Edwards Lifesciences Corp (Form: 10-Q, Received: 11/07/2012 06:02:24)

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q


(Mark One)
ý		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended September 30, 2012
or
o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-15525

EDWARDS LIFESCIENCES CORPORATION
(Exact name of registrant as specified in its charter)


Delaware		36-4316614
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
One Edwards Way, Irvine, California		92614
(Address of principal executive offices)		(Zip Code)
(949) 250-2500 (Registrant's telephone number, including area code)

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ý No o

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


Large accelerated filer ý		Accelerated filer o		Non-accelerated filer o (Do not check if a smaller reporting company)		Smaller Reporting Company o

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

The number of shares outstanding of the registrant's common stock, $1.00 par value, as of October 31, 2012 was 115,410,951.

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EDWARDS LIFESCIENCES CORPORATION

FORM 10-Q
For the quarterly period ended September 30, 2012

TABLE OF CONTENTS

		Page Number

Part I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	1
	Consolidated Condensed Balance Sheets	1
	Consolidated Condensed Statements of Operations	2
	Consolidated Condensed Statements of Comprehensive Income	3
	Consolidated Condensed Statements of Cash Flows	4
	Notes to Consolidated Condensed Financial Statements	5
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	30
Item 4.	Controls and Procedures	31
Part II.	OTHER INFORMATION	32
Item 1.	Legal Proceedings	32
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	32
Item 6.	Exhibits	32
Signature		33
Exhibits		34

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Part I. Financial Information

Item 1. Financial Statements

EDWARDS LIFESCIENCES CORPORATION

CONSOLIDATED CONDENSED BALANCE SHEETS

(in millions, except par value; unaudited)

	September 30, 2012			December 31, 2011

ASSETS
Current assets
Cash and cash equivalents	$	305.8		$	171.2
Short-term investments		316.7			279.3
Accounts and other receivables, net of allowances of $5.4 and $14.8, respectively		325.4			320.7
Inventories, net (Note 3)		286.0			261.3
Deferred income taxes		42.4			43.9
Prepaid expenses		42.1			35.0
Other current assets		69.3			57.1

Total current assets		1,387.7			1,168.5
Long-term accounts receivable, net of allowances of $6.0 and $4.2, respectively		9.7			24.6
Property, plant and equipment, net		328.7			304.3
Goodwill		349.8			349.8
Other intangible assets, net (Note 4)		59.6			66.9
Investments in unconsolidated affiliates (Note 5)		23.4			21.8
Deferred income taxes		10.9			20.0
Other assets		26.0			24.6

	$	2,195.8		$	1,980.5

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued liabilities	$	298.6		$	335.2

Long-term debt		175.4			150.4

Other long-term liabilities		185.5			157.0

Commitments and contingencies (Note 11)
Stockholders' equity
Preferred stock, $.01 par value, authorized 50.0 shares, no shares outstanding		—			—
Common stock, $1.00 par value, 350.0 shares authorized, 123.9 and 120.0 shares issued, and 116.0 and 114.1 shares outstanding, respectively		123.9			120.0
Additional paid-in capital		458.8			300.5
Retained earnings		1,562.8			1,360.7
Accumulated other comprehensive loss		(37.1	)		(37.5	)
Treasury stock, at cost, 7.9 and 5.9 shares, respectively		(572.1	)		(405.8	)

Total stockholders' equity		1,536.3			1,337.9

	$	2,195.8		$	1,980.5

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

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EDWARDS LIFESCIENCES CORPORATION

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS

(in millions, except per share information; unaudited)

	Three Months Ended September 30,					Nine Months Ended September 30,

	2012			2011		2012			2011
Net sales	$	447.9		$	412.7	$	1,389.1		$	1,248.4
Cost of goods sold		111.7			125.6		368.8			370.2

Gross profit		336.2			287.1		1,020.3			878.2
Selling, general and administrative expenses		167.8			165.5		527.4			479.0
Research and development expenses		73.8			61.7		216.4			185.6
Special charges (Note 2)		—			—		7.0			4.0
Interest income, net		(0.3	)		—		(0.4	)		(0.3	)
Other expense (income), net		1.5			2.3		1.0			(5.1	)

Income before provision for income taxes		93.4			57.6		268.9			215.0
Provision for income taxes		24.2			6.0		66.8			41.4

Net income	$	69.2		$	51.6	$	202.1		$	173.6

Share information (Note 13)
Earnings per share:
Basic	$	0.60		$	0.45	$	1.76		$	1.51
Diluted	$	0.58		$	0.43	$	1.71		$	1.45
Weighted-average number of common shares outstanding:
Basic		115.7			114.6		114.9			114.8
Diluted		119.0			119.0		118.4			119.8

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

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EDWARDS LIFESCIENCES CORPORATION

CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME

(in millions; unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,

	2012			2011			2012			2011
Net income	$	69.2		$	51.6		$	202.1		$	173.6

Other comprehensive income (loss), net of tax (Note 12):
Foreign currency translation adjustments		23.5			(29.8	)		(0.6	)		13.3

Unrealized (loss) gain on cash flow hedges		(9.8	)		17.5			0.4			7.3

Unrealized gain (loss) on available-for-sale investments for the period		0.2			(0.4	)		0.3			(0.7	)
Reclassification of net realized investment (gain) loss to earnings		—			(1.0	)		0.3			(1.0	)

Unrealized gain (loss) on available-for-sale investments		0.2			(1.4	)		0.6			(1.7	)

Other comprehensive income (loss)		13.9			(13.7	)		0.4			18.9

Comprehensive income	$	83.1		$	37.9		$	202.5		$	192.5

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EDWARDS LIFESCIENCES CORPORATION

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(in millions; unaudited)

	Nine Months Ended September 30,

	2012			2011
				(as restated) (Note 16)
Cash flows from operating activities
Net income	$	202.1		$	173.6
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization		42.2			43.2
Stock-based compensation (Note 9)		31.3			26.0
Excess tax benefit from stock plans		(39.0	)		(3.6	)
Deferred income taxes		1.1			2.2
Special charges (Note 2)		7.0			4.0
Other		0.4			(1.2	)
Changes in operating assets and liabilities:
Accounts and other receivables, net		(4.0	)		(38.5	)
Inventories, net		(23.9	)		(38.3	)
Accounts payable and accrued liabilities		6.8			43.0
Prepaid expenses and other current assets		15.7			9.3
Other		7.7			(4.9	)

Net cash provided by operating activities		247.4			214.8

Cash flows from investing activities
Capital expenditures		(64.9	)		(50.6	)
Purchases of short-term investments		(526.2	)		(454.0	)
Proceeds from short-term investments		488.1			237.2
Investments in intangible assets		(7.0	)		(2.3	)
Proceeds from sale of assets		2.6			3.9
Proceeds from unconsolidated affiliates, net		0.4			6.9
Investments in trading securities, net		(0.1	)		3.3
Acquisition		—			(42.6	)
Other		0.9			—

Net cash used in investing activities		(106.2	)		(298.2	)

Cash flows from financing activities
Proceeds from issuance of debt		237.9			505.5
Payments on debt		(211.6	)		(376.7	)
Purchases of treasury stock		(166.3	)		(263.3	)
Proceeds from stock plans		89.4			48.6
Excess tax benefit from stock plans		39.0			3.6
Other		2.9			0.7

Net cash used in financing activities		(8.7	)		(81.6	)

Effect of currency exchange rate changes on cash and cash equivalents		2.1			12.9

Net increase (decrease) in cash and cash equivalents		134.6			(152.1	)
Cash and cash equivalents at beginning of period		171.2			396.1

Cash and cash equivalents at end of period	$	305.8		$	244.0

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

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1. BASIS OF PRESENTATION

The accompanying interim consolidated condensed financial statements and related disclosures have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") and should be read in conjunction with the consolidated financial statements and notes included in Edwards Lifesciences Corporation's Annual Report on Form 10-K for the year ended December 31, 2011. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles ("GAAP") have been condensed or omitted.

In the opinion of management of Edwards Lifesciences Corporation ("Edwards Lifesciences" or the "Company"), the interim consolidated condensed financial statements reflect all adjustments considered necessary for a fair statement of the interim periods. All such adjustments are of a normal, recurring nature. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year.

Recently Adopted Accounting Standards

In May 2011, the Financial Accounting Standards Board ("FASB") issued an amendment to the accounting guidance on fair value measurements to ensure that United States GAAP and International Financial Reporting Standards have common requirements for fair value measurement and disclosures, including a consistent definition of fair value. The guidance was effective for interim and annual periods beginning on or after December 15, 2011. The adoption of this guidance did not have a material impact on the Company's consolidated financial statements.

In June 2011, the FASB issued an amendment to the accounting guidance on the presentation of comprehensive income. The guidance eliminates the option to present components of other comprehensive income as part of the statement of changes in stockholders' equity, and instead requires that all nonowner changes in stockholders' equity be presented in either a single continuous statement of comprehensive income or in two separate but consecutive statements. The guidance was effective for fiscal years, and interim periods within those years, beginning after December 15, 2011. The Company elected to present two separate but consecutive statements.

In September 2011, the FASB issued an amendment to the accounting guidance on goodwill to permit an entity to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill impairment test. The guidance was effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011. The Company does not expect the adoption of this guidance will have a material impact on its consolidated financial statements.

New Accounting Standards Not Yet Adopted

In July 2012, the FASB issued an amendment to the accounting guidance on intangible assets to permit an entity to first assess qualitative factors to determine whether it is more likely than not that the indefinite-lived asset is impaired as a basis for determining whether it is necessary to calculate the fair value of the indefinite-lived asset and perform the quantitative impairment test by comparing the fair value with the carrying amount. The guidance is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. The Company does not expect the adoption of this guidance will have a material impact on its consolidated financial statements.

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2. SPECIAL CHARGES

Licensing of Intellectual Property

In April 2012, the Company obtained an exclusive license to a suturing device for minimally invasive surgery applications. The intellectual property is under development and there is uncertainty as to whether the product will ultimately be approved. The Company recorded a charge of $2.0 million related to the upfront licensing and royalty fees.

In June 2012, the Company obtained a co-exclusive sublicense to intellectual property related to processing tissue and implanting cardiovascular valves. The intellectual property is under development and there is uncertainty as to whether the product will ultimately be approved. The Company recorded a charge of $5.0 million related to the upfront licensing fee.

European Receivables

In June 2011, the Company recorded a $4.0 million charge to reflect the increased risk associated with its European receivables.

3. INVENTORIES, NET

Inventories, net of reserves, consisted of the following (in millions):

	September 30, 2012		December 31, 2011

Raw materials	$	50.6	$	51.7
Work in process		62.3		66.6
Finished products		173.1		143.0

	$	286.0	$	261.3

The Company recorded an $8.1 million charge to gross profit during the second quarter of 2012 due to the voluntary recalls of certain of the Company's heart valves and Critical Care catheters. The majority of the affected products were still part of inventory at the time of the recalls. As of September 30, 2012, there were $3.5 million of reserves for the recall remaining in inventory.

4. OTHER INTANGIBLE ASSETS

Other intangible assets consisted of the following (in millions):

	September 30, 2012							December 31, 2011

	Cost		Accumulated Amortization			Net Carrying Value		Cost		Accumulated Amortization			Net Carrying Value
Amortizable intangible assets
Patents	$	208.9	$	(166.4	)	$	42.5	$	205.9	$	(158.4	)	$	47.5
Unpatented technology		39.2		(32.5	)		6.7		39.3		(31.3	)		8.0
Other		10.5		(6.4	)		4.1		12.0		(6.9	)		5.1

		258.6		(205.3	)		53.3		257.2		(196.6	)		60.6

Unamortizable intangible assets
In-process research and development		6.3		—			6.3		6.3		—			6.3

	$	264.9	$	(205.3	)	$	59.6	$	263.5	$	(196.6	)	$	66.9

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The net carrying value of patents includes $16.6 million of capitalized legal costs related to the defense and enforcement of issued patents and trademarks for which success is deemed probable as of September 30, 2012.

Amortization expense related to other intangible assets was $3.5 million and $2.4 million for the three months ended September 30, 2012 and 2011, respectively, and $10.1 million and $10.8 million for the nine months ended September 30, 2012 and 2011, respectively. Estimated amortization expense for each of the years ending December 31 is as follows (in millions):


2012	$	13.6
2013		13.4
2014		11.9
2015		10.7
2016		10.3

The Company expenses costs incurred to renew or extend the term of acquired intangible assets.

5. INVESTMENTS IN UNCONSOLIDATED AFFILIATES

The Company has a number of equity investments in privately and publicly held companies. Investments in these unconsolidated affiliates are as follows:

	September 30, 2012			December 31, 2011

	(in millions)
Available-for-sale investments
Cost	$	0.4		$	2.0
Unrealized gains		2.2			1.3

Fair value of available-for-sale investments		2.6			3.3

Equity method investments
Cost		13.6			12.6
Equity in losses		(0.4	)		(0.7	)

Carrying value of equity method investments		13.2			11.9

Cost method investments
Carrying value of cost method investments		7.6			6.6

Total investments in unconsolidated affiliates	$	23.4		$	21.8

Proceeds from sales of available-for-sale investments were $2.1 million for the nine months ended September 30, 2012, and $3.6 million for the three and nine months ended September 30, 2011. The Company realized pre-tax gains from these sales of $0.4 million for the nine months ended September 30, 2012, and $1.4 million for the three and nine months ended September 30, 2011.

6. FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS

The consolidated condensed financial statements include financial instruments for which the fair market value of such instruments may differ from amounts reflected on a historical cost basis. Financial instruments of the Company consist of cash deposits, bank time deposits, accounts and other receivables, investments in unconsolidated affiliates, accounts payable, certain accrued liabilities and borrowings under a revolving credit agreement. The carrying value of these financial instruments generally approximates fair value due to their short-term nature.

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Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The Company prioritizes the inputs used to determine fair values in one of the following three categories:

Level 1—Quoted market prices in active markets for identical assets or liabilities.
Level 2—Inputs, other than quoted prices in active markets, that are observable, either directly or indirectly.
Level 3—Unobservable inputs that are not corroborated by market data.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table summarizes the Company's financial instruments which are measured at fair value on a recurring basis (in millions):

September 30, 2012	Level 1		Level 2		Level 3		Total

Assets
Investments held for executive deferred compensation plan	$	12.5	$	—	$	—	$	12.5
Investments in unconsolidated affiliates		2.6		—		—		2.6
Derivatives		—		1.3		—		1.3

	$	15.1	$	1.3	$	—	$	16.4

Liabilities
Executive deferred compensation plan	$	12.0	$	—	$	—	$	12.0

December 31, 2011
Assets
Investments held for executive deferred compensation plan	$	11.5	$	—	$	—	$	11.5
Investments in unconsolidated affiliates		3.3		—		—		3.3
Derivatives		—		12.7		—		12.7

	$	14.8	$	12.7	$	—	$	27.5

Liabilities
Executive deferred compensation plan	$	9.9	$	—	$	—	$	9.9

Executive Deferred Compensation Plan

The Company holds investments in trading securities related to its executive deferred compensation plan ("EDCP"). The amounts deferred under the EDCP are invested in a variety of stock and bond mutual funds. The fair values of these investments and the corresponding liabilities are based on quoted market prices and are categorized as Level 1.

Investments in Unconsolidated Affiliates

Investments in unconsolidated affiliates are long-term equity investments in companies that are in various stages of development. Certain of the Company's investments in unconsolidated affiliates are designated as available-for-sale. These investments are carried at fair market value based on quoted market prices and are categorized as Level 1.

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Derivative Instruments

The Company uses derivative financial instruments in the form of foreign currency forward exchange contracts to manage foreign currency exposures. All derivatives contracts are recognized on the balance sheet at their fair value. The fair value for derivatives is determined based on quoted foreign currency exchange rates discounted to present as appropriate. The valuation procedures are based upon well recognized financial principles. Although readily observable data is used in the valuations, different valuation methods could have an effect on the estimated fair value. The derivative instruments are categorized as Level 2.

Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis

The Company has assets that are subject to measurement at fair value on a non-recurring basis, including assets acquired in a business combination, such as goodwill and intangible assets, and other long-lived assets. The Company reviews the carrying value of intangible and other long-lived assets whenever events and circumstances indicate that the carrying amounts of the assets may not be recoverable. If it is determined that the assets are impaired, the carrying value would be reduced to estimated fair market value. During the nine months ended September 30, 2012, the Company had no impairments related to assets subject to measurement at fair value on a non-recurring basis. In March 2011, the Company acquired Embrella Cardiovascular, Inc. This transaction resulted in an increase to " Goodwill " and " Other Intangible Assets, net " of $34.6 million and $12.1 million, respectively.

7. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

The Company uses derivative financial instruments to manage its currency exchange rate risk as summarized below. Notional amounts are stated in United States dollar equivalents at spot exchange rates at the respective dates.

	September 30, 2012				December 31, 2011

	Notional Amount		Fair Value Asset (Liability)		Notional Amount		Fair Value Asset (Liability)
	(in millions)
Foreign currency forward exchange contracts	$	812.3	$	1.3	$	759.5	$	12.7

The Company uses foreign currency forward exchange contracts to offset the changes due to currency rate movements in the amount of future cash flows associated with intercompany transactions and certain third-party expenses expected to occur within the next thirteen months. These foreign currency forward exchange contracts are designated as cash flow hedges. Certain of the Company's locations have assets and liabilities denominated in currencies other than their functional currencies resulting from intercompany and third-party transactions. The Company uses foreign currency forward exchange contracts that are not designated as hedging instruments to offset the transaction gains and losses associated with certain of these assets and liabilities. All foreign currency forward exchange contracts are denominated in currencies of major industrial countries, principally the Euro and the Japanese yen. It is the Company's policy not to enter into derivative financial instruments for speculative purposes.

All derivative financial instruments are recognized at fair value in the consolidated condensed balance sheets. The Company reports in " Other Comprehensive Income (Loss) " ("OCI") the effective portion of the gain or loss on derivative financial instruments that are designated and that qualify as cash flow hedges. The Company reclassifies these gains and losses into earnings in the same period in which the underlying hedged transactions affect earnings. Any hedge ineffectiveness (which represents the amount by which the changes in the fair value of the derivative exceed the variability in the cash flows of the forecasted transaction) is recorded in current period earnings. For the nine months ended September 30, 2012 and 2011, the Company did not record any gains or losses due to hedge ineffectiveness. The gains and losses on derivative financial instruments for which the Company does not elect hedge accounting treatment are recognized in the consolidated condensed statements of

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operations in each period, based upon the change in the fair value of the derivative financial instrument. Cash flows from derivative financial instruments are reported as operating activities in the consolidated condensed statements of cash flows.

Derivative financial instruments involve credit risk in the event the counterparty should default. It is the Company's policy to execute such instruments with global financial institutions that the Company believes to be creditworthy. The Company diversifies its derivative financial instruments among counterparties to minimize exposure to any one of these entities. The Company also uses International Swap Dealers Association master-netting agreements. Under the master-netting agreements, the Company's counterparty settlement risk is the net amount of any receipts or payments due between the Company and the counterparty financial institution.

The following table presents the location and fair value amounts of derivative instruments reported in the consolidated condensed balance sheets (in millions):

		Fair Value

Derivatives designated as hedging instruments	Balance Sheet Location	September 30, 2012		December 31, 2011
Assets
Foreign currency contracts	Prepaid expenses	$	1.3	$	12.7

The following tables present the effect of derivative instruments on the consolidated condensed statements of operations and consolidated condensed statements of comprehensive income (in millions):

	Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion)						Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income

	Three Months Ended September 30,						Three Months Ended September 30,
	Three Months Ended September 30,					Location of Gain or (Loss) Reclassified from Accumulated OCI into Income	Three Months Ended September 30,
Derivatives in cash flow hedging relationships	2012			2011			2012		2011
Foreign currency contracts	$	(9.5	)	$	17.3	Cost of goods sold	$	6.2	$	(11.6	)

	Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion)						Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income

	Nine Months Ended September 30,						Nine Months Ended September 30,
	Nine Months Ended September 30,					Location of Gain or (Loss) Reclassified from Accumulated OCI into Income	Nine Months Ended September 30,
Derivatives in cash flow hedging relationships	2012		2011				2012		2011
Foreign currency contracts	$	3.9	$	(9.5	)	Cost of goods sold	$	3.5	$	(21.5	)

		Amount of Gain or (Loss) Recognized in Income on Derivative

		Three Months Ended September 30,
	Location of Gain or (Loss) Recognized in Income on Derivative	Three Months Ended September 30,
Derivatives not designated as hedging instruments		2012			2011
Foreign currency contracts	Other expense (income), net	$	(3.5	)	$	(1.9	)

		Amount of Gain or (Loss) Recognized in Income on Derivative

		Nine Months Ended September 30,
	Location of Gain or (Loss) Recognized in Income on Derivative	Nine Months Ended September 30,
Derivatives not designated as hedging instruments		2012			2011
Foreign currency contracts	Other expense (income), net	$	(3.0	)	$	(6.2	)

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The Company expects that during the next twelve months it will reclassify to earnings an $8.5 million gain currently recorded in " Accumulated Other Comprehensive Loss ."

8. DEFINED BENEFIT PLANS

The components of net periodic benefit costs for the three and nine months ended September 30, 2012 and 2011 were as follows (in millions):

	Three Months Ended September 30,						Nine Months Ended September 30,

	2012			2011			2012			2011
Service cost	$	1.8		$	1.5		$	5.4		$	4.6
Interest cost		0.6			0.5			1.8			1.5
Expected return on plan assets		(0.4	)		(0.3	)		(1.1	)		(1.0	)
Amortization of actuarial loss, prior service credit and other		0.2			0.1			0.5			0.3

Net periodic pension benefit cost	$	2.2		$	1.8		$	6.6		$	5.4

9. STOCK-BASED COMPENSATION

Stock-based compensation expense related to awards issued under the Company's incentive compensation plans for the three and nine months ended September 30, 2012 and 2011 was as follows (in millions):

	Three Months Ended September 30				Nine Months Ended September 30,

	2012		2011		2012		2011
Cost of goods sold	$	1.4	$	1.3	$	3.7	$	3.0
Selling, general and administrative expenses		8.0		7.5		23.1		18.7
Research and development expenses		1.5		1.7		4.5		4.3

Total stock-based compensation expense	$	10.9	$	10.5	$	31.3	$	26.0

At September 30, 2012, the total remaining compensation cost related to nonvested stock options, restricted stock units ("RSUs"), market-based restricted stock units ("MRSUs") and employee stock purchase plan ("ESPP") subscription awards amounted to $77.2 million, which will be amortized on a straight-line basis over the weighted-average remaining requisite service period of 31 months.

During the nine months ended September 30, 2012, the Company granted 1.1 million stock options at a weighted-average exercise price of $86.70 and 0.2 million shares of RSUs at a weighted-average grant-date fair value of $86.04. The Company also granted 47,275 shares of MRSUs at a weighted-average grant-date fair value of $109.78. The MRSUs vest based on a combination of certain service and market conditions. The actual number of shares issued will be determined based on the Company's total shareholder return relative to a selected industry peer group over a three-year performance period, and may range from 0 percent to 175 percent of the targeted number of shares granted.

Fair Value Disclosures

The fair value of the MRSUs was determined using a Monte Carlo simulation model, which uses multiple input variables to determine the probability of satisfying the market condition requirements. The weighted-average assumptions used to determine the fair value of the MRSUs included a 0.3 percent risk-free interest rate and a 30.4 percent expected volatility rate.

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The Black-Scholes option pricing model was used with the following weighted-average assumptions for options granted during the following periods:

Option Awards

	Three Months Ended September 30,						Nine Months Ended September 30,

	2012			2011			2012			2011
Risk-free interest rate		0.6	%		1.4	%		0.7	%		1.7	%
Expected dividend yield		None			None			None			None
Expected volatility		31.2	%		27.2	%		31.3	%		27.3	%
Expected term (years)		4.9			4.7			4.6			4.5
Fair value, per share	$	29.00		$	21.72		$	23.92		$	22.81

The Black-Scholes option pricing model was used with the following weighted-average assumptions for ESPP subscriptions granted during the following periods:

ESPP

	Three Months Ended September 30,						Nine Months Ended September 30,

	2012			2011			2012			2011
Risk-free interest rate		0.2	%		0.1	%		0.1	%		0.2	%
Expected dividend yield		None			None			None			None
Expected volatility		36.0	%		29.8	%		33.2	%		27.6	%
Expected term (years)		0.6			0.6			0.6			0.6
Fair value, per share	$	26.90		$	21.06		$	21.30		$	20.02

10. ACCELERATED SHARE REPURCHASE

In February 2012, the Company entered into an accelerated share repurchase ("ASR") agreement with an investment bank to repurchase $54.0 million of the Company's common stock. The February ASR agreement provided for the repurchase of the Company's common stock based on the volume-weighted average price ("VWAP") of the Company's common stock during the term of the agreement, less a discount, and was subject to collar provisions that established minimum and maximum number of shares to be repurchased. In March 2012, the Company paid the $54.0 million purchase price and received an initial delivery of 0.6 million shares, representing the minimum number of shares to be repurchased under the agreement. The initial shares were valued at $72.40 per share based on the VWAP of the Company's common stock on March 1, 2012, which was the date the major terms of the ASR agreement were finalized, and represented approximately 80 percent of the shares expected to be repurchased. The February ASR agreement concluded in May 2012, and upon final settlement, the Company had received a total of 0.7 million shares at an average price per share of $75.12 based on the VWAP of the Company's common stock during the term of the agreement.

In May 2012, the Company entered into another ASR agreement with the same investment bank to repurchase $50.0 million of the Company's common stock. The May ASR agreement provided for the repurchase of the Company's common stock based on the VWAP of the Company's common stock during the term of the agreement, less a discount, and was subject to collar provisions that established minimum and maximum number of shares to be repurchased. In June 2012, the Company paid the $50.0 million purchase price and received an initial delivery of 0.5 million shares, representing the minimum number of shares to be repurchased under the agreement. The initial shares were valued at $84.81 per share based on the VWAP of the Company's common stock on June 1, 2012, which was the

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date the major terms of the May ASR agreement were finalized, and represented approximately 80 percent of the shares expected to be repurchased. The May ASR agreement concluded in August 2012, and upon final settlement, the Company had received a total of 0.5 million shares at an average price per share of $97.50 based on the VWAP of the Company's common stock during the term of the agreement.

The ASR agreements were accounted for as two separate transactions: (a) the value of the initial delivery of shares was recorded as shares of common stock acquired in a treasury stock transaction on the acquisition date and (b) the remaining amount of the purchase price paid was recorded as a forward contract indexed to the Company's own common stock and was recorded in " Additional Paid-in Capital " on the consolidated condensed balance sheet. The initial delivery of shares resulted in an immediate reduction of the outstanding shares used to calculate the weighted-average common shares outstanding for basic and diluted earnings per share. The Company determined that the forward contract indexed to the Company's common stock met all the applicable criteria for equity classification and, therefore, was not accounted for as a derivative instrument.

11. COMMITMENTS AND CONTINGENCIES

In February 2008, Edwards Lifesciences filed a lawsuit against CoreValve, Inc. in the U.S. District Court for the District of Delaware alleging that its ReValving System infringes three of Edwards' U.S. Andersen patents, later narrowed to one patent ("the '552 patent"). Medtronic, Inc. ("Medtronic") acquired CoreValve, Inc. ("Medtronic CoreValve") in April 2009. In April 2010, a federal jury found the '552 patent to be valid and found that Medtronic CoreValve willfully infringes it. The jury also awarded Edwards $73.9 million in damages. In February 2011, the District Court reaffirmed the jury decision and ruled that Edwards is entitled to recover additional damages due to Medtronic CoreValve's continued infringing sales from the trial through the life of the patent, plus interest. In the same ruling, the court denied Edwards' motions for a permanent injunction, as well as its motion for increased damages relating to Medtronic CoreValve's willful infringement. Both Edwards and Medtronic CoreValve have appealed. The U.S. Court of Appeals for the Federal Circuit heard the appeals in January 2012 and the parties are awaiting its decision. A second lawsuit is pending in the same trial court against Medtronic CoreValve and Medtronic alleging infringement of three of Edwards' U.S. Andersen patents. In September 2010, the United States Patent and Trademark Office ("USPTO") granted Medtronic's third request to reexamine the validity of the claim of the '552 patent and in July 2011 confirmed the validity of that patent. Medtronic has since filed another request for reexamination of the '552 patent and that request has been partially granted by the USPTO.

In June 2011, Medtronic filed a lawsuit in the U.S. District Court for the District of Minnesota alleging that certain surgical valve holders and a surgical embolic filter device infringe its patents. Edwards counterclaimed against Medtronic, alleging that the Medtronic Contour 3D annuloplasty ring infringes an Edwards ring patent. Edwards subsequently added two more patents to its counterclaim. In February and March 2012, the USPTO granted Edwards' request to reexamine the validity of three of the four Medtronic patents involved in this lawsuit.

In June 2011, Medtronic CoreValve also filed another lawsuit in the U.S. District Court for the Central District of California alleging that the Edwards SAPIEN transcatheter heart valve infringes a Medtronic CoreValve patent. Edwards counterclaimed against Medtronic CoreValve and Medtronic, alleging that the Medtronic CoreValve heart valve infringes Edwards' U.S. Letac-Cribier transcatheter heart valve patent. Edwards' counterclaim was subsequently transferred to the U.S. District Court for the District of Delaware, where proceedings continue. In April 2012, the USPTO granted Edwards' request to reexamine the validity of the Medtronic CoreValve patent.

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In March 2012, Medtronic filed another lawsuit in the U.S. District Court for the Central District of California alleging that the methods of implanting the Edwards SAPIEN transcatheter heart valve in the United States infringes two Medtronic patents relating to methods of pacing the heart.

In August 2012, Edwards filed a lawsuit against Medtronic in the German District Court of Mannheim alleging that Medtronic's Corevalve and Evolut valves infringe two of Edwards' transcatheter valve patents. These patents were issued by the European Patent Office and were validated as national patents in various European countries, including Germany. The matter is scheduled for trial in April 2013.

In March and September 2010, the Company received grand jury subpoenas for documents from the United States Attorney's Office in the Central District of California in connection with an investigation by the Food and Drug Administration. The subpoenas to the Company seek records relating to the Vigilance I Monitor model with software release 5.3 that was the subject of a voluntary field recall by the Company in June 2006. The Company has cooperated fully with the investigation. In October 2012, the Company was advised by the U.S. Attorney's Office that it is declining to pursue a criminal investigation and/or prosecution at this time.

In addition, Edwards Lifesciences is or may be a party to, or may otherwise be responsible for, pending or threatened lawsuits related primarily to products and services currently or formerly manufactured or performed, as applicable, by Edwards Lifesciences. Such cases and claims raise difficult and complex factual and legal issues and are subject to many uncertainties, including, but not limited to, the facts and circumstances of each particular case or claim, the jurisdiction in which each suit is brought, and differences in applicable law. Upon resolution of any such legal matter or other claim, Edwards Lifesciences may incur charges in excess of established reserves. The Company is not able to estimate the amount or range of any loss for legal contingencies for which there is no reserve or additional loss for matters already reserved. While any such charge could have a material adverse impact on Edwards Lifesciences' net income or cash flows in the period in which it is recorded or paid, management does not believe that any such charge relating to any currently pending lawsuit would have a material adverse effect on Edwards Lifesciences' financial position, results of operations or liquidity.

Edwards Lifesciences is subject to various environmental laws and regulations both within and outside of the United States. The operations of Edwards Lifesciences, like those of other medical device companies, involve the use of substances regulated under environmental laws, primarily in manufacturing and sterilization processes. While it is difficult to quantify the potential impact of continuing compliance with environmental protection laws, management believes that such compliance will not have a material impact on Edwards Lifesciences' financial position, results of operations or liquidity.

