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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 28, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ____________ TO____________
COMMISSION FILE NO. 1-5353
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TELEFLEX INCORPORATED
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 23-1147939
(STATE OR OTHER JURISDICTION OF (I.R.S.
INCORPORATION OR ORGANIZATION) EMPLOYER
IDENTIFICATION
NO.)
630 WEST GERMANTOWN PIKE, SUITE 450, PLYMOUTH MEETING, 19462
PENNSYLVANIA (ZIP CODE)
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
Registrant's telephone number, including area code: (610) 834-6301
Securities registered pursuant to Section 12(b) of the Act:
Common Stock, par value $1 per share--New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act:
NONE
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days.
YES X NO __
The aggregate market value of the voting stock held by non-affiliates of
the registrant was approximately $1,164,123,532 as of February 1, 1998.
The registrant had 37,129,696 Common Shares outstanding as of February 1,
1998.
Documents Incorporated by Reference: (a) Annual Report to Shareholders for
the fiscal year ended December 28, 1997, incorporated partially in Part I and
Part II hereof; and (b) Proxy Statement for the 1998 Annual Meeting of
Shareholders, incorporated partially in Part III hereof.
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PART I
ITEM 1. BUSINESS
The Company* was incorporated in 1943 as a manufacturer of precision
mechanical push/pull controls for military aircraft. From this original single
market, single product orientation, the Company began to emphasize products and
services in a broader range of economically diverse markets to reduce its
vulnerability to economic cycles. Since the mid-1970s, the Company's investments
have been directed toward specific market niches employing its technical
capabilities to provide solutions to specific engineering problems and, over the
last ten years toward expanding into medical businesses. The continuing stream
of new products and value-added product improvements that have resulted from
this strategy have enabled the Company to participate in larger market segments.
Several of these new products and product improvements were developed by means
of an unusual investment program of the Company called the New Venture Fund.
Established in 1972, the Fund directs monies representing one-half percent of
sales into the development of new products and services. This concept allows for
entrepreneurial risk taking in new areas by encouraging innovation and
competition among the Company's managers for funds to pursue new programs and
activities independent of their operating budgets. Examples of New Venture
projects include the initial funding of SermeTel(R) research and most of the
early seed money for certain medical products.
The Company's business is separated into three segments -- Commercial,
Medical and Aerospace.
COMMERCIAL SEGMENT
The Commercial Segment designs and manufactures proprietary mechanical
controls for the automotive market; mechanical, electrical and hydraulic
controls, and electronic products for the pleasure marine market; and
proprietary products for the fluid transfer and outdoor power equipment markets.
Products in the Commercial Segment generally are less complex and are
produced in higher unit volume than those of the Company's other two segments.
They are manufactured both for general distribution as well as custom fabricated
to meet individual customer needs. Consumer spending patterns generally
influence the market trends for these products.
The Commercial Segment consists of three major product lines: Marine,
Automotive and Industrial.
The Company is a leading domestic producer of mechanical steering systems
for pleasure power boats. It also manufactures hydraulic steering systems,
engine throttle and shift controls, electrical gauges and instrumentation and
electronic location, communication and navigation systems. Techsonic Industries,
Inc., a manufacturer of marine information systems (electronic navigation,
communication and fish location devices) sold through mass merchandisers under
the Humminbird brand name, became a wholly owned subsidiary in 1992. In 1994,
the Company acquired TX Controls, a Swedish manufacturer of mechanical and
hydraulic steering systems, engine control systems and cables for application on
marine craft and industrial vehicles. Aside from the Humminbird products, the
Company's marine products are sold principally to boat builders and in the
aftermarket. These products are used principally on pleasure craft but also have
application on commercial vessels.
