Cooper Companies (COO) 10-K risk factor changes: FY2014 vs FY2013

There can be no assurance that we will not encounter increased competition in the future, [added: for example with increased product entries from Asia Pacific contact lens manufacturers,] or that our competitors' newer contact lens products will not successfully erode CooperVision's contact lens business, which could have a material adverse effect on our business, financial condition and results of operations.

As part of our growth strategy, particularly at [removed: CooperSurgical,] [added: CooperSurgical and more recently at CooperVision,] we intend to continue to consider acquiring complementary technologies, products and businesses.

[added: acquisitions could result in] potentially dilutive issuances of equity securities, the incurrence of debt and contingent liabilities and an increase in amortization and/or [removed: write-offs] [added: impairments] of goodwill and other intangible assets, which could have a material adverse effect upon our business, financial condition and results of operations.

In fiscal [added: 2014, CooperVision completed the acquisition of Sauflon Pharmaceuticals Limited, and in fiscal] 2012, CooperSurgical completed the acquisition of Origio a/s.

[removed: This acquisition] [added: These acquisitions] added significant operations to [removed: CooperSurgical] [added: CooperVision] and [added: CooperSurgical, respectively, and] greatly expanded [removed: its] [added: their] international [removed: business.][added: businesses.]

[removed: Risks] [added: The acquisitions have, correspondingly, added risks] we could face with respect to [removed: acquisitions, including the Origio acquisition,] [added: acquisitions and] include:

| • | expenses of any undisclosed or potential [added: liabilities, contingent] liabilities [added: or indemnification obligations] of the acquired company; |

CooperSurgical [removed: does] [added: has] not [removed: allocate] [added: allocated] substantial resources to new product development, but rather it has historically purchased, leveraged or licensed the technology developments of others.

[removed: Although CooperVision focuses on products that will be marketable immediately or in the short to medium term rather than on funding longer-term, higher risk research] [added: Research] and development [removed: projects,] time commitments, [added: higher feasibility risk with longer term projects,] the cost of obtaining necessary regulatory approval and other costs related to product innovations can be substantial.

Competitors may also introduce new uses for contact [removed: lenses, such as for drug delivery or the control of myopia.]

[removed: The][added: In addition, the]

[added: The] development of a market for our products may be influenced by many factors, some of which are out of our control, including:

A significant portion of our current operations for CooperVision and our newly acquired [added: Sauflon and] Origio [removed: business] [added: businesses] are conducted and located outside the United States, and our growth strategy involves expanding our existing foreign operations and entering into new foreign jurisdictions.

Approximately two-thirds of our net sales for CooperVision for the fiscal years ended October 31, [removed: 2013] [added: 2014] and [removed: 2012,] [added: 2013,] respectively, were derived from the sale of products outside the United States.

| • | we may find it difficult to grow in emerging markets such as China, [removed: India] [added: India, Russia] and other developing nations due to, among other things, customer acceptance, undeveloped distribution channels, regulatory restrictions and [added: changes, and] business knowledge of these new markets; |

| • | failure to comply with United States Department of Commerce [removed: export] [added: and other nations import-export] controls may result in fines and/or penalties; |

| • | foreign governments may adopt regulations or take other actions that would have a direct or indirect adverse impact on our business and market [removed: opportunities;] [added: opportunities, including but not limited to increased enforcement of potentially conflicting] and [added: ambiguous anti-bribery laws; and] |

As a result, we continue to have lower than historical expectations for market growth in fiscal [removed: 2014.][added: 2015.]

Continued turbulence [added: particularly] in [removed: the United States and] international markets and economic conditions may adversely affect our liquidity and financial condition, and the liquidity and financial condition of our customers.

For example, some of the primary material used to make our silicone hydrogel contact lens products, including MyDay, [removed: Biofinity] [added: Biofinity, Avaira] and [removed: Avaira,] [added: clariti,] are supplied by a sole supplier.

We consider our intellectual property rights, including patents, [added: trade secrets,] trademarks and licensing agreements, to be an integral component of our business.

To protect our trade secrets and other proprietary information, we require employees, consultants, advisors and collaborators to enter into confidentiality agreements and assignment agreements, which generally provide that inventions conceived [removed: by the party in the course of rendering services to us will be our exclusive property.]

Adverse determinations in a judicial or administrative proceeding could prevent us from manufacturing and selling our products or prevent us from stopping others from manufacturing and selling competing products, and thereby have a material adverse [removed: affect] [added: effect] on our business, financial condition and results of operations.

There can be no assurance that we will not experience material losses due to [added: product liability claims or recalls, or a decline in sales resulting from sales of counterfeit or other infringing products, in the future.]

[added: We may not be successful] in structuring such swap agreements to manage our risks effectively, which could adversely affect our business, earnings and financial condition.