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12. OTHER COMPREHENSIVE INCOME (LOSS)

The tax effect on the components of other comprehensive income (loss) is as follows (in millions):

	Foreign Currency Translation Adjustments			Unrealized (Loss) Gain on Cash Flow Hedges			Unrealized Gain (Loss) on Investments in Unconsolidated Affiliates			Total Other Comprehensive Income (Loss)

Three Months Ended September 30, 2012
Pre-tax period change	$	23.5		$	(15.7	)	$	0.3		$	8.1
Deferred income tax benefit (expense)		—			5.9			(0.1	)		5.8

Net of tax amount	$	23.5		$	(9.8	)	$	0.2		$	13.9

Nine Months Ended September 30, 2012
Pre-tax period change	$	(0.6	)	$	0.4		$	1.0		$	0.8
Deferred income tax expense		—			—			(0.4	)		(0.4	)

Net of tax amount	$	(0.6	)	$	0.4		$	0.6		$	0.4

Three Months Ended September 30, 2011
Pre-tax period change	$	(29.8	)	$	28.9		$	(2.2	)	$	(3.1	)
Deferred income tax (expense) benefit		—			(11.4	)		0.8			(10.6	)

Net of tax amount	$	(29.8	)	$	17.5		$	(1.4	)	$	(13.7	)

Nine Months Ended September 30, 2011
Pre-tax period change	$	13.3		$	12.0		$	(2.7	)	$	22.6
Deferred income tax (expense) benefit		—			(4.7	)		1.0			(3.7	)

Net of tax amount	$	13.3		$	7.3		$	(1.7	)	$	18.9

13. EARNINGS PER SHARE

Basic earnings per share is computed by dividing net income by the weighted-average common shares outstanding during a period. Employee equity share options, nonvested shares and similar equity instruments granted by the Company are treated as potential common shares in computing diluted earnings per share. Diluted shares outstanding include the dilutive effect of RSUs, MRSUs, and in-the-money options. The dilutive impact of the RSUs, MRSUs, and in-the-money options is calculated based on the average share price for each fiscal period using the treasury stock method. Under the treasury stock method, the amount that the employee must pay for exercising stock options, the amount of compensation expense for future service that the Company has not yet recognized, and the amount of tax benefits that would be recorded in " Additional Paid-in Capital " when the award becomes deductible are assumed to be used to repurchase shares. Potential common share equivalents have been excluded where their inclusion would be anti-dilutive.

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The table below presents the computation of basic and diluted earnings per share (in millions, except for per share information):

	Three Months Ended September 30,				Nine Months Ended September 30,

	2012		2011		2012		2011
Basic:
Net income	$	69.2	$	51.6	$	202.1	$	173.6

Weighted-average shares outstanding		115.7		114.6		114.9		114.8

Basic earnings per share	$	0.60	$	0.45	$	1.76	$	1.51

Diluted:
Net income	$	69.2	$	51.6	$	202.1	$	173.6

Weighted-average shares outstanding		115.7		114.6		114.9		114.8
Dilutive effect of stock plans		3.3		4.4		3.5		5.0

Dilutive weighted-average shares outstanding		119.0		119.0		118.4		119.8

Diluted earnings per share	$	0.58	$	0.43	$	1.71	$	1.45

Stock options, RSUs, and MRSUs to purchase 1.3 million and 1.3 million shares for the three months ended September 30, 2012 and 2011, respectively, and 1.6 million and 0.9 million for the nine months ended September 30, 2012 and 2011, respectively, were outstanding, but were not included in the computation of diluted earnings per share because the effect would have been anti-dilutive.

14. INCOME TAXES

The Company's effective income tax rates were 25.9% and 24.8% for the three and nine months ended September 30, 2012, respectively, and 10.4% and 19.3% for the three and nine months ended September 30, 2011, respectively. The effective income tax rate for the nine months ended September 30, 2012 included a $2.3 million benefit from the remeasurement of uncertain tax positions. The effective income tax rates for the three and nine months ended September 30, 2011 included a $6.9 million and $9.4 million tax benefit, respectively, related to rulings made by the tax authorities in Switzerland.

The federal research credit expired on December 31, 2011 and has not been reinstated as of September 30, 2012. The effective income tax rates for the three and nine months ended September 30, 2012 have been calculated without an assumed benefit for the federal research credit. In 2011, the federal research credit favorably impacted the effective tax rate by approximately 2.4%.

The Company strives to resolve open matters with each tax authority at the examination level and could reach agreement with a tax authority at any time. While the Company has accrued for matters it believes are more likely than not to require settlement, the final outcome with a tax authority may result in a tax liability that is more or less than that reflected in the consolidated condensed financial statements. Furthermore, the Company may later decide to challenge any assessments, if made, and may exercise its right to appeal. The uncertain tax positions are reviewed quarterly and adjusted as events occur that affect potential liabilities for additional taxes, such as lapsing of applicable statutes of limitations, proposed assessments by tax authorities, negotiations between tax authorities, identification of new issues and issuance of new legislation, regulations or case law.

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benefits associated with the correlative effects of potential transfer pricing adjustments, state income taxes and timing adjustments. The net amounts of $85.1 million and $71.2 million, respectively, if not required, would favorably affect the Company's effective tax rate.

All material state, local and foreign income tax matters have been concluded for years through 2006. The Internal Revenue Service ("IRS") has completed its examination of the 2007 and 2008 tax years, including certain transfer pricing issues that were under appeal. The appeals process for those transfer pricing issues was finalized during the third quarter of 2012. The IRS began its examination of the 2009 and 2010 tax years during the second quarter of 2011.

15. SEGMENT INFORMATION

Edwards Lifesciences conducts operations worldwide and is managed in the following geographical regions: United States, Europe, Japan and Rest of World. All regions sell products that are used to treat advanced cardiovascular disease.

The Company's geographic segments are reported based on the financial information provided to the Chief Operating Decision Maker (the Chief Executive Officer). The Company evaluates the performance of its geographic segments based on net sales and income before provision for income taxes ("pre-tax income"). The accounting policies of the segments are substantially the same as those described in Note 2 of the Company's consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2011. Net sales and pre-tax income of reportable segments are based on internally derived standard foreign exchange rates, which may differ from year to year, and do not include inter-segment profits. Because of the interdependence of the reportable segments, the operating profit as presented may not be representative of the geographical distribution that would occur if the segments were not interdependent. Net sales by geographic area are based on the location of the customer.

Certain items are maintained at the corporate level and are not allocated to the segments. The non-allocated items include net interest expense, global marketing expenses, corporate research and development expenses, manufacturing variances, corporate headquarters costs, special gains and charges, stock-based compensation, foreign currency hedging activities, certain litigation costs and most of the Company's amortization expense. Although most of the Company's depreciation expense is included in segment pre-tax income, due to the Company's methodology for cost build-up, it is impractical to determine the amount of depreciation expense included in each segment, and therefore a portion is maintained at the corporate level. The Company neither discretely allocates assets to its operating segments, nor evaluates the operating segments using discrete asset information.

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The table below presents information about Edwards Lifesciences' reportable segments (in millions):

	Three Months Ended September 30,				Nine Months Ended September 30,

	2012		2011		2012		2011
Segment Net Sales
United States	$	193.5	$	150.5	$	587.1	$	450.9
Europe		129.7		128.9		430.9		409.0
Japan		70.7		53.3		214.0		167.9
Rest of world		62.0		50.1		171.7		147.9

Total segment net sales	$	455.9	$	382.8	$	1,403.7	$	1,175.7

Segment Pre-Tax Income
United States	$	109.2	$	76.3	$	330.2	$	237.2
Europe		53.4		52.4		185.2		177.2
Japan		36.5		23.6		110.2		78.9
Rest of world		19.3		15.4		48.5		44.8

Total segment pre-tax income	$	218.4	$	167.7	$	674.1	$	538.1

The table below presents reconciliations of segment net sales to consolidated net sales and segment pre-tax income to consolidated pre-tax income (in millions):

	Three Months Ended September 30,						Nine Months Ended September 30,

	2012			2011			2012			2011
Net Sales Reconciliation
Segment net sales	$	455.9		$	382.8		$	1,403.7		$	1,175.7
Foreign currency		(8.0	)		29.9			(14.6	)		72.7

Consolidated net sales	$	447.9		$	412.7		$	1,389.1		$	1,248.4

Pre-Tax Income Reconciliation
Segment pre-tax income	$	218.4		$	167.7		$	674.1		$	538.1
Unallocated amounts:
Corporate items		(127.4	)		(109.8	)		(399.1	)		(330.2	)
Special charges		—			—			(7.0	)		(4.0	)
Interest income, net		0.3			—			0.4			0.3
Foreign currency		2.1			(0.3	)		0.5			10.8

Consolidated pre-tax income	$	93.4		$	57.6		$	268.9		$	215.0

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Enterprise-Wide Information

Enterprise-wide information is based on actual foreign exchange rates used in the Company's consolidated financial statements.

	Three Months Ended September 30,				Nine Months Ended September 30,

	2012		2011		2012		2011
	(in millions)
Net Sales by Geographic Area
United States	$	193.6	$	150.5	$	587.2	$	450.9
Europe		121.8		139.1		417.1		430.3
Japan		71.8		67.8		214.9		206.9
Rest of world		60.7		55.3		169.9		160.3

	$	447.9	$	412.7	$	1,389.1	$	1,248.4

Net Sales by Major Product and Service Area
Surgical Heart Valve Therapy	$	185.7	$	190.4	$	589.8	$	593.8
Transcatheter Heart Valves		123.8		82.6		391.1		240.6
Critical Care		138.4		139.7		408.2		414.0

	$	447.9	$	412.7	$	1,389.1	$	1,248.4

	September 30, 2012		December 31, 2011

	(in millions)
Long-Lived Tangible Assets by Geographic Area
United States	$	241.0	$	223.0
International		113.7		105.9

	$	354.7	$	328.9

16. RESTATEMENT OF UNAUDITED INTERIM CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

During the fourth quarter of 2011, the Company determined that its previously issued consolidated condensed balance sheets and consolidated condensed statements of cash flows for the quarter ended September 30, 2011 contained errors related to (1) its cash equivalents and short-term investments and (2) the excess tax benefit from stock plans. Neither of these errors had an impact on the consolidated condensed statements of operations.

First, during 2011, the Company purchased bank time deposits with original maturities over three months but less than one year. The Company determined that these bank time deposits had been incorrectly classified as cash equivalents for the above mentioned period and, accordingly, the Company has restated the presentation as reflected below. The classification error had no impact on the Company's current assets.

	As of September 30, 2011

Balance Sheets	As Reported		As Restated
	(in millions)
Cash and cash equivalents	$	451.1	$	244.0
Short-term investments		—		207.1

Total	$	451.1	$	451.1

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	Nine Months Ended September 30, 2011

Statements of Cash Flows	As Reported			As Restated
	(in millions)
Cash flows from investing activities
Purchases of short-term investments		—			(454.0	)
Proceeds from short-term investments		—			237.2
Net cash used in investing activities		(81.4	)		(298.2	)
Effect of currency exchange rate changes on cash and cash equivalents		3.2			12.9
Net increase (decrease) in cash and cash equivalents		55.0			(152.1	)
Cash and cash equivalents at end of period		451.1			244.0

Second, the amount presented in the consolidated condensed statements of cash flows as " Excess Tax Benefits from Stock Plans " for the period ended September 30, 2011 was not reduced to reflect the absence of cash flows from the generation of credit carryforwards and net operating losses in the United States in 2011 primarily due to significant tax deductions from stock option exercises and, accordingly, the Company has restated the presentation as reflected below.

	Nine Months Ended September 30, 2011

Statements of Cash Flows	As Reported			As Restated
	(in millions)
Cash flows from operating activities
Excess tax benefit from stock plans	$	(47.0	)	$	(3.6	)
Net cash provided by operating activities		171.4			214.8
Cash flows from financing activities
Excess tax benefit from stock plans		47.0			3.6
Net cash used in financing activities		(38.2	)		(81.6	)

17. SUBSEQUENT EVENT

On October 9, 2012, the Company acquired all the outstanding shares of BMEYE, B.V. ("BMEYE") for an aggregate cash purchase price of € 32.5 million (approximately $42 million). BMEYE is a medical device company that specializes in the development of non-invasive technology for advanced hemodynamic monitoring. The acquisition provides the Company with full rights to develop BMEYE's existing technology platform to create a new, integrated hemodynamic monitoring system that has a disposable sensor unit worn by the patient. The acquisition will be accounted for as a business combination, and consisted primarily of goodwill and in-process research and development. The Company is in the process of evaluating the impact of the business combination on its consolidated financial statements.

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

This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The Company (as defined below in "Overview") intends the forward-looking statements contained in this report to be covered by the safe harbor provisions of such Acts. All statements other than statements of historical fact in this report or referred to or incorporated by reference into this report are "forward-looking statements" for purposes of these sections. These statements include, among other things, any predictions of earnings, revenues, expenses or other financial items, plans or expectations with respect to development activities, clinical trials or regulatory approvals, any statements of plans, strategies and objectives of management for future operations, any statements concerning the Company's future operations, financial conditions and prospects, and any statements of assumptions underlying any of the foregoing. These statements can sometimes be identified by the use of the forward-looking words such as "may," "believe," "will," "expect," "project," "estimate," "should," "anticipate," "plan," "goal," "continue," "seek," "pro forma," "forecast," "intend," "guidance," "optimistic," "aspire," "confident," other forms of these words or similar words or expressions or the negative thereof. Investors are cautioned not to unduly rely on such forward-looking statements. These forward-looking statements are subject to substantial risks and uncertainties that could cause the Company's results or future business, financial condition, results of operations or performance to differ materially from the Company's historical results or experiences or those expressed or implied in any forward-looking statements contained in this report. Investors should carefully review the information contained in, or incorporated by reference into, the Company's annual report on Form 10-K for the year ended December 31, 2011 and subsequent reports on Forms 10-Q and 8-K for a description of certain of these risks and uncertainties. These forward-looking statements speak only as of the date on which they are made and the Company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of the statement. If the Company does update or correct one or more of these statements, investors and others should not conclude that the Company will make additional updates or corrections.

Overview

Edwards Lifesciences Corporation ("Edwards Lifesciences" or the "Company") is focused on technologies that treat structural heart disease and critically ill patients. A pioneer in the development and commercialization of heart valve products, Edwards Lifesciences is the world's leading manufacturer of tissue heart valves and repair products used to replace or repair a patient's diseased or defective heart valve. The Company is also a global leader in hemodynamic monitoring systems used to measure a patient's cardiovascular function in the hospital setting.

During the first quarter of 2012, the Company began reporting its products and technologies in three new product groups: Surgical Heart Valve Therapy, which combines surgical heart valves and Cardiac Surgery Systems; Transcatheter Heart Valves; and Critical Care, which includes Vascular. Sales amounts for the prior year periods have been recast to conform with the new product classifications.

Edwards Lifesciences' Surgical Heart Valve Therapy portfolio is comprised primarily of tissue heart valves and heart valve repair products for the surgical repair or replacement of a patient's heart valve. The portfolio also includes a diverse line of products used during minimally invasive surgical procedures, and cannulae, embolic protection devices and other products used during cardiopulmonary bypass. The Company's Transcatheter Heart Valves portfolio includes technologies designed to treat heart valve disease using catheter-based approaches as opposed to open surgical techniques. In the Critical Care portfolio, Edwards Lifesciences' products include pulmonary artery catheters, disposable pressure transducers and advanced monitoring systems. The portfolio also includes a line of balloon catheter-based products, surgical clips and inserts.

The healthcare marketplace continues to be competitive with strong global and local competitors. The Company competes with many companies, ranging from small start-up enterprises to companies

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that are larger and more established than Edwards Lifesciences with access to significant financial resources. Furthermore, rapid product development and technological change characterize the market in which the Company competes. Global demand for healthcare is increasing as the population ages. There is mounting pressure to contain healthcare costs in the face of this increasing demand, which has resulted in pricing and market share pressures. The cardiovascular segment of the medical device industry is dynamic, and technology, cost-of-care considerations, regulatory reform, industry and customer consolidation, and evolving patient needs are expected to continue to drive change.