The Company is a major supplier of driver control systems to automotive
manufacturers worldwide. The principal products in this market are accelerator,
transmission shift, park lock, window regulator controls, pedal box and gear
shift systems and a heat resistant flexible fuel line. In 1995 the Company
acquired the cable controls businesses of Handy & Harmon Automotive Group. This
acquisition broadened the automotive product line by adding a park brake and
provided a manufacturing plant in Mexico. In 1996 the Company acquired a U.K.
manufacturer of cable control products which establishes the Company's
automotive cable operations in Europe. In May 1997 the Company acquired Comcorp
Technologies, Inc. a supplier of pedal assemblies and other automotive
components and systems. In December 1997 the company acquired United Parts N.V.
a European manufacturer of gear shift systems and other components supplying
most of the
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* As used herein the "Company" refers to Teleflex Incorporated and its
consolidated subsidiaries.
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European auto and truck makers. The Truck Systems Division of United Parts was
sold in February 1998. The remaining Driver Control Division which has five
manufacturing plants throughout Europe, expanded the Company's entrance into the
European automotive market. The acquisitions of both Comcorp and United Parts
are part of the Company's strategy to integrate cable controls with other
automotive components in order to provide systems solutions for customers.
Acceptance by the automobile manufacturers of a Company-developed control for
use on a new model ordinarily assures the Company a large, but not exclusive,
market share for the supply of that control. The sales of mechanical automotive
cable controls were $193,361,000, $217,904,000 and $248,397,000 in 1995, 1996
and 1997, respectively.
Industrial controls and electrical instrumentation products are also
manufactured for use in other applications, including agricultural equipment,
outdoor power equipment, leisure vehicles and other on- and off-road vehicles.
In addition, the Company produces stainless steel overbraided fluoroplastic hose
for fluid transfer in such markets as the chemical, petroleum and food
processing industries.
MEDICAL SEGMENT
The Medical Segment manufactures and distributes a broad range of invasive
disposable and reusable devices for the urology, gastroenterology,
anesthesiology and respiratory care markets worldwide. It also designs and
manufactures a variety of surgical instruments, closure systems and provides
instrument management services. Products in this segment generally are required
to meet exacting standards of performance and have long product life cycles.
External economic influences on sales relate primarily to spending patterns in
the worldwide medical devices and supplies market.
Within the Medical Segment, the Company has two major product lines:
Hospital Supply and Surgical Devices. In addition the Company has extrusion
capabilities which it uses to serve original equipment manufacturers. In the
late 1970s, the Company decided to apply its polymer technologies to the medical
market, and began by extruding intravenous catheter tubing which it sold to
original equipment manufacturers. Through Teleflex OEM, the Company produces
standard and custom-designed semi-finished components for other medical device
manufacturers using its polymer materials and processing technology. Through
acquisitions the Company established the other two product lines of this
segment.
In 1989, the acquisition of Willy Rusch AG and affiliates in Germany
brought with it an established manufacturing base and distribution network,
primarily in Europe. This and other smaller acquisitions designed to broaden the
Company's product offerings form the base of the Hospital Supply product line.
The Hospital Supply product line includes the manufacture and sale of invasive
disposable and reusable devices for the urology, gastroenterology,
anesthesiology and respiratory care markets worldwide. Product offerings
include, among others, latex catheters, endotracheal tubes, laryngoscopes, face
masks, tracheostomy tubes and stents for airway and esophageal management.
The acquisitions of the Pilling Company in 1991 and Edward Weck
Incorporated in 1993 became the foundation of the Surgical Devices product line.
The Pilling and Weck businesses significantly expanded the product offerings,
marketing opportunities and selling capabilities in the surgical devices market
in the United States and provide opportunities for increasing international
sales. During 1994 and 1995, smaller acquisitions were made to balance the
Company's product offerings in Europe. In 1997 the acquisition of a manufacturer
with a complementary line of closure products broadened the Company's product
offerings. The Surgical Devices product line will focus on three distinct
markets: surgical instruments, surgical closure products and instrument
management services. Each market is served by a separate sales force and
management team dedicated to each market. Surgical Devices designs, manufactures
and distributes, primarily through its own sales force, instruments used in both
open and minimally-invasive surgical procedures including general and
specialized surgical instruments such as scissors, forceps, vascular clamps,
needle holders and retractors; closure products such as ligation clips, appliers
and skin staples; and, provides specialized instrument management services.
