|
FORM 10-K
|
ý
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Michigan
|
|
38-1239739
|
(State of incorporation)
|
|
(I.R.S. Employer Identification No.)
|
2825 Airview Boulevard, Kalamazoo, Michigan
|
|
49002
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Title of each class
|
|
Name of each exchange on which registered
|
Common Stock, $.10 par value
|
|
New York Stock Exchange
|
Large accelerated filer
ý
|
|
Accelerated filer
o
|
Non-accelerated filer
o
|
|
Smaller reporting company
o
|
|
|
|
|
|
PART I
|
|
||
Item 1.
|
Business
|
1
|
|
Item 1A.
|
Risk Factors
|
4
|
|
Item 1B.
|
Unresolved Staff Comments
|
6
|
|
Item 2.
|
Properties
|
6
|
|
Item 3.
|
Legal Proceedings
|
7
|
|
Item 4.
|
Mine Safety Disclosures
|
7
|
|
|
|
||
PART II
|
|
||
Item 5.
|
Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
|
7
|
|
Item 6.
|
Selected Financial Data
|
8
|
|
Item 7.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
9
|
|
Item 7A.
|
Quantitative and Qualitative Disclosures About Market Risk
|
16
|
|
Item 8.
|
Financial Statements and Supplementary Data
|
17
|
|
|
Report of Independent Registered Public Accounting Firm on Consolidated Financial Statements
|
17
|
|
|
Consolidated Statements of Earnings
|
18
|
|
|
Consolidated Statements of Comprehensive Income
|
18
|
|
|
Consolidated Balance Sheets
|
19
|
|
|
Consolidated Statements of Shareholders’ Equity
|
20
|
|
|
Consolidated Statements of Cash Flows
|
21
|
|
|
Notes to Consolidated Financial Statements
|
22
|
|
Item 9.
|
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
|
34
|
|
Item 9A.
|
Controls and Procedures
|
34
|
|
Item 9B.
|
Other Information
|
35
|
|
|
|
||
PART III
|
|
||
Item 10.
|
Directors, Executive Officers and Corporate Governance
|
35
|
|
Item 11.
|
Executive Compensation
|
35
|
|
Item 12.
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
|
35
|
|
Item 13.
|
Certain Relationships and Related Transactions, and Director Independence
|
35
|
|
Item 14.
|
Principal Accounting Fees and Services
|
35
|
|
|
|
||
PART IV
|
|
||
Item 15.
|
Exhibits, Financial Statement Schedules
|
36
|
|
PART I
|
ITEM 1.
|
BUSINESS.
|
|
2014
|
|
2013
|
|
2012
|
||||||||||||
Orthopaedics
|
$
|
4,153
|
|
43
|
%
|
|
$
|
3,949
|
|
44
|
%
|
|
$
|
3,823
|
|
44
|
%
|
MedSurg
|
3,781
|
|
39
|
%
|
|
3,414
|
|
38
|
%
|
|
3,265
|
|
38
|
%
|
|||
Neurotechnology and Spine
|
1,741
|
|
18
|
%
|
|
1,658
|
|
18
|
%
|
|
1,569
|
|
18
|
%
|
|||
Total
|
$
|
9,675
|
|
100
|
%
|
|
$
|
9,021
|
|
100
|
%
|
|
$
|
8,657
|
|
100
|
%
|
|
2014
|
|
2013
|
|
2012
|
||||||||||||
Knees
|
$
|
1,396
|
|
34
|
%
|
|
$
|
1,371
|
|
35
|
%
|
|
$
|
1,356
|
|
35
|
%
|
Hips
|
1,291
|
|
31
|
%
|
|
1,272
|
|
32
|
%
|
|
1,233
|
|
32
|
%
|
|||
Trauma and Extremities
|
1,230
|
|
30
|
%
|
|
1,116
|
|
28
|
%
|
|
989
|
|
26
|
%
|
|||
Other
|
236
|
|
5
|
%
|
|
190
|
|
5
|
%
|
|
245
|
|
7
|
%
|
|||
Total
|
$
|
4,153
|
|
100
|
%
|
|
$
|
3,949
|
|
100
|
%
|
|
$
|
3,823
|
|
100
|
%
|
1
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
|
2014
|
|
2013
|
|
2012
|
||||||||||||
Instruments
|
$
|
1,424
|
|
38
|
%
|
|
$
|
1,269
|
|
37
|
%
|
|
$
|
1,261
|
|
39
|
%
|
Endoscopy
|
1,382
|
|
37
|
%
|
|
1,222
|
|
36
|
%
|
|
1,111
|
|
34
|
%
|
|||
Medical
|
766
|
|
20
|
%
|
|
710
|
|
21
|
%
|
|
691
|
|
21
|
%
|
|||
Sustainability
|
209
|
|
5
|
%
|
|
213
|
|
6
|
%
|
|
202
|
|
6
|
%
|
|||
Total
|
$
|
3,781
|
|
100
|
%
|
|
$
|
3,414
|
|
100
|
%
|
|
$
|
3,265
|
|
100
|
%
|
|
2014
|
|
2013
|
|
2012
|
||||||||||||
Neurotechnology
|
$
|
1,001
|
|
57
|
%
|
|
$
|
915
|
|
55
|
%
|
|
$
|
842
|
|
54
|
%
|
Spine
|
740
|
|
43
|
%
|
|
743
|
|
45
|
%
|
|
727
|
|
46
|
%
|
|||
Total
|
$
|
1,741
|
|
100
|
%
|
|
$
|
1,658
|
|
100
|
%
|
|
$
|
1,569
|
|
100
|
%
|
2
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
Name
|
Age
|
|
First Became an Executive Officer
|
Kevin A. Lobo
|
49
|
Chairman, President and Chief Executive Officer
|
2011
|
Steven P. Benscoter
|
47
|
Vice President, Human Resources
|
2012
|
William E. Berry Jr.
|
49
|
Vice President, Corporate Controller and Principal Accounting Officer
|
2014
|
Lonny J. Carpenter
|
53
|
Group President, Global Quality and Operations
|
2008
|
David K. Floyd
|
54
|
Group President, Orthopaedics
|
2012
|
Michael D. Hutchinson
|
44
|
General Counsel
|
2014
|
William R. Jellison
|
57
|
Vice President and Chief Financial Officer
|
2013
|
Katherine A. Owen
|
44
|
Vice President, Strategy and Investor Relations
|
2007
|
Bijoy S.N. Sagar
|
46
|
Vice President, Chief Information Officer
|
2014
|
Timothy J. Scannell
|
50
|
Group President, MedSurg and Neurotechnology
|
2008
|
Ramesh Subrahmanian
|
53
|
Group President, International
|
2011
|
3
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
ITEM 1A.
|
RISK FACTORS.
|
4
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
5
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
ITEM 1B.
|
UNRESOLVED STAFF COMMENTS.
|
ITEM 2.
|
PROPERTIES.
|
6
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
ITEM 3.
|
LEGAL PROCEEDINGS.
|
ITEM 4.
|
MINE SAFETY DISCLOSURES.
|
PART II
|
ITEM 5.
|
MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.
|
2014 Quarter Ended
|
|
Mar 31
|
|
Jun 30
|
|
Sep 30
|
|
Dec 31
|
||||||||
Dividends declared per share of common stock
|
|
$
|
0.305
|
|
|
$
|
0.305
|
|
|
$
|
0.305
|
|
|
$
|
0.345
|
|
Market price of common stock:
|
|
|
|
|
|
|
||||||||||
High
|
|
83.86
|
|
|
86.93
|
|
|
85.91
|
|
|
98.24
|
|
||||
Low
|
|
74.02
|
|
|
75.78
|
|
|
78.91
|
|
|
77.87
|
|
2013 Quarter Ended
|
|
Mar 31
|
|
Jun 30
|
|
Sep 30
|
|
Dec 31
|
||||||||
Dividends declared per share of common stock
|
|
$
|
0.265
|
|
|
$
|
0.265
|
|
|
$
|
0.265
|
|
|
$
|
0.305
|
|
Market price of common stock:
|
|
|
|
|
|
|
||||||||||
High
|
|
66.92
|
|
|
70.00
|
|
|
71.94
|
|
|
75.55
|
|
||||
Low
|
|
55.24
|
|
|
63.35
|
|
|
63.71
|
|
|
66.93
|
|
Period
|
Total
Number
of Shares
Purchased
|
Average Price
Paid
Per Share
|
Total
Number of
Shares
Purchased as
Part of Publicly
Announced Plan
|
Maximum Dollar Value of Shares that may yet be Purchased Under the Plan
|
||||||
10/1/2014-10/31/2014
|
—
|
|
$
|
—
|
|
—
|
|
$
|
178
|
|
11/1/2014-11/30/2014
|
—
|
|
—
|
|
—
|
|
178
|
|
||
12/1/2014-12/31/2014
|
—
|
|
—
|
|
—
|
|
178
|
|
||
Total
|
—
|
|
$
|
—
|
|
—
|
|
|
7
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
ITEM 6.
|
SELECTED FINANCIAL DATA.
|
CONSOLIDATED OPERATIONS
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
||||||||||
Net sales
|
|
$
|
9,675
|
|
|
$
|
9,021
|
|
|
$
|
8,657
|
|
|
$
|
8,307
|
|
|
$
|
7,320
|
|
Cost of sales
|
|
3,291
|
|
|
2,977
|
|
|
2,781
|
|
|
2,811
|
|
|
2,286
|
|
|||||
Gross profit
|
|
6,384
|
|
|
6,044
|
|
|
5,876
|
|
|
5,496
|
|
|
5,034
|
|
|||||
Research, development and engineering expenses
|
|
614
|
|
|
536
|
|
|
471
|
|
|
462
|
|
|
394
|
|
|||||
Selling, general and administrative expenses
|
|
3,575
|
|
|
3,492
|
|
|
3,367
|
|
|
3,226
|
|
|
2,831
|
|
|||||
Recall charges, net of insurance recoveries
|
|
761
|
|
|
622
|
|
|
174
|
|
|
—
|
|
|
—
|
|
|||||
Intangibles amortization
|
|
188
|
|
|
138
|
|
|
123
|
|
|
122
|
|
|
58
|
|
|||||
|
|
5,138
|
|
|
4,788
|
|
|
4,135
|
|
|
3,810
|
|
|
3,283
|
|
|||||
Operating income
|
|
1,246
|
|
|
1,256
|
|
|
1,741
|
|
|
1,686
|
|
|
1,751
|
|
|||||
Other income (expense)
|
|
(86
|
)
|
|
(44
|
)
|
|
(36
|
)
|
|
—
|
|
|
(22
|
)
|
|||||
Earnings before income taxes
|
|
1,160
|
|
|
1,212
|
|
|
1,705
|
|
|
1,686
|
|
|
1,729
|
|
|||||
Income taxes
|
|
645
|
|
|
206
|
|
|
407
|
|
|
341
|
|
|
456
|
|
|||||
Net earnings
|
|
$
|
515
|
|
|
$
|
1,006
|
|
|
$
|
1,298
|
|
|
$
|
1,345
|
|
|
$
|
1,273
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
PER SHARE DATA
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net earnings per share of common stock:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
$
|
1.36
|
|
|
$
|
2.66
|
|
|
$
|
3.41
|
|
|
$
|
3.48
|
|
|
$
|
3.21
|
|
Diluted
|
|
$
|
1.34
|
|
|
$
|
2.63
|
|
|
$
|
3.39
|
|
|
$
|
3.45
|
|
|
$
|
3.19
|
|
Dividends per share of common stock:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Declared
|
|
$
|
1.26
|
|
|
$
|
1.10
|
|
|
$
|
0.90
|
|
|
$
|
0.75
|
|
|
$
|
0.63
|
|
Paid
|
|
$
|
1.22
|
|
|
$
|
1.06
|
|
|
$
|
0.85
|
|
|
$
|
0.72
|
|
|
$
|
0.60
|
|
Average number of shares outstanding—in millions:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
378.5
|
|
|
378.6
|
|
|
380.6
|
|
|
386.5
|
|
|
396.4
|
|
|||||
Diluted
|
|
382.8
|
|
|
382.1
|
|
|
383.0
|
|
|
389.5
|
|
|
399.5
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
CONSOLIDATED FINANCIAL POSITION
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash, cash equivalents and current marketable securities
|
|
$
|
5,000
|
|
|
$
|
3,980
|
|
|
$
|
4,285
|
|
|
$
|
3,418
|
|
|
$
|
4,380
|
|
Accounts receivable—net
|
|
1,572
|
|
|
1,518
|
|
|
1,430
|
|
|
1,417
|
|
|
1,252
|
|
|||||
Inventory—net
|
|
1,588
|
|
|
1,422
|
|
|
1,265
|
|
|
1,283
|
|
|
1,057
|
|
|||||
Property, plant and equipment—net
|
|
1,098
|
|
|
1,081
|
|
|
948
|
|
|
888
|
|
|
798
|
|
|||||
Capital expenditures
|
|
233
|
|
|
195
|
|
|
210
|
|
|
226
|
|
|
182
|
|
|||||
Depreciation and amortization
|
|
586
|
|
|
511
|
|
|
486
|
|
|
481
|
|
|
410
|
|
|||||
Total assets
|
|
17,713
|
|
|
15,743
|
|
|
13,206
|
|
|
12,146
|
|
|
10,895
|
|
|||||
Accounts payable
|
|
329
|
|
|
314
|
|
|
288
|
|
|
345
|
|
|
292
|
|
|||||
Total debt
|
|
3,973
|
|
|
2,764
|
|
|
1,762
|
|
|
1,768
|
|
|
1,021
|
|
|||||
Shareholders’ equity
|
|
8,595
|
|
|
9,047
|
|
|
8,597
|
|
|
7,683
|
|
|
7,174
|
|
|||||
Net cash provided by operating activities
|
|
1,782
|
|
|
1,886
|
|
|
1,657
|
|
|
1,434
|
|
|
1,547
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
OTHER DATA
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Number of shareholders of record
|
|
3,305
|
|
|
3,612
|
|
|
4,258
|
|
|
4,508
|
|
|
4,586
|
|
|||||
Approximate number of employees
|
|
26,000
|
|
|
25,000
|
|
|
22,000
|
|
|
21,000
|
|
|
20,000
|
|
8
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
ITEM 7.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
|
1.
|
Acquisitions
|
2.
|
Dividends
|
3.
|
Share repurchases
|
Consolidated results of operations:
|
Years Ended December 31,
|
|
Percentage Change
|
||||||
|
2014
|
2013
|
2012
|
|
2014/2013
|
2013/2012
|
|||
Net Sales
|
$9,675
|
$9,021
|
$8,657
|
|
7.3
|
|
4.2
|
|
|
Gross Profit
|
6,384
|
6,044
|
5,876
|
|
5.6
|
|
2.9
|
|
|
Research, development and engineering expenses
|
614
|
536
|
471
|
|
14.6
|
|
13.8
|
|
|
Selling, general and administrative expenses
|
4,336
|
4,114
|
3,541
|
|
5.4
|
|
16.2
|
|
|
Intangibles amortization
|
188
|
138
|
123
|
|
36.2
|
|
12.2
|
|
|
Other income (expense)
|
(86)
|
(44)
|
(36
|
)
|
|
95.5
|
|
22.2
|
|
Income taxes
|
645
|
206
|
407
|
|
213.1
|
|
(49.4
|
)
|
|
Net Earnings
|
$515
|
$1,006
|
$1,298
|
|
(48.8
|
)
|
(22.5
|
)
|
|
Diluted Net Earnings per share
|
$1.34
|
$2.63
|
$3.39
|
|
(49.0
|
)
|
(22.4
|
)
|
|
Adjusted Net Earnings per share
(1)
|
$4.73
|
$4.49
|
$4.30
|
|
5.3
|
|
4.4
|
|
9
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
Geographic and segment net sales:
|
|
|
|
Percentage Change
|
||||||||||||||||
|
|
|
|
2014/2013
|
|
2013/2012
|
||||||||||||||
|
|
Years Ended December 31,
|
|
|
|
Constant
Currency |
|
|
|
Constant
Currency |
||||||||||
|
|
2014
|
|
2013
|
|
2012
|
|
Reported
|
|
|
Reported
|
|
||||||||
Geographic sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
United States
|
|
$
|
6,558
|
|
|
$
|
5,984
|
|
|
$
|
5,658
|
|
|
9.6
|
|
9.6
|
|
5.8
|
|
5.8
|
International
|
|
3,117
|
|
|
3,037
|
|
|
2,999
|
|
|
2.6
|
|
5.7
|
|
1.3
|
|
6.0
|
|||
Total net sales
|
|
$
|
9,675
|
|
|
$
|
9,021
|
|
|
$
|
8,657
|
|
|
7.3
|
|
8.3
|
|
4.2
|
|
5.9
|
Segment sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Orthopaedics
|
|
$
|
4,153
|
|
|
$
|
3,949
|
|
|
$
|
3,823
|
|
|
5.2
|
|
6.3
|
|
3.3
|
|
5.4
|
MedSurg
|
|
3,781
|
|
|
3,414
|
|
|
3,265
|
|
|
10.8
|
|
11.7
|
|
4.6
|
|
5.5
|
|||
Neurotechnology and Spine
|
|
1,741
|
|
|
1,658
|
|
|
1,569
|
|
|
5.0
|
|
6.2
|
|
5.6
|
|
7.7
|
|||
Total net sales
|
|
$
|
9,675
|
|
|
$
|
9,021
|
|
|
$
|
8,657
|
|
|
7.3
|
|
8.3
|
|
4.2
|
|
5.9
|
|
|
|
Percentage Change
|
|
|
|
Percentage Change
|
||||||||||||||||||||||
|
Years Ended December 31,
|
|
|
U.S.
|
International
|
|
Years Ended December 31,
|
|
|
U.S.