New Accounting Standards Not Yet Adopted

In July 2012, the Financial Accounting Standards Board issued an amendment to the accounting guidance on intangible assets to permit an entity to first assess qualitative factors to determine whether it is more likely than not that the indefinite-lived asset is impaired as a basis for determining whether it is necessary to calculate the fair value of the indefinite-lived asset and perform the quantitative impairment test by comparing the fair value with the carrying amount. The guidance is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. The Company does not expect the adoption of this guidance will have a material impact on its consolidated financial statements.

Results of Operations

Net Sales Trends
(dollars in millions)

	Three Months Ended September 30,										Nine Months Ended September 30,

	Three Months Ended September 30,							Percent Change			Nine Months Ended September 30,						Percent Change
	2012		2011		Change			Percent Change			2012		2011		Change		Percent Change
United States	$	193.6	$	150.5	$	43.1			28.5	%	$	587.2	$	450.9	$	136.3		30.2	%
International		254.3		262.2		(7.9	)		(3.0	)%		801.9		797.5		4.4		0.6	%

Total net sales	$	447.9	$	412.7	$	35.2			8.5	%	$	1,389.1	$	1,248.4	$	140.7		11.3	%

In the United States, the $43.1 million and $136.3 million increases in net sales for the three and nine months ended September 30, 2012, respectively, were due primarily to:

•: Transcatheter Heart Valves, which increased net sales by $47.4 million and $139.9 million, respectively, driven primarily by sales of the Edwards SAPIEN transcatheter heart valve which was launched in the United States in the fourth quarter of 2011.

International net sales decreased $7.9 million for the three months ended September 30, 2012 and increased $4.4 million for the nine months ended September 30, 2012, due primarily to:

•: foreign currency exchange rate fluctuations, which decreased net sales by $19.8 million and $33.5 million, respectively, due primarily to the weakening of the Euro against the United States dollar;

partially offset by:

•: Transcatheter Heart Valves, which increased net sales by $3.4 million and $28.4 million, respectively, driven primarily by sales of the Edwards SAPIEN XT transcatheter heart valve; and
•: Surgical Heart Valve Therapy products, which increased net sales by $5.9 million and $12.1 million, respectively, driven primarily by sales of the Carpentier-Edwards PERIMOUNT Magna Aortic Ease valve.

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The impact of foreign currency exchange rate fluctuations on net sales is not necessarily indicative of the impact on net income due to the corresponding effect of foreign currency exchange rate fluctuations on international manufacturing and operating costs and the Company's hedging activities. For more information see Item 3, " Quantitative and Qualitative Disclosures About Market Risk ."

Net Sales by Product Line
(dollars in millions)

	Three Months Ended September 30,										Nine Months Ended September 30,

	Three Months Ended September 30,							Percent Change			Nine Months Ended September 30,							Percent Change
	2012		2011		Change			Percent Change			2012		2011		Change			Percent Change
Surgical Heart Valve Therapy	$	185.7	$	190.4	$	(4.7	)		(2.5	)%	$	589.8	$	593.8	$	(4.0	)		(0.7	)%
Transcatheter Heart Valves		123.8		82.6		41.2			49.9	%		391.1		240.6		150.5			62.5	%
Critical Care		138.4		139.7		(1.3	)		(1.0	)%		408.2		414.0		(5.8	)		(1.4	)%

Total net sales	$	447.9	$	412.7	$	35.2			8.5	%	$	1,389.1	$	1,248.4	$	140.7			11.3	%

Surgical Heart Valve Therapy

Net sales of Surgical Heart Valve Therapy products decreased by $4.7 million and $4.0 million for the three and nine months ended September 30, 2012, respectively, due primarily to:

•: foreign currency exchange rate fluctuations, which decreased net sales by $7.6 million and $12.1 million, respectively, due primarily to the weakening of the Euro against the United States dollar;

partially offset by:

•: surgical heart valve products, which increased net sales by $2.8 million and $4.4 million, respectively, driven by sales of pericardial aortic tissue valves; and
•: cardiac surgery systems, which increased net sales by $3.7 million for the nine month period, driven by specialty cannula products and minimally invasive surgical products.

In Europe, the Company received CE Mark in February 2012 for EDWARDS INTUITY , its minimally invasive aortic valve surgery system. During the second quarter, the Company received conditional Investigational Device Exemption ("IDE") approval from the United States Food and Drug Administration ("FDA") to initiate the TRANSFORM Trial, which will evaluate the EDWARDS INTUITY valve system, and began enrollment in the third quarter. Also, during the second quarter, the Company received IDE approval to initiate a clinical trial to study its GLX next-generation tissue treatment platform applied to a surgical bovine pericardial heart valve.

During the second quarter, the Company received regulatory approval in the United States and Europe for its ProPlege retrograde cardioplegia device, designed to protect the heart during aortic and mitral valve procedures. The Company initiated a limited launch of ProPlege in Europe in June 2012 and in the United States in July 2012.

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Transcatheter Heart Valves

Net sales of Transcatheter Heart Valves for the three and nine months ended September 30, 2012 increased by $41.2 million and $150.5 million, respectively, due primarily to:

•: the Edwards SAPIEN transcatheter heart valve, which increased net sales by $45.2 million and $117.5 million, respectively, primarily due to the launch in the United States in the fourth quarter of 2011; and
•: the Edwards SAPIEN XT transcatheter heart valve, which increased net sales by $5.7 million and $52.2 million, respectively, primarily due to an increase in international sales;

partially offset by:

•: foreign currency exchange rate fluctuations, which decreased net sales by $7.7 million and $14.4 million, respectively, due primarily to the weakening of the Euro against the United States dollar.

The Company expects that its transcatheter heart valves will continue to be a strong contributor to 2012 sales. In November 2011, the Company received approval from the FDA for the transfemoral delivery of the Edwards SAPIEN transcatheter heart valve for treatment of certain inoperable patients with severe symptomatic aortic stenosis (Cohort B of The PARTNER Trial). In October 2012, the Company received approval from the FDA for the transfemoral and transapical delivery of the Edwards SAPIEN transcatheter heart valve for treatment of patients with severe, symptomatic aortic stenosis deemed at high risk for traditional open-heart surgery (Cohort A of The PARTNER Trial). The Company is continuing to conduct its PARTNER II trial, which is evaluating the Edwards SAPIEN XT transcatheter heart valve. In September 2012, the Company received FDA approval to add to the trial its larger 29 millimeter SAPIEN XT valve with the NovaFlex+ delivery system and the Ascendra+ delivery system for both the transapical and new transaortic approach.

Critical Care

Net sales of Critical Care products for the three and nine months ended September 30, 2012 decreased by $1.3 million and $5.8 million, respectively, due primarily to:

•: foreign currency exchange rate fluctuations, which decreased net sales by $4.5 million and $7.0 million, respectively, due primarily to the weakening of the Euro against the United States dollar; and
•: the discontinuation of distributed sales of certain oximetry products and reduced sales of the Company's Central Venous Access products, which decreased net sales by $0.8 million and $7.2 million, respectively;

partially offset by:

•: FloTrac systems, which increased net sales for the nine month period by $4.3 million; and
•: pressure monitoring products, which increased net sales by $1.8 million and $1.7 million, respectively.

Gross Profit

	Three Months Ended September 30,								Nine Months Ended September 30,

	2012			2011			Change		2012			2011			Change
Gross profit as a percentage of net sales		75.1	%		69.6	%		5.5 pts.		73.5	%		70.3	%		3.2 pts.

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The 5.5 and 3.2 percentage point increases in gross profit as a percentage of net sales for the three and nine months ended September 30, 2012, respectively, were driven primarily by:

•: a 3.8 percentage point and 2.5 percentage point increase due to the impact of foreign currency exchange rate fluctuations, including the outcome of foreign currency hedging contracts; and
•: a 2.3 percentage point and a 1.6 percentage point increase in the United States due to a more profitable product mix, primarily higher sales of Transcatheter Heart Valves.

Selling, General and Administrative ("SG&A") Expenses
(dollars in millions)

	Three Months Ended September 30,								Nine Months Ended September 30,

	2012			2011			Change		2012			2011			Change
SG&A expenses	$	167.8		$	165.5		$	2.3	$	527.4		$	479.0		$	48.4
SG&A expenses as a percentage of net sales		37.5	%		40.1	%		(2.6) pts.		38.0	%		38.4	%		(0.4) pts.

The increase in SG&A expenses for the three and nine months ended September 30, 2012 was due primarily to higher sales and marketing expenses in the United States, mainly to support the Transcatheter Heart Valve program, including the launch in the United States. The decrease in SG&A expenses as a percentage of net sales for the three months ended September 30, 2012 was due primarily to the impact of foreign currency. The impact of foreign currency reduced expenses by $8.2 million and $14.2 million, respectively, due to the weakening of various currencies against the United States dollar, primarily the Euro.

Research and Development Expenses
(dollars in millions)

	Three Months Ended September 30,								Nine Months Ended September 30,

	2012			2011			Change		2012			2011			Change
Research and development expenses	$	73.8		$	61.7		$	12.1	$	216.4		$	185.6		$	30.8
Research and development expenses as a percentage of net sales		16.5	%		15.0	%		1.5 pts.		15.6	%		14.9	%		0.7 pts.

The increase in research and development expenses for the three and nine months ended September 30, 2012 was due primarily to additional investments in clinical studies and new product development efforts in the Transcatheter Heart Valve program.

Special Charges

Licensing of Intellectual Property

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European Receivables

In June 2011, the Company recorded a $4.0 million charge to reflect the increased risk associated with its European receivables.

Interest Income, net
(in millions)

	Three Months Ended September 30,									Nine Months Ended September 30,

	2012			2011			Change			2012			2011			Change
Interest expense	$	0.9		$	1.0		$	(0.1	)	$	3.2		$	2.2		$	1.0
Interest income		(1.2	)		(1.0	)		(0.2	)		(3.6	)		(2.5	)		(1.1	)

Interest income, net	$	(0.3	)	$	—		$	(0.3	)	$	(0.4	)	$	(0.3	)	$	(0.1	)

The increase in interest expense for the nine months ended September 30, 2012 resulted primarily from higher average interest rates as compared to the prior year period. The increase in interest income resulted primarily from the recognition of interest income on discounted accounts receivables in southern Europe, partially offset by lower average interest rates.

Other Expense (Income), net
(in millions)

	Three Months Ended September 30,					Nine Months Ended September 30,

	2012		2011			2012			2011
Foreign exchange losses, net	$	0.6	$	3.1		$	1.7		$	1.7
Loss on sale of property		0.6		—			0.6			—
Loss (gain) on investments in unconsolidated affiliates		0.3		(0.9	)		(0.7	)		(5.5	)
License agreement		—		—			(0.9	)		—
Earn-out payments		—		—			—			(1.0	)
Other		—		0.1			0.3			(0.3	)

Other expense (income), net	$	1.5	$	2.3		$	1.0		$	(5.1	)

The foreign exchange losses relate to the foreign currency fluctuations in the Company's global trade and intercompany receivable and payable balances offset by the gains and losses on derivative instruments intended to hedge those exposures. Foreign exchange fluctuations (primarily related to United States dollar payables in non-United States dollar functional currency locations) resulted in a net loss in 2012.

The loss on sale of property is due to the sale of one of the Company's buildings.

The loss (gain) on investments in unconsolidated affiliates primarily represents the Company's net share of gains and losses in investments accounted for under the equity method, and realized gains and losses on the Company's available-for-sale and cost method investments.

The license agreement gain relates to the collection of a previously fully reserved promissory note under a licensing arrangement.

In September 2009, the Company sold its hemofiltration product line. In connection with the transaction, the Company was entitled to earn-out payments up to $9.0 million based on certain revenue objectives to be achieved by the buyer over the two years following the sale. As of March 31, 2011, all earn-out payments had been earned.

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Provision for Income Taxes

The provision for income taxes consists of provisions for federal, state and foreign income taxes. The Company operates in an international environment with significant operations in various locations outside the United States, which have statutory tax rates lower than the United States tax rate. Accordingly, the consolidated income tax rate is a composite rate reflecting the earnings in the various locations and the applicable rates. The Company's effective income tax rates were 25.9% and 24.8% for the three and nine months ended September 30, 2012, respectively, and 10.4% and 19.3% for the three and nine months ended September 30, 2011, respectively. The effective income tax rate for the nine months ended September 30, 2012 included a $2.3 million benefit from the remeasurement of uncertain tax positions. The effective income tax rates for the three and nine months ended September 30, 2011 included a $6.9 and $9.4 million tax benefit, respectively, related to rulings made by the tax authorities in Switzerland.

The federal research credit expired on December 31, 2011 and has not been reinstated as of September 30, 2012. The effective income tax rates for the three and nine months ended September 30, 2012 have been calculated without an assumed benefit for the federal research credit, which if reinstated would have a favorable impact on the Company's full year effective tax rate. In 2011, the federal research credit favorably impacted the full year effective tax rate by approximately 2.4%.

As of September 30, 2012 and December 31, 2011, the liability for income taxes associated with uncertain tax positions was $94.9 million and $78.0 million, respectively. The Company estimates that these liabilities would be reduced by $9.8 million and $6.8 million, respectively, from offsetting tax benefits associated with the correlative effects of potential transfer pricing adjustments, state income taxes and timing adjustments. The net amounts of $85.1 million and $71.2 million, respectively, if not required, would favorably affect the Company's effective tax rate.

Liquidity and Capital Resources

The Company's sources of cash liquidity include cash on hand and cash equivalents, short-term investments (bank time deposits with original maturities over three months but less than one year), amounts available under credit facilities and cash from operations. The Company believes that these sources are sufficient to fund the current requirements of working capital, capital expenditures and other financial commitments. The Company further believes that it has the financial flexibility to attract long-term capital to fund short-term and long-term growth objectives. However, no assurances can be given that such long-term capital will be available to the Company on favorable terms, or at all.

As of September 30, 2012, cash and cash equivalents and short-term investments held outside the United States were $573.7 million, and have historically been used to fund international operations. The Company believes that cash held in the United States, in addition to amounts available under credit facilities and cash from operations, are sufficient to fund its United States operating requirements. The majority of cash and cash equivalents and short-term investments held outside the

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United States relate to undistributed earnings of certain of the Company's foreign subsidiaries which are considered to be indefinitely reinvested by the Company. Repatriations of cash and cash equivalents and short-term investments held outside the United States are subject to restrictions in certain jurisdictions and may be subject to withholding and other taxes. The potential tax liability related to any repatriation would be dependent on the facts and circumstances that would exist at the time such repatriation is made and the complexities of the tax laws of the United States and the respective foreign jurisdictions.

The Company has a Four-Year Credit Agreement ("the Credit Facility") which matures on July 29, 2015. The Credit Facility provides up to an aggregate of $500.0 million in borrowings in multiple currencies. Borrowings generally bear interest at the London interbank offering rate ("LIBOR") plus 0.875%, subject to adjustment for leverage ratio changes as defined in the Credit Facility. The Company also pays a facility fee of 0.125% on the entire $500.0 million facility whether or not drawn. The facility fee is also subject to adjustment for leverage ratio changes. All amounts outstanding under the Credit Facility have been classified as long-term obligations as these borrowings are expected to be refinanced pursuant to the Credit Facility. As of September 30, 2012, borrowings of $175.4 million were outstanding under the Credit Facility. The Credit Facility is unsecured and contains various financial and other covenants, including a maximum leverage ratio and a minimum interest coverage ratio, as defined in the Credit Facility. The Company was in compliance with all covenants at September 30, 2012.