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AEROSPACE SEGMENT
The Aerospace Segment serves the commercial aerospace and turbine engine
markets. Its businesses design and manufacture precision controls and cargo
systems for aviation; provide coatings, repair services and manufactured
components for users of both flight and land-based turbine engines. Sales are
both to original equipment manufacturers and the aftermarket. These products and
services, many of which are proprietary, require a high degree of engineering
sophistication and are often custom designed. External economic influences on
these products and services relate primarily to spending patterns in the
worldwide aerospace industry.
In 1995 and in the first quarter of 1996 the Company sold product lines as
part of a structural realignment within the Aerospace Segment. These businesses
produced a variety of mechanical and electromechanical controls for commercial
and military aircraft, ordnance and space vehicles. The sale of these product
lines effectively ended most of the Company's involvement in the
military/defense sector of the aerospace industry. Telair International
manufactures and distributes cargo handling systems for commercial aircraft and
other aircraft controls. The Company's cargo handling systems include patented
digitally controlled systems to move and secure containers of cargo inside
commercial aircraft. In 1997 the Company acquired Scandinavian Bellyloading
Company, a European manufacturer of cargo loading systems for narrow-body
aircraft which complements the Company's existing wide-body cargo handling
systems. Cargo handling systems are sold either to aircraft manufacturers as
original installations or to airlines and air freight carriers for retrofit of
existing systems. The Company also designs, manufactures and repairs mechanical
and electromechanical components used on both commercial and, to a lesser extent
military aircraft. These other aircraft controls include flight controls, canopy
and door actuators, cargo winches and control valves. The Company's design
engineers work with design personnel from the major aircraft manufacturers in
the development of controls for use on new aircraft. In addition, the Company
supplies spare parts to aircraft operators typically through distributors. This
spare parts business extends as long as the particular type of aircraft
continues in service.
In the early 1960s, aircraft manufacturers began to encounter high
temperature lubrication problems in connection with mechanical controls for
aircraft jet engines. Through Sermatech International, the Company utilized its
aerospace experience and engineering capabilities to develop a series of
formulations of inorganic coatings to solve these high temperature lubrication
problems. These products were further developed by the Company and sold under
the trademark SermeTel(R) to provide anti-corrosion protection for compressor
blades and other airfoils. Sermatech International, through a network of
facilities in five countries, provides a variety of sophisticated protective
coatings and repair services for ground turbine engine components; highly-
specialized repairs for critical components such as fan blades and airfoils for
flight-based turbine engines; and manufacturing and high quality dimensional
finishing of airfoils and other turbine engine components. The Company has added
technologies through acquisition and internal development and now offers a
diverse range of technical services and materials technologies to turbine
markets throughout the world. In 1993 the Company acquired Mal Tool &
Engineering, a manufacturer of fan blades for flight turbines, and airfoils for
both flight and ground-based gas turbines and steam turbines. This acquisition
broadened the Company's product offering including turnkey manufactured and
coated airfoils and provided another entree to major international turbine
manufacturers. During the fourth quarter of 1995 the Company formed a joint
venture, Airfoil Technologies International LLC (ATI), with General Electric
Aircraft Engines to provide fan blade and airfoil repair services for
flight-based turbine engine blades. The Sermatech repair operations were
contributed to ATI which is owned 51% by the Company. ATI provides a vehicle for
the technological and geographic expansion of the Sermatech repairs services
business. To further broaden the Company's turbo-machinery technological and
manufacturing capabilities, and to improve the range of product offerings, the
Company, in 1996 acquired Lehr Precision, Inc., an electro-chemical machining
manufacturer of turbo-machinery components used on both flight and ground
turbines. In 1997 the Company acquired Gas-Path Technology, Inc. to further
expand its ground turbine repair capabilities within the Sermatech network of
facilities.