|
International
|
||||||||||||||||||
|
2014
|
2013
|
As Reported
|
Constant Currency
|
As Reported
|
As Reported
|
Constant Currency
|
|
2013
|
2012
|
As Reported
|
Constant Currency
|
As Reported
|
As Reported
|
Constant Currency
|
||||||||||||||
Orthopaedics
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Knees
|
1,396
|
|
1,371
|
|
1.8
|
%
|
2.7
|
%
|
4.3
|
%
|
(3.5
|
)%
|
(0.7
|
)%
|
|
1,371
|
|
1,356
|
|
1.1
|
%
|
2.6
|
%
|
3.4
|
%
|
(3.3
|
)%
|
1.1
|
%
|
Hips
|
1,291
|
|
1,272
|
|
1.5
|
%
|
2.7
|
%
|
6.1
|
%
|
(4.2
|
)%
|
(1.4
|
)%
|
|
1,272
|
|
1,233
|
|
3.2
|
%
|
6.0
|
%
|
7.2
|
%
|
(1.4
|
)%
|
4.5
|
%
|
Trauma and Extremities
|
1,230
|
|
1,116
|
|
10.2
|
%
|
11.4
|
%
|
14.8
|
%
|
5.1
|
%
|
7.7
|
%
|
|
1,116
|
|
989
|
|
12.8
|
%
|
15.1
|
%
|
18.4
|
%
|
7.2
|
%
|
11.8
|
%
|
Other
|
236
|
|
190
|
|
24.0
|
%
|
25.2
|
%
|
37.4
|
%
|
(7.6
|
)%
|
(3.7
|
)%
|
|
190
|
|
245
|
|
(22.5
|
)%
|
(20.9
|
)%
|
(19.7
|
)%
|
(28.3
|
)%
|
(23.4
|
)%
|
ORTHOPAEDICS
|
4,153
|
|
3,949
|
|
5.2
|
%
|
6.3
|
%
|
9.4
|
%
|
(1.1
|
)%
|
1.7
|
%
|
|
3,949
|
|
3,823
|
|
3.3
|
%
|
5.4
|
%
|
6.2
|
%
|
(0.6
|
)%
|
4.4
|
%
|
MedSurg
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Instruments
|
1,424
|
|
1,269
|
|
12.2
|
%
|
13.1
|
%
|
14.8
|
%
|
5.7
|
%
|
8.8
|
%
|
|
1,269
|
|
1,261
|
|
0.6
|
%
|
1.9
|
%
|
0.7
|
%
|
0.6
|
%
|
5.1
|
%
|
Endoscopy
|
1,382
|
|
1,222
|
|
13.1
|
%
|
14.2
|
%
|
13.3
|
%
|
12.6
|
%
|
16.2
|
%
|
|
1,222
|
|
1,111
|
|
10.0
|
%
|
11.0
|
%
|
11.4
|
%
|
6.5
|
%
|
9.9
|
%
|
Medical
|
766
|
|
710
|
|
7.9
|
%
|
8.8
|
%
|
9.3
|
%
|
2.2
|
%
|
6.7
|
%
|
|
710
|
|
691
|
|
2.8
|
%
|
3.1
|
%
|
3.4
|
%
|
0.3
|
%
|
2.0
|
%
|
Sustainability
|
209
|
|
213
|
|
(1.9
|
)%
|
(1.9
|
)%
|
(1.8
|
)%
|
nm
|
|
nm
|
|
|
213
|
|
202
|
|
5.6
|
%
|
5.6
|
%
|
5.8
|
%
|
nm
|
|
nm
|
|
MEDSURG
|
3,781
|
|
3,414
|
|
10.8
|
%
|
11.7
|
%
|
11.7
|
%
|
7.9
|
%
|
11.5
|
%
|
|
3,414
|
|
3,265
|
|
4.6
|
%
|
5.5
|
%
|
5.2
|
%
|
2.9
|
%
|
6.4
|
%
|
Neurotechnology and Spine
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Neurotechnology
|
1,001
|
|
915
|
|
9.4
|
%
|
10.9
|
%
|
11.2
|
%
|
6.7
|
%
|
10.4
|
%
|
|
915
|
|
842
|
|
8.7
|
%
|
11.4
|
%
|
11.2
|
%
|
5.1
|
%
|
11.8
|
%
|
Spine
|
740
|
|
743
|
|
(0.4
|
)%
|
0.3
|
%
|
(1.6
|
)%
|
2.5
|
%
|
5.2
|
%
|
|
743
|
|
727
|
|
2.1
|
%
|
3.4
|
%
|
1.8
|
%
|
2.9
|
%
|
7.2
|
%
|
NEUROTECHNOLOGY AND SPINE
|
1,741
|
|
1,658
|
|
5.0
|
%
|
6.2
|
%
|
5.0
|
%
|
5.1
|
%
|
8.5
|
%
|
|
1,658
|
|
1,569
|
|
5.6
|
%
|
7.7
|
%
|
6.4
|
%
|
4.3
|
%
|
10.0
|
%
|
10
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
11
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
1.
|
Acquisition and integration related costs
. Costs related to integrating recently acquired businesses and specific costs related to the consummation of the acquisition process.
|
2.
|
Amortization of intangible assets
. Periodic amortization expense related to purchased intangible assets.
|
3.
|
Restructuring related charges
. Costs associated with focused workforce reductions, other restructuring activities and long-lived asset impairments.
|
4.
|
Rejuvenate and recall matters
. Our best estimate of the minimum of the range of probable loss to resolve certain product recalls.
|
5.
|
Regulatory and legal matters
. Our best estimate of the minimum of the range of probable loss to resolve certain regulatory matters and other legal settlements.
|
6.
|
Tax matters
. Certain significant and discrete tax items and adjustments to interest expense related to the settlement of certain tax matters.
|
Year Ended December 31, 2014
|
Gross Profit
|
Selling, General & Administrative Expenses
|
Intangible Amortization
|
Operating Income
|
Net Earnings
|
Effective Tax Rate
|
Diluted EPS
|
|||||||||||||
AS REPORTED
|
$
|
6,384
|
|
$
|
4,336
|
|
$
|
188
|
|
$
|
1,246
|
|
$
|
515
|
|
55.6
|
%
|
$
|
1.34
|
|
Acquisition and integration related charges
|
|
|
|
|
|
|
|
|||||||||||||
Inventory stepped up to fair value
|
27
|
|
—
|
|
—
|
|
27
|
|
15
|
|
0.5
|
|
0.04
|
|
||||||
Other acquisition and integration related
|
—
|
|
(75
|
)
|
—
|
|
75
|
|
50
|
|
0.7
|
|
0.13
|
|
||||||
Amortization of intangible assets
|
—
|
|
—
|
|
(188
|
)
|
188
|
|
133
|
|
1.1
|
|
0.35
|
|
||||||
Restructuring related charges
|
1
|
|
(116
|
)
|
—
|
|
117
|
|
78
|
|
1.1
|
|
0.20
|
|
||||||
Rejuvenate and other recall matters
|
—
|
|
(761
|
)
|
—
|
|
761
|
|
628
|
|
(3.1
|
)
|
1.65
|
|
||||||
Tax matters
|
—
|
|
—
|
|
—
|
|
—
|
|
391
|
|
(33.6
|
)
|
1.02
|
|
||||||
ADJUSTED
|
$
|
6,412
|
|
$
|
3,384
|
|
$
|
—
|
|
$
|
2,414
|
|
$
|
1,810
|
|
22.3
|
%
|
$
|
4.73
|
|
Year Ended December 31, 2013
|
Gross Profit
|
Selling, General & Administrative Expenses
|
Intangible Amortization
|
Operating Income
|
Net Earnings
|
Effective Tax Rate
|
Diluted EPS
|
|||||||||||||
AS REPORTED
|
$
|
6,044
|
|
$
|
4,114
|
|
$
|
138
|
|
$
|
1,256
|
|
$
|
1,006
|
|
17.0
|
%
|
$
|
2.63
|
|
Acquisition and integration related charges
|
|
|
|
|
|
|
|
|||||||||||||
Inventory stepped up to fair value
|
28
|
|
—
|
|
—
|
|
28
|
|
21
|
|
0.1
|
|
0.06
|
|
||||||
Other acquisition and integration related
|
—
|
|
(70
|
)
|
—
|
|
70
|
|
51
|
|
0.3
|
|
0.13
|
|
||||||
Amortization of intangible assets
|
—
|
|
—
|
|
(138
|
)
|
138
|
|
98
|
|
0.4
|
|
0.26
|
|
||||||
Restructuring related charges
|
11
|
|
(52
|
)
|
—
|
|
63
|
|
46
|
|
0.3
|
|
0.12
|
|
||||||
Rejuvenate and other recall matters
|
—
|
|
(622
|
)
|
—
|
|
622
|
|
460
|
|
2.0
|
|
1.20
|
|
||||||
Regulatory and legal matters
|
7
|
|
(62
|
)
|
—
|
|
69
|
|
63
|
|
(0.6
|
)
|
0.17
|
|
||||||
Donations
|
—
|
|
(25
|
)
|
—
|
|
25
|
|
15
|
|
0.3
|
|
0.04
|
|
||||||
Tax matters
|
—
|
|
—
|
|
—
|
|
—
|
|
(46
|
)
|
2.9
|
|
(0.12
|
)
|
||||||
ADJUSTED
|
$
|
6,090
|
|
$
|
3,283
|
|
$
|
—
|
|
$
|
2,271
|
|
$
|
1,714
|
|
22.7
|
%
|
$
|
4.49
|
|
12
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
Year Ended December 31, 2012
|
Gross Profit
|
Selling General and Administrative Expenses
|
Intangible Amortization
|
Operating Income
|
Net Earnings
|
Effective Tax Rate
|
Diluted EPS
|
|||||||||||||
AS REPORTED
|
$
|
5,876
|
|
$
|
3,466
|
|
$
|
123
|
|
$
|
1,741
|
|
$
|
1,298
|
|
23.9
|
%
|
$
|
3.39
|
|
Acquisition and integration related charges
|
|
|
|
|
|
|
|
|||||||||||||
Inventory stepped up to fair value
|
18
|
|
—
|
|
—
|
|
18
|
|
13
|
|
—
|
|
0.03
|
|
||||||
Other acquisition and integration related
|
—
|
|
(37
|
)
|
—
|
|
37
|
|
24
|
|
0.3
|
|
0.06
|
|
||||||
Amortization of intangible assets
|
—
|
|
—
|
|
(123
|
)
|
123
|
|
88
|
|
0.3
|
|
0.23
|
|
||||||
Restructuring related charges
|
5
|
|
(75
|
)
|
—
|
|
80
|
|
59
|
|
0.1
|
|
0.15
|
|
||||||
Rejuvenate and other recall matters
|
—
|
|
(174
|
)
|
—
|
|
174
|
|
133
|
|
—
|
|
0.35
|
|
||||||
Regulatory and legal matters
|
—
|
|
(33
|
)
|
—
|
|
33
|
|
33
|
|
(0.5
|
)
|
0.09
|
|
||||||
ADJUSTED
|
$
|
5,899
|
|
$
|
3,147
|
|
$
|
—
|
|
$
|
2,206
|
|
$
|
1,648
|
|
24.1
|
%
|
$
|
4.30
|
|
13
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
|
Payment Period
|
|||||||||||||||||||
|
Total
|
|
Less than 1 year
|
|
1-3 years
|
|
3-5 years
|
|
After 5 years
|
|
||||||||||
Short-term and long-term debt
|
$
|
3,979
|
|
|
$
|
727
|
|
|
$
|
750
|
|
|
$
|
600
|
|
|
$
|
1,902
|
|
|
Unconditional purchase obligations
|
1,056
|
|
|
697
|
|
|
238
|
|
|
120
|
|
|
1
|
|
|
|||||
Operating leases
|
216
|
|
|
60
|
|
|
78
|
|
|
44
|
|
|
34
|
|
|
|||||
Contributions to defined benefit plans
|
19
|
|
|
19
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|||||
Other
|
94
|
|
|
13
|
|
|
17
|
|
|
9
|
|
|
55
|
|
|
|||||
|
$
|
5,364
|
|
|
$
|
1,516
|
|
|
$
|
1,083
|
|
|
$
|
773
|
|
|
$
|
1,992
|
|
|
14
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
15
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
ITEM 7A.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
16
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
ITEM 8.
|
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
|
17
|
|
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2014
|
|
2013
|
|
2012
|
||||||
Net sales
|
|
$
|
9,675
|
|
|
$
|
9,021
|
|
|
$
|
8,657
|
|
Cost of sales
|
|
3,291
|
|
|
2,977
|
|
|
2,781
|
|
|||
Gross profit
|
|
6,384
|
|
|
6,044
|
|
|
5,876
|
|
|||
Research, development and engineering expenses
|
|
614
|
|
|
536
|
|
|
471
|
|
|||
Selling, general and administrative expenses
|
|
3,575
|
|
|
3,492
|
|
|
3,367
|
|
|||
Recall charges, net of insurance recoveries
|
|
761
|
|
|
622
|
|
|
174
|
|
|||
Intangible asset amortization
|
|
188
|
|
|
138
|
|
|
123
|
|
|||
Total operating expenses
|
|
5,138
|
|
|
4,788
|
|
|
4,135
|
|
|||
Operating income
|
|
1,246
|
|
|
1,256
|
|
|
1,741
|
|
|||
Other income (expense), net
|
|
(86
|
)
|
|
(44
|
)
|
|
(36
|
)
|
|||
Earnings before income taxes
|
|
1,160
|
|
|
1,212
|
|
|
1,705
|
|
|||
Income taxes
|
|
645
|
|
|
206
|
|
|
407
|
|
|||
Net earnings
|
|
$
|
515
|
|
|
$
|
1,006
|
|
|
$
|
1,298
|
|
|
|
|
|
|
|
|
||||||
Net earnings per share of common stock:
|
|
|
|
|
|
|
||||||
Basic net earnings per share of common stock
|
|
$
|
1.36
|
|
|
$
|
2.66
|
|
|
$
|
3.41
|
|
Diluted net earnings per share of common stock
|
|
$
|
1.34
|
|
|
$
|
2.63
|
|
|
$
|
3.39
|
|
|
|
|
|
|
|
|
||||||
Weighted-average shares outstanding—in millions:
|
|
|
|
|
|
|
||||||
Basic
|
|
378.5
|
|
|
378.6
|
|
|
380.6
|
|
|||
Net effect of dilutive employee stock options
|
|
4.3
|
|
|
3.5
|
|
|
2.4
|
|
|||
Diluted
|
|
382.8
|
|
|
382.1
|
|
|
383.0
|
|
|||
Anti-dilutive shares excluded from the calculation of net effect of dilutive employee stock options
|
|
—
|
|
|
—
|
|
|
6.4
|
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2014
|
|
2013
|
|
2012
|
||||||
Net earnings
|
|
$
|
515
|
|
|
$
|
1,006
|
|
|
$
|
1,298
|
|
Other comprehensive income (loss), net of tax
|
|
|
|
|
|
|
||||||
Marketable securities
|
|
3
|
|
|
(4
|
)
|
|
4
|
|
|||
Pension plans
|
|
(55
|
)
|
|
20
|
|
|
(69
|
)
|
|||
Unrealized gains on designated hedges
|
|
6
|
|
|
7
|
|
|
—
|
|
|||
Financial statement translation
|
|
(440
|
)
|
|
80
|
|
|
50
|
|
|||
Total other comprehensive (loss) income, net of tax
|
|
(486
|
)
|
|
103
|
|
|
(15
|
)
|
|||
Comprehensive income
|
|
$
|
29
|
|
|
$
|
1,109
|
|
|
$
|
1,283
|
|
18
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
|
|
December 31,
|
||||||
|
2014
|
|
2013
|
|||||
ASSETS
|
|
|
|
|
||||
Current assets
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
1,795
|
|
|
$
|
1,339
|
|
Marketable securities
|
|
3,205
|
|
|
2,641
|
|
||
Accounts receivable, less allowance of $59 ($72 in 2013)
|
|
1,572
|
|
|
1,518
|
|
||
Inventories
|
|
|
|
|
||||
Materials and supplies
|
|
248
|
|
|
227
|
|
||
Work in process
|
|
88
|
|
|
85
|
|
||
Finished goods
|
|
1,252
|
|
|
1,110
|
|
||
Total inventories
|
|
1,588
|
|
|
1,422
|
|
||
Deferred income taxes
|
|
989
|
|
|
880
|
|
||
Prepaid expenses and other current assets
|
|
524
|
|
|
535
|
|
||
Total current assets
|
|
9,673
|
|
|
8,335
|
|
||
Property, plant and equipment
|
|
|
|
|
||||
Land, buildings and improvements
|
|
678
|
|
|
686
|
|
||
Machinery and equipment
|
|
1,919
|
|
|
1,811
|
|
||
Total property, plant and equipment
|
|
2,597
|
|
|
2,497
|
|
||
Less accumulated depreciation
|
|
1,499
|
|
|
1,416
|
|
||
Net property, plant and equipment
|
|
1,098
|
|
|
1,081
|
|
||
Other assets
|
|
|
|
|
||||
Goodwill
|
|
4,186
|
|
|
3,844
|
|
||
Other intangibles, net
|
|
2,018
|
|
|
1,989
|
|
||
Other
|
|
738
|
|
|
494
|
|
||
Total assets
|
|
$
|
17,713
|
|
|
$
|
15,743
|
|
|
|
|
|
|
||||
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
|
|
|
||||
Current liabilities
|
|
|
|
|
||||
Accounts payable
|
|
329
|
|
|
314
|
|
||
Accrued compensation
|
|
597
|
|
|
535
|
|
||
Income taxes
|
|
333
|
|
|
131
|
|
||
Dividend payable
|
|
131
|
|
|
115
|
|
||
Accrued recall expenses
|
|
1,593
|
|
|
772
|
|
||
Accrued expenses and other liabilities
|
|
754
|
|
|
765
|
|
||
Current maturities of debt
|
|
727
|
|
|
25
|
|
||
Total current liabilities
|
|
4,464
|
|
|
2,657
|
|
||
Long-term debt, excluding current maturities
|
|
3,246
|
|
|
2,739
|
|
||
Other liabilities
|
|
1,408
|
|
|
1,300
|
|
||
Shareholders' equity
|
|
|
|
|
||||
Common stock, $0.10 par value:
|
|
|
|
|
||||
Authorized: 1 billion shares, outstanding: 378 million shares (378 million in 2013)
|
|
38
|
|
|
38
|
|
||
Additional paid-in capital
|
|
1,252
|
|
|
1,160
|
|
||
Retained earnings
|
|
7,559
|
|
|
7,617
|
|
||
Accumulated other comprehensive income
|
|
(254
|
)
|
|
232
|
|
||
Total shareholders' equity
|
|
8,595
|
|
|
9,047
|
|
||
Total liabilities & shareholders' equity
|
|
$
|
17,713
|
|
|
$
|
15,743
|
|
