2017 FORM 10-K

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STRYKER CORPORATION 2017 FORM 10-K Dollar amounts in millions except per share amounts or as otherwise specified. 6 the United States in China and Netherlands. Damage to these facilities as a result of natural disasters or otherwise, as well as issues in our manufacturing arising from a failure to follow specific internal protocols and procedures, compliance concerns relating to the quality systems regulation, equipment breakdown or malfunction or other factors could adversely affect the availability of our products. In the event of an interruption in manufacturing, we may be unable to move quickly to alternate means of producing affected products to meet customer demand. In the event of a significant interruption, we may experience lengthy delays in resuming production of affected products due to the need for regulatory approvals. We may experience loss of market share, additional expense and harm to our reputation. We use a variety of raw materials, components or devices in our global supply chains, production and distribution processes; significant shortages or price increases could increase our operating costs, require significant capital expenditures, or adversely impact the competitive position of our products: Our reliance on certain suppliers to secure raw materials, components and finished devices exposes us to product shortages and unanticipated increases in prices. In addition, several raw materials, components, and finished devices are procured from a sole-source due to the quality considerations, unique intellectual property considerations or constraints associated with regulatory requirements. If sole-source suppliers are acquired or were unable or unwilling to deliver these materials, we may not be able to manufacture or have available one or more products during such period of unavailability and our business could suffer. In certain cases we may not be able to establish additional or replacement suppliers for such materials in a timely or cost effective manner, largely as a result of FDA and other regulations that require, among other things, validation of materials and components prior to their use in our products. ITEM 1B. UNRESOLVED STAFF COMMENTS. None. ITEM 2. PROPERTIES. We have approximately 24 company-owned and 251 leased locations worldwide including 42 manufacturing locations. We believe that our properties are in good operating condition and adequate for the manufacture and distribution of our products. We do not anticipate difficulty in renewing existing leases as they expire or in finding alternative facilities. ITEM 3. LEGAL PROCEEDINGS. We are involved in various proceedings, legal actions and claims arising in the normal course of business, including proceedings related to product, labor and intellectual property, and the matters described in more detail in Note 6 to our Consolidated Financial Statements. ITEM 4. MINE SAFETY DISCLOSURES. Not applicable. PART II ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES. Our common stock is traded on the New York Stock Exchange under the symbol SYK. Quarterly Stock Price and Dividend Information 2017 Quarter Mar 31 Jun 30 Sep 30 Dec 31 Dividends declared per share of common stock $ 0.425 $ 0.425 $ 0.425 $ 0.470 Market price of common stock: High $ 133.59 $ 145.62 $ 148.84 $ 160.62 Low $ 116.50 $ 129.82 $ 137.70 $ 141.68 2016 Quarter Dividends declared per share of common stock $ 0.380 $ 0.380 $ 0.380 $ 0.425 Market price of common stock: High $ 107.95 $ 119.83 $ 123.55 $ 121.84 Low $ 86.68 $ 106.26 $ 109.75 $ 106.48 Our Board of Directors considers payment of cash dividends at its quarterly meetings. On January 31, 2018 there were 2,833 shareholders of record of our common stock. We did not repurchase any shares in the three months ended December 31, 2017 and the total dollar value of shares that could be acquired under our authorized repurchase program at December 31, 2017 was $1,640. We issued 100 shares of our common stock in the fourth quarter of 2017 as performance incentive awards. These shares were not registered under the Securities Act of 1933 based on the conclusion that the awards would not be events of sale within the meaning of Section 2(a)(3) of the Act. The following graph compares our total returns (including reinvestments of dividends) against the Standard & Poor's (S&P) 500 Index and the S&P 500 Health Care Index. The graph assumes $100 (not in millions) invested on December 31, 2012 in our common stock and each of the indices. Company / Index 2012 2013 2014 2015 2016 2017 Stryker Corporation $100.00 $139.29 $177.47 $177.51 $231.94 $303.46 S&P 500 Index $100.00 $132.39 $150.51 $152.59 $170.84 $208.14 S&P 500 Health Care Index $100.00 $141.46 $177.30 $189.52 $184.42 $225.13

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