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MARKETING
In 1997, the percentages of the Company's consolidated net sales
represented by its major markets were as follows: aerospace -- 28%;
medical -- 28%; marine and industrial -- 20%; and automotive -- 24%.
The major portion of the Company's products are sold to original equipment
manufacturers. Generally, products sold to the aerospace and automotive markets
are sold through the Company's own force of field engineers. Products sold to
the marine, medical and general industrial markets are sold both through the
Company's own sales forces and through independent representatives and
independent distributor networks.
For information on foreign operations, export sales, and principal
customers, see text under the heading "Business segments and other information"
on page 25 of the Company's 1997 Annual Report to Shareholders, which
information is incorporated herein by reference.
COMPETITION
The Company has varying degrees of competition in all elements of its
business. None of the Company's competitors offers products for all the markets
served by the Company. The Company believes that its competitive position
depends on the technical competence and creative ability of its engineering and
development personnel, the know-how and skill of its manufacturing personnel as
well as its plants, tooling and other resources.
PATENTS
The Company owns a number of patents and has a number of patent
applications pending. The Company does not believe that its business is
materially dependent on patent protection.
SUPPLIERS
Materials used in the manufacture of the Company's products are purchased
from a large number of suppliers. The Company is not dependent upon any single
supplier for a substantial amount of the materials it uses.
BACKLOG
As of December 28, 1997 the Company's backlog of firm orders for the
Aerospace Segment was $364 million, of which it is anticipated that
approximately one-half will be filled in 1998. The Company's backlog for the
Aerospace Segment on December 29, 1996 was $180 million.
As of December 28, 1997 the Company's backlog of firm orders for the
Medical and Commercial segments was $26 million and $98 million, respectively.
This compares with $21 million and $88 million, respectively, as of December 29,
1996. Substantially all of the December 28, 1997 backlog will be filled in 1998.
Most of the Company's medical and commercial products are sold on orders calling
for delivery within no more than a few months so that the backlog of such orders
is not indicative of probable net sales in any future 12-month period.
EMPLOYEES
The Company had approximately 11,700 employees at December 28, 1997.
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EXECUTIVE OFFICERS
The names and ages of all executive officers of the Company as of March 1,
1998 and the positions and offices with the Company held by each such officer
are as follows:
POSITIONS AND OFFICES
NAME AGE WITH COMPANY
---- --- ---------------------
Lennox K. Black 67 Chairman of the Board and Director
David S. Boyer 55 President, Chief Executive Officer and Director
John J. Sickler 55 President, TFX Equities Inc.
Dr. Roy C. Carriker 60 President and Chief Operating Officer, TFX Sermatech
Harold L. Zuber, Jr. 48 Vice President, Chief Financial Officer and Controller
Steven K. Chance 52 Vice President, General Counsel and Secretary
Ira Albom 68 Senior Vice President
Louis T. Horvath 59 Vice President, Quality and Productivity
Ronald D. Boldt 55 Vice President, Human Resources
Janine Dusossoit 44 Vice President, Investor Relations
Thomas M. Byrne 51 Assistant Treasurer
Mr. Boyer was elected President and Chief Executive Officer on April 28,
1995. Prior to that date he was President.
Dr. Carriker was named President and Chief Operating Officer, TFX Sermatech
on January 3, 1994. Prior to that date he was President, Sermatech
International.
Mr. Horvath was named to the position of Vice Presidents, Quality and
Productivity on January 4, 1996. Prior to that date he was Vice President,
Quality Management.
Officers are elected by the Board of Directors for one year terms. No
family relationship exists among any of the executive officers of the Company.