19
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
|
|
Common
Stock |
|
Additional
Paid-In Capital |
|
Retained
Earnings |
|
Accumulated
Other Comprehensive Income (Loss) |
|
Total
|
||||||||||
Balances at January 1, 2012
|
|
$
|
38
|
|
|
$
|
1,022
|
|
|
$
|
6,479
|
|
|
$
|
144
|
|
|
$
|
7,683
|
|
Net earnings
|
|
|
|
|
|
1,298
|
|
|
|
|
1,298
|
|
||||||||
Other comprehensive loss
|
|
|
|
|
|
|
|
(15
|
)
|
|
(15
|
)
|
||||||||
Issuance of 1.5 million shares of common stock under stock option and benefit plans, including $28 excess income tax benefit
|
|
|
|
7
|
|
|
|
|
|
|
7
|
|
||||||||
Repurchase and retirement of 2.1 million shares of common stock
|
|
|
|
|
(6
|
)
|
|
(102
|
)
|
|
|
|
(108
|
)
|
||||||
Share-based compensation
|
|
|
|
75
|
|
|
|
|
|
|
75
|
|
||||||||
Cash dividends declared of $0.9025 per share of common stock
|
|
|
|
|
|
(343
|
)
|
|
|
|
(343
|
)
|
||||||||
Balances at December 31, 2012
|
|
38
|
|
|
1,098
|
|
|
7,332
|
|
|
129
|
|
|
8,597
|
|
|||||
Net earnings
|
|
|
|
|
|
1,006
|
|
|
|
|
1,006
|
|
||||||||
Other comprehensive income
|
|
|
|
|
|
|
|
103
|
|
|
103
|
|
||||||||
Issuance of 2.1 million shares of common stock under stock option and benefit plans, including $47 excess income tax benefit
|
|
|
|
(1
|
)
|
|
|
|
|
|
(1
|
)
|
||||||||
Repurchase and retirement of 4.8 million shares of common stock
|
|
|
|
(13
|
)
|
|
(304
|
)
|
|
|
|
(317
|
)
|
|||||||
Share-based compensation
|
|
|
|
76
|
|
|
|
|
|
|
76
|
|
||||||||
Cash dividends declared of $1.10 per share of common stock
|
|
|
|
|
|
(417
|
)
|
|
|
|
(417
|
)
|
||||||||
Balances at December 31, 2013
|
|
38
|
|
|
1,160
|
|
|
7,617
|
|
|
232
|
|
|
9,047
|
|
|||||
Net earnings
|
|
|
|
|
|
515
|
|
|
|
|
515
|
|
||||||||
Other comprehensive loss
|
|
|
|
|
|
|
|
(486
|
)
|
|
(486
|
)
|
||||||||
Issuance of 2.2 million shares of common stock under stock option and benefit plans, including $59 excess income tax benefit
|
|
|
|
19
|
|
|
|
|
|
|
19
|
|
||||||||
Repurchase and retirement of 1.3 million shares of common stock
|
|
|
|
(4
|
)
|
|
(96
|
)
|
|
|
|
(100
|
)
|
|||||||
Share-based compensation
|
|
|
|
77
|
|
|
|
|
|
|
77
|
|
||||||||
Cash dividends declared of $1.26 per share of common stock
|
|
|
|
|
|
(477
|
)
|
|
|
|
(477
|
)
|
||||||||
Balances at December 31, 2014
|
|
$
|
38
|
|
|
$
|
1,252
|
|
|
$
|
7,559
|
|
|
$
|
(254
|
)
|
|
$
|
8,595
|
|
20
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2014
|
|
2013
|
|
2012
|
||||||
Operating activities
|
|
|
|
|
|
|
||||||
Net earnings
|
|
$
|
515
|
|
|
$
|
1,006
|
|
|
$
|
1,298
|
|
Adjustments to reconcile net earnings to net cash provided by operating activities:
|
|
|
|
|
|
|
||||||
Depreciation
|
|
190
|
|
|
169
|
|
|
154
|
|
|||
Amortization of intangible assets
|
|
188
|
|
|
138
|
|
|
123
|
|
|||
Share-based compensation
|
|
77
|
|
|
76
|
|
|
75
|
|
|||
Gross recall charges
|
|
940
|
|
|
622
|
|
|
174
|
|
|||
Sale of inventory stepped up to fair value at acquisition
|
|
27
|
|
|
28
|
|
|
18
|
|
|||
Deferred income tax benefit
|
|
60
|
|
|
23
|
|
|
(39
|
)
|
|||
Changes in operating assets and liabilities, net of effects of acquisitions:
|
|
|
|
|
|
|
||||||
Accounts receivable
|
|
(89
|
)
|
|
(89
|
)
|
|
(20
|
)
|
|||
Inventories
|
|
(173
|
)
|
|
(77
|
)
|
|
18
|
|
|||
Accounts payable
|
|
13
|
|
|
1
|
|
|
(48
|
)
|
|||
Accrued expenses and other liabilities
|
|
92
|
|
|
41
|
|
|
9
|
|
|||
Recall related payments
|
|
(98
|
)
|
|
(6
|
)
|
|
(3
|
)
|
|||
Income taxes
|
|
133
|
|
|
(124
|
)
|
|
(159
|
)
|
|||
Other
|
|
(93
|
)
|
|
78
|
|
|
57
|
|
|||
Net cash provided by operating activities
|
|
1,782
|
|
|
1,886
|
|
|
1,657
|
|
|||
Investing activities
|
|
|
|
|
|
|
||||||
Acquisitions, net of cash acquired
|
|
(916
|
)
|
|
(2,320
|
)
|
|
(154
|
)
|
|||
Purchases of marketable securities
|
|
(4,365
|
)
|
|
(4,558
|
)
|
|
(3,480
|
)
|
|||
Proceeds from sales of marketable securities
|
|
3,636
|
|
|
4,856
|
|
|
3,108
|
|
|||
Purchases of property, plant and equipment
|
|
(233
|
)
|
|
(195
|
)
|
|
(210
|
)
|
|||
Net cash used in investing activities
|
|
(1,878
|
)
|
|
(2,217
|
)
|
|
(736
|
)
|
|||
Financing activities
|
|
|
|
|
|
|
||||||
Proceeds from borrowings
|
|
1,601
|
|
|
369
|
|
|
178
|
|
|||
Payments on borrowings
|
|
(1,428
|
)
|
|
(355
|
)
|
|
(182
|
)
|
|||
Proceeds from issuance of long-term debt, net
|
|
986
|
|
|
991
|
|
|
—
|
|
|||
Dividends paid
|
|
(462
|
)
|
|
(401
|
)
|
|
(324
|
)
|
|||
Repurchase and retirement of common stock
|
|
(100
|
)
|
|
(317
|
)
|
|
(108
|
)
|
|||
Other financing
|
|
32
|
|
|
13
|
|
|
(13
|
)
|
|||
Net cash provided by (used in) financing activities
|
|
629
|
|
|
300
|
|
|
(449
|
)
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
|
(77
|
)
|
|
(25
|
)
|
|
18
|
|
|||
Change in cash and cash equivalents
|
|
456
|
|
|
(56
|
)
|
|
490
|
|
|||
Cash and cash equivalents at beginning of year
|
|
1,339
|
|
|
1,395
|
|
|
905
|
|
|||
Cash and cash equivalents at end of year
|
|
$
|
1,795
|
|
|
$
|
1,339
|
|
|
$
|
1,395
|
|
|
|
|
|
|
|
|
||||||
Supplemental cash flow disclosure:
|
|
|
|
|
|
|
||||||
Cash paid for income taxes, net of refunds
|
|
$
|
437
|
|
|
$
|
321
|
|
|
$
|
599
|
|
|
|
|
|
|
|
|
21
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
22
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
23
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
|
2014
|
|
2013
|
||||
Marketable Securities - Beginning
|
$
|
—
|
|
|
$
|
4
|
|
Other comprehensive income (OCI)
|
12
|
|
|
16
|
|
||
Income tax expense on OCI
|
(2
|
)
|
|
1
|
|
||
Reclassifications out of AOCI into:
|
|
|
|
||||
Cost of sales
|
—
|
|
|
—
|
|
||
Other (income) expense
|
(9
|
)
|
|
(21
|
)
|
||
Income tax expense (benefit)
|
2
|
|
|
—
|
|
||
Total other comprehensive income
|
3
|
|
|
(4
|
)
|
||
Marketable Securities - Ending
|
$
|
3
|
|
|
$
|
—
|
|
|
|
|
|
||||
Pension Plans - Beginning
|
$
|
(81
|
)
|
|
$
|
(101
|
)
|
Other comprehensive income (OCI)
|
(72
|
)
|
|
30
|
|
||
Income tax expense on OCI
|
22
|
|
|
(15
|
)
|
||
Reclassifications out of AOCI into:
|
|
|
|
||||
Cost of sales
|
(6
|
)
|
|
7
|
|
||
Other (income) expense
|
—
|
|
|
—
|
|
||
Income tax expense (benefit)
|
1
|
|
|
(2
|
)
|
||
Total other comprehensive income
|
(55
|
)
|
|
20
|
|
||
Pension Plans - Ending
|
$
|
(136
|
)
|
|
$
|
(81
|
)
|
|
|
|
|
||||
Hedges - Beginning
|
$
|
7
|
|
|
$
|
—
|
|
Other comprehensive income (OCI)
|
10
|
|
|
8
|
|
||
Income tax expense on OCI
|
(4
|
)
|
|
4
|
|
||
Reclassifications out of AOCI into:
|
|
|
|
||||
Cost of sales
|
(1
|
)
|
|
(9
|
)
|
||
Other (income) expense
|
—
|
|
|
—
|
|
||
Income tax expense (benefit)
|
1
|
|
|
4
|
|
||
Total other comprehensive income
|
6
|
|
|
7
|
|
||
Hedges - Ending
|
$
|
13
|
|
|
$
|
7
|
|
|
|
|
|
||||
Financial Statement Translation - Beginning
|
$
|
306
|
|
|
$
|
226
|
|
Other comprehensive income (OCI)
|
(440
|
)
|
|
80
|
|
||
Financial Statement Translation - Ending
|
$
|
(134
|
)
|
|
$
|
306
|
|
|
|
|
|
||||
AOCI - Beginning
|
$
|
232
|
|
|
$
|
129
|
|
Other comprehensive income (OCI)
|
(490
|
)
|
|
134
|
|
||
Income tax expense on OCI
|
16
|
|
|
(10
|
)
|
||
Reclassifications out of AOCI into:
|
|
|
|
||||
Cost of sales
|
(7
|
)
|
|
(2
|
)
|
||
Other (income) expense
|
(9
|
)
|
|
(21
|
)
|
||
Income tax expense (benefit)
|
4
|
|
|
2
|
|
||
Total other comprehensive income
|
(486
|
)
|
|
103
|
|
||
AOCI - Ending
|
$
|
(254
|
)
|
|
$
|
232
|
|
Level 1
|
Quoted market prices in active markets for identical assets or liabilities.
|
Level 2
|
Observable market-based inputs or unobservable inputs that are corroborated by market data.
|
Level 3
|
Unobservable inputs reflecting our assumptions or external inputs from active markets.
|
|
2014
|
2013
|
||||
Cash and cash equivalents
|
$
|
1,795
|
|
$
|
1,339
|
|
Trading marketable securities
|
80
|
|
72
|
|
||
Level 1 - Assets
|
1,875
|
|
1,411
|
|
||
Available-for-sale marketable securities
|
|
|
||||
Corporate and asset-backed debt securities
|
1,525
|
|
1,177
|
|
||
Foreign government debt securities
|
726
|
|
845
|
|
||
United States agency debt securities
|
382
|
|
211
|
|
||
United States treasury debt securities
|
474
|
|
350
|
|
||
Certificates of deposit
|
110
|
|
53
|
|
||
Other
|
12
|
|
5
|
|
||
Total available-for-sale marketable securities
|
3,229
|
|
2,641
|
|
||
Foreign currency exchange forward contracts
|
32
|
|
25
|
|
||
Interest rate swap asset
|
10
|
|
—
|
|
||
Level 2 - Assets
|
3,271
|
|
2,666
|
|
||
Total assets measured at fair value
|
$
|
5,146
|
|
$
|
4,077
|
|
|
|
|
||||
Deferred compensation arrangements
|
$
|
80
|
|
$
|
72
|
|
Level 1 - Liabilities
|
80
|
|
72
|
|
||
Foreign currency exchange forward contracts
|
12
|
|
2
|
|
||
Level 2 - Liabilities
|
12
|
|
2
|
|
||
Contingent consideration
|
|
|
||||
Beginning Balance
|
59
|
|
103
|
|
||
Losses (Gains) included in earnings
|
4
|
|
(5
|
)
|
||
Settlements
|
(15
|
)
|
(39
|
)
|
||
Ending Balance
|
48
|
|
59
|
|
||
Level 3 - Liabilities
|
48
|
|
59
|
|
||
Total liabilities measured at fair value
|
$
|
140
|
|
$
|
133
|
|
24
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
|
2014
|
|||||
|
Cost
|
Estimated Fair Value
|
||||
Due in one year or less
|
$
|
430
|
|
$
|
430
|
|
Due after one year through three years
|
2,502
|
|
2,505
|
|
||
Due after three years
|
294
|
|
294
|
|
Summary of marketable securities:
|
December
|
December
|
||||
|
2014
|
2013
|
||||
|
Amortized Cost
|
|||||
Available-for-sale marketable securities:
|
|
|
||||
Corporate and asset-backed debt securities
|
$
|
1,523
|
|
$
|
1,177
|
|
Foreign government debt securities
|
725
|
|
846
|
|
||
United States agency debt securities
|
382
|
|
211
|
|
||
United States treasury debt securities
|
474
|
|
350
|
|
||
Certificates of deposit
|
110
|
|
53
|
|
||
Other
|
12
|
|
5
|
|
||
|
Gross Unrealized Gains
|
|||||
Corporate and asset-backed debt securities
|
$
|
3
|
|
$
|
1
|
|
Foreign government debt securities
|
2
|
|
—
|
|
||
United States agency debt securities
|
—
|
|
—
|
|
||
United States treasury debt securities
|
—
|
|
—
|
|
||
Certificates of deposit
|
—
|
|
—
|
|
||
Other
|
—
|
|
—
|
|
||
|
Gross Unrealized Losses
|
|||||
Corporate and asset-backed debt securities
|
$
|
(1
|
)
|
$
|
(1
|
)
|
Foreign government debt securities
|
(1
|
)
|
(1
|
)
|
||
United States agency debt securities
|
—
|
|
—
|
|
||
United States treasury debt securities
|
—
|
|
—
|
|
||
Certificates of deposit
|
—
|
|
—
|
|
||
Other
|
—
|
|
—
|
|
||
|
Estimated Fair Value
|
|||||
Corporate and asset-backed debt securities
|
$
|
1,525
|
|
$
|
1,177
|
|
Foreign government debt securities
|
726
|
|
845
|
|
||
United States agency debt securities
|
382
|
|
211
|
|
||
United States treasury debt securities
|
474
|
|
350
|
|
||
Certificates of deposit
|
110
|
|
53
|
|
||
Other
|
12
|
|
5
|
|
||
Total available-for-sale marketable securities
|
$
|
3,229
|
|
$
|
2,641
|
|
Trading marketable securities
|
80
|
|
72
|
|
||
Total marketable securities
|
$
|
3,309
|
|
$
|
2,713
|
|
Reported as:
|
|
|
||||
Current assets-marketable securities
|
$
|
3,205
|
|
$
|
2,641
|
|
Current assets-prepaid expenses and other current assets
|
$
|
24
|
|
$
|
—
|
|
Noncurrent assets-other
|
$
|
80
|
|
$
|
72
|
|
|
|
Probability Range
|
||
Fair Value
|
|
Minimum
|
Maximum
|
Weighted Average
|
48
|
|
85
|
100
|
95
|
|
Number of Investments
|
Fair Value
|
Unrealized Losses
|
||||
Less than 12 months
|
|
|
|
||||
Corporate and Asset-Backed
|
716
|
$
|
1,515
|
|
$
|
(1
|
)
|
Foreign Government
|
142
|
711
|
|
(1
|
)
|
||
United States Agency
|
91
|
382
|
|
—
|
|
||
Other
|
164
|
596
|
|
—
|
|
||
|
1,113
|
$
|
3,204
|
|
$
|
(2
|
)
|
Total
|
|
|
|
||||
Corporate and Asset-Backed
|
722
|
$
|
1,525
|
|
$
|
(1
|
)
|
Foreign Government
|
147
|
726
|
|
(1
|
)
|
||
United States Agency
|
91
|
382
|
|
—
|
|
||
Other
|
164
|
596
|
|
—
|
|
||
|
1,124
|
$
|
3,229
|
|
$
|
(2
|
)
|
25
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
|
|
Designated
|
|
Non-Designated
|
|
Total
|
||||||
December 31, 2014
|
|
|
|
|
|
|
||||||
Gross Notional Amount
|
|
$
|
357
|
|
|
$
|
2,085
|
|
|
$
|
2,442
|
|
Maximum term in days
|
|
|
|
|
|
546
|
|
|||||
Fair Value
|
|
|
|
|
|
|
||||||
Other Current Assets
|
|
$
|
18
|
|
|
$
|
12
|
|
|
$
|
30
|
|
Other Noncurrent Assets
|
|
2
|
|
|
—
|
|
|
2
|
|
|||
Other Current Liabilities
|
|
—
|
|
|
12
|
|
|
12
|
|
|||
|
|
$
|
20
|
|
|
$
|
—
|
|
|
$
|
20
|
|
December 31, 2013
|
|
|
|
|
|
|
||||||
Gross Notional Amount
|
|
$
|
344
|
|
|
$
|
2,000
|
|
|
$
|
2,344
|
|
Maximum term in days
|
|
|
|
|
|
546
|
|
|||||
Fair Value
|
|
|
|
|
|
|
||||||
Other Current Assets