In February 2010, the Board of Directors approved a stock repurchase program authorizing the Company to purchase on the open market and in privately negotiated transactions up to $500.0 million of the Company's common stock. In September 2011, the Board of Directors approved a new stock repurchase program authorizing the Company to purchase on the open market and in privately negotiated transactions up to an additional $500.0 million of the Company's common stock. Under these stock repurchase authorizations, in February 2012 and May 2012, the Company entered into accelerated share repurchase ("ASR") agreements with an investment bank to repurchase $54.0 million and $50.0 million, respectively, of the Company's common stock. The Company received a total of 1.2 million shares under the February 2012 and May 2012 ASR agreements, which were concluded in May 2012 and August 2012, respectively. Also under these stock repurchase authorizations, in August 2012, the Company entered into a Rule 10b5-1 plan to repurchase up to $100.0 million of the Company's common stock in accordance with certain pre-defined price parameters. As of September 30, 2012, $86.9 million remained available under the Rule 10b5-1 plan, which has a termination date of December 31, 2012. During the nine months ended September 30, 2012, the Company repurchased a total of 2.0 million shares at an aggregate cost of $163.3 million, and as of September 30, 2012, had remaining authority under the program to purchase $434.6 million of the Company's common stock. In addition to shares repurchased under the stock repurchase program, the Company also acquired shares to satisfy tax withholding obligations in connection with the vesting of restricted stock issued to employees.

In October 2012, the Company acquired all the outstanding shares of BMEYE, B.V. ("BMEYE") for an aggregate cash purchase price of € 32.5 million (approximately $42 million). BMEYE is a medical device company that specializes in the development of non-invasive technology for advanced hemodynamic monitoring. The acquisition provides the Company with full rights to develop BMEYE's existing technology platform to create a new, integrated hemodynamic monitoring system that has a disposable sensor unit worn by the patient. The Company is in the process of evaluating the impact of the business combination on its financial statements.

At September 30, 2012, there had been no material changes in the Company's significant contractual obligations and commercial commitments as disclosed in its Annual Report on Form 10-K for the year ended December 31, 2011 other than as follows: during the quarter ended June 30, 2012, the Company entered into two separate supply agreements and a registry agreement. Under the supply agreements, the Company has agreed to purchase a minimum of $13.4 million of product by July 31,

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2013. The total future minimum commitments under the registry agreement are approximately $4.3 million, with payments through 2019.

Net cash flows provided by operating activities of $247.4 million for the nine months ended September 30, 2012 increased $32.6 million over the same period a year ago due primarily to (1) increased collection of accounts receivable, particularly a $26.3 million non-recurring collection in Spain and the sale of the Company's Greek bonds, (2) improved operating performance and (3) a decrease in inventory builds in comparison to the prior year. These increases were partially offset by (1) a $35.4 million impact from excess tax benefits from stock plans, primarily the realization of excess tax benefits that had been previously unrealized due to credit carryforwards and net operating losses in the United States in 2011, and (2) the timing of supplier payments.

Net cash used in investing activities of $106.2 million for the nine months ended September 30, 2012 consisted primarily of capital expenditures of $64.9 million and net purchases of short-term investments of $38.1 million.

Net cash used in investing activities of $298.2 million for the nine months ended September 30, 2011 consisted primarily of net purchases of short-term investments of $216.8 million, capital expenditures of $50.6 million, and a $42.6 million payment associated with the acquisition of Embrella Cardiovascular, Inc.

Net cash used in financing activities of $8.7 million for the nine months ended September 30, 2012 consisted primarily of purchases of treasury stock of $166.3 million, partially offset by proceeds from stock plans of $89.4 million, the excess tax benefit from stock plans of $39.0 million (including the realization of previously unrealized excess tax benefits), and net proceeds from debt of $26.3 million.

Net cash used in financing activities of $81.6 million for the nine months ended September 30, 2011 consisted primarily of purchases of treasury stock of $263.3 million, partially offset by net proceeds from debt of $128.8 million, proceeds from stock plans of $48.6 million, and the excess tax benefit from stock plans of $3.6 million.

Critical Accounting Policies and Estimates

The consolidated condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States which require the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and revenues and expenses during the periods reported. Actual results could differ from those estimates. Information with respect to the Company's critical accounting policies and estimates which the Company believes could have the most significant effect on the Company's reported results and require subjective or complex judgments by management is contained on pages 37-41 in Item 7, " Management's Discussion and Analysis of Financial Condition and Results of Operations, " of the Company's Annual Report on Form 10-K for the year ended December 31, 2011. Management believes that at September 30, 2012, there had been no material changes to this information.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

Interest Rate, Foreign Currency and Credit Risk

For a complete discussion of the Company's exposure to interest rate, foreign currency and credit risk, refer to Item 7A " Quantitative and Qualitative Disclosures About Market Risk " on pages 41-43 of the Company's Annual Report on Form 10-K for the year ended December 31, 2011. There have been no significant changes from the information discussed therein.

Concentrations of Risk

The Company invests excess cash in bank time deposits and diversifies the concentration of cash amongst different financial institutions.

In the normal course of business, Edwards Lifesciences provides credit to customers in the healthcare industry, performs credit evaluations of these customers and maintains allowances for potential credit losses which have historically been adequate compared to actual losses. The Company continues to do business with foreign governments in certain European countries that have experienced a deterioration in credit and economic conditions. These conditions have resulted in, and may continue to result in, a reduction in value and an increase in the average length of time that it takes to collect accounts receivable outstanding in these countries. In addition, the Company may also be impacted by declines in sovereign credit ratings or sovereign defaults in these countries.

Investment Risk

Edwards Lifesciences is exposed to investment risks related to changes in the fair values of its investments. The Company invests in equity instruments of public and private companies. These investments are classified in " Investments in Unconsolidated Affiliates " on the consolidated condensed balance sheets.

As of September 30, 2012, Edwards Lifesciences had $23.4 million of investments in equity instruments of other companies and had recorded unrealized gains of $1.7 million on these investments in " Accumulated Other Comprehensive Loss, " net of tax. Should these companies experience a decline in financial condition or fail to meet certain development milestones, the decline in the investments' value may be considered other-than-temporary and impairment charges may be necessary.

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Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures. The Company's management, including the Chief Executive Officer and the Chief Financial Officer, performed an evaluation of the effectiveness of the Company's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of September 30, 2012. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company's disclosure controls and procedures were effective as of September 30, 2012.

Changes in Internal Control Over Financial Reporting. There have been no changes in the Company's internal control over financial reporting during the quarter ended September 30, 2012 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

Remediation of Material Weakness. As described in the Company's Annual Report on Form 10-K, filed on February 27, 2012, for the year ended December 31, 2011, the Company did not maintain effective controls over the completeness and timeliness of information impacting classification and disclosures related to financial reporting.

Beginning in February 2012, with the oversight of the Audit and Public Policy Committee, the Company's management began to design and implement certain remediation measures to address the material weakness discussed above and to improve its internal control over financial reporting.

The Company enhanced its existing controls and added new controls beginning in the quarter ended March 31, 2012 to improve the communication to appropriate financial reporting personnel from other departments of changes to information impacting classification and disclosures in the financial statements. Specifically, these changes included implementation of quarterly meetings and modifications to existing monthly meetings involving other departments and regions as well as financial reporting personnel to appropriately address matters impacting the classification and disclosures in the Company's financial statements; and enhancing certain tools to be used to facilitate effective communication between other departments, regions and financial reporting personnel. In addition, during the quarter ended June 30, 2012, financial reporting personnel travelled to the Company's regional offices to present financial trainings and to help the Company better execute on its communication and coordination efforts in the regions.

The Company tested the newly implemented controls and the enhanced controls and found them to be effective and in operation for a sufficient period of time to effectively measure their operating effectiveness. Therefore, the Company has concluded that the material weakness has been fully remediated as of September 30, 2012.

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Part II. Other Information

Item 1. Legal Proceedings

For a description of our material pending legal proceedings, please see Note 11 to the " Consolidated Condensed Financial Statements " of this Quarterly Report on Form 10-Q, which is incorporated by reference.

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

Issuer Purchases of Equity Securities

Period		Average Price Paid per Share (or Unit)			Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs (in millions)(b)(c)

July 1, 2012 through July 31, 2012	111	$	103.34	—	$	447.7
August 1, 2012 through August 31, 2012	132,383		98.80	132,383		434.6
September 1, 2012 through September 30, 2012	41,230		97.51	41,177		434.6

Total	173,724		98.50	173,560

(a): The difference between the total number of shares (or units) purchased and the total number of shares (or units) purchased as part of publicly announced plans or programs is due to shares withheld by the Company to satisfy tax withholding obligations in connection with the vesting of RSUs issued to employees.
(b): On September 13, 2011, the Board of Directors approved a stock repurchase program authorizing the Company to purchase on the open market and in privately negotiated transactions up to $500.0 million of the Company's common stock.
(c): In August 2012, the Company's May ASR agreement was concluded, and the Company received an additional 41 thousand shares. Shares purchased pursuant to the Company's ASR agreements are presented in the above table in the periods in which they were received.

Item 6. Exhibits

Exhibits required by Item 601 of Regulation S-K are listed in the Exhibit Index hereto and include the following:


10.1	*	Edwards Lifesciences Corporation Amended and Restated Chief Executive Officer Change-In-Control Severance Agreement dated October 9, 2012.
10.2	*	Edwards Lifesciences Corporation Form of Change-In-Control Severance Agreement.
31.1		Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2		Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101		The following financial statements from Edwards Lifesciences' Quarterly Report on Form 10-Q for the quarter ended September 30, 2012, formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Condensed Balance Sheets, (ii) the Consolidated Condensed Statements of Operations, (iii) the Consolidated Condensed Statements of Comprehensive Income, (iv) the Consolidated Condensed Statements of Cash Flows, and (v) Notes to Consolidated Condensed Financial Statements

*: Represents management contract or compensatory plan.

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SIGNATURE

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


	EDWARDS LIFESCIENCES CORPORATION (Registrant)
Date: November 7, 2012	By:	/s/ THOMAS M. ABATE Thomas M. Abate Corporate Vice President, Chief Financial Officer (Chief Accounting Officer)

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EXHIBITS FILED WITH SECURITIES AND EXCHANGE COMMISSION

		Description

10.1	*	Edwards Lifesciences Corporation Amended and Restated Chief Executive Officer Change-In-Control Severance Agreement dated October 9, 2012.
10.2	*	Edwards Lifesciences Corporation Form of Change-In-Control Severance Agreement.
31.1		Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2		Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101		The following financial statements from Edwards Lifesciences' Quarterly Report on Form 10-Q for the quarter ended September 30, 2012, formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Condensed Balance Sheets, (ii) the Consolidated Condensed Statements of Operations, (iii) the Consolidated Condensed Statements of Comprehensive Income, (iv) the Consolidated Condensed Statements of Cash Flows, and (v) Notes to Consolidated Condensed Financial Statements

*: Represents management contract or compensatory plan.

Exhibit 10.1

Amended and Restated
Chief Executive Officer

Change-in-Control Severance Agreement

Dated October 9, 2012

by and between

EDWARDS LIFESCIENCES CORPORATION

and

MICHAEL A. MUSSALLEM

Contents

Article 1.	Definitions	2

Article 2.	Separation Benefits	6

Article 3.	Form and Timing of Separation Benefits	10

Article 4.	Benefit Limit	10

Article 5.	The Company’s Payment Obligation	11

Article 6.	Term of Agreement	12

Article 7.	Legal Remedies	12

Article 8.	Successors	12

Article 9.	Miscellaneous	13

Amended and Restated
Chief Executive Officer
Change-in-Control Severance Agreement
Edwards Lifesciences Corporation

THIS AMENDED AND RESTATED CHIEF EXECUTIVE OFFICER CHANGE-IN-CONTROL SEVERANCE AGREEMENT (this “Agreement”) is made, entered into, and is effective as of October 9, 2012 (hereinafter referred to as the “Effective Date”), by and between EDWARDS LIFESCIENCES CORPORATION, a Delaware corporation (the “Company”), and MICHAEL A. MUSSALLEM (the “Executive”).

WHEREAS, the Executive is currently employed by the Company as Chief Executive Officer; and

WHEREAS, the Executive possesses considerable experience and knowledge of the business and affairs of the Company concerning its policies, methods, personnel, and operations; and

WHEREAS, the Company is desirous of assuring insofar as possible, that it will continue to have the benefit of the Executive’s services; and the Executive is desirous of having such assurances; and

WHEREAS, the Company recognizes that circumstances may arise in which a Change in Control of the Company occurs, through acquisition or otherwise, thereby causing uncertainty of employment without regard to the Executive’s competence or past contributions, and that such uncertainty may result in the loss of the valuable services of the Executive to the detriment of the Company and its stockholders; and

WHEREAS, both the Company and the Executive are desirous that any proposal for a Change in Control will be considered by the Executive objectively and with reference only to the business interests of the Company and its stockholders; and

WHEREAS, the Executive will be in a better position to consider the Company’s best interests if the Executive is afforded reasonable security, as provided in this Agreement, against altered conditions of employment which could result from any such Change in Control; and

WHEREAS, the Executive and the Company are currently parties to that certain Amended and Restated Chief Executive Officer Change-In-Control Severance Agreement, dated March 30, 2009, as amended on December 15, 2010 and March 28, 2012 (the “Prior Agreement”); and

WHEREAS, by executing this Agreement, the Executive and the Company hereby agree that this Agreement shall supersede the severance benefits set forth in the Prior Agreement.

NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements of the parties set forth in this Agreement, and of other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, agree as follows:

Article 1. Definitions

Wherever used in this Agreement, the following terms shall have the meanings set forth below and, when the meaning is intended, the initial letter of the word is capitalized:

1.1 “Agreement” means this Amended and Restated Chief Executive Officer Change-in-Control Severance Agreement.

1.2 “Base Salary” means, at any time, the then-regular annual rate of pay which the Executive is receiving as annual salary, excluding amounts: (i) received under short- or long-term incentive or other bonus plans, regardless of whether or not the amounts are deferred, or (ii) designated by the Company as payment toward reimbursement of expenses.

1.3 “ Board ” means the Board of Directors of the Company.

1.4 “ Cause ” shall mean the occurrence of any one or more of the following (provided that the determination of whether “Cause” exists at any time prior to the occurrence of a Change in Control shall be determined solely by the Board (excluding the Executive, if he or she is then a member of the Board), in the exercise of the Board’s good faith and reasonable judgment, and any such determination shall be final and binding upon the parties):

(a) A continuing material breach by the Executive of the duties and responsibilities of the Executive, which duties shall not differ in any material respect from the duties and responsibilities in effect as of the Effective Date of this Agreement (other than as a result of incapacity due to a physical or mental condition or illness), which breach is demonstrably willful and deliberate on the Executive’s part, is committed in bad faith and without a reasonable belief that such a breach is in the best interests of the Company, and (x) the Board delivers to Executive a written demand for substantial performance that specifically identifies the manner in which the Board believes the Executive has breached such duties and responsibilities, (y) the Executive fails to remedy such breach within sixty (60) days after receipt of such written demand, and (z) the Board delivers the Notice of Termination pursuant to Section 2.7 herein within thirty (30) days after the expiration of such sixty (60) day cure period; or

and responsibilities, (y) the Executive fails to remedy such breach within sixty (60) days after receipt of such written demand, and (z) the Board delivers the Notice of Termination pursuant to Section 2.7 herein within thirty (30) days after the expiration of such sixty (60) day cure period; or

(c) The Executive is convicted of, or pled guilty or nolo contendere to a felony (under the laws of the United States or any relevant state, or a similar crime or offense under the applicable laws of any relevant foreign jurisdiction) that adversely affects the reputation of the Executive or the Company;

provided, that no act or failure to act on the Executive’s part shall be deemed “willful” unless done, or omitted to be done, by the Executive not in good faith and without reasonable belief that the action or omission was in the best interest of the Company.

1.5 “Code Section 409A” has the meaning ascribed to such term in Section 9.9 herein.