ITEM 2. PROPERTIES
The Company's operations have approximately 90 owned and leased properties
consisting of plants, engineering and research centers, distribution warehouses
and other facilities. The properties are maintained in good operating condition.
All the plants are suitably equipped and utilized, and have space available for
the activities currently conducted therein and the increased volume expected in
the foreseeable future.
The following are the Company's major facilities:
SQUARE OWNED OR EXPIRATION
LOCATION FOOTAGE LEASED DATE
-------- ------- -------- ----------
COMMERCIAL SEGMENT
Dassel, Germany............................................. 140,000 Owned N/A
Van Wert, OH................................................ 130,000 Owned(1) N/A
Limerick, PA................................................ 110,000 Owned N/A
Dalstorp, Sweden............................................ 105,000 Owned N/A
Hagerstown, MD.............................................. 103,000 Owned(1) N/A
Warren, MI.................................................. 100,000 Leased 1999
Waterbury, CT............................................... 99,000 Leased 1998
Eufaula, AL................................................. 98,000 Owned N/A
Haysville, KS............................................... 98,000 Leased 2002
Suffield, CT................................................ 90,000 Leased 2000
Hillsdale, MI............................................... 85,000 Owned(1) N/A
Sarasota, FL................................................ 82,000 Owned(1) N/A
Willis, TX.................................................. 70,000 Owned(1) N/A
Nuevo Laredo, Mexico........................................ 67,000 Leased 1998
Eufaula, AL................................................. 61,000 Owned N/A
Birmingham, England......................................... 60,000 Leased 2016
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SQUARE OWNED OR EXPIRATION
LOCATION FOOTAGE LEASED DATE
-------- ------- -------- ----------
Plymouth, MI................................................ 55,000 Leased 1998
Lebanon, VA................................................. 53,000 Owned(1) N/A
Lyons, OH................................................... 50,000 Owned N/A
Vrable, Slovakia............................................ 49,000 Leased 2000
Auburn Hills, MI............................................ 38,000 Owned N/A
Goteborg, Sweden............................................ 37,000 Owned N/A
Swainsboro, GA.............................................. 37,000 Leased 2004
Richmond, Canada............................................ 35,000 Leased 2002
Vancouver, B.C., Canada..................................... 30,000 Owned N/A
Troy, MI.................................................... 29,000 Leased 2003
Selmer, TN.................................................. 24,000 Leased 2005
Birmingham, England......................................... 24,000 Leased 2011
Poole, England.............................................. 20,000 Owned N/A
MEDICAL SEGMENT
Kernen, Germany............................................. 263,000 Owned N/A
Durham, NC.................................................. 144,000 Owned N/A
Kernen, Germany............................................. 114,000 Leased 2013
Taiping, Malaysia........................................... 85,000 Owned N/A
Lurgan, Northern Ireland.................................... 80,000 Owned N/A
Duluth, GA.................................................. 69,000 Leased 1999
Fort Washington, PA......................................... 65,000 Owned N/A
Jaffrey, NH................................................. 60,000 Owned(1) N/A
Franiere, Belgium........................................... 59,000 Leased 2005
Montevideo, Uruguay......................................... 45,000 Owned N/A
Bad Liebenzell, Germany..................................... 36,000 Leased 2000
Bourg-en-Bresse, France..................................... 34,000 Leased 1999
Betschdorf, France.......................................... 32,000 Owned N/A
High Wycombe, England....................................... 25,000 Leased 2012
Limerick, Ireland........................................... 16,000 Leased 2020
AEROSPACE SEGMENT
Cincinnati, OH.............................................. 160,000 Leased 2001
Oxnard, CA.................................................. 145,000 Owned N/A
Mentor, OH.................................................. 90,000 Owned N/A
Manchester, CT.............................................. 74,000 Owned N/A
Limerick, PA................................................ 70,000 Owned N/A
Derbyshire, England......................................... 70,000 Leased 1999
Singapore, Asia............................................. 61,000 Owned N/A
Lincoln, England............................................ 50,000 Leased 2018
Compton, CA................................................. 49,000 Leased 1999
Biddeford, ME............................................... 32,000 Leased 1998
Hausham, Germany............................................ 30,000 Owned N/A
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(1) The Company is the beneficial owner of these facilities under installment
sale or similar financing agreements.