|
|
$
|
11
|
|
|
$
|
10
|
|
|
$
|
21
|
|
Other Noncurrent Assets
|
|
1
|
|
|
3
|
|
|
4
|
|
|||
Other Current Liabilities
|
|
1
|
|
|
1
|
|
|
2
|
|
|||
|
|
$
|
11
|
|
|
$
|
12
|
|
|
$
|
23
|
|
Recorded In:
|
|
2014
|
2013
|
2012
|
||||||
Cost of goods sold
|
|
$
|
1
|
|
$
|
—
|
|
$
|
—
|
|
Other income (expense)
|
|
(8
|
)
|
3
|
|
(7
|
)
|
|||
Total
|
|
$
|
(7
|
)
|
$
|
3
|
|
$
|
(7
|
)
|
26
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
|
2014
|
|||||||||||
|
SBi
|
Berchtold
|
PST
|
Other
|
||||||||
Purchase price paid
|
$
|
358
|
|
$
|
184
|
|
$
|
120
|
|
$
|
216
|
|
Tangible assets acquired:
|
|
|
|
|
||||||||
Cash
|
—
|
|
12
|
|
—
|
|
—
|
|
||||
Inventory
|
34
|
|
22
|
|
7
|
|
5
|
|
||||
Other assets
|
4
|
|
38
|
|
19
|
|
25
|
|
||||
Liabilities
|
(2
|
)
|
(45
|
)
|
(33
|
)
|
(37
|
)
|
||||
Intangible assets:
|
|
|
|
|
||||||||
Customer relationship
|
19
|
|
11
|
|
33
|
|
5
|
|
||||
Trade name
|
—
|
|
7
|
|
—
|
|
—
|
|
||||
Developed technology & patents
|
82
|
|
32
|
|
26
|
|
115
|
|
||||
IPRD
|
—
|
|
—
|
|
—
|
|
2
|
|
||||
Goodwill
|
221
|
|
107
|
|
68
|
|
101
|
|
||||
|
$
|
358
|
|
$
|
184
|
|
$
|
120
|
|
$
|
216
|
|
|
Orthopedics
|
MedSurg
|
Neurotechnology and Spine
|
Total
|
||||||||
December 31, 2012
|
$
|
691
|
|
$
|
513
|
|
$
|
938
|
|
$
|
2,142
|
|
Goodwill acquired during the year
|
1,559
|
|
2
|
|
108
|
|
1,669
|
|
||||
Foreign currency and other
|
(23
|
)
|
(9
|
)
|
65
|
|
33
|
|
||||
December 31, 2013
|
$
|
2,227
|
|
$
|
506
|
|
$
|
1,111
|
|
$
|
3,844
|
|
Goodwill acquired during the year
|
243
|
|
231
|
|
23
|
|
497
|
|
||||
Foreign currency and other
|
(84
|
)
|
(11
|
)
|
(60
|
)
|
(155
|
)
|
||||
December 31, 2014
|
$
|
2,386
|
|
$
|
726
|
|
$
|
1,074
|
|
$
|
4,186
|
|
|
Weighted Average Amortization Period (Years)
|
|
Gross
Carrying Amount |
|
Less
Accumulated Amortization |
|
Net
Carrying Amount |
||||
Developed technologies
|
|
|
|
|
|
|
|||||
2014
|
13
|
|
$
|
1,468
|
|
|
466
|
|
|
1,002
|
|
2013
|
12
|
|
1,450
|
|
|
380
|
|
|
1,070
|
|
|
Customer relationships
|
|
|
|
|
|
|
|||||
2014
|
15
|
|
$
|
801
|
|
|
239
|
|
|
562
|
|
2013
|
17
|
|
677
|
|
|
189
|
|
|
488
|
|
|
Patents
|
|
|
|
|
|
|
|||||
2014
|
12
|
|
$
|
293
|
|
|
175
|
|
|
118
|
|
2013
|
13
|
|
238
|
|
|
190
|
|
|
48
|
|
|
Trademarks
|
|
|
|
|
|
|
|||||
2014
|
14
|
|
$
|
112
|
|
|
37
|
|
|
75
|
|
2013
|
14
|
|
127
|
|
|
34
|
|
|
93
|
|
|
In-process research and development
|
|
|
|
|
|||||||
2014
|
|
|
$
|
201
|
|
|
—
|
|
|
201
|
|
2013
|
|
|
223
|
|
|
—
|
|
|
223
|
|
|
Other
|
|
|
|
|
|
|
|
||||
2014
|
12
|
|
$
|
111
|
|
|
51
|
|
|
60
|
|
2013
|
13
|
|
118
|
|
|
51
|
|
|
67
|
|
|
Total
|
|
|
|
|
|
|
|
||||
2014
|
13
|
|
$
|
2,986
|
|
|
968
|
|
|
2,018
|
|
2013
|
13
|
|
2,833
|
|
|
844
|
|
|
1,989
|
|
|
2015
|
2016
|
2017
|
2018
|
2019
|
||||||||||
Estimated amortization expense
|
$
|
196
|
|
$
|
166
|
|
$
|
164
|
|
$
|
148
|
|
$
|
132
|
|
27
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
|
2015
|
2016
|
2017
|
2018
|
2019
|
Thereafter
|
||||||||||||
Purchase obligations
|
$
|
710
|
|
$
|
134
|
|
$
|
121
|
|
$
|
67
|
|
$
|
62
|
|
$
|
56
|
|
Minimum lease payments
|
60
|
|
45
|
|
33
|
|
25
|
|
19
|
|
34
|
|
28
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
|
|
2014
|
|
2013
|
|
2012
|
|||
Risk-free interest rate
|
|
2.1
|
%
|
|
1.3
|
%
|
|
1.3
|
%
|
Expected dividend yield
|
|
1.8
|
%
|
|
1.9
|
%
|
|
1.5
|
%
|
Expected stock price volatility
|
|
20.2
|
%
|
|
27.9
|
%
|
|
27.6
|
%
|
Expected option life
|
|
7.1 years
|
|
|
7.1 years
|
|
|
7.1 years
|
|
|
|
Shares (in millions)
|
|
Weighted
Average Exercise Price |
|
Weighted-Average
Remaining Term (in years) |
|
Aggregate
Intrinsic Value |
|||||
Outstanding January 1
|
|
17.0
|
|
|
$
|
55.35
|
|
|
|
|
|
||
Granted
|
|
2.5
|
|
|
81.13
|
|
|
|
|
|
|||
Exercised
|
|
(3.7
|
)
|
|
52.20
|
|
|
|
|
|
|||
Canceled
|
|
(0.6
|
)
|
|
65.23
|
|
|
|
|
|
|||
Outstanding December 31
|
|
15.2
|
|
|
$
|
59.97
|
|
|
5.6
|
|
$
|
524.2
|
|
Exercisable December 31
|
|
8.7
|
|
|
$
|
54.34
|
|
|
3.8
|
|
$
|
349.7
|
|
Options expected to vest
|
|
6.0
|
|
|
$
|
67.17
|
|
|
8.0
|
|
$
|
163.2
|
|
29
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
|
|
Shares
(in millions) |
|
Weighted
Average Grant date Fair value |
||||||||||
|
|
RSUs
|
|
PSUs
|
|
RSUs
|
|
PSUs
|
||||||
Nonvested at January 1
|
|
1.5
|
|
|
0.3
|
|
|
$
|
56.19
|
|
|
$
|
58.10
|
|
Granted
|
|
0.6
|
|
|
0.1
|
|
|
76.61
|
|
|
81.14
|
|
||
Vested
|
|
(0.7
|
)
|
|
(0.1
|
)
|
|
55.71
|
|
|
56.53
|
|
||
Canceled
|
|
(0.1
|
)
|
|
—
|
|
|
63.45
|
|
|
57.12
|
|
||
Nonvested at December 31
|
|
1.3
|
|
|
0.3
|
|
|
$
|
65.04
|
|
|
$
|
66.18
|
|
|
|
2014
|
|
2013
|
|
2012
|
||||||
United States
|
|
$
|
355
|
|
|
$
|
193
|
|
|
$
|
591
|
|
International
|
|
805
|
|
|
1,019
|
|
|
1,114
|
|
|||
|
|
$
|
1,160
|
|
|
$
|
1,212
|
|
|
$
|
1,705
|
|
|
|
2014
|
|
2013
|
|
2012
|
||||||
Current income tax expense
|
|
|
|
|
|
|
||||||
United States federal
|
|
$
|
213
|
|
|
$
|
79
|
|
|
$
|
227
|
|
United States state and local
|
|
26
|
|
|
29
|
|
|
41
|
|
|||
International
|
|
346
|
|
|
75
|
|
|
178
|
|
|||
Total current income tax expense
|
|
585
|
|
|
183
|
|
|
446
|
|
|||
Deferred income tax expense (benefit)
|
|
|
|
|
|
|
||||||
United States federal
|
|
9
|
|
|
(52
|
)
|
|
(12
|
)
|
|||
United States state and local
|
|
(16
|
)
|
|
(4
|
)
|
|
(9
|
)
|
|||
International
|
|
67
|
|
|
79
|
|
|
(18
|
)
|
|||
Total deferred income tax expense (benefit)
|
|
60
|
|
|
23
|
|
|
(39
|
)
|
|||
Total income tax expense
|
|
$
|
645
|
|
|
$
|
206
|
|
|
$
|
407
|
|
|
|
|
|
|
|
|
||||||
Interest expense and penalties included in other income (expense)
|
|
$
|
8
|
|
|
$
|
12
|
|
|
$
|
(4
|
)
|
|
|
2014
|
|
2013
|
|
2012
|
|||
United States federal statutory rate
|
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
Add (deduct):
|
|
|
|
|
|
|
|||
United States state and local income taxes, less federal deduction
|
|
2.2
|
|
|
1.4
|
|
|
1.7
|
|
Foreign income tax at rates other than 35%
|
|
4.9
|
|
|
(13.7
|
)
|
|
(12.1
|
)
|
Tax related to repatriation of foreign earnings
|
|
10.1
|
|
|
—
|
|
|
(0.4
|
)
|
Other
|
|
3.4
|
|
|
(5.7
|
)
|
|
(0.3
|
)
|
|
|
55.6
|
%
|
|
17.0
|
%
|
|
23.9
|
%
|
|
|
December
|
||||||
|
|
2014
|
|
2013
|
||||
Deferred income tax assets:
|
|
|
|
|
||||
Inventories
|
|
$
|
585
|
|
|
$
|
607
|
|
Product related liabilities
|
|
167
|
|
|
67
|
|
||
Other accrued expenses
|
|
226
|
|
|
221
|
|
||
Depreciation and amortization
|
|
44
|
|
|
46
|
|
||
State income taxes
|
|
68
|
|
|
53
|
|
||
Share-based compensation
|
|
90
|
|
|
101
|
|
||
Net operating loss carryforwards
|
|
123
|
|
|
124
|
|
||
Other
|
|
143
|
|
|
107
|
|
||
Total deferred income tax assets
|
|
1,446
|
|
|
1,326
|
|
||
Less valuation allowances
|
|
(42
|
)
|
|
(39
|
)
|
||
Total deferred income tax assets after valuation allowances
|
|
1,404
|
|
|
1,287
|
|
||
Deferred income tax liabilities:
|
|
|
|
|
||||
Depreciation and amortization
|
|
(666
|
)
|
|
(668
|
)
|
||
Undistributed earnings
|
|
(132
|
)
|
|
(16
|
)
|
||
Other
|
|
(54
|
)
|
|
(86
|
)
|
||
Total deferred income tax liabilities
|
|
(852
|
)
|
|
(770
|
)
|
||
Net deferred income tax assets
|
|
$
|
552
|
|
|
$
|
517
|
|
Reported as:
|
|
|
|
|
||||
Current assets—Deferred income taxes
|
|
$
|
989
|
|
|
$
|
880
|
|
Noncurrent assets—Other
|
|
39
|
|
|
34
|
|
||
Current liabilities—Accrued expenses and other liabilities
|
|
(3
|
)
|
|
—
|
|
||
Noncurrent liabilities—Other liabilities
|
|
(473
|
)
|
|
(397
|
)
|
||
|
|
$
|
552
|
|
|
$
|
517
|
|
Accrued interest and penalties reported as accrued expenses and other liabilities
|
|
$
|
26
|
|
|
$
|
34
|
|
30
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
|
|
December
|
||||||
|
|
2014
|
|
2013
|
||||
Balance at beginning of year
|
|
$
|
204
|
|
|
$
|
227
|
|
Increases related to current year income tax positions
|
|
133
|
|
|
22
|
|
||
Increases related to prior year income tax positions
|
|
23
|
|
|
56
|
|
||
Decreases related to prior year income tax positions:
|
|
|
||||||
Settlements and resolutions of income tax audits
|
|
(33
|
)
|
|
(37
|
)
|
||
Statute of limitations expirations
|
|
(1
|
)
|
|
(64
|
)
|
||
Foreign currency translation
|
|
(6
|
)
|
|
—
|
|
||
Other
|
|
(5
|
)
|
|
—
|
|
||
Balance at end of year
|
|
$
|
315
|
|
|
$
|
204
|
|
Reported as:
|
|
|
|
|
||||
Current liabilities—Income taxes
|
|
$
|
3
|
|
|
$
|
10
|
|
Noncurrent liabilities—Other liabilities
|
|
312
|
|
|
194
|
|
||
|
|
$
|
315
|
|
|
$
|
204
|
|
|
|
2014
|
|
2013
|
|
2012
|
||||||
Plan expense
|
|
$
|
132
|
|
|
$
|
132
|
|
|
$
|
112
|
|
Expense funded with Stryker common stock
|
|
18
|
|
|
16
|
|
|
15
|
|
|||
Stryker common stock held by plan
|
|
|
|
|
|
|
||||||
Dollar amount
|
|
198
|
|
|
150
|
|
|
104
|
|
|||
Shares (in millions of shares)
|
|
2.1
|
|
|
2.0
|
|
|
1.9
|
|
|||
Value as a percentage of total plan assets
|
|
11
|
%
|
|
9
|
%
|
|
9
|
%
|
Obligations and Funded Status
|
|
December
|
||||||
|
|
2014
|
|
2013
|
||||
Funded status
|
|
|
|
|
||||
Fair value of plan assets
|
|
$
|
310
|
|
|
$
|
281
|
|
Benefit obligations
|
|
570
|
|
|
456
|
|
||
Funded status
|
|
$
|
(260
|
)
|
|
$
|
(175
|
)
|
Reported as:
|
||||||||
Current liabilities—accrued compensation
|
|
(1
|
)
|
|
(1
|
)
|
||
Noncurrent liabilities—other liabilities
|
|
(259
|
)
|
|
(174
|
)
|
||
Pre-tax amounts recognized in AOCI
|
|
|
|
|
||||
Unrecognized net actuarial loss
|
|
$
|
(195
|
)
|
|
$
|
(115
|
)
|
Unrecognized prior service cost
|
|
15
|
|
|
12
|
|
||
|
|
$
|
(180
|
)
|
|
$
|
(103
|
)
|
Change in Benefit Obligations:
|
|
December
|
||||||
2014
|
|
2013
|
||||||
Beginning Projected benefit obligations
|
|
$
|
456
|
|
|
$
|
447
|
|
Service cost
|
|
26
|
|
|
30
|
|
||
Interest cost
|
|
13
|
|
|
13
|
|
||
Foreign exchange impact
|
|
(43
|
)
|
|
2
|
|
||
Employee contributions
|
|
6
|
|
|
6
|
|
||
Actuarial (gains) losses
|
|
134
|
|
|
(29
|
)
|
||
Plan amendments
|
|
(5
|
)
|
|
(1
|
)
|
||
Acquisitions
|
|
5
|
|
|
—
|
|
||
Benefits paid
|
|
(22
|
)
|
|
(12
|
)
|
||
Ending Projected benefit obligations
|
|
$
|
570
|
|
|
$
|
456
|
|
Ending Accumulated benefit obligations
|
|
$
|
533
|
|
|
$
|
427
|
|
|
|
|
|
|
||||
Change in Plan Assets:
|
|
December
|
||||||
2014
|
|
2013
|
||||||
Beginning Fair value of plan assets
|
|
281
|
|
|
254
|
|
||
Actual return
|
|
46
|
|
|
11
|
|
||
Employer contributions
|
|
18
|
|
|
20
|
|
||
Employee contributions
|
|
6
|
|
|
6
|
|
||
Foreign exchange impact
|
|
(24
|
)
|
|
1
|
|
||
Acquisition
|
|
3
|
|
|
—
|
|
||
Benefits paid
|
|
(20
|
)
|
|
(11
|
)
|
||
Ending Fair value of plan assets
|
|
$
|
310
|
|
|
$
|
281
|
|
31
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
|
Target
|
|
December
|
|||||
|
2014
|
|
2014
|
|
2013
|
|||
Equity securities
|
30
|
%
|
|
30
|
%
|
|
34
|
%
|
Debt securities
|
50
|
|
|
48
|
|
|
46
|
|
Other
|
20
|
|
|
22
|
|
|
20
|
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
Level
|
|
||||||||||
2014
|
1
|
2
|
3
|
Total
|
||||||||
Cash and cash equivalents
|
$
|
6
|
|
$
|
—
|
|
$
|
—
|
|
$
|
6
|
|
Equity securities
|
125
|
|
—
|
|
—
|
|
125
|
|
||||
Corporate debt securities
|
121
|
|
—
|
|
—
|
|
121
|
|
||||
Other
|
17
|
|
8
|
|
33
|
|
58
|
|
||||
Total
|
$
|
269
|
|
$
|
8
|
|
$
|
33
|
|
$
|
310
|
|
2013
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
10
|
|
$
|
—
|
|
$
|
—
|
|
$
|
10
|
|
Equity securities
|
94
|
|
—
|
|
—
|
|
94
|
|
||||
Corporate debt securities
|
127
|
|
2
|
|
—
|
|
129
|
|
||||
Other
|
18
|
|
8
|
|
22
|
|
48
|
|
||||
Total
|
$
|
249
|
|
$
|
10
|
|
$
|
22
|
|
$
|
281
|
|
|
|
2014
|
|
2013
|
||||
Balance at January 1
|
|
$
|
22
|
|
|
$
|
23
|
|
Actual return on plan assets held at the reporting date
|
|
11
|
|
|
—
|
|
||
Purchases, sales, and settlements
|
|
—
|
|
|
(1
|
)
|
||
Balance at December 31
|
|
$
|
33
|
|
|
$
|
22
|
|
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020-24
|
||||||||||||
Expected benefit payments
|
|
$
|
15
|
|
|
$
|
15
|
|
|
$
|
15
|
|
|
$
|
15
|
|
|
$
|
15
|
|
|
$
|
81
|
|
32
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
|
2014
|
2013
|
2012
|
||||||
Orthopaedics
|
4,153
|
|
3,949
|
|
3,823
|
|
|||
MedSurg
|
3,781
|
|
3,414
|
|
3,265
|
|
|||
Neurotechnology & Spine
|
1,741
|
|
1,658
|
|
1,569
|
|
|||
Net sales
|
$
|
9,675
|
|
$
|
9,021
|
|
$
|
8,657
|
|
Orthopaedics
|
319
|
|
273
|
|
271
|
|
|||
MedSurg
|
113
|
|
84
|
|
85
|
|
|||
Neurotechnology & Spine
|
134
|
|
135
|
|
122
|
|
|||
Other
|
19
|
|
19
|
|
8
|
|
|||
Depreciation and amortization
|
$
|
585
|
|
$
|
511
|
|
$
|
486
|
|
Orthopaedics
|
367
|
|
365
|
|
344
|
|
|||
MedSurg
|
162
|
|