1.6 “Change in Control” of the Company shall mean the first to occur of any one of the following events after the Effective Date and prior to the expiration of this Agreement pursuant to Article 6 below:

(a) Any “Person,” as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934 (as amended) (other than the Company, any corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company, and any trustee or other fiduciary holding securities under an employee benefit plan of the Company or such proportionately owned corporation), is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended), directly or indirectly, of securities of the Company representing thirty percent (30%) or more of the combined voting power of the Company’s then outstanding securities; or

(b) During any period of not more than twenty-four (24) months, individuals who at the beginning of such period constitute the Board, and any new director (other than a director designated by a Person who has entered into an agreement with the Company to effect a transaction described in Sections 1.6(a), 1.6(c), or 1.6(d) of this Section 1.6) whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute at least a majority thereof; or

into voting securities of the surviving entity) more than sixty percent (60%) of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation; or (ii) a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no Person acquires more than thirty percent (30%) of the combined voting power of the Company’s then outstanding securities; or

(d) The Company’s stockholders approve a plan of complete liquidation or dissolution of the Company, or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets (or any transaction having a similar effect).

1.7 “Code” means the Internal Revenue Code of 1986, as amended.

1.8 “Company” means Edwards Lifesciences Corporation, a Delaware corporation (including any and all subsidiaries), or any successor thereto as provided in Article 8 herein.

1.9 “Disability” shall have the meaning ascribed to such term in the Executive’s governing long-term disability plan as of the Effective Date.

1.10 “Effective Date” means the date specified in the opening sentence of this Agreement.

1.11 “Effective Date of Termination” means the date on which a Qualifying Termination occurs, as provided in Section 2.2 herein.

1.12 “Good Reason” means, without the Executive’s express written consent, the occurrence of any one or more of the following conditions during the Protected Period:

(a) The assignment of the Executive to duties materially inconsistent with the Executive’s authorities, duties, responsibilities, and status (including offices, titles, and reporting requirements) as an executive and/or officer of the Company, or a material reduction or alteration in the nature or status of the Executive’s authorities, duties, or responsibilities from those in effect as of the Effective Date of this Agreement, other than an insubstantial or inadvertent act that is remedied by the Company promptly after receipt of notice thereof given by the Executive;

(b) Following a Change in Control and without the Executive’s consent, the Executive is no longer a member of the Board or fails to be nominated for reelection to the Board;

(c) The Company’s requiring the Executive to be based at a location in excess of fifty (50) miles from the location of the Executive’s principal job location or office immediately prior to such change, except for required travel on the Company’s business to an extent substantially consistent with the Executive’s then present business travel obligations;

(d) A reduction by the Company of the Executive’s Base Salary in effect on the Effective Date hereof, or as the same shall be increased from time to time;

(e) The failure of the Company to continue in effect any of the Company’s short- and long-term incentive compensation plans, or employee benefit or retirement plans, policies, practices, or other compensation arrangements in which the Executive participates, unless the Executive is permitted to participate in other plans that provide the Executive with substantially comparable benefits; or the failure by the Company to continue the Executive’s participation therein on substantially the same basis, both in terms of the amount of benefits provided and the level of the Executive’s participation relative to other participants;

(f) The failure of the Company to obtain a satisfactory agreement from any successor to the Company to assume and agree to perform the Company’s obligations under this Agreement, as contemplated in Article 8 herein;

(g) The Company, or any successor company, commits a material breach of any of the material provisions of this Agreement; or

(h) Following a Change in Control, the Executive and the Company, or any successor company, have not mutually agreed (in writing and within five (5) business days following a Change in Control) on mutually acceptable terms and conditions of continued employment for the Executive;

provided, however, that any such condition shall not constitute “Good Reason” unless the following requirements are satisfied: (x) the Executive provides the Company the Notice of Termination pursuant to Section 2.7 herein within sixty (60) days following the initial existence of the event giving rise to the condition claimed to constitute “Good Reason,” (y) the Company fails to remedy such condition within thirty (30) days after receiving such Notice of Termination (the “Cure Period”), and (z) the Executive resigns in writing from his or her employment, citing failure to remedy the condition giving rise to Good Reason, within thirty (30) days following the expiration of such thirty (30) day cure period.

The Executive’s right to terminate employment for Good Reason shall not be affected by the Executive’s incapacity due to physical or mental illness. The Executive’s continued employment shall not constitute consent to, or a waiver of rights with respect to, any circumstance constituting Good Reason herein.

1.13 “Protected Period” means, with respect to a Change in Control, the period commencing the date that is six (6) months prior to the date of such Change in Control and ending on the date that is twenty four (24) months following such Change in Control.

1.14 “Qualifying Termination” has the meaning ascribed to such term in Section 2.2 herein.

1.15 “Separation from Service” means the Executive’s separation from service as determined in accordance with Code Section 409A and the applicable standards of the Treasury Regulations issued thereunder.

1.16 “Separation Benefits” means the payments and/or benefits provided in Section 2.3 herein.

Article 2. Separation Benefits

2.1 Right to Separation Benefits . The Executive shall be entitled to receive from the Company the Separation Benefits described in Section 2.3 herein if there has been a Change in Control of the Company and if the Executive incurs a Qualifying Termination (as set forth in Section 2.2); provided, however, that the Executive’s entitlement to Separation Benefits (other than under Section 2.3(a)) is conditioned upon (i) the Executive executing and delivering to the Company a general release of claims in the form attached hereto as Exhibit A (“Release”) within twenty-one (21) days (or forty-five (45) days if such longer period is required under applicable law), and (ii) the Executive not revoking such Release.

The Executive shall not be entitled to receive Separation Benefits if his or her employment with the Company terminates (i) at any time before or after the Protected Period corresponding to a Change in Control of the Company (regardless of the reason), or (ii) during the Protected Period but other than in a Qualifying Termination.

2.2 Qualifying Termination . The occurrence of either of the following events within the Protected Period corresponding to a Change in Control of the Company shall constitute a “Qualifying Termination”:

(a) The Company’s involuntary termination of the Executive’s employment without Cause; or

(b) The Executive’s voluntary termination of employment for Good Reason.

For purposes of this Agreement, a Qualifying Termination shall not include a termination of the Executive’s employment with the Company by reason of death, Disability, voluntary normal retirement (as such term is defined under the then established rules of the Company’s tax-qualified retirement plan), the Executive’s voluntary termination of employment for any reason other than that specified in Section 2.2(b) herein, or the Company’s involuntary termination of the Executive’s employment for Cause.

2.3 Description of Separation Benefits . In the event that the Executive becomes entitled to receive Separation Benefits, as provided in Sections 2.1 and 2.2 herein, the Company shall pay to the Executive and provide him or her with total Separation Benefits equal to all of the following:

(a) A lump-sum amount equal to the Executive’s unpaid Base Salary, accrued vacation pay, unreimbursed business expenses, and all other items earned by and owed to the Executive through and including the Effective Date of Termination.

(b) A lump-sum amount equal to the product obtained by multiplying (i) the Executive’s annual incentive pay objective amount, established under the annual bonus plan in which the Executive is then participating for the bonus plan year in which the Effective Date of Termination occurs, by (ii) a fraction, the numerator of which is the number of full completed months in the bonus plan year through the Effective Date of Termination, and the denominator of which is twelve (12). This payment will be in lieu of any other payment to be made to the Executive under the annual bonus plan in which the Executive is then participating for that plan year.

(c) A lump-sum amount equal to three (3) multiplied by the higher of (i) the Executive’s annual rate of Base Salary in effect upon the Effective Date of Termination, or (ii) the Executive’s highest annual rate of Base Salary in effect during the twelve (12) months preceding the date of the Change in Control.

(d) A lump-sum amount equal to the higher of (i) three (3) multiplied by the Executive’s annual incentive pay objective amount established under the annual bonus plan in which the Executive is then participating for the bonus plan year in which the Effective Date of Termination occurs, or (ii) three (3) multiplied by the actual annual bonus payment made to the Executive under the annual bonus plan in which the Executive participated in the year preceding the year in which the Effective Date of Termination occurs.

(e) Except as provided below in this Section 2.3(e), all long-term incentive awards granted by the Company to the Executive prior to the Qualifying Termination, to the extent such awards are outstanding and otherwise unvested immediately prior to the Qualifying Termination, shall vest upon (or, as may be necessary to give effect to the acceleration, immediately prior to) the Qualifying Termination; provided that any long-term incentive award which includes performance-based (in addition to time-based) vesting requirements may include specific provisions regarding a termination of employment in connection with a Change in Control or similar event and, in such event, such specific provisions applicable to the award shall control. Stock options or stock appreciation rights that become vested in accordance with this Section 2.3(e), may be exercised after the Qualifying Termination only within the time frame specified in the applicable long-term incentive plan or award agreement. For purposes of clarity, this Section 2.3(e) does not limit the Executive’s right (pursuant to the applicable long-term incentive plan or pursuant to the terms and conditions applicable to the specific award) to any

accelerated vesting upon or in connection with a Change in Control or similar event. To the extent a termination of the Executive’s employment constitutes a Qualifying Termination but it occurs prior to a Change in Control, the Executive’s long-term incentive awards that would otherwise terminate and be forfeited in connection with such termination of employment shall:

(i) except as provided in clause (iii), remain outstanding and unvested for a period of six (6) months following such termination of employment and shall vest upon a Change in Control should a Change in Control occur during such six-month period of time in the same manner, and to the same extent, so as to provide the Executive with the same payment or benefit as the Executive would have received had the Executive been subject to a Qualifying Termination upon or following a Change in Control;

(ii) terminate and be forfeited at the end of such six-month period should no Change in Control occur during such six-month period; and

(iii) if such long-term incentive award is a stock option or stock appreciation right, it shall remain subject to its existing termination date at the end of the maximum stated term of the award and, should a Change in Control occur during the period referred to in clause (i) and within the maximum term of the stock option or stock appreciation right, the Executive may exercise any portion of the stock option or stock appreciation right that would be vested upon the Change in Control only within the time frame specified in the applicable long-term incentive plan or award as if the date of the Change in Control was the Effective Date of Termination. For purposes of clarity, this Section 2.3(e)(iii) is to ensure the Executive will receive the same benefit the Executive would have received for any outstanding stock options or stock appreciation rights had the Executive been subject to a Qualifying Termination upon or following a Change in Control.

(f) Executive shall be entitled to continue to participate in the Company’s medical and dental insurance programs (subject in each case to the eligibility and other provisions of such programs), including coverage for any of Executive’s dependents enrolled in the Company’s medical and dental insurance programs as of the Effective Date of Termination, at the same or substantially similar coverage level as in effect as of the Effective Date of Termination, for a period of thirty-six (36) months following the Effective Date of Termination and at substantially the same economic cost to the Executive as of the Effective Date of Termination. To the extent that any payments or reimbursements pursuant to this Section 2.3(f) are taxable to the Executive, any such payment or reimbursement shall be subject to Section 9.9 of this Agreement.

(g) The Executive shall be entitled, at the expense of the Company, to receive outplacement services the scope of which shall be reasonable and consistent with the industry practice for similarly situated executives; provided, that the Company’s total obligation pursuant to this Section 2.3(g) shall not exceed fifty thousand dollars ($50,000) in the aggregate. The Company’s obligation to pay for outplacement services pursuant to this Section 2.3(g) shall cease by no later than the end of the second taxable year following the year in which the Effective Date of Termination occurs.

2.4 Termination due to Disability . If the Executive’s employment is terminated with the Company due to Disability, the Company shall pay the Executive his or her unpaid Base Salary, accrued vacation, and other items earned by and owed to the Executive through the Effective Date of Termination, plus all other amounts to which the Executive is entitled under any compensation plans of the Company at the time such payments are due, and the Company shall have no further obligations to the Executive under this Agreement.

2.5 Termination due to Retirement or Death . If the Executive’s employment with the Company is terminated by reason of his or her voluntary normal retirement (as defined under the then established rules of the Company’s tax-qualified retirement plan), or death, the Company shall pay the Executive his or her unpaid Base Salary, accrued vacation, and other items earned by and owed to the Executive through the Effective Date of Termination, plus all other amounts to which the Executive is entitled under any compensation plans of the Company at the time such payments are due, and the Company shall have no further obligations to the Executive under this Agreement.

2.6 Termination for Cause or by the Executive Other Than for Good Reason . If the Executive’s employment is terminated either: (i) by the Company for Cause; or (ii) voluntarily by the Executive for a reason other than that specified in Section 2.2(b) herein, the Company shall pay the Executive his or her unpaid Base Salary, accrued vacation, and other items earned by and owed to the Executive through the Effective Date of Termination, plus all other amounts to which the Executive is entitled under any compensation plans of the Company at the time such payments are due, and the Company shall have no further obligations to the Executive under this Agreement.

2.7 Notice of Termination . Any termination of the Executive’s employment by the Company for Cause or by the Executive for Good Reason shall be communicated by Notice of Termination to the other party. For purposes of this Agreement, a “Notice of Termination” shall mean a written notice which shall indicate the specific termination provision in this Agreement relied upon, and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated.

Article 3. Form and Timing of Separation Benefits

3.1 Form and Timing of Separation Benefits . The Separation Benefit described in Section 2.3(a) herein shall be paid in cash to the Executive in a single lump sum as soon as practicable following the Effective Date of Termination, but in no event beyond ten (10) calendar days from such date. Subject to Sections 2.1 and 9.9(b), the Separation Benefits described in Sections 2.3(b), 2.3(c) and 2.3(d) herein shall be paid in cash to the Executive in a single lump sum on the sixtieth (60th) day following the later to occur of (1) the Separation from Service by reason of the Qualifying Termination and (2) the related Change in Control. To the extent the payment of any such Separation Benefits to which the Executive becomes entitled under this Agreement as a result of an actual termination following a Change in Control is deferred beyond the Executive’s Separation from Service (including by reason of Section 9.9(b)), the Executive shall be entitled to interest on those amounts, for the period the payment of such amounts is so deferred, with such interest to accrue at the prime rate published by the Wall Street Journal as in effect on the date of the Executive’s Separation from Service and to be paid in a lump sum upon payment of such Separation Benefits.

3.2 Withholding of Taxes . The Company shall withhold from any amounts payable under this Agreement all federal, state, city, or other taxes as legally shall be required.

Article 4. Benefit Limit

4.1 Benefit Limit . In the event that any payments or benefits to which the Executive becomes entitled in accordance with the provisions of this Agreement (or any other agreement with the Company) would otherwise constitute a parachute payment under Code Section 280G(b)(2), then such payments and/or benefits will be subject to reduction to the extent necessary to assure that the Executive receives only the greater of (i) the amount of those payments which would not constitute such a parachute payment or (ii) the amount which yields the Executive the greatest after-tax amount of benefits after taking into account any excise tax imposed under Code Section 4999 on the payments and benefits provided the Executive under this Agreement (or on any other payments or benefits to which the Executive may become entitled in connection with any change in control or ownership of the Company or the subsequent termination of his or her employment with the Company).

4.2 Order of Reduction . Should a reduction in benefits be required to satisfy the benefit limit of Section 4.1, then the portion of any parachute payment otherwise payable in cash to the Executive shall be reduced to the extent necessary to comply with such benefit limit. Should such benefit limit still be exceeded following such reduction, then the number of shares which would otherwise vest on an accelerated basis under each of the Executive’s options or other equity awards (based on the amount of the parachute payment attributable to each such option or equity award under Code Section 280G) shall be reduced to the extent necessary to eliminate such excess, with such reduction to be made in the same chronological order in which those awards were made. If additional reductions are necessary, the benefits under Section 2.3(g) shall be reduced to the extent necessary to satisfy the benefit limit of Section 4.1.

4.3 Resolution Procedures . In the event there is any disagreement between the Executive and the Company as to whether one or more payments or benefits to which the Executive becomes entitled constitute a parachute payment under Code Section 280G or as to the determination of the present value thereof, such dispute will be resolved as follows:

(a) In the event the Treasury Regulations under Code Section 280G (or applicable judicial decisions) specifically address the status of any such payment or benefit or the method of valuation therefor, the characterization afforded to such payment or benefit by the Regulations (or such decisions) will, together with the applicable valuation methodology, be controlling.