In addition to the above, the Company owns or leases approximately 800,000
square feet of warehousing, manufacturing and office space located in the United
States, Canada, Europe and Asia.
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ITEM 3. LEGAL PROCEEDINGS
Two subsidiaries of the Company were identified as potentially responsible
parties (PRPs) in connection with the Casmalia Hazardous Waste Management
Facility in 1994. The Company and other PRPs have negotiated with the United
States Environmental Protection Agency (EPA) a good faith offer and have taken
over certain closure and post-closure activities. These activities will take
place over the next three years.
In addition, the Company has been named as a PRP by the EPA at various
sites throughout the country.
In the opinion of the Company's management, based on current allocation
formulas and the facts presently known, the ultimate outcome of these
environmental matters will not result in a liability material to the Company's
consolidated financial position, results of operations or cash flows.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER
MATTERS
See "Quarterly Financial Data" on page 27 of the Company's 1997 Annual
Report to Shareholders for market price and dividend information. Also see the
Note entitled "Borrowings and Leases" on pages 23 and 24 of such Annual Report
for certain dividend restrictions under loan agreements, all of which
information is incorporated herein by reference. The Company had approximately
1,400 registered shareholders at February 1, 1998.
ITEM 6. SELECTED FINANCIAL DATA
See pages 28 through 31 of the Company's 1997 Annual Report to
Shareholders, which pages are incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
See the text under the heading "Financial Review" on pages 32 through 37 of
the Company's 1997 Annual Report to Shareholders, which information is
incorporated herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
See pages 19 through 27 of the Company's 1997 Annual Report to
Shareholders, which pages are incorporated herein by reference.
ITEM 9. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
Not applicable.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
For information with respect to the Company's Directors and Director
nominees, see "Election Of Directors" and "Additional Information About The
Board Of Directors" on pages 2 through 4 of the Company's Proxy Statement for
its 1998 Annual Meeting, which information is incorporated herein by reference.
For information with respect to the Company's Executive Officers, see Part
I of this report on page 5, which information is incorporated herein by
reference.
ITEM 11. EXECUTIVE COMPENSATION
See "Additional Information About The Board of Directors", "Board
Compensation Committee", "Five-Year Shareholder Return Comparison" and
"Executive Compensation and Other Information" on pages 6 through 8 of the
Company's Proxy Statement for its 1998 Annual Meeting, which information is
incorporated herein by reference.
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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
See "Security Ownership of Certain Beneficial Owners and Management" on
pages 1 and 2, "Section 16(a) Beneficial Ownership Reporting Compliance" on page
2 and "Election Of Directors" on pages 2 and 3 of the Company's Proxy Statement
for its 1998 Annual Meeting, which information is incorporated herein by
reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
See "Additional Information About The Board Of Directors", "Board
Compensation Committee" and "Executive Compensation and Other Information" on
pages 4 through 8 of the Company's Proxy Statement for its 1998 Annual Meeting,
which information is incorporated herein by reference.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a) Consolidated Financial Statements:
The index to Consolidated Financial Statements and Schedules is set
forth on page 10 hereof.
(b) Reports on Form 8-K:
No reports on Form 8-K have been filed during the last quarter of the
period covered by this report.
(c) Exhibits:
The Exhibits are listed in the Index to Exhibits.