167
|
|
177
|
|
|||
Neurotechnology & Spine
|
107
|
|
98
|
|
76
|
|
|||
Other
|
(118
|
)
|
(127
|
)
|
(75
|
)
|
|||
Income taxes (credit)
|
$
|
518
|
|
$
|
503
|
|
$
|
522
|
|
Orthopaedics
|
1,033
|
|
988
|
|
971
|
|
|||
MedSurg
|
677
|
|
638
|
|
631
|
|
|||
Neurotechnology & Spine
|
364
|
|
333
|
|
326
|
|
|||
Other
|
(264
|
)
|
(245
|
)
|
(280
|
)
|
|||
Segment net earnings (loss)
|
$
|
1,810
|
|
$
|
1,714
|
|
$
|
1,648
|
|
Less:
|
|
|
|
||||||
Acquisition & integration-related charges
|
(65
|
)
|
(72
|
)
|
(37
|
)
|
|||
Amortization of intangible assets
|
(133
|
)
|
(98
|
)
|
(88
|
)
|
|||
Restructuring related charges
|
(78
|
)
|
(46
|
)
|
(59
|
)
|
|||
Rejuvenate and related charges
|
(628
|
)
|
(460
|
)
|
(133
|
)
|
|||
Regulatory and legal matters
|
—
|
|
(63
|
)
|
(33
|
)
|
|||
Donation
|
—
|
|
(15
|
)
|
—
|
|
|||
Income tax related adjustments
|
(391
|
)
|
46
|
|
—
|
|
|||
Net earnings
|
$
|
515
|
|
$
|
1,006
|
|
$
|
1,298
|
|
|
2014
|
2013
|
2012
|
||||||
Orthopaedics
|
8,600
|
|
6,675
|
|
3,654
|
|
|||
MedSurg
|
5,626
|
|
3,382
|
|
2,996
|
|
|||
Neurotechnology & Spine
|
3,772
|
|
3,147
|
|
2,600
|
|
|||
Other
|
(285
|
)
|
2,539
|
|
3,956
|
|
|||
Total assets
|
$
|
17,713
|
|
$
|
15,743
|
|
$
|
13,206
|
|
Orthopaedics
|
80
|
|
89
|
|
87
|
|
|||
MedSurg
|
77
|
|
59
|
|
51
|
|
|||
Neurotechnology & Spine
|
20
|
|
16
|
|
53
|
|
|||
Other
|
56
|
|
31
|
|
19
|
|
|||
Capital spending
|
$
|
233
|
|
$
|
195
|
|
$
|
210
|
|
|
|
Net Sales
|
|
Net Property, Plant & Equipment
|
|||||||||||||
|
|
2014
|
2013
|
2012
|
|
2014
|
2013
|
||||||||||
United States
|
|
$
|
6,558
|
|
$
|
5,984
|
|
$
|
5,658
|
|
|
$
|
539
|
|
$
|
506
|
|
Europe, Middle East, Africa
|
|
1,371
|
|
1,316
|
|
1,266
|
|
|
417
|
|
446
|
|
|||||
Asia Pacific
|
|
1,368
|
|
1,319
|
|
1,336
|
|
|
119
|
|
122
|
|
|||||
Other foreign countries
|
|
378
|
|
402
|
|
397
|
|
|
23
|
|
7
|
|
|||||
|
|
$
|
9,675
|
|
$
|
9,021
|
|
$
|
8,657
|
|
|
$
|
1,098
|
|
$
|
1,081
|
|
|
|
2014 Quarter Ended
|
||||||||||||||
|
|
Mar 31
|
|
Jun 30
|
|
Sep 30
|
|
Dec 31
|
||||||||
Net sales
|
|
$
|
2,305
|
|
|
$
|
2,363
|
|
|
$
|
2,389
|
|
|
$
|
2,618
|
|
Gross profit
|
|
1,536
|
|
|
1,555
|
|
|
1,567
|
|
|
1,726
|
|
||||
Earnings before income taxes
|
|
107
|
|
|
167
|
|
|
425
|
|
|
461
|
|
||||
Net earnings
|
|
70
|
|
|
128
|
|
|
57
|
|
|
260
|
|
||||
Net earnings per share of common stock:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
0.19
|
|
|
0.34
|
|
|
0.16
|
|
|
0.68
|
|
||||
Diluted
|
|
0.18
|
|
|
0.33
|
|
|
0.16
|
|
|
0.67
|
|
||||
Market price of common stock:
|
|
|
|
|
|
|
|
|
||||||||
High
|
|
83.86
|
|
|
86.93
|
|
|
85.91
|
|
|
98.24
|
|
||||
Low
|
|
74.02
|
|
|
75.78
|
|
|
78.91
|
|
|
77.87
|
|
||||
Dividends declared per share of common stock
|
|
$
|
0.305
|
|
|
$
|
0.305
|
|
|
$
|
0.305
|
|
|
$
|
0.345
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
2013 Quarter Ended
|
||||||||||||||
|
|
Mar 31
|
|
Jun 30
|
|
Sep 30
|
|
Dec 31
|
||||||||
Net sales
|
|
$
|
2,190
|
|
|
$
|
2,212
|
|
|
$
|
2,151
|
|
|
$
|
2,468
|
|
Gross profit
|
|
1,477
|
|
|
1,482
|
|
|
1,469
|
|
|
1,616
|
|
||||
Earnings before income taxes
|
|
375
|
|
|
269
|
|
|
137
|
|
|
431
|
|
||||
Net earnings
|
|
304
|
|
|
213
|
|
|
103
|
|
|
386
|
|
||||
Net earnings per share of common stock:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
0.80
|
|
|
0.56
|
|
|
0.27
|
|
|
1.02
|
|
||||
Diluted
|
|
0.79
|
|
|
0.56
|
|
|
0.27
|
|
|
1.01
|
|
||||
Market price of common stock:
|
|
|
|
|
|
|
|
|
||||||||
High
|
|
66.92
|
|
|
70.00
|
|
|
71.94
|
|
|
75.55
|
|
||||
Low
|
|
55.24
|
|
|
63.35
|
|
|
63.71
|
|
|
66.93
|
|
||||
Dividends declared per share of common stock
|
|
$
|
0.265
|
|
|
$
|
0.265
|
|
|
$
|
0.265
|
|
|
$
|
0.305
|
|
33
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
|
ITEM 9A.
|
CONTROLS AND PROCEDURES.
|
34
|
|
|
ITEM 9B.
|
OTHER INFORMATION.
|
PART III
|
ITEM 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
|
ITEM 11.
|
EXECUTIVE COMPENSATION.
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.
|
Plan Category
|
Equity compensation plans approved by shareholders
|
||
Number of shares of common stock to be issued upon exercise of outstanding options
|
16.9
|
|
|
Weighted-average exercise price of outstanding options
|
$
|
54.24
|
|
Number of shares of common stock remaining available for future issuance under equity compensation plans (excluding shares reflected in the first row)
|
23.0
|
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.
|
ITEM 14.
|
PRINCIPAL ACCOUNTING FEES AND SERVICES.
|
35
|
|
|
PART IV
|
ITEM 15.
|
EXHIBITS, FINANCIAL STATEMENT SCHEDULES.
|
36
|
|
Dollar amounts in millions except per share amounts or as otherwise specified.
|
Date: February 12, 2015
|
|
STRYKER CORPORATION
|
|
/s/ WILLIAM R. JELLISON
|
William R. Jellison, Vice President, Chief Financial Officer
|
|
|
|
/s/ KEVIN A. LOBO
|
|
/s/ WILLIAM R. JELLISON
|
Kevin A. Lobo, Chairman, President and Chief Executive Officer
|
|
William R. Jellison, Vice President, Chief Financial Officer
|
(Principal Executive Officer)
|
|
(Principal Financial Officer)
|
|
|
|
/s/ WILLIAM E. BERRY JR.
|
|
|
William E. Berry Jr., Vice President, Corporate Controller
|
|
|
(Principal Accounting Officer)
|
|
|
|
|
|
|
|
|
/s/ HOWARD E. COX JR.
|
|
/s/ ALLAN C. GOLSTON
|
Howard E. Cox, Jr.—Director
|
|
Allan C. Golston—Director
|
|
|
|
/s/ SRIKANT M. DATAR
|
|
/s/ WILLIAM U. PARFET
|
Srikant M. Datar, Ph.D.—Director
|
|
William U. Parfet—Director
|
|
|
|
/s/ ROCH DOLIVEUX
|
|
/s/ ANDREW K. SILVERNAIL
|
Roch Doliveux—Director
|
|
Andrew K. Silvernail —Director
|
|
|
|
/s/ LOUISE L. FRANCESCONI
|
|
/s/ RONDA E. STRYKER
|
Louise L. Francesconi—Director
|
|
Ronda E. Stryker—Director
|
|
|
|
37
|
|
|
Exhibit 3—
|
|
Articles of Incorporation and By-Laws
|
(i)
|
|
Restated Articles of Incorporation — Incorporated by reference to Exhibit 3.1 to our Form 10-K for the year ended December 31, 2012 (Commission File No. 00-09165).
|
(ii)
|
|
By-Laws — Incorporated by reference to Exhibit 3(ii) to our Form 8-K dated October 28, 2008 (Commission File No. 000-09165).
|
|
|
|
Exhibit 4—
|
|
Instruments defining the rights of security holders, including indentures—We agree to furnish to the Commission upon request a copy of each instrument pursuant to which long-term debt of Stryker Corporation and its subsidiaries not exceeding 10% of the total assets of Stryker Corporation and its consolidated subsidiaries is authorized.
|
(i)
|
|
Amended and Restated Credit Agreement, dated as of August 29, 2014, among Stryker Corporation and certain subsidiaries, as designated borrowers; the lenders party thereto; and JPMorgan Chase Bank, N.A., as administrative agent.—Incorporated by reference to Exhibit 4.1 to our Form 8-K dated September 3, 2014 (Commission File no. 000-09165).
|
(ii)
|
|
Indenture, dated January 15, 2010, between Stryker Corporation and U.S. Bank National Association.—Incorporated by reference to Exhibit 4.1 to our Form 8-K dated January 15, 2010 (Commission File No. 000-09165).
|
(iii)
|
|
First Supplemental Indenture (including the form of 2015 note), dated January 15, 2010, between Stryker Corporation and U.S. Bank National Association.—Incorporated by reference to Exhibit 4.2 to our Form 8-K dated January 15, 2010 (Commission File No. 000-09165).
|
(iv)
|
|
Second Supplemental Indenture (including the form of 2020 note), dated January 15, 2010, between Stryker Corporation and U.S. Bank National Association.—Incorporated by reference to Exhibit 4.3 to our Form 8-K dated January 15, 2010 (Commission File No. 000-09165).
|
(v)
|
|
Third Supplemental Indenture (including the form of 2016 note), dated September 16, 2011, between Stryker Corporation and U.S. Bank National Association.—Incorporated by reference to Exhibit 4.2 to our Form 8-K dated September 16, 2011 (Commission File No. 000-09165).
|
(vi)
|
|
Fourth Supplemental Indenture (including the form of 2018 note) dated March 25, 2013, between Stryker Corporation and U.S. Bank National Association.—Incorporated by reference to Exhibit 4.2 to our Form 8-K dated March 25, 2013 (Commission File No. 000-09165).
|
(vii)
|
|
Fifth Supplemental Indenture (including the form of 2043 note) dated March 25, 2013, between Stryker Corporation and U.S. Bank National Association.—Incorporated by reference to Exhibit 4.3 to our Form 8-K dated March 25, 2013 (Commission File No. 000-09165).
|
(viii)
|
|
Sixth Supplemental Indenture (including the form of 2024 note), dated May 1, 2014, between Stryker Corporation and U.S. Bank National Association.—Incorporated by reference to Exhibit 4.2 to the Company's Form 8-K dated May 1, 2014 (Commission File No. 000-09165).
|
(ix)
|
|
Seventh Supplemental Indenture (including the form of 2044 note), dated May 1, 2014, between Stryker Corporation and U.S. Bank National association.—Incorporated by reference to Exhibit 4.3 to the Company's Form 8-K dated May 1, 2014 (Commission File No. 000-09165).
|
|
|
|
Exhibit 10—
|
|
Material contracts
|
(i)*
|
|
2011 Long-Term Incentive Plan (as amended effective July 26, 2011)—Incorporated by reference to Exhibit 4(i) to Amendment No. 1 to our Registration Statement on Form S-8, File No. 333-179142 (Commission File No. 000-09165).
|
(ii)*
|
|
2006 Long-Term Incentive Plan (as amended effective February 8, 2011)—Incorporated by reference to Exhibit 10(i) to our Form 10-K for the year ended December 31, 2010 (Commission File No. 000-09165).
|
(iii)*
|
†
|
Form of grant notice and terms and conditions for stock options granted in 2015 under the 2011 Long-Term Incentive Plan.
|
(iv)*
|
†
|
Form of grant notice and terms and conditions for restricted stock units granted in 2015 under the 2011 Long-Term Incentive Plan.
|
(v)*
|
†
|
Form of grant notice and terms and conditions for performance stock units granted in 2015 under the 2011 Long-
Term Incentive Plan.
|
(vi)*
|
†
|
Form of grant notice and terms and conditions for stock options and restricted stock units granted in 2015 under the 2011 Long-Term Incentive Plan to non-employee directors.
|
(vii)*
|
|
Form of grant notice and terms and conditions for stock options granted in 2014 under the 2011 Long-Term Incentive Plan—Incorporated by reference to Exhibit 10(iii) to our Form 10-K for the year ended December 31, 2013 (Commission File No. 000-09165).
|
(viii)*
|
|
Form of grant notice and terms and conditions for restricted stock units granted in 2014 under the 2011 Long-Term Incentive Plan—Incorporated by reference to Exhibit 10(iv) to our Form 10-K for the year ended December 31, 2013. (Commission File No. 000-09165).
|
(ix)*
|
|
Form of grant notice and terms and conditions for performance stock units granted in 2014 under the 2011 Long-
Term Incentive Plan—Incorporated by reference to Exhibit 10(v) to our Form 10-K for the year ended December 31, 2013 (Commission File No. 000-09165).
|
(x)*
|
|
Form of grant notice and terms and conditions for stock options and restricted stock units granted in 2014 under the 2011 Long-Term Incentive Plan to non-employee directors.—Incorporated by reference to Exhibit 10.vi to our Form 10-K for the year ended December 31, 2013 (Commission File No. 000-09165).
|
38
|
|
|
(xi)*
|
|
Form of grant notice and terms and conditions for stock options granted in 2013 under the 2006 Long-Term Incentive Plan—Incorporated by reference to Exhibit 10(iii) to our Form 10-K for the year ended December 31, 2012 (Commission File No. 000-09165).
|
(xii)*
|
|
Form of grant notice and terms and conditions for restricted stock units granted in 2013 under the 2006 Long-Term Incentive Plan—Incorporated by reference to Exhibit 10(iv) to our Form 10-K for the year ended December 31, 2012 (Commission File No. 000-09165).
|
(xiii)*
|
|
Form of grant notice and terms and conditions for performance stock units granted in 2013 under the 2011 Long-Term Incentive Plan—Incorporated by reference to Exhibit 10(v) to our Form 10-K for the year ended December 31, 2012 (Commission File No. 000-09165).
|
(xiv)*
|
|
Form of grant notice and terms and conditions for stock options granted in 2012 under the 2006 Long-Term Incentive Plan—Incorporated by reference to Exhibit 10(i) to our Form 10-Q for the quarter ended March 31, 2012 (Commission File No. 000-09165).
|
(xv)*
|
|
Form of grant notice and terms and conditions for restricted stock units granted in 2012 under the 2006 Long-Term Incentive Plan—Incorporated by reference to Exhibit 10(ii) to our Form 10-Q for the quarter ended March 31, 2012 (Commission File No. 000-09165).
