxembourg
80.
Teleflex Urology Limited 23
Ireland
81.
TFX Aviation Inc. 24
California


82. TFX Development LLC Delaware
83. TFX Engineering Ltd. Bermuda
84. TFX Equities Incorporated Delaware
85. TFX Group Limited United Kingdom
86. TFX Holding GmbH Germany
87.
TFX International SAS 25
France
88. TFX North America Inc. Delaware
89. The Laryngeal Mask Company (Malaysia) Sdn. Bhd. Malaysia
90. The Laryngeal Mask Company (Singapore) Pte. Ltd. Singapore
91. The Laryngeal Mask Company Limited Seychelles
92. Truphatek Holdings (1993) Limited Israel
93. Truphatek International Limited Israel
94. Truphatek Product Resources India Private Limited India
95.
Vascular Solutions LLC 26
Minnesota
96. Vascular Solutions Zerusa Limited Ireland
97. Willy Rüsch GmbH Germany
98. WIRUTEC Rüsch Medical Vertriebs GmbH Germany

__________________________________________________
1.Formerly Steamer Holding AB
2.Formerly Inmed (Malaysia) Holdings Sdn. Berhad
3.Formerly Teleflex Care Ltd.
4.Formerly IH Holding LLC
5.Formerly Teleflex Holding Singapore Pte. Ltd.
6.Formerly Teleflex Life Sciences
7.Formerly Arrow Africa (Pty) Limited
8.Formerly Pilling Weck (Asia) PTE Ltd. and Rusch-Pilling (Asia) PTE LTD.
9.Formerly LMA PacMed Pty Ltd
10.Formerly W. Pabisch NV
11.Formerly GFI Control Systems Inc. and Teleflex Holding Company Ltd.
12.Formerly Arrow International EDC NV
13.Formerly Arrow Swiss GmbH
14.Formerly Arrow Hellas A.E.E.
15.Formerly Hudson Respiratory Care Inc.
16.Formerly Arrow Japan, Ltd.
17.Formerly LMA NZ Limited
18.Formerly Rusch Pilling S.A.
19.Formerly Rusch Sdn. Berhad
20.Formerly KMedic Europe GmbH
21.Formerly Rusch Medica Espana SA
22.Formerly Arrow Slovensko Piešt’any s.r.o.
23.Formerly Davik Limited
24.Formerly Telair International Incorporated and The Talley Corporation
25.Formerly Rusch International SA
26.Formerly Vascular Solutions, Inc.


CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 033-53385, 333-77601, 333-38224, 333-101005, 333-120245, 333-127103, 333-157518, and 333-199665) of Teleflex Incorporated of our report dated February 21, 2020 relating to the financial statements, financial statement schedule, and the effectiveness of internal control over financial reporting, which appears in this Form 10-K.



/s/ PricewaterhouseCoopers LLP
Philadelphia, Pennsylvania
February 21, 2020





Exhibit 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
I, Liam J. Kelly, certify that:
1.     I have reviewed this annual report on Form 10-K of Teleflex Incorporated;
2.     Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.     Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.     The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a.     designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.     designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.     evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.     disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.     The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
a.     all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b.     any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
 
Date: February 21, 2020 /s/ Liam J. Kelly
  Liam J. Kelly
  President and Chief Executive Officer



Exhibit 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
I, Thomas E. Powell, certify that:
1.     I have reviewed this annual report on Form 10-K of Teleflex Incorporated;
2.     Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.     Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.     The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a.     designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.     designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.     evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.     disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.     The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
a.     all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b.     any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
 
Date: February 21, 2020 /s/ Thomas E. Powell
  Thomas E. Powell
  Executive Vice President and Chief Financial Officer



Exhibit 32.1
 
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO SECTION 906 OF
THE SARBANES-OXLEY ACT OF 2002
 
In connection with the Annual Report of Teleflex Incorporated (the “Company”) on Form 10-K for the year ended December 31, 2019, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Liam J. Kelly, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:
 
(1)     The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
 
(2)     The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
 
Date: February 21, 2020 /s/ Liam J. Kelly
  Liam J. Kelly
  President and Chief Executive Officer



Exhibit 32.2
 
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO SECTION 906 OF
THE SARBANES-OXLEY ACT OF 2002
 
In connection with the Annual Report of Teleflex Incorporated (the “Company”) on Form 10-K for the year ended December 31, 2019, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Thomas E. Powell, Executive Vice President and Chief Financial Officer, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:
 
(1)    The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
 
(2)    The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
 
Date: February 21, 2020 /s/ Thomas E. Powell
  Thomas E. Powell  
  Executive Vice President and Chief Financial Officer