For the purposes of complying with the amendments to the rules governing
Form S-8 (effective July 13, 1990) under the Securities Act of 1933, the
undersigned registrant hereby undertakes as follows, which undertaking shall be
incorporated by reference into registrant's Registration Statements on Form S-8
Nos. 2-84148 (filed June 28, 1989), 2-98715 (filed May 11, 1987), 33-34753
(filed May 10, 1990) and 33-53385 (filed April 29, 1994):
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing provisions,
or otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act of 1933 and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in
the successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the opinion of
its counsel the matter has been settled by controlling precedent, submit to
a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this Annual Report to be
signed on its behalf by the undersigned, thereunto duly authorized as of the
date indicated below.
TELEFLEX INCORPORATED
By LENNOX K. BLACK
------------------------------------
Lennox K. Black
Chairman of the Board
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and as of the date indicated below.
By DAVID S. BOYER
------------------------------------
David S. Boyer
(Principal Executive Officer)
By HAROLD L. ZUBER, JR.
------------------------------------
Harold L. Zuber, Jr.
(Principal Financial and Accounting
Officer)
Pursuant to General Instruction D to Form 10-K, this report has been signed
by Steven K. Chance as Attorney-in-Fact for a majority of the Board of Directors
as of the date indicated below.
John H. Remer Director
Lewis E. Hatch, Jr. Director
Palmer E. Retzlaff Director
Sigismundus W. W. Lubsen Director
David S. Boyer Director
Lennox K. Black Director
Pemberton Hutchinson Director
Donald Beckman Director
James W. Stratton Director
Joseph S. Gonnella, MD Director
Patricia C. Barron Director
By STEVEN K. CHANCE
------------------------------------
Steven K. Chance
Attorney-in-Fact
Dated: March 20, 1998
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TELEFLEX INCORPORATED
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
The consolidated financial statements together with the report thereon of
Price Waterhouse LLP dated February 11, 1998 on pages 19 to 31 of the
accompanying 1997 Annual Report to Shareholders are incorporated in this Annual
Report on Form 10-K. With the exception of the aforementioned information, and
those portions incorporated by specific reference in this document, the 1997
Annual Report to Shareholders is not to be deemed filed as part of this report.
The following Financial Statement Schedule together with the report thereon of
Price Waterhouse LLP dated February 11, 1998 on page 11 should be read in
conjunction with the consolidated financial statements in such 1997 Annual
Report to Shareholders. Financial Statement Schedules not included in this Form
10-K Annual Report have been omitted because they are not applicable or the
required information is shown in the consolidated financial statements or notes
thereto.
FINANCIAL STATEMENT SCHEDULE
Schedule:
PAGE
----
VIII Valuation and qualifying accounts........................... 12
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REPORT OF INDEPENDENT ACCOUNTANTS ON
FINANCIAL STATEMENT SCHEDULE
To the Board of Directors
of Teleflex Incorporated
Our audits of the consolidated financial statements referred to in our report
dated February 11, 1998 appearing on page 26 of the 1997 Annual Report to
Shareholders of Teleflex Incorporated (which report and consolidated financial
statements are incorporated by reference in this Annual Report on Form 10-K)
also included an audit of the Financial Statement Schedule listed in Item 14(a)
of this Form 10-K. In our opinion, the Financial Statement Schedule presents
fairly, in all material respects, the information set forth therein when read in
conjunction with the related consolidated financial statements.
PRICE WATERHOUSE LLP
Thirty South Seventeenth Street
Philadelphia, Pennsylvania 19103
February 11, 1998
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statements on Form S-8 (No. 2-84148, No. 2-98715, No. 33-34753, and No.
33-53385) of Teleflex Incorporated of our report dated February 11, 1998
appearing on page 26 of the 1997 Annual Report to Shareholders which is
incorporated in this Annual Report on Form 10-K. We also consent to the
incorporation by reference of our report on the Financial Statement Schedule,
which appears above.