|
(xvi)*
|
|
Form of grant notice and terms and conditions for performance stock units granted in 2012 under the 2011 Long-Term Incentive Plan—Incorporated by reference to Exhibit 10(iii) to our Form 10-Q for the quarter ended March 31, 2012 (Commission File No. 000-09165).
|
(xvii)*
|
|
Supplemental Savings and Retirement Plan (as amended effective January 1, 1995)—Incorporated by reference to Exhibit 10(iii) to our Form 10-K for the year ended December 31, 1994 (Commission File No.000-09165).
|
(xviii)
|
|
Stryker Corporation Executive Bonus Plan—Incorporated by reference to Exhibit 10.1 to our Form 8-K dated February 21, 2007 (Commission File No. 000-09165).
|
(xix)
|
|
Form of Indemnification Agreement for Directors—Incorporated by reference to Exhibit 10 (xiv) to our Form 10-K for the year ended December 31, 2008 (Commission File No. 000-09165).
|
(xx)
|
|
Form of Indemnification Agreement for Certain Officers—Incorporated by reference to Exhibit 10 (xv) to our Form 10-K for the year ended December 31, 2008 (Commission File No. 000-09165).
|
(xxi)
|
|
Agreement and Plan of Merger, dated September 25, 2013, by and among Stryker Corporation, Lauderdale Merger Corporation and MAKO Surgical Corp. — Incorporated by reference to Exhibit 2.1 of our Current Report on Form 8-K filed with the SEC on September 27, 2013 (Commission File No. 000-09165).
|
(xxii)
|
|
Letter Agreement between Stryker Corporation and William Jellison — Incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K filed with the SEC on April 11, 2013 (Commission File No. 000-09165).
|
(xxiii)
|
†
|
Settlement Agreement between Howmedica Osteonics Corp. and the counsel listed on the signature pages thereto, dated as of November 3, 2014 (Rejuvenate and ABF II Hip Implant Products Liability Litigation).
|
|
|
|
Exhibit 11—
|
|
Statement re: computation of per share earnings
|
(i)
|
|
Consolidated Statement of Earnings in Item 8 of this report.
|
|
|
|
Exhibit 21—
|
|
Subsidiaries of the registrant
|
(i)
|
†
|
List of Subsidiaries.
|
|
|
|
Exhibit 23—
|
|
Consent of experts and counsel
|
(i)
|
†
|
Consent of Independent Registered Public Accounting Firm.
|
|
|
|
Exhibit 31—
|
|
Rule 13a-14(a) Certifications
|
(i)
|
†
|
Certification by Principal Executive Officer of Stryker Corporation.
|
(ii)
|
†
|
Certification by Principal Financial Officer of Stryker Corporation.
|
|
|
|
Exhibit 32—
|
|
18 U.S.C. Section 1350 Certifications
|
(i)
|
†
|
Certification by Principal Executive Officer of Stryker Corporation.
|
(ii)
|
†
|
Certification by Principal Financial Officer of Stryker Corporation.
|
|
|
|
Exhibit 99—
|
|
Additional exhibits
|
(i)*
|
|
2008 Employee Stock Purchase Plan as amended on February 10, 2009—Incorporated by reference to Exhibit 99 (i) to our Form 10-K for the year ended December 31, 2008 (Commission File No. 000-09165).
|
|
|
|
Exhibit 101—
|
|
XBRL (Extensible Business Reporting Language) Documents
|
101.INS
|
|
XBRL Instance Document
|
101.SCH
|
|
XBRL Schema Document
|
101.CAL
|
|
XBRL Calculation Linkbase Document
|
101.DEF
|
|
XBRL Definition Linkbase Document
|
101.LAB
|
|
XBRL Label Linkbase Document
|
101.PRE
|
|
XBRL Presentation Linkbase Document
|
*
|
compensation arrangement
|
†
|
furnished with this Form 10-K
|
39
|
|
|
|
< Minimum
|
Minimum
|
Target
|
Maximum
|
Adjusted EPS Growth
|
Less than 5.0%
|
5.0%
|
8.0%
|
11% or more
|
Vested Percent of EPS PSUs
|
0%
|
50%
|
100%
|
200%
|
Sales Growth Percentile Ranking
|
75
th
and Above
|
50
th
|
33
rd
|
Below 33
rd
|
Vested Percent of Sales Growth PSUs
|
200%
|
100%
|
50%
|
0%
|
▪
|
Abbott Laboratories
|
▪
|
Baxter International Inc.
|
▪
|
Becton, Dickinson and Co.
|
▪
|
Boston Scientific Corporation
|
▪
|
CareFusion Corporation
|
▪
|
CR Bard Inc.
|
▪
|
Fresenius Medical Care AG & Co. KGaA
|
▪
|
General Electric (Healthcare)
|
▪
|
Johnson & Johnson (Medical Devices & Diagnostics)
|
▪
|
Laboratory Corporation of America Holdings
|
▪
|
Medtronic plc
|
▪
|
Quest Diagnostics Inc.
|
▪
|
Royal Philips (Healthcare)
|
▪
|
Siemens Aktiengesellschaft (Healthcare)
|
▪
|
Smith & Nephew plc
|
▪
|
St. Jude Medical Inc.
|
▪
|
Thermo Fisher Scientific, Inc.
|
▪
|
3M Company (Healthcare)
|
▪
|
Zimmer Holdings, Inc.
|
Article 1
|
Definitions 2
|
Section 1.1
|
General 2
|
Section 1.2
|
Terms 2
|
Article 2
|
Claimant Eligibility 13
|
Section 2.1
|
Eligibility Requirements 13
|
Article 3
|
Registration of All Filed and Unfiled Affected Product-Related Claims 13
|
Section 3.1
|
Registration 14
|
Section 3.2
|
Plaintiff-Attorney Requirements 14
|
Section 3.3
|
Registration Declaration 15
|
Article 4
|
Enrollment into the Settlement Program 15
|
Section 4.1
|
Enrollment in the Qualified Revision Surgery Program 15
|
Section 4.2
|
Enrollment in the Covered Unrevised, Infirm Claimant Program 18
|
Section 4.4
|
Additional Claim Information 21
|
Section 4.5
|
Submissions Review 21
|
Article 5
|
Qualifying for the Settlement Program 22
|
Section 5.1
|
Qualifying for the Settlement Program 22
|
Section 5.2
|
Determination and Appeal of Program Awards 25
|
Section 5.3
|
For the avoidance of doubt, there is no discovery process involved in the evaluation or determination of eligibility for the Settlement Program or the determination of Settlement Program Awards 27
|
Article 6
|
Settlement Program: General Terms 27
|
Section 6.1
|
General Provision 27
|
Section 6.2
|
No Punitive Damages 28
|
Article 7
|
Qualified Revision Surgery Program 29
|
Section 7.1
|
Base Award Program 29
|
Section 7.2
|
Enhancements Benefit Program 31
|
Article 8
|
Covered Unrevised, Infirm Claimants Program 32
|
Section 8.1
|
Benefits for Covered Unrevised, Infirm Claimants 32
|
Section 8.2
|
Determinations of Covered Unrevised, Infirm Claimants Benefits 32
|
Section 8.3
|
Covered Unrevised, Infirm Claimants Benefits 33
|
Article 9
|
Timing of HOC’s Payment Obligations 33
|
Section 9.1
|
Timing of Settlement Program Award and Payments 33
|
Section 9.2
|
Timing of Enhancements Benefits Payments 35
|
Section 9.3
|
Limit on Award Payments
36
|
Section 9.4
|
Form of Notices to Escrow Agent
36
|
Article 10
|
Settlement Program Administration and Expenses
37
|
Section 10.1
|
Administrative Costs
37
|
Section 10.2
|
Funding of Administrative Expenses Escrow Account
37
|
Section 10.3
|
Audits of Administrative Expenses and Payments
37
|
Article 11
|
Administrators
38
|
Section 11.1
|
Appointment and Replacement of Administrative Personnel
38
|
Section 11.2
|
Claims Administrator
38
|
Section 11.3
|
Claims Processor
39
|
Section 11.4
|
Special Masters
39
|
Section 11.5
|
Certain General Authority of the Claims Processor
39
|
Section 11.6
|
Liability of Administrative Personnel
40
|
Article 12
|
Certain Litigation Matters
40
|
Section 12.1
|
HOC Defenses
40
|
Section 12.2
|
Tolling
41
|
Section 12.3
|
Use of Dismissal with Prejudice Stipulations and Releases
41
|
Section 12.4
|
Pursuit of Certain Claims
41
|
Section 12.5
|
Unrevised Claimants with Filed Lawsuits
43
|
Article 13
|
Submission to Authority 43
|
Section 13.1
|
Submission to Authority of Claims Administrator and Special Masters
43
|
Article 14
|
Attorneys’ Fees
45
|
Section 14.1
|
Individual Counsel Attorneys’ Fees
45
|
Article 15
|
Quality Control and Audit Procedures
46
|
Section 15.1
|
Prevention and Detection of Fraud - General
46
|
Section 15.2
|
Mandatory Periodic Audits
47
|
Section 15.3
|
HOC Audit Right
48
|
Section 15.4
|
Relief
48
|
Section 15.5
|
Quality Control
50
|
Section 15.6
|
Inaccuracy of Representations, Warranties or Certifications
51
|
Section 15.7
|
No Misrepresentation of Settlement Program
51
|
Article 16
|
Walk Away Rights and Participation Requirements
51
|
Section 16.1
|
Walk Away Rights and Termination of the Agreement
51
|
Section 16.2
|
Good Faith Participation
53
|
Section 16.3
|
Calculation of Claimants for Walk Away Rights
55
|
Section 16.4
|
Time to Exercise Walk Away Right
56
|
Section 16.5
|
Notice of Exercise
56
|
Section 16.6
|
Effects of Termination
56
|
Article 17
|
Liens
57
|
Section 17.1
|
General Assumption of Lien Obligations: Settlement Program Claimants agree to assume and resolve all Liens, claims or interests held or asserted by third parties
57
|
Section 17.2
|
Healthcare Related Liens
57
|
Section 17.3
|
Cooperation, Reports and Data Exchange Relating to Liens
61
|
Section 17.4
|
Settlement Program Claimants’ Holdback Associated With Lien Administration
61
|
Article 18
|
No Admission of Liability or Lack of Merit
62
|
Section 18.1
|
No Admission of Liability or Lack of Merit
62
|
Article 19
|
Reporting Obligations; HOC and SOC Access to Data
62
|
Section 19.1
|
Reporting Obligations
63
|
Section 19.2
|
HOC and the SOC Access to Data
63
|
Article 20
|
Public Statements; Confidentiality
63
|
Section 20.1
|
Enrolled Claimant Confidential Information
63
|
Section 20.2
|
Accurate Public Statement
64
|
Article 21
|
Miscellaneous
64
|
Section 21.1
|
Notice by Parties
64
|
Section 21.2
|
Receipt of Documentation
65
|
Section 21.3
|
Governing Law
66
|
Section 21.4
|
Waiver of Inconsistent Provisions of Law; Severability
66
|
Section 21.5
|
Facsimile Signatures
66
|
Section 21.6
|
Construction
66
|
Section 21.7
|
Entire Agreement
66
|
Section 21.8
|
Headings; References
67
|
Section 21.9
|
No Third Party Beneficiaries; Assignment
67
|
Section 21.10
|
Amendments; No Implied Waiver
68
|
Section 21.11
|
Counterparts
68
|
Section 21.12
|
Tax Matters
68
|
Section 21.13
|
Further Assurances
68
|
a.
|
In re Stryker Rejuvenate Hip Stem and ABG II Modular Hip Stem Litigation
, Case No. 296, Master Docket No. BER-L-936-13, venued in the MCL Court; and
|
b.
|
In re: Stryker Rejuvenate and ABG II Hip Implant Products Liability Litigation
, MDL Docket No. 13-2441, venued in the MDL Court.
|
Kim M. Catullo, Esq.
Gibbons P.C.
One Gateway Center
Newark, New Jersey 07102-5310
Phone: 973-596-4815
Facsimile: 973-639-6280
Email: kcatullo@gibbonslaw.com
|
Nora E. Wolf, Esq.
Gibbons P.C.
One Gateway Center
Newark, New Jersey 07102-5310
Phone: 212-613-2089
Facsimile: 212-554-9693
Email: nwolf@gibbonslaw.com
|
NEW JERSEY PLAINTIFFS’ STEERING COMMITTEE
|
|
______________________________
David R. Buchanan
Seeger Weiss LLP
Dated: ______________________
|
______________________________
Tobias L. Millrood
Pogust Braslow & Millrood, LLC
Dated: ______________________
|
DEFENDANT
|
|
Howmedica Osteonics Corp.
By: ______________________________
Dated: ______________________
|
|
1)
|
“
Additional Surgery
” means specific procedures set forth in Enhancements Past Matrix Level II(a).
|
2)
|
“
Covered Open Surgical Procedure Under General Anesthesia
” means a Re-Revision Surgery, Additional Surgery, open reduction, open reduction with conversion to constrained component, or open Infection-related surgical procedure as set forth in each procedure’s respective Past Matrix Level.
|
3)
|
“
Infection
” for purposes of determining qualification for an Enhancement, means any Infection that does not form the basis for an Excluded Infection-Related Revision Surgery and also satisfies the eligibility requirements set forth in Past Matrix II(c).
|
4)
|
“
Intra-Operative Fracture
” means the unintentional fracturing of the femur bone during the course of an operation.
|
5)
|
“
Osteotomy
” means a surgical procedure in which the surgeon intentionally cuts or saws the femur bone in order to facilitate removal of a femoral stem component.
|
I.
|
PAST MATRIX LEVEL I (RE-REVISION)
|
a.
|
Re-Revision Surgery
|
i.
|
Eligibility
. Qualified Claimants who have undergone a Re-Revision Surgery and meet the following criteria:
|
1.
|
A Re-Revision Surgery, which occurred prior to the Enrollment Date that (i) was determined to be medically necessary, (ii) required removal of the revision femoral stem component, and (iii) was made necessary by the Qualified Revision Surgery (“
Re-Revision Surgery
”); and
|
2.
|
Was not necessitated by a Re-Revision surgery, the underlying cause of which was “trauma” as defined in Section 1.2.32.2 (an “
Excluded Trauma-Related Re-Revision Surgery
”).
|
ii.
|
Benefits
: If the foregoing eligibly requirements are met, a Qualified Claimant may be entitled to an Enhancement as follows:
|
1.
|
$175,000 for the first Re-Revision Surgery and $100,000 for each additional Re-Revision Surgery.
|
2.
|
A Qualified Claimant who is making a claim for a Re-Revision Surgery that was caused by an Infection, as described in the eligibility requirements set forth in Past Matrix Level II(c)(i), shall be governed by this Past Matrix Level.
|
3.
|
If a dislocation event was one of the causes of a Re-Revision Surgery, the Enhancement will issue under this Past Matrix Level and not Past Matrix Level II(b).
|
4.
|
The maximum number of compensable Re-Revision Surgeries shall be three (3) per hip in which an Affected Product has been removed.
|
b.
|
Events Associated with Qualified Revision Surgery or Covered Re-Revision Surgery
|
i.
|
Eligibility
: Qualified Claimants who underwent a Qualified Revision Surgery or Re-Revision Surgery that is not an Excluded Revision Surgery or an Excluded Trauma-Related Re-Revision Surgery, and
|
ii.
|
Benefits
: If the foregoing eligibly requirements are met, a Qualified Claimant may be entitled to an Enhancement as follows:
|
1.
|
Controlled Osteotomy
: A Qualified Claimant who, prior to the Enrollment Date, underwent a controlled Osteotomy during a Qualified Revision Surgery or Re-Revision Surgery shall receive $75,000. This Enhancement is not available to those Qualified Claimants who underwent a controlled Osteotomy during their Index Surgery. The maximum number of Enhancements under this Past Matrix Level shall be two (2) per hip in which an Affected Product has been removed.
|
2.
|
Intra-Operative Femur Fracture
With
Osteotomy
: A Qualified Claimant who, prior to the Enrollment Date, experienced an Intra-Operative Femur Fracture during a Qualified Revision Surgery or Re-Revision Surgery that required an Osteotomy, as well as cabling or prosthetic fixation, shall receive $100,000. The maximum number Enhancements under this Past Matrix Level shall be two (2) per hip in which an Affected Product has been removed.
|
3.
|
Intra-Operative Femur Fracture
Without
Osteotomy
: A Qualified Claimant who, prior to the Enrollment Date, experienced an intra-operative femur fracture requiring cabling or prosthetic fixation during a Qualified Revision Surgery or Re-Revision Surgery that
did not require
an Osteotomy shall receive $40,000. The maximum number of Enhancements under this Past Matrix Level shall be two (2) per hip in which an Affected Product has been removed.
|
4.
|
Surgical Repair/Reattachment of a Damaged Abductor Muscle Complex
: A Qualified Claimant who, prior to the Enrollment date and during a Qualified Revision Surgery or Re-Revision Surgery, presents objective documented evidence of damage to the abductor muscle complex related to the reasons underlying the Voluntary Recall that is sufficient to require surgical repair of the muscles shall receive $75,000. This Enhancement excludes mere debridement of tissue, including necrotic tissue. The maximum number of Enhancements under this Past Matrix Level shall be two (2) per hip in which an Affected Product has been removed.
|
II.
|
PAST MATRIX LEVEL II (MAJOR COMPLICATIONS)
|
a.
|
Additional Surgeries
|
i.
|
Eligibility
. Qualified Claimants who have undergone an Additional Surgery in the hip in which the Affected Product was removed.
|
ii.
|
Benefits
: If the foregoing eligibly requirements are met, a Qualified Claimant may be entitled to an Enhancement as follows:
|
1.
|
Removal of Hardware
: A Qualified Claimant who, prior to the Enrollment Date and following a Qualified Revision Surgery or Re-Revision Surgery, undergoes an additional surgery to remove hardware that was implanted during an osteotomy or repair of an intra-operative femur fracture shall receive $35,000. The maximum number of Enhancements under this Past Matrix Level shall be two (2) per hip in which an Affected Product has been removed.