(b) In the event Treasury Regulations (or applicable judicial decisions) do not address the status of any payment in dispute, the matter will be submitted for resolution to independent auditors selected and paid for by the Company. The resolution reached by the independent auditors will be final and controlling; provided, however, that if in the judgment of the independent auditors, the status of the payment in dispute can be resolved through the obtainment of a private letter ruling from the Internal Revenue Service, a formal and proper request for such ruling will be prepared and submitted by the independent auditors, and the determination made by the Internal Revenue Service in the issued ruling will be controlling. All expenses incurred in connection with the preparation and submission of the ruling request shall be paid by the Company.

(c) In the event Treasury Regulations (or applicable judicial decisions) do not address the appropriate valuation methodology for any payment in dispute, the present value thereof will, at the independent auditor’s election, be determined through an independent third-party appraisal, and the expenses incurred in obtaining such appraisal shall be paid by the Company.

Article 5. The Company’s Payment Obligation

5.1 Payment Obligations Absolute . The Company’s obligation to make the payments and the arrangements provided for herein shall be absolute and unconditional, and shall not be affected by any circumstances including, without limitation, any offset, counterclaim, recoupment, defense, or other right which the Company may have against the Executive or anyone else. All amounts payable by the Company hereunder shall be paid without notice or demand. Each and every payment made hereunder by the Company shall be final, and the Company shall not seek to recover all or any part of such payment from the Executive or from whomsoever may be entitled thereto, for any reasons whatsoever.

The Executive shall not be obligated to seek other employment in mitigation of the amounts payable or arrangements made under any provision of this Agreement, and the obtaining of any such other employment shall in no event effect any reduction of the Company’s obligations to make the payments and arrangements required to be made under this Agreement.

5.2 Contractual Rights to Benefits . This Agreement establishes and vests in the Executive a contractual right to the benefits to which he or she is entitled hereunder. However, nothing herein contained shall require or be deemed to require, or prohibit or be deemed to prohibit, the Company to segregate, earmark, or otherwise set aside any funds or other assets, in trust or otherwise, to provide for any payments to be made or required hereunder.

Article 6. Term of Agreement

The current term of this Agreement extends through December 31, 2013 and shall be extended automatically for successive one (1) year extended terms, unless the Company notifies the Executive in writing at least one hundred eighty (180) days prior to the expiration of the current term or any extended term that the Company elects not to extend the term. If proper notice of the Company’s election not to extend the term of this Agreement under this Article 6 is provided, the then-current term of this Agreement will not be further extended, and this Agreement will terminate at the end of the then-current term.

Notwithstanding any other provision of this Agreement to the contrary, in the event a Change in Control occurs during the original term or any extended term of this Agreement, the term of this Agreement shall remain in effect for twenty four (24) months after the month in which such Change in Control occurred. In addition, should a Qualifying Termination occur during the term of this Agreement, this Agreement shall continue in effect until all of Executive’s rights in respect of such termination have been satisfied.

Article 7. Legal Remedies

7.1 Dispute Resolution . The Executive shall have the right and option to elect to have any good faith dispute or controversy arising under or in connection with this Agreement settled by litigation or arbitration. If arbitration is selected, such proceeding shall be conducted by final and binding arbitration before a panel of three (3) arbitrators in accordance with the rules and under the administration of the American Arbitration Association.

7.2 Payment of Legal Fees . In the event that it shall be necessary or desirable for the Executive to retain legal counsel and/or to incur other costs and expenses in connection with the enforcement of any or all of his or her rights under this Agreement, the Company shall pay (or the Executive shall be entitled to recover from the Company) the Executive’s attorneys’ fees, costs, and expenses in connection with a good faith enforcement of his or her rights including the enforcement of any arbitration award, and any such payment shall be made to the Executive as soon as administratively practicable following the time at which the related expense was incurred. This shall include, without limitation, court costs and attorneys’ fees incurred by the Executive as a result of any good faith claim, action, or proceeding, including any such action against the Company arising out of, or challenging the validity or enforceability of this Agreement or any provision hereof. To the extent that any payments or reimbursements pursuant to this Section 7.2 are taxable to the Executive, any such payment or reimbursement shall be subject to 9.9 of this Agreement.

Article 8. Successors

The Company shall require any successor (whether direct or indirect, by purchase, merger, reorganization, consolidation, acquisition of property or stock, liquidation, or otherwise) of all or substantially all of the assets of the Company by agreement to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place. Regardless of whether such agreement is executed, this Agreement shall be binding upon any successor in accordance with the operation of law and such successor shall be deemed the “Company” for purposes of this Agreement.

Article 9.Miscellaneous

9.1 Employment Status . This Agreement is not, and nothing herein shall be deemed to create, an employment contract between the Executive and the Company or any of its subsidiaries. Subject to the terms of any employment contract between the Executive and the Company, the Executive acknowledges that the rights of the Company remain wholly intact to change or reduce at any time and from time to time his or her compensation, title, responsibilities, location, and all other aspects of the employment relationship, or to discharge him or her prior to a Change in Control (subject to such discharge possibly being considered a Qualifying Termination pursuant to Section 2.2).

9.2 Entire Agreement . This Agreement contains the entire understanding of the Company and the Executive with respect to the subject matter hereof and supersedes all prior oral and written agreements between the parties hereto with respect to the subject matter hereof, including but not limited to, the Prior Agreement, which is terminated and no longer in effect. In addition, if the Executive is entitled to Separation Benefits under this Agreement, payment of any such benefits shall be in lieu of any severance payments payable under that certain Amended and Restated Employment Agreement entered into between the Company and the Executive, dated as of March 30, 2009 (the “Employment Agreement”). Notwithstanding any other provision to the contrary in the Employment Agreement or this Agreement, to the extent the Executive becomes entitled to the “Severance Payments” (as defined in the Employment Agreement) under Sections 4.3(c) and 4.3(e) of the Employment Agreement (such Severance Payments, the “Employment Agreement Severance Payments”), then the Employment Agreement Severance Payments shall be paid on the sixtieth (60th) day following the Executive’s Separation from Service (subject to the applicable release requirements set forth in the Employment Agreement). In the event the Executive becomes entitled to the Separation Benefits under this Agreement following the time at which the Executive became entitled to the Employment Agreement Severance Payments and there remains a benefit to be paid (or to become payable) under the Employment Agreement at such time, the Executive’s rights to the Employment Agreement Severance Payments as well as the severance payment contemplated by Section 4.3(b) of the Employment Agreement shall immediately terminate at such time, and the terms of this Agreement shall thereafter control. To the extent the Executive becomes entitled to the Separation Benefits under Sections 2.3(b), (c) and (d) under this Agreement, the aggregate amount of such Separation Benefits shall be reduced, on a dollar-for-dollar basis, by the aggregate amount of the Employment Agreement Severance Payments, as well as any severance payment contemplated by Section 4.3(b) of the Employment Agreement, previously paid to the Executive.

Notwithstanding anything in this Section 9.2 to the contrary, and for purposes of clarity, the Company’s and the Executive’s rights under that certain Indemnification Agreement previously entered into between the Company and the Executive, dated as of March 1, 2012, is specifically not integrated into this Agreement and shall continue in effect.

9.3 Notices . All notices, requests, demands, and other communications hereunder shall be sufficient if in writing and shall be deemed to have been duly given if delivered by hand or if sent by registered or certified mail to the Executive at the last address he or she has filed in writing with the Company or, in the case of the Company, at its principal offices to the attention of the General Counsel.

9.4 Execution in Counterparts . This Agreement may be executed by the parties hereto in counterparts, each of which shall be deemed to be an original, but all such counterparts shall constitute one and the same instrument, and all signatures need not appear on any one counterpart.

9.5 Conflicting Agreements . The Executive hereby represents and warrants to the Company that his or her entering into this Agreement, and the obligations and duties undertaken by him or her hereunder, will not conflict with, constitute a breach of, or otherwise violate the terms of, any other employment or other agreement to which he or she is a party, except to the extent any such conflict, breach, or violation under any such agreement has been disclosed to the Board in writing in advance of the signing of this Agreement.

9.6 Severability . In the event any provision of this Agreement shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of this Agreement, and this Agreement shall be construed and enforced as if the illegal or invalid provision had not been included. Further, the captions of this Agreement are not part of the provisions hereof and shall have no force and effect.

Notwithstanding any other provisions of this Agreement to the contrary, the Company shall have no obligation to make any payment to the Executive hereunder to the extent, but only to the extent, that such payment is prohibited by the terms of any final order of a Federal or state court or regulatory agency of competent jurisdiction; provided, however, that such an order shall not affect, impair, or invalidate any provision of this Agreement not expressly subject to such order.

9.7 Modification . No provision of this Agreement may be modified, waived, or discharged unless such modification, waiver, or discharge is agreed to in writing and signed by the Executive and by the Company, as applicable, or by the respective parties’ legal representatives or successors.

9.8 Applicable Law . To the extent not preempted by the laws of the United States, the laws of California shall be the controlling law in all matters relating to this Agreement without giving effect to principles of conflicts of laws.

9.9 Compliance with Code Section 409A .

(a) It is intended that any amounts payable under this Agreement shall either be exempt from or comply with Code Section 409A (including the Treasury regulations and other published guidance relating thereto) (“Code Section 409A”) so as not to subject the Executive to payment of any additional tax, penalty or interest imposed under Code Section 409A. The provisions of this Agreement shall be construed and interpreted to avoid the imputation of any such additional tax, penalty or interest under Code Section 409A yet preserve (to the nearest extent reasonably possible) the intended benefit payable to the Executive.

(b) If the Executive is a “specified employee” within the meaning of Treasury Regulation Section 1.409A-1(i) as of the date of the Executive’s Separation from Service, the Executive shall not be entitled to the Separation Benefits described in Sections 2.3(b), 2.3(c) and 2.3(d) until the earlier of (i) the date which is six (6) months after his or her Separation from Service for any reason other than death, or (ii) the date of the Executive’s death. The provisions of this Section 9.9(b) shall only apply if, and to the extent, required to avoid the imputation of any tax, penalty or interest pursuant to Code Section 409A. Any amounts otherwise payable to the Executive upon or in the six (6) month period following the Executive’s Separation from Service that are not so paid by reason of this Section 9.9(b) shall be paid as soon as practicable (and in all events within thirty (30) days) after the date that is six (6) months after the Executive’s Separation from Service (or, if earlier, as soon as practicable, and in all events within thirty (30) days, after the date of the Executive’s death).

(c) To the extent that any payments or reimbursements pursuant to Sections 2.3(f) and 7.2 of this Agreement are taxable to the Executive, any payment or reimbursement shall be paid to the Executive on or before the last day of the Executive’s taxable year following the taxable year in which the related expense was incurred. Any such benefits or reimbursements are not subject to liquidation or exchange for another benefit and the amount of such benefits and reimbursements that the Executive receives in one taxable year shall not affect the amount of such benefits and reimbursements that the Executive receives in any other taxable year.

9.10 Legal Counsel . Each party recognizes that this is a legally binding contract and acknowledges and agrees that they have had the opportunity to consult with legal counsel of their choice. Hence, in any construction to be made of this Agreement, the same shall not be construed against either party on the basis of that party being the drafter of such language.

[Remainder of page intentionally left blank]

IN WITNESS WHEREOF , the parties have executed this Agreement as of the Effective Date.

“ COMPANY ”		“ EXECUTIVE ”

Edwards Lifesciences Corporation


By:	/s/ Denise E. Botticelli	/s/ Michael A. Mussallem
Name:	Denise E. Botticelli	Michael A. Mussallem
Title:	Vice President, Associate	Chief Executive Officer
	General Counsel and Secretary

EXHIBIT A

FORM OF GENERAL RELEASE AGREEMENT

[ ] (“ Executive ”) provides this General Release Agreement (this “ Agreement ”) to Edwards Lifesciences Corporation (the “ Company ”) pursuant to Section 2.1 of the Amended and Restated Chief Executive Officer Change-in-Control Severance Agreement, by and between Executive and the Company, dated [ ] (the “ C-I-C Agreement ”), in exchange for those certain separation benefits provided for in the C-I-C Agreement.

1. Release by Executive . Executive, on Executive’s own behalf and on behalf of Executive’s descendants, dependents, heirs, executors, administrators, assigns and successors, and each of them, hereby acknowledges full and complete satisfaction of and releases and discharges and covenants not to sue the Company, its divisions, subsidiaries, parents, or affiliated corporations, past and present, and each of them, as well as its and their assignees, successors, directors, officers, stockholders, partners, representatives, attorneys, agents or employees, past or present, or any of them (individually and collectively, “ Releasees ”), from and with respect to any and all claims, agreements, obligations, demands and causes of action, known or unknown, suspected or unsuspected, arising out of or in any way connected with Executive’s employment or any other relationship with or interest in the Company or the termination thereof, including without limiting the generality of the foregoing, any claim for severance pay, profit sharing, bonus or similar benefit, pension, retirement, life insurance, health or medical insurance or any other fringe benefit, or disability, or any other claims, agreements, obligations, demands and causes of action, known or unknown, suspected or unsuspected resulting from any act or omission by or on the part of Releasees committed or omitted prior to the date of this Agreement set forth below, including, without limiting the generality of the foregoing, any claim under Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, the Family and Medical Leave Act, the California Fair Employment and Housing Act, California Labor Code Section 132a, the California Family Rights Act, or any other federal, state or local law, regulation, ordinance constitution or common law (collectively, the “ Claims ”); provided, however, that the foregoing release does not apply to any obligation of the Company to Executive pursuant to any of the following: (1) Article 2 of the C-I-C Agreement; (2) any equity-based awards previously granted by the Company to Executive, to the extent that such awards continue after the termination of Executive’s employment with the Company in accordance with the applicable terms of such awards; (3) any right to indemnification that Executive may have pursuant to the Company’s bylaws, its corporate charter or under any written indemnification agreement with the Company (or any corresponding provision of any subsidiary or affiliate of the Company) with respect to any loss, damages or expenses (including but not limited to attorneys’ fees to the extent otherwise provided) that Executive may in the future incur with respect to Executive’s service as an employee, officer or director of the Company or any of its subsidiaries or affiliates; (4) with respect to any rights that Executive may have to insurance coverage for such losses, damages or expenses under any Company (or subsidiary or affiliate) directors and officers liability insurance policy; (5) any rights to continued medical and dental coverage that Executive may have under COBRA; (6) any rights to payment of vested benefits that Executive may have under any other benefit plan sponsored or maintained by the Company. In addition, this Agreement does not cover any Claim that cannot be so released as a matter of applicable law. Executive acknowledges and agrees that Executive has received any and all leave and other benefits that Executive has been and is entitled to pursuant to the Family and Medical Leave Act of 1993.

2. Acknowledgement of Payment of Wages . Except for accrued vacation (which the parties agree totals approximately [ ] days of pay) and salary for the current pay period, Executive acknowledges that Executive has received all amounts owed for Executive’s regular and usual salary (including, but not limited to, any bonus, severance, or other wages), and usual benefits through the date of this Agreement.

3. Waiver of Civil Code Section 1542. This Agreement is intended to be effective as a general release of and bar to each and every Claim hereinabove specified. Accordingly, Executive hereby expressly waives any rights and benefits conferred by Section 1542 of the California Civil Code and any similar provision of any other applicable state law as to the Claims. Section 1542 of the California Civil Code provides:

“A GENERAL RELEASE DOES NOT EXTEND TO A CLAIM WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.”

Executive acknowledges that Executive may later discover claims, demands, causes of action or facts in addition to or different from those which Executive now knows or believes to exist with respect to the subject matter of this Agreement and which, if known or suspected at the time of executing this Agreement, may have materially affected its terms. Nevertheless, Executive hereby waives, as to the Claims, any claims, demands, and causes of action that might arise as a result of such different or additional claims, demands, causes of action or facts.

4. ADEA Waiver . Executive expressly acknowledges and agrees that by entering into this Agreement, Executive is waiving any and all rights or claims that Executive may have arising under the Age Discrimination in Employment Act of 1967, as amended (“ ADEA ”), which have arisen on or before the date of execution of this Agreement. Executive further expressly acknowledges and agrees that:

Executive is hereby advised in writing by this Agreement to consult with an attorney before signing this Agreement;

Executive was given a copy of this Agreement on [ ] and informed that Executive had [twenty-one (21)/forty-five (45)] days within which to consider this Agreement and that if Executive wished to execute this Agreement prior to expiration of such [21/45]-day period, Executive agrees that he or she voluntarily chose to do so.