PRICE WATERHOUSE LLP
Thirty South Seventeenth Street
Philadelphia, Pennsylvania 19103
March 20, 1998
11
13
TELEFLEX INCORPORATED
SCHEDULE VIII -- VALUATION AND QUALIFYING ACCOUNTS
ALLOWANCE FOR DOUBTFUL ACCOUNTS
BALANCE AT ADDITIONS DOUBTFUL BALANCE AT
BEGINNING CHARGED TO ACCOUNTS END OF
FOR THE YEAR ENDED OF YEAR INCOME WRITTEN OFF YEAR
------------------ ---------- ---------- ----------- ----------
December 28, 1997........................ $4,110,000 $2,218,000 $ (660,000) $5,668,000
December 29, 1996........................ $3,797,000 $2,026,000 $(1,713,000) $4,110,000
December 31, 1995........................ $3,036,900 $1,333,600 $ (573,500) $3,797,000
12
14
March 20, 1998
INDEX TO EXHIBITS
Exhibit
- -------
3 (a) -- The Company's Articles of Incorporation (except for Article Thirteenth
and the first paragraph of Article Fourth) are incorporated herein by reference
to Exhibit 3(a) to the Company's Form 10-Q for the period ended June 30, 1985.
Article Thirteenth of the Company's Articles of Incorporation is incorporated
herein by reference to Exhibit 3 of the Company's Form 10-Q for the period ended
June 28, 1987. The first paragraph of Article Fourth of the Company's Articles
of Incorporation is incorporated herein by reference to Exhibit 3 of the
Company's Form 10-Q for the period ended June 25, 1989 (filed with Form 8, dated
August 23, 1989).
(b) -- The Company's Bylaws are incorporated herein by reference to Exhibit
3(b) of the Company's Form 10-K for the year ended December 28, 1987.
10 (a) -- The 1982 Stock Option Plan, incorporated herein by reference to the
Company's registration statement on Form S-8 (Registration No. 2-84148), as
supplemented, with amendments of April 26, 1991 incorporated by reference to
the Company's definitive Proxy Statement for the 1991 Annual Meeting of
Shareholders.
(b) -- The 1990 Stock Compensation Plan, incorporated herein by reference to
the Company's registration statement on Form S-8 (Registration No. 33-34753),
revised and restated as of December 1, 1997 included herein.
(c) -- The Salaried Employees' Pension Plan, as amended and restated in its
entirety, effective July 1, 1989 and the retirement income plan as amended and
restated in its entirety effective January 1, 1994 and related Trust
Agreements, dated July 1, 1994 is incorporated by reference to the company's
Form 10-K for the year ended December 25, 1994.
(d) -- Description of deferred compensation arrangements between the Company
and its Chairman, L. K. Black, incorporated by reference to the Company's
definitive Proxy Statement for the 1998 Annual Meeting of Shareholders.
15
INDEX TO EXHIBITS --- PAGE 2
(e) -- Description of compensation arrangement between the Company and its
President and Chief Executive Officer, David S. Boyer, incorporated by
reference to the Company's definitive Proxy Statement for the 1998 Annual
Meeting of Shareholders.
(f) -- Teleflex Incorporated Deferred Compensation Plan effective as of
January 1, 1995 and amended and restated November 3, 1997.
(g) -- Information on the Company's Profit Participation Plan, insurance
arrangements with certain officers and deferred compensation arrangements with
certain officers, non-qualified supplementary pension plan for salaried
employees and compensation arrangements with directors is incorporated by
reference to the Company's definitive Proxy Statement for the 1996, 1997 and
1998 Annual Meeting of Shareholders.
(h) -- The Company's Voluntary Investment Plan is incorporated by reference
to Exhibit 28 of the Company's registration statement on Form S-8 (Registration
No. 2-98715).
13 -- Pages 19 through 37 of the Company's Annual Report to Shareholders for the
period ended December 28, 1997.
21 -- The Company's Subsidiaries.
24 -- Consent of Independent Accountants (see page 11 herein).
25 -- Power of Attorney.
27 -- Financial Data Schedule