|
2.
|
Debridement and/or Removal of Pseudotumors
: A Qualified Claimant who, prior to the Enrollment Date and following a Qualified Revision Surgery or Re-Revision Surgery, undergoes an additional surgery that requires debridement, and is preceded by objective documented evidence through preoperative imaging, or supported by intra-operative findings or pathology that demonstrates the presence of tissue damage related to the reasons underlying the Voluntary Recall shall receive $70,000. This Enhancement excludes exploratory surgeries. The maximum number of Enhancements under this Past Matrix Level shall be two (2) per hip in which an Affected Product has been removed.
|
3.
|
Reattachment/Repair of a Damaged Abductor Muscle Complex
: A Qualified Claimant who, prior to the Enrollment Date and following a Qualified Revision Surgery or Re-Revision Surgery, undergoes an additional surgery that requires reattachment or repair of a damaged abductor muscle complex and there exists evidence of damage to the abductor muscle complex related to the reasons underlying the Voluntary Recall shall receive $100,000. This Enhancement is not available for mere debridement of tissue, including necrotic tissue, and excludes exploratory surgeries. The maximum number of Enhancements under this Past Matrix Level shall be two (2) per hip in which an Affected Product has been removed.
|
4.
|
Placement of Constrained Component Due to Dislocation
: A Qualified Claimant who, prior to the Enrollment Date and following a Qualified Revision Surgery or Re-Revision Surgery, undergoes an additional surgery to place a constrained component due to dislocation shall receive $50,000. The maximum number of
|
a.
|
If a constrained component is placed during an open reduction, the Enhancement will issue under this Past Matrix Level and not Past Matrix Level II(b).
|
5.
|
Post-Revision Femur Fracture
: A Qualified Claimant who, prior to the Enrollment Date and following a Qualified Revision Surgery or Re-Revision Surgery, undergoes an additional surgery to repair a femur fracture that occurred within ninety (90) days of a Qualified Revision Surgery or Re-Revision Surgery shall receive $100,000;
provided
,
however
, that there will be a ten percent (10%) reduction to said amount where the Qualified Claimant had a BMI
2
of forty (40) or greater at the time of the Revision Surgery and a fifteen percent (15%) reduction of the stated award where the Qualified Claimant had a BMI of fifty (50) or greater at the time of the Revision Surgery. The maximum number of Enhancements under this Past Matrix Level shall be two (2) per hip in which an Affected Product has been removed.
|
iii.
|
Notwithstanding anything to the contrary contained in Past Matrix Level II(a), a Qualified Claimant shall receive only one (1) Enhancement under Past Matrix Level II(a)
per Additional Surgery
(the greater of which applies), regardless of the number of Enhancements under Past Matrix Level II(a) that apply to that surgery.
|
b.
|
Dislocation
|
i.
|
Eligibility
: A Qualified Claimant who, prior to the Enrollment Date and following a Qualified Revision Surgery or Re-Revision Surgery, experiences a dislocation of the femoral head of the hip in which the Affected Product was removed may be entitled to an Enhancement set forth in this Past Matrix Level II(b) provided that (i) the first dislocation occurred within nine (9) months after a Qualified Revision Surgery or Re-Revision Surgery, whichever is later, (ii) the dislocation event is documented by a diagnosis in contemporary medical records, and (iii) the dislocation event necessitated (a) a closed reduction in a hospital, or (b) an open reduction in a hospital, and subject to the following criteria:
|
1.
|
Dislocation events that occur before the Index Surgery and/or before the Qualified Revision Surgery do not qualify for this Enhancement.
|
2.
|
Dislocation events after a Qualified Revision Surgery or Re-Revision Surgery that are caused or precipitated by trauma as defined in Section 1.2.32.2 are not entitled to an Enhancement under this Past Matrix Level.
|
3.
|
If a dislocation event was one of the causes of a Re-Revision Surgery, an eligible Qualified Claimant’s Enhancement will issue under Past Matrix Level I and not this Past Matrix Level II(b).
|
ii.
|
Benefits
: If the foregoing eligibly requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Past Matrix Level as follows:
|
1.
|
$25,000 for each dislocation managed in a closed reduction.
|
2.
|
$60,000 for each dislocation managed in an open reduction.
|
3.
|
$75,000 for each dislocation managed in an open reduction with conversion to a constrained component due to dislocation.
|
4.
|
If a separate surgery for conversion to a constrained component is performed, an eligible Qualified Claimant’s Enhancement will issue under Past Matrix Level II(a) and not Past Matrix Level II(b).
|
5.
|
There will be a ten percent (10%) reduction of the stated award where the Qualified Claimant had a BMI of forty (40) or greater at the time of the Revision Surgery and a fifteen percent (15%) reduction of the stated award where the Qualified Claimant had a BMI of fifty (50) or greater at the time of the Revision Surgery.
|
6.
|
The maximum number of Enhancements under this Past Matrix Level shall be three (3) per hip in which the Affected Product has been removed, regardless of the method by which the dislocation events are managed.
|
c.
|
Infection
|
i.
|
Eligibility
. A Qualified Claimant who (i) prior to the Enrollment Date is diagnosed with an Infection of the hip in which the Affected Product was removed within nine (9) months of a Qualified Revision Surgery, Re-Revision Surgery or Additional Surgery (as set forth in Past Matrix Level II(a)), and (ii) provides contemporaneous Medical Records of same.
|
ii.
|
Benefits
: If the foregoing eligibly requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Past Matrix Level as follows:
|
1.
|
Infection-Related Open Surgical Procedures
|
a.
|
A Qualified Claimant, who undergoes surgery under general anesthesia for irrigation and debridement of an infected surgical wound that occurs within ninety (90) days of the diagnosis of the subject Infection, shall receive $30,000.
|
b.
|
A Qualified Claimant whose Infection-related treatment commences within ninety (90) days of the diagnosis of the subject Infection and who requires a two-stage surgery under general anesthesia that requires removal of the femoral head, acetabular shell and/or acetabular liner of the hip in which the Affected Product was removed for treatment of the Infection and s/he subsequently returns to surgery to replace the previously removed components shall receive $75,000.
|
c.
|
If the femoral stem of the hip in which Affected Product was removed during a Covered Infection-related open surgical procedure, the Qualified Claimant’s Enhancement will issue under Past Matrix Level I and not this Past Matrix Level, provided that the eligibility requirements in Past Matrix Level II(c)(i) have been satisfied.
|
d.
|
The Enhancements for covered Infection-related open surgical procedures under this Past Matrix Level are only available to those Qualified Claimants who required the above-listed procedures in the hip in which the Affected Product was removed following a Qualified Revision Surgery, Re-Revision Surgery, or Additional Surgery. The maximum number of Enhancements under this Past Matrix Level shall be two (2) per Qualified Claimant. A Qualified Claimant who undergoes a surgical procedure that would qualify as both an Additional Surgery and an Infection-related open surgical procedure may only receive one (1) Enhancement for that surgery, the greater of which applies.
|
e.
|
Notwithstanding anything to the contrary contained in Past Matrix Level II(c), a Qualified Claimant shall receive only one (1) Enhancement under Past Matrix Level II(c)
per covered Infection-related open surgical procedure
(the greater of which applies), regardless of the number of Enhancements under Past Matrix Level II(c) that apply to that surgery.
|
2.
|
Infection-Related Non-Surgical Treatment
|
a.
|
A Qualified Claimant who undergoes intravenous antibiotic treatment lasting six (6) weeks or longer that begins within ninety (90) days of the diagnosis of the subject Infection shall receive $10,000.
|
b.
|
A Qualified Claimant whose Infection-related treatment commences within ninety (90) days of the diagnosis of the subject Infection and requires placement and continuous use of a wound vac shall receive $10,000.
|
c.
|
A Qualified Claimant whose Infection-related treatment commences within ninety (90) days of the diagnosis of the subject Infection and requires confinement in a skilled nursing facility, related to Infection, for rehabilitation, wound care, and/or intravenous administration shall receive an Enhancement as follows:
|
i.
|
Greater than 15 days: $15,000.
|
ii.
|
Greater than 30 days: $30,000.
|
iii.
|
Greater than 45 days: $45,000.
|
iv.
|
Greater than 60 days: $60,000.
|
d.
|
There will be two (2) Enhancements per Qualified Claimant under this Past Matrix Level (the greater of which applies), regardless of the number of qualifying treatments under this Past Matrix Level that apply.
|
d.
|
Foot Drop
|
i.
|
Eligibility
: A Qualified Claimant who, prior to the Enrollment Date and following a Qualified Revision Surgery or Re-Revision Surgery, has suffered injury to the peroneal nerve as a result of the Qualified Revision Surgery or Re-Revision Surgery in the hip in which the Affected Product was removed, that resulted in the inability to lift the front part of the foot and which is diagnosed during the hospitalization for the Qualified Revision Surgery or Re-Revision Surgery.
|
ii.
|
Benefits
: If the foregoing eligibly requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Past Matrix Level as follows:
|
1.
|
A Qualified Claimant shall receive a one-time benefit of $20,000 for a foot drop that is documented in contemporaneous medical records as existing more than ninety (90) days after the date of the Qualified Revision Surgery or Re-Revision Surgery
|
2.
|
If that Qualified Claimant’s foot drop continues to exist, as evidenced by contemporaneous Medical Records, on the date that is 365 days after a Qualified Revision Surgery or Re-Revision Surgery s/he shall not receive an Enhancement under Past Matrix Level II(d)(1), but instead shall receive an Enhancement pursuant to the following matrix based on the Qualified Claimant’s age on the date of his/her first Qualified Revision Surgery and the defined severity level:
|
e.
|
Pulmonary Embolism (“
PE
”) or Deep Vein Thrombosis (“
DVT
”)
|
i.
|
Eligibility:
A Qualified Claimant who, prior to the Enrollment Date, was either (i) diagnosed contemporaneously during the hospitalization for the Qualified Revision Surgery or Covered Open Surgical Procedure Under General Anesthesia; or (ii) within seventy-two (72) hours of a Qualified Revision Surgery or Covered Open Surgical Procedure Under General Anesthesia, whichever is later, with a PE (an
|
ii.
|
Benefits:
If the foregoing eligibly requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Past Matrix Level as follows:
|
1.
|
$20,000 for a DVT.
|
2.
|
$35,000 for a PE.
|
3.
|
A Qualified Claimant is entitled to only one PE or DVT Enhancement per Qualified Revision Surgery or Covered Open Surgical Procedure Under General Anesthesia (the greater of which applies); and
|
4.
|
The maximum number Enhancements under this Past Matrix Level shall be two (2), regardless of the number of Qualified Revision Surgeries or Covered Open Surgical Procedures.
|
III.
|
PAST MATRIX LEVEL III (MYOCARDIAL INFARCTION)
|
a.
|
Eligibility
: A Qualified Claimant who, prior to the Enrollment Date, has suffered a myocardial infarction (MI) during (i) a Qualified Revision Surgery or Covered Open Surgical Procedure Under General Anesthesia; or (ii) hospitalization for the Qualified Revision Surgery or Covered Open Surgical Procedure Under General Anesthesia; or (iii) within seventy-two (72) hours of a Qualified Revision Surgery or Covered Open Surgical Procedure Under General Anesthesia, whichever is later.
|
b.
|
Benefits
: If the foregoing eligibly requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Past Matrix Level based upon (a) the pre- and post-myocardial infarction change in Functional Classification (as defined by the New York Heart Association), and (b) the Qualified Claimant’s age on the date of the myocardial infarction, as follows:
|
i.
|
Only one Enhancement may be given under this Past Matrix Level, regardless of the number, type or location of the MIs suffered.
|
ii.
|
There will be a ten (10%) reduction of the stated Enhancement where the Qualified Claimant had a BMI of forty (40) or greater at the time of the Index Surgery and a fifteen percent (15%) reduction of the stated award where the Qualified Claimant had a BMI of fifty (50) or greater at the time of the Index Surgery.
|
iii.
|
There will be a five percent (5%) reduction of the stated Enhancement where the Qualified Claimant was a current smoker at the time of the Qualified Revision Surgery.
|
IV.
|
PAST MATRIX LEVEL IV (STROKE)
|
a.
|
Eligibility:
A Qualified Claimant who, prior to the Enrollment Date, has suffered a stroke (i) during a Qualified Revision Surgery or Covered Open Surgical Procedure Under General Anesthesia; (ii) during the hospitalization for a Covered Open Surgical Procedure Under General Anesthesia; or (iii) within seventy-two (72) hours of a Qualified Revision Surgery or Covered Open Surgical Procedure Under General Anesthesia, whichever is later.
|
b.
|
Benefits:
If the foregoing eligibly requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Past Matrix Level based upon (a) the American Heart Association Stroke Outcome Classification, and (b) the age of the Qualified Claimant on the date of the stroke, as follows:
|
Age on Date of Stroke
|
|||||
Stroke Outcome Classification
|
≤ 40
|
41-49
|
50-59
|
60-69
|
≥ 70
|
Level I
|
$360,000
|
$285,000
|
$209,000
|
$143,000
|
$85,000
|
Level II
|
$412,000
|
$325,000
|
$239,000
|
$163,000
|
$97,000
|
Level III
|
$464,000
|
$366,000
|
$268,000
|
$183,000
|
$110,000
|
Level IV
|
$516,000
|
$407,000
|
$299,000
|
$203,000
|
$123,000
|
i.
|
A transient ischemic attack or “TIA” is not considered a stroke for purposes of this Past Matrix Level.
|
ii.
|
Only one Enhancement may be given under this Past Matrix Level, regardless of the number or types of strokes suffered.
|
iii.
|
There will be a ten percent (10%) reduction of the stated Enhancement where the Qualified Claimant had a BMI of forty (40) or greater at the time of the Index Surgery and a fifteen (15%) reduction of the stated award where the Qualified Claimant had a BMI of fifty (50) or greater at the time of the Index Surgery.
|
iv.
|
There will be a five (5%) reduction of the stated Enhancement where the Qualified Claimant was a current smoker at the time of the Qualified Revision Surgery.
|
V.
|
PAST MATRIX LEVEL V (DEATH)
|
a.
|
Eligibility:
A Qualified Claimant whose Product User died (i) during the Qualified Revision Surgery or Covered Open Surgical Procedure Under General Anesthesia, or (ii) during the hospitalization for the Qualified Revision Surgery or Covered Open Surgical Procedure Under General Anesthesia.
|
b.
|
Benefits:
If the foregoing eligibility requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Past Matrix Level as follows:
|
i.
|
S/he will receive a minimum payment of $100,000;
|
ii.
|
S/he will receive $206,000 if the Product User was married on the date of the Product User’s death;
|
iii.
|
S/he will receive $100,000 multiplied by the number of minor children (under the age of 18), if any, on the date of the Product User’s death;
|
iv.
|
S/he will receive $25,000 multiplied by the number of adult children (age 18 or older), if any, on the date of the Product User’s death;
|
v.
|
S/he will receive $50,000 multiplied by the number of parents, if any, on the date of the Product User’s death; and
|
vi.
|
Where applicable under state law, an award pertaining to a deceased Product User’s lost income under this Past Matrix Level will be calculated as the sum of the following: (i) the percentage of the “
adjusted current annual income
” equal to the number of days from the date of death to the end of the year divided by 365; and (ii) the present value of the future “
adjusted current annual income
,” beginning the year following the death, ending the year of the Product User’s 62nd birthday, and discounted to the Enrollment Date at a net interest rate of 1.0% (which percentage is calculated as the difference between 3.0% growth and a 4.0% discount rate), less an amount for personal consumption. If the Product User had no such income or was age 62 or older at the time of death, then there is no payment for lost wages under this Past Matrix Level V.
|
vii.
|
A Qualified Claimant who is eligible to receive an Enhancement under this Past Matrix Level V will be ineligible to receive all other Enhancements provided for in the Settlement Agreement for injuries suffered during or as a result of the same Qualified Revision Surgery or Covered Open Surgical Procedure Under General Anesthesia.
|
viii.
|
Under no circumstances should the total benefits recoverable under this Matrix Level VI exceed $600,000.
|
ix.
|
There will be a ten percent (10%) reduction of the stated Enhancement where the Qualified Claimant had a BMI of forty (40) or greater at the time of the Index Surgery and a fifteen (15%) reduction of the stated award where the Qualified Claimant had a BMI of fifty (50) or greater at the time of the Index Surgery.
|
x.
|
There will be a five (5%) reduction of the stated Enhancement where the Qualified Claimant was a current smoker at the time of the Qualified Revision Surgery.
|
VI.
|
PAST MATRIX LEVEL VI (LOST WAGES)
|
a.
|
A Qualified Claimant who lost wages in connection with a Qualified Revision Surgery or Re-Revision Surgery may be eligible for lost wages under this Past Matrix Level VI. The threshold for eligibility will be twenty percent (20%) of the Qualified Claimant’s aggregate annual income for the two (2) years preceding his/her Index Surgery, less any amount received from the Broadspire Program, to offset economic loss. Under no circumstances will this Enhancement exceed $200,000.
|
I.
|
FUTURE MATRIX LEVEL I (RE-REVISION)
|
a.
|
Re-Revision
|
i.
|
Eligibility:
A Qualified Claimant who on or after the Enrollment Date and within two (2) years of the Qualified Revision Surgery or the last pre-enrollment Covered Open Surgical Procedure Under General Anesthesia on that hip, whichever is later, underwent a Re-Revision Surgery or subsequent Re-Revision Surgery.
|
ii.
|
Benefits:
If the foregoing eligibility requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Future Matrix Level I(a), calculated in the same manner and subject to the same limitations as an award under Past Matrix Level I(a) and the Enhancements Benefit Cap, except that the Future Matrix Level I(a) Enhancement will be subject to a thirty percent (30%) reduction for any Re-Revision or subsequent Re-Revisions that occur during the second (2
nd
) year following the Enrollment Date.
|
b.
|
Events Associated with Qualified Revision Surgery or Covered Re-Revision Surgery:
|
i.