Nothing in this Agreement prevents or precludes Executive from challenging or seeking a determination in good faith of the validity of this waiver under the ADEA, nor does it impose any condition precedent, penalties or costs from doing so, unless specifically authorized by federal law; and

Executive was informed that Executive has seven (7) days following the date of execution of this Agreement in which to revoke this Agreement, and this Agreement will become null and void if Executive elects revocation during that time. Any revocation must be in writing and must be received by the General Counsel of the Company during the seven-day revocation period. In the event that Executive exercises Executive’s right of revocation, neither the Company nor Executive will have any obligations under this Agreement.

5. No Transferred Claims . Executive represents and warrants to the Company that Executive has not heretofore assigned or transferred to any person not a party to this Agreement any released matter or any part or portion thereof.

6. Miscellaneous . The following provisions shall apply for purposes of this Agreement:

(a) Number and Gender . Where the context requires, the singular shall include the plural, the plural shall include the singular, and any gender shall include all other genders.

(b) Section Headings . The section headings of, and titles of paragraphs and subparagraphs contained in, this Agreement are for the purpose of convenience only, and they neither form a part of this Agreement nor are they to be used in the construction or interpretation thereof.

(c) Governing Law . This Agreement, and all questions relating to its validity, interpretation, performance and enforcement, as well as the legal relations hereby created between the parties hereto, shall be governed by and construed under, and interpreted and enforced in accordance with, the laws of the State of California, notwithstanding any California or other conflict of law provision to the contrary.

(d) Severability . If any provision of this Agreement or the application thereof is held invalid, the invalidity shall not affect other provisions or applications of this Agreement which can be given effect without the invalid provisions or applications and to this end the provisions of this Agreement are declared to be severable.

(e) Modifications . This Agreement may not be amended, modified or changed (in whole or in part), except by a formal, definitive written agreement expressly referring to this Agreement, which agreement is executed by both of the parties hereto.

(f) Waiver . No waiver of any breach of any term or provision of this Agreement shall be construed to be, nor shall be, a waiver of any other breach of this Agreement. No waiver shall be binding unless in writing and signed by the party waiving the breach.

(g) Arbitration . Any controversy arising out of or relating to this Agreement shall be submitted to arbitration in accordance with the arbitration provisions of the C-I-C Agreement.

(h) Counterparts . This Agreement may be executed in counterparts, and each counterpart, when executed, shall have the efficacy of a signed original. Photographic copies of such signed counterparts may be used in lieu of the originals for any purpose.

[Remainder of page intentionally left blank]

The undersigned have read and understand the consequences of this Agreement and voluntarily sign it. The undersigned declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct.

EXECUTED this day of 20 , at County, .

	“EXECUTIVE”


	[Name]

EXECUTED this day of 20 , at County, .

	“COMPANY”

	[ ]

	By:
		[Name]
		[Title]

Exhibit 10.2

Form of
[Amended and Restated]

Change-in-Control Severance Agreement

Dated [ ]

by and between

EDWARDS LIFESCIENCES CORPORATION

and

[ ]

Contents

Article 1.	Definitions	2

Article 2.	Separation Benefits	6

Article 3.	Form and Timing of Separation Benefits	9

Article 4.	Benefit Limit	10

Article 5.	The Company’s Payment Obligation	11

Article 6.	Term of Agreement	11

Article 7.	Legal Remedies	12

Article 8.	Successors	12

Article 9.	Miscellaneous	13

[Amended and Restated]
Change-in-Control Severance Agreement
Edwards Lifesciences Corporation

THIS [AMENDED AND RESTATED] CHANGE-IN-CONTROL SEVERANCE AGREEMENT (this “Agreement”) is made, entered into, and is effective as of [ ] (hereinafter referred to as the “Effective Date”), by and between EDWARDS LIFESCIENCES CORPORATION, a Delaware corporation (the “Company”), and [ ] (the “Executive”).

WHEREAS, the Executive is currently employed by the Company in a key management capacity; and

WHEREAS, the Executive possesses considerable experience and knowledge of the business and affairs of the Company concerning its policies, methods, personnel, and operations; and

WHEREAS, the Company is desirous of assuring insofar as possible, that it will continue to have the benefit of the Executive’s services; and the Executive is desirous of having such assurances; and

[ WHEREAS, the Executive and the Company are currently parties to that certain [Amended and Restated] Change-in-Control Severance Agreement, dated [ ], as amended on [ ] (the “Prior Agreement”); and ]

[ WHEREAS, by executing this Agreement, the Executive and the Company hereby agree that this Agreement shall supersede the severance benefits set forth in the Prior Agreement ] .

Article 1. Definitions

Wherever used in this Agreement, the following terms shall have the meanings set forth below and, when the meaning is intended, the initial letter of the word is capitalized:

1.1 “Agreement” means this [Amended and Restated] Change-in-Control Severance Agreement.

1.3 “ Board ” means the Board of Directors of the Company.

(a) A continuing material breach by the Executive of the duties and responsibilities of the Executive, which duties shall not differ in any material respect from the duties and responsibilities during the 90-day period immediately prior to a Change in Control (other than as a result of incapacity due to a physical or mental condition or illness), which breach is demonstrably willful and deliberate on the Executive’s part, is committed in bad faith and without a reasonable belief that such a breach is in the best interests of the Company, and (x) the Board delivers to Executive a written demand for substantial performance that specifically identifies the manner in which the Board believes the Executive has breached such duties and responsibilities, (y) the Executive fails to remedy such breach within sixty (60) days after receipt of such written demand, and (z) the Board delivers the Notice of Termination pursuant to Section 2.7 herein within thirty (30) days after the expiration of such sixty (60) day cure period; or

(b) The Executive has engaged in conduct that is willfully, demonstrably and materially injurious to the Company, monetarily or otherwise and, if cure is reasonably possible in the circumstances, (x) the Board delivers to Executive a written demand for substantial performance that specifically identifies the manner in which the Board believes the Executive has breached such duties and responsibilities, (y) the Executive fails to remedy such breach within sixty (60) days after receipt of such written demand, and (z) the Board delivers the Notice of Termination pursuant to Section 2.7 herein within thirty (30) days after the expiration of such sixty (60) day cure period; or

1.5 “Code Section 409A” has the meaning ascribed to such term in Section 9.9 herein.

(c) The consummation of a merger or consolidation of the Company with any other entity, other than: (i) a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than sixty percent (60%) of the combined voting power of the voting securities of the Company or such

surviving entity outstanding immediately after such merger or consolidation; or (ii) a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no Person acquires more than thirty percent (30%) of the combined voting power of the Company’s then outstanding securities; or

1.7 “Code” means the Internal Revenue Code of 1986, as amended.

1.8 “Company” means Edwards Lifesciences Corporation, a Delaware corporation (including any and all subsidiaries), or any successor thereto as provided in Article 8 herein.

1.9 “Disability” shall have the meaning ascribed to such term in the Executive’s governing long-term disability plan as of the Effective Date.

1.10 “Effective Date” means the date specified in the opening sentence of this Agreement.

1.11 “Effective Date of Termination” means the date on which a Qualifying Termination occurs, as provided in Section 2.2 herein.

1.12 “Good Reason” means, without the Executive’s express written consent, the occurrence of any one or more of the following conditions during the Protected Period:

(a) The assignment of the Executive to duties materially inconsistent with the Executive’s authorities, duties, responsibilities, and status (including offices, titles, and reporting requirements) as an executive and/or officer of the Company, or a material reduction or alteration in the nature or status of the Executive’s authorities, duties, or responsibilities, other than an insubstantial or inadvertent act that is remedied by the Company promptly after receipt of notice thereof given by the Executive;

(b) The Company’s requiring the Executive to be based at a location in excess of fifty (50) miles from the location of the Executive’s principal job location or office immediately prior to such change, except for required travel on the Company’s business to an extent substantially consistent with the Executive’s then present business travel obligations;

(c) A reduction by the Company of the Executive’s Base Salary in effect on the Effective Date hereof, or as the same shall be increased from time to time;

(d) The failure of the Company to continue in effect any of the Company’s short- and long-term incentive compensation plans, or employee benefit or retirement plans, policies, practices, or other compensation arrangements in which the Executive participates, unless the Executive is permitted to participate in other plans that provide the Executive with substantially comparable benefits; or the failure by the Company to continue the Executive’s participation therein on substantially the same basis, both in terms of the amount of benefits provided and the level of the Executive’s participation relative to other participants;

(e) The failure of the Company to obtain a satisfactory agreement from any successor to the Company to assume and agree to perform the Company’s obligations under this Agreement, as contemplated in Article 8 herein; or

(f) The Company, or any successor company, commits a material breach of any of the material provisions of this Agreement;

1.14 “Qualifying Termination” has the meaning ascribed to such term in Section 2.2 herein.

1.16 “Separation Benefits” means the payments and/or benefits provided in Section 2.3 herein.

Article 2. Separation Benefits

(a) The Company’s involuntary termination of the Executive’s employment without Cause; or

(b) The Executive’s voluntary termination of employment for Good Reason.

the numerator of which is the number of full completed months in the bonus plan year through the Effective Date of Termination, and the denominator of which is twelve (12). This payment will be in lieu of any other payment to be made to the Executive under the annual bonus plan in which the Executive is then participating for that plan year.

(c) A lump-sum amount equal to [ ] multiplied by the higher of (i) the Executive’s annual rate of Base Salary in effect upon the Effective Date of Termination, or (ii) the Executive’s highest annual rate of Base Salary in effect during the twelve (12) months preceding the date of the Change in Control.

(d) A lump-sum amount equal to the higher of (i) [ ] multiplied by the Executive’s annual incentive pay objective amount established under the annual bonus plan in which the Executive is then participating for the bonus plan year in which the Effective Date of Termination occurs, or (ii) [ ] multiplied by the actual annual bonus payment made to the Executive under the annual bonus plan in which the Executive participated in the year preceding the year in which the Effective Date of Termination occurs.

(ii) terminate and be forfeited at the end of such six-month period should no Change in Control occur during such six-month period; and

Article 3. Form and Timing of Separation Benefits

3.2 Withholding of Taxes . The Company shall withhold from any amounts payable under this Agreement all federal, state, city, or other taxes as legally shall be required.

Article 4. Benefit Limit

provided, however, that if in the judgment of the independent auditors, the status of the payment in dispute can be resolved through the obtainment of a private letter ruling from the Internal Revenue Service, a formal and proper request for such ruling will be prepared and submitted by the independent auditors, and the determination made by the Internal Revenue Service in the issued ruling will be controlling. All expenses incurred in connection with the preparation and submission of the ruling request shall be paid by the Company.

Article 5. The Company’s Payment Obligation

Article 6. Term of Agreement

The current term of this Agreement extends through [ ] and shall be extended automatically for successive one (1) year extended terms, unless the Company notifies the Executive in writing at least one hundred eighty (180) days prior to the expiration of the current term or any extended term that the Company elects not to extend the term. If proper notice of the Company’s election not to extend the term of this Agreement under this Article 6 is provided, the then-current term of this Agreement will not be further extended, and this Agreement will terminate at the end of the then-current term.

Article 7. Legal Remedies

Article 8. Successors

Article 9. Miscellaneous

Notwithstanding anything in this Section 9.2 to the contrary, and for purposes of clarity, (1) the Company’s rights under its standard form of employment agreement, which generally contains the Company’s rights with respect to any trade secrets, confidentiality, inventions and arbitration, and any similar agreements or policies, previously entered into between the Company and the Executive, and (2) the Company’s and the Executive’s rights under that certain Indemnification Agreement previously entered into between the Company and the Executive, dated as of [ ], are specifically not integrated into this Agreement and shall continue in effect.

Notwithstanding any other provisions of this Agreement or in the Company’s Severance Pay Plan, as the same may be amended from time to time (the “Severance Plan”), to the contrary, in the event that the Executive is entitled to benefits under the Severance Plan and also has a Qualifying Termination for purposes of this Agreement, the Executive shall be entitled to the benefits under this Agreement only and any installment payments to the Executive under the Severance Plan shall immediately cease and terminate; provided, that in no event shall the Executive’s benefits under this Agreement be subject to offset or reduction for, or otherwise abrogate the Executive’s right to, any benefits received by the Executive under the Severance Plan prior to the time the Executive has a Qualifying Termination for purposes of this Plan. To such extent, this provision of this Section 9.2 constitutes an amendment of the Severance Plan as to the Executive.

9.9 Compliance with Code Section 409A .

this Section 9.9(b) shall only apply if, and to the extent, required to avoid the imputation of any tax, penalty or interest pursuant to Code Section 409A. Any amounts otherwise payable to the Executive upon or in the six (6) month period following the Executive’s Separation from Service that are not so paid by reason of this Section 9.9(b) shall be paid as soon as practicable (and in all events within thirty (30) days) after the date that is six (6) months after the Executive’s Separation from Service (or, if earlier, as soon as practicable, and in all events within thirty (30) days, after the date of the Executive’s death).

[Remainder of page intentionally left blank]

IN WITNESS WHEREOF , the parties have executed this Agreement as of the Effective Date.

“ COMPANY ”			“ EXECUTIVE ”

Edwards Lifesciences Corporation


By:
Name:			[Name]
Title:			[Title]

EXHIBIT A

FORM OF GENERAL RELEASE AGREEMENT

[ ] (“ Executive ”) provides this General Release Agreement (this “ Agreement ”) to Edwards Lifesciences Corporation (the “ Company ”) pursuant to Section 2.1 of the [Amended and Restated] Change-in-Control Severance Agreement, by and between Executive and the Company, dated [ ] (the “ C-I-C Agreement ”), in exchange for those certain separation benefits provided for in the C-I-C Agreement.

Executive is hereby advised in writing by this Agreement to consult with an attorney before signing this Agreement;

6. Miscellaneous . The following provisions shall apply for purposes of this Agreement:

(a) Number and Gender . Where the context requires, the singular shall include the plural, the plural shall include the singular, and any gender shall include all other genders.

(g) Arbitration . Any controversy arising out of or relating to this Agreement shall be submitted to arbitration in accordance with the arbitration provisions of the C-I-C Agreement.

[Remainder of page intentionally left blank]

EXECUTED this day of 20 , at County, .

	“EXECUTIVE”


	[Name]

EXECUTED this day of 20 , at County, .

	“COMPANY”

	[ ]

	By:
		[Name]
		[Title]

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Exhibit 31.1

EDWARDS LIFESCIENCES CORPORATION
CERTIFICATIONS PURSUANT TO
SECTION 302 OF
THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Michael A. Mussallem, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Edwards Lifesciences Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.


Date: November 7, 2012		By:		/s/ MICHAEL A. MUSSALLEM Michael A. Mussallem Chairman of the Board and Chief Executive Officer

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Exhibit 31.1

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Exhibit 31.2

EDWARDS LIFESCIENCES CORPORATION
CERTIFICATIONS PURSUANT TO
SECTION 302 OF
THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Thomas M. Abate, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Edwards Lifesciences Corporation;

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.


Date: November 7, 2012		By:		/s/ THOMAS M. ABATE Thomas M. Abate Corporate Vice President, Chief Financial Officer (Chief Accounting Officer)

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Exhibit 31.2

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Exhibit 32

EDWARDS LIFESCIENCES CORPORATION
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Edwards Lifesciences Corporation (the "Company") on Form 10-Q for the period ended September 30, 2012 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), we, Michael A. Mussallem, Chairman of the Board and Chief Executive Officer of the Company, and Thomas M. Abate, Corporate Vice President, Chief Financial Officer, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


November 7, 2012				/s/ MICHAEL A. MUSSALLEM Michael A. Mussallem Chairman of the Board and Chief Executive Officer
November 7, 2012				/s/ THOMAS M. ABATE Thomas M. Abate Corporate Vice President, Chief Financial Officer (Chief Accounting Officer)

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Exhibit 32