|
Eligibility
: A Qualified Claimant who on or after the Enrollment Date and within two (2) years of the Qualified Revision Surgery or the last pre-enrollment Covered Open Surgical Procedure Under General Anesthesia on
|
ii.
|
Benefits:
If the foregoing eligibility requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Future Matrix Level I(b), calculated in the same manner and subject to the same limitations as an award under Past Matrix Level I(b) and the Enhancements Benefit Cap, except that the Future Matrix Level I(b) Enhancement will be subject to a thirty percent (30%) reduction for any covered events that occur during the second (2
nd
) year following the Enrollment Date.
|
II.
|
FUTURE MATRIX LEVEL II (MAJOR COMPLICATIONS)
|
a.
|
Additional Surgeries
|
i.
|
Eligibility:
A Qualified Claimant who on or after the Enrollment Date and within two (2) years of the Qualified Revision Surgery or the last pre-enrollment Covered Open Surgical Procedure Under General Anesthesia on that hip in which the Affected Product was removed, whichever is later, underwent an Additional Surgery and meets the eligibility requirements as set forth in Past Matrix Level II(a).
|
ii.
|
Benefits:
If the foregoing eligibility requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Future Matrix Level II(a), calculated in the same manner and subject to the same limitations and reductions as an award under Past Matrix Level II(a) and the Enhancements Benefit Cap, except that the Future Matrix Level II(a) Enhancement will be subject to a thirty percent (30%) reduction for any covered events that occur during the second (2
nd
) year following the Enrollment Date.
|
b.
|
Dislocation
|
i.
|
Eligibility
: A Qualified Claimant who on or after the Enrollment Date and within two (2) years of the Qualified Revision Surgery or the last pre-enrollment Covered Open Surgical Procedure Under General Anesthesia on that hip in which the Affected Product was removed, which ever is later, experienced a dislocation event and meets the eligibility requirements as set forth in Past Matrix Level II(b).
|
ii.
|
Benefits:
If the foregoing eligibility requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Future Matrix Level II(b), calculated in the same manner and subject to the same limitations and reductions as an award under Past Matrix Level II(b) and the Enhancements Benefit Cap, except that the Future Matrix Level II(b) Enhancement will be subject to a thirty percent (30%) reduction for any covered events that occur during the second (2
nd
) year following the Enrollment Date.
|
c.
|
Infection
|
i.
|
Eligibility:
A Qualified Claimant who on or after the Enrollment Date and within two (2) years of the Qualified Revision Surgery or the last pre-enrollment Covered Open Surgical Procedure Under General Anesthesia on that hip in which the Affected Product was removed, which ever is later, experienced an Infection and meets the eligibility requirements as set forth in Past Matrix Level II(c).
|
ii.
|
Benefits:
If the foregoing eligibility requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Future Matrix Level II(c), calculated in the same manner and subject to the same limitations as an award under Past Matrix Level II(c) and the Enhancements Benefit Cap, except that the Future Matrix Level II(c) Enhancement will be subject to a thirty percent (30%) reduction for any covered events that occur during the second (2
nd
) year following the Enrollment Date.
|
d.
|
Foot Drop
|
i.
|
Eligibility:
A Qualified Claimant who on or after the Enrollment Date and within two (2) years of the Qualified Revision Surgery or the last pre-enrollment Covered Open Surgical Procedure Under General Anesthesia on that hip in which the Affected Product was removed, which ever is later, experienced a foot drop and meets the eligibility requirements as set forth in Past Matrix Level II(d).
|
ii.
|
Benefits:
If the foregoing eligibility requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Future Matrix Level II(d), calculated in the same manner and subject to the same limitations as an award under the Past Matrix Level II(d) and the Enhancements Benefit Cap, except that the Future Matrix Level II(d) Enhancement will be subject to a thirty percent (30%) reduction for any covered events that occur during the second (2
nd
) year following the Enrollment Date.
|
e.
|
Pulmonary Embolism and Deep Vein Thrombosis
|
i.
|
Eligibility:
A Qualified Claimant who on or after the Enrollment Date and within two (2) years of the Qualified Revision Surgery or the last pre-enrollment Covered Open Surgical Procedure Under General Anesthesia on that hip in which the Affected Product was removed, which ever is later, experienced a PE or DVT and meets the eligibility requirements as set forth in Past Matrix Level II(e).
|
ii.
|
Benefits:
If the foregoing eligibility requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Future Matrix Level II(e), calculated in the same manner and subject to the same limitations as an award under Past Matrix Level II(e) and the Enhancements Benefit Cap, except that the Future Matrix Level II(e) Enhancement will be subject to a thirty percent (30%) reduction for any covered events that occur during the second (2
nd
) year following the Enrollment Date.
|
III.
|
FUTURE MATRIX LEVEL III (MYOCARDIAL INFARCTION)
|
a.
|
Eligibility:
A Qualified Claimant who on or after the Enrollment Date and within two (2) years of the Qualified Revision Surgery or the last pre-enrollment Covered Open Surgical Procedure Under General Anesthesia on that hip, which ever is later, experienced a myocardial infarction and meets the eligibility requirements as set forth in Past Matrix Level III.
|
b.
|
Benefits:
If the foregoing eligibility requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Future Matrix Level III, calculated in the same manner and subject to the same limitations and reductions as an award under Past Matrix Level III and the Enhancements Benefit Cap, except that the Future Matrix Level III Enhancement will be subject to a thirty percent (30%) reduction for any covered events that occur during the second (2
nd
) year following the Enrollment Date.
|
IV.
|
FUTURE MATRIX LEVEL IV (STROKE)
|
a.
|
Eligibility:
A Qualified Claimant who on or after the Enrollment Date and within two (2) years of the Qualified Revision Surgery or the last pre-enrollment Covered Open Surgical Procedure Under General Anesthesia on that hip, which ever is later, experienced a stroke and meets the eligibility requirements as set forth in Past Matrix Level IV.
|
b.
|
Benefits:
If the foregoing eligibility requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Future Matrix Level IV, calculated in the same manner and subject to the same limitations and reductions as an award under Past Matrix Level IV and the Enhancements Benefit Cap, except that the Future Matrix Level IV Enhancement will be subject to a thirty percent (30%) reduction for any covered events that occur during the second (2
nd
) year following the Enrollment Date.
|
V.
|
FUTURE MATRIX LEVEL V (DEATH)
|
a.
|
Eligibility:
A Qualified Claimant who on or after the Enrollment Date and within two (2) years of the Qualified Revision Surgery or the last pre-enrollment Covered Open Surgical Procedure Under General Anesthesia on that hip, which ever is later, died and meets the eligibility requirements as set forth in Past Matrix Level V.
|
b.
|
Benefits:
If the foregoing eligibility requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Future Matrix Level V, calculated in the same manner and subject to the same limitations and reductions as an award under Past Matrix Level V and the Enhancements Benefit Cap, except that the Future Matrix Level V Enhancement will be subject to a thirty percent (30%) reduction for any covered events that occur during the second (2
nd
) year following the Enrollment Date.
|
VI.
|
FUTURE MATRIX LEVEL VI (LOST WAGES)
|
a.
|
Eligibility:
A Qualified Claimant who on or after the Enrollment Date and within two (2) years of the Qualified Revision Surgery or the last pre-enrollment Covered Open Surgical Procedure Under General Anesthesia on that hip, which ever is later, lost wages and meets the eligibility requirements as set forth in Past Matrix Level VI.
|
b.
|
Benefits:
If the foregoing eligibility requirements are met, a Qualified Claimant may be entitled to receive an Enhancement under this Future Matrix Level VI, calculated in the same manner and subject to the same limitations and reductions as an award under Past Matrix Level VI and the Enhancements Benefit Cap, except that the Future Matrix Level VI Enhancement will be subject to a thirty percent (30%) reduction for any covered events that occur during the second (2
nd
) year following the Enrollment Date.
|
|
State or Country
|
Name of Subsidiary
|
of Incorporation
|
|
|
Alcott Indemnity Company
|
Vermont
|
Benoist Girard SAS
|
France
|
Berchtold + Fritz GmbH
|
Germany
|
Berchtold Asia SDN BHD
|
Malaysia
|
Berchtold China Ltd
|
China
|
Berchtold Consulting GmbH
|
Switzerland
|
Berchtold Corporation
|
Delaware
|
Berchtold Deutschland GmbH & Co KG
|
Germany
|
Berchtold do Brasil Importacao e Exportacao Ltda. EPP
|
Brazil
|
Berchtold Espana S.L.
|
Spain
|
Berchtold GmbH & Co KG
|
Germany
|
Berchtold Holding GmbH
|
Germany
|
Berchtold Holding GmbH (f/k/a Berchtold Holding AG)
|
Switzerland
|
Berchtold Italia Srl
|
Italy
|
Berchtold Japan KK
|
Japan
|
Berchtold Pacific Pty
|
Australia
|
Berchtold UK Limited
|
United Kingdom
|
Cersys, Inc.
|
Delaware
|
Changzhou Orthomed Medical Instruments Company Limited
|
China
|
Colorado Biomedical, Inc.
|
Colorado
|
Concentric Medical Europe SARL
|
Belgium
|
Concentric Medical, Inc.
|
Delaware
|
Everest Biomedical Instruments Company
|
Delaware
|
Gaymar Industries, Inc.
|
New York
|
Howmedica International S. de R.L.
|
Panama
|
Howmedica Osteonics Corp.
|
New Jersey
|
Image Guided Technologies, Inc.
|
Colorado
|
Instrumedics, LLC
|
Michigan
|
Jiangsu Chuangyi Medical Instrument Company Limited
|
China
|
Link Technology, Inc.
|
Colorado
|
Mako Surgical, Inc.
|
Delaware
|
Medicycle, Inc.
|
Arizona
|
MediSearch, Inc.
|
Puerto Rico
|
Memometal Technologies SAS
|
France
|
Memometal UK Limited
|
United Kingdom
|
Memometal, Inc.
|
Delaware
|
MicroDexterity Systems, Inc.
|
Delaware
|
N.V. Stryker SA
|
Belgium
|
Nettrick Limited
|
Ireland
|
OOO Stryker
|
Russia
|
Orthomed (Hong Kong) Medical Instrument Company Limited
|
Hong Kong
|
Orthovita, Inc.
|
Pennsylvania
|
Osteo France SARL
|
France
|
OtisMed Corporation
|
California
|
ParaMed Corporation
|
Utah
|
Patient Safety Technologies, Inc.
|
Delaware
|
Pficonprod Pty. Ltd.
|
Australia
|
Pivot Medical, Inc.
|
Delaware
|
S.E.H.T. SARL
|
France
|
S.I.R.E., LLC
|
Michigan
|
Shanghai Gongpin Trading Company Limited
|
China
|
SpineCore, Inc.
|
Delaware
|
SSI Divesture, Inc.
|
Massachusetts
|
Stryker (Barbados) Foreign Sales Corporation
|
Barbados
|
Stryker (Beijing) Healthcare Products Co. Ltd.
|
China
|
Stryker (India) Private Limited
|
India
|
Stryker (Shanghai) Healthcare Products Co., Ltd.
|
China
|
Stryker (Suzhou) Medical Technology Co Ltd.
|
China
|
Stryker (Thailand) Limited
|
Thailand
|
Stryker AB
|
Sweden
|
Stryker Acquisitions BV
|
The Netherlands
|
Stryker Asia Holdings CV
|
The Netherlands
|
Stryker Australia LLC
|
Delaware
|
Stryker Australia Pty. Ltd.
|
Australia
|
Stryker Beteiligungs GmbH
|
Germany
|
Stryker Biotech LLC
|
Michigan
|
Stryker Canada Holding Company
|
Canada
|
Stryker Canada LP
|
Canada
|
Stryker Canadian Management ULC
|
Canada
|
Stryker Capital BV
|
The Netherlands
|
Stryker China Limited
|
Hong Kong
|
Stryker Colombia SAS
|
Colombia
|
Stryker Combo LLC
|
Michigan
|
Stryker Communications, Inc.
|
Delaware
|
Stryker Corporation
|
Michigan
|
Stryker Corporation (Chile) y Compania Limitada
|
Chile
|
Stryker Corporation (Malaysia) Sdn. Bhd.
|
Malaysia
|
Stryker Czech Republic s.r.o.
|
Czech Republic
|
Stryker do Brasil Ltda.
|
Brazil
|
Stryker EMEA Supply Chain Services BV
|
The Netherlands
|
Stryker European Coordination Center BV
|
The Netherlands
|
Stryker European Holdin
gs
Coöperatief U.A.
|
The Netherlands
|
Stryker European Holdings I, LLC
|
Delaware
|
Stryker European Holdings II, LLC
|
Delaware
|
Stryker European Holdings III, LLC
|
Delaware
|
Stryker European Holdings IV, LLC
|
Delaware
|
Stryker European Holdings V, LLC
|
Delaware
|
Stryker European Holdings VI, LLC
|
Delaware
|
Stryker European Operations BV
|
The Netherlands
|
Stryker European Technologies CV
|
The Netherlands
|
Stryker Far East, Inc.
|
Delaware
|
Stryker Financial Services CV
|
The Netherlands
|
Stryker Foreign Acquisitions, Inc.
|
Delaware
|
Stryker France Holding SNC
|
France
|
Stryker France MM Holdings SAS
|
France
|
Stryker France SAS
|
France
|
Stryker Funding BV
|
The Netherlands
|
Stryker GI Ltd.
|
Israel
|
Stryker GI Services CV
|
The Netherlands
|
Stryker Global Technology Center Private Limited
|
India
|
Stryker GmbH
|
Austria
|
Stryker GmbH & Co. KG
|
Germany
|
Stryker Grundstucks GmbH & Co KG
|
Germany
|
Stryker Grundstucks Verwaltungs GmbH
|
Germany
|
Stryker Hellas Limited Liability Company Trading in Medical Devices EPE
|
Greece
|
Stryker Holdings BV
|
The Netherlands
|
Stryker Hong Kong Holding Ltd
|
Hong Kong
|
Stryker Iberia, SL
|
Spain
|
Stryker IFSC Limited
|
Ireland
|
Stryker International Acquisitions BV
|
The Netherlands
|
Stryker International Holdings BV
|
The Netherlands
|
Stryker Investment Holdings BV
|
The Netherlands
|
Stryker Ireland Holdings
|
Ireland
|
Stryker Ireland Limited
|
Ireland
|
Stryker Italia SRL
|
Italy
|
Stryker Japan Holdings BV
|
The Netherlands
|
Stryker Japan KK
|
Japan
|
Stryker Korea Ltd.
|
South Korea
|
Stryker Lebanon (Offshore) SAL
|
Lebanon
|
Stryker Leibinger GmbH & Co. KG
|
Germany
|
Stryker Luxembourg Holdings SARL
|
Luxembourg
|
Stryker Luxembourg SARL
|
Luxembourg
|
Stryker Mauritius Holding Ltd.
|
Mauritius
|
Stryker Medical Quebec LP
|
Canada
|
Stryker Medtech KK
|
Japan
|
Stryker Medtech Limited
|
Ireland
|
Stryker Mexico, S.A. de C.V.
|
Mexico
|
Stryker Nederland BV
|
The Netherlands
|
Stryker New Zealand Limited
|
New Zealand
|
Stryker Newplant GmbH
|
Switzerland
|
Stryker NV Operations Limited
|
Ireland
|
Stryker Pacific Limited
|
Hong Kong
|
Stryker Performance Solutions LLC
|
New Jersey
|
Stryker Polska Sp.z.o.o.
|
Poland
|
Stryker Portugal - Produtos Medicos Unipessoal, Lda.
|
Portugal
|
Stryker Puerto Rico Limited
|
Ireland
|
Stryker Real Estate BV
|
The Netherlands
|
Stryker Romania SRL
|
Romania
|
Stryker SA
|
Switzerland
|
Stryker Sales Corporation
|
Michigan
|
Stryker Servicios Administrativos S. de R.L. de C.V.
|
Mexico
|
Stryker Singapore Private Limited
|
Singapore
|
Stryker South Africa (Proprietary) Limited
|
South Africa
|
Stryker Spain Holding, SL
|
Spain
|
Stryker Spine SA
|
Switzerland
|
Stryker Spine SAS
|
France
|
Stryker Sustainability Solutions, Inc.
|
Delaware
|
Stryker Tibbi Cihazlan Sanayi Ve Ticaret Limited
|
Turkey
|
Stryker Trauma GmbH
|
Germany
|
Stryker Trauma SA
|
Switzerland
|
Stryker Trauma SAS
|
France
|
Stryker U.S. Holding LLC
|
Delaware
|
Stryker UK Limited
|
United Kingdom
|
Stryker Verwaltungs GmbH
|
Germany
|
Stryker-Osteonics SA
|
Switzerland
|
SurgiCount Medical, Inc.
|
California
|
Surpass Medical, Ltd.
|
Israel
|
Trauson (China) Medical Instrument Company Limited
|
China
|
Trauson (Hong Kong) Company Limited
|
Hong Kong
|
Trauson Holdings (BV) Limited
|
British Virgin Islands
|
Trauson Holdings (Hong Kong) Company Limited
|
Hong Kong
|
Trauson Holdings Company Limited
|
Cayman Islands
|
Waterloo Bedding Co.
|
Canada
|
(1)
|
Registration Statement (Form S-3 No. 333-186953) of Stryker Corporation, and
|
(2)
|
Registration Statement (Form S-8 Nos. 333-78201, 333-140961, 333-150396 and 333-179142) of Stryker Corporation;
|
/s/ KEVIN A. LOBO
|
Kevin A. Lobo
|
President and Chief Executive Officer
|
/s/ WILLIAM R. JELLISON
|
William R. Jellison
|
Vice President, Chief Financial Officer
|
(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.
|
/s/ KEVIN A. LOBO
|
Kevin A. Lobo
|
President and Chief Executive Officer
|
February 12, 2015
|
(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.
|
/s/ WILLIAM R. JELLISON
|
William R. Jellison
|
Vice President, Chief Financial Officer
|
February 12, 2015
|