We also have the protections of Section 203 of the Delaware General Corporation Law, which could have [removed: similar effects.]

The process of [removed: obtaining] [added: obtaining, renewing and maintaining] regulatory clearances and approvals to market a medical device, particularly from the FDA, can be costly and time consuming.

In addition, the FDA [added: and foreign jurisdictions] may change its policies, adopt additional regulations or revise existing regulations, each of which could prevent or delay premarket approval or clearance of our products or could impact our ability to market our currently approved or cleared products.

If the FDA requires us to seek clearance or approval for modification of a previously cleared product for which we have concluded that new clearances or approvals are unnecessary, we may be required to cease marketing or to recall the modified product until we obtain clearance or approval, and we may be subject to significant regulatory fines or penalties, which could have [removed: a material adverse effect on our financial results and competitive position.]

[removed: In addition, the] FDA or other foreign governmental agencies may implement enforcement actions in connection with a recall which could impair our product offerings and be harmful to our business and financial results.

[added: | • | New reporting and disclosure requirements on medical device manufacturers for any “transfer of value” made or distributed to prescribers and other healthcare providers, and any ownership and investment interests held by physicians or their immediate family members, and any payments or other “transfers of value” to such owners.] Manufacturers were required to begin data collection on August 1, 2013 and [removed: will be] [added: were] required to report such data to the government by March 31, 2014 and [added: in future periods] by the 90th calendar day of each year thereafter; [added: |]

CooperVision is not affected by this [removed: new] tax because contact lenses are excluded from the tax.

However, United States sales of almost all of CooperSurgical's products are subject to this [removed: new] tax.

While [added: with the possible exception of limited value-added software solutions for eye care professionals which] we [added: believe are HIPAA compliant, we] do not believe that we are a covered entity or a business associate under HIPAA, many of our customers may be covered entities or business associates subject to HIPAA.

[removed: Some customers as an expectation of transacting business with us may require us to enter into business associate] agreements, which would obligate us to safeguard and restrict the manner in which we use certain protected health information (as defined by HIPAA) that we obtain in the course of our commercial relationship with them, triggering potential liability on us for failure to meet our contractual obligations.

Future

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

| • | failure to successfully obtain the anticipated revenues, margins and earnings benefits, including the Sauflon acquisition; |

| • | increased leverage and the risk of lack of access to available financing, including financing for the acquisition or refinancing of debt owed by us on a timely basis and on reasonable terms; |

| • | risks inherent in accounting allocations and the risk that we are required to record significant adjustments to the preliminary fair value of assets acquired and liabilities assumed within the measurement period. |

CooperSurgical has recently invested in expanding the internal research and development function with the goal of organizational growth and to complement our acquisitions strategy.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

lenses, such as for drug delivery or the control of myopia.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

Through the Sauflon acquisition, CooperVision acquired manufacturing facilities in the United Kingdom and Hungary.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

by the party in the course of rendering services to us will be our exclusive property.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

We attempt to protect our computer and communications systems but may experience interruptions and breaches including computer viruses, malicious software, cyberattacks and "hacking,” that could impair our ability to conduct business and communicate internally and with our customers, or result in the theft of trade secrets or other misappropriation of assets, or otherwise compromise privacy of our sensitive information, or that of our customers or other business partners.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

similar effects.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

a material adverse effect on our financial results and competitive position.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

| | |

| --- | --- |

| | |

| --- | --- |

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

Some customers as an expectation of transacting business with us may require us to enter into business associate

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

To the extent HIPAA is applicable to certain ancillary practice management software services offered to eye care professionals, we believe those offerings are HIPAA compliant.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

Future acquisitions could result in

The Origio acquisition has correspondingly added risks to CooperSurgical.

| • | risks inherent in accounting allocations. |

product liability claims or recalls, or a decline in sales resulting from sales of counterfeit or other infringing products, in the future.

We may not be successful

| • | New reporting and disclosure requirements on medical device manufacturers for any “transfer of value” made or distributed to prescribers and other healthcare providers, and any ownership and investment |

interests held by physicians or their immediate family members, and any payments or other “transfers of value” to such owners.

We cannot anticipate at this time the magnitude of this new tax as there are significant uncertainties concerning key definitions and terms within the law.

We discuss below the results of our operations for fiscal [removed: 2013] [added: 2014] compared with fiscal [removed: 2012] [added: 2013] and the results of our operations for fiscal [removed: 2012] [added: 2013] compared with fiscal [removed: 2011.][added: 2012.]

However, events affecting the economy as a whole, including the uncertainty and instability of global markets driven by United States [removed: debt] and [removed: uncertainty surrounding employment, housing and credit concerns together with the] European debt [removed: crisis] [added: concerns, the Affordable Care Act, including the trend of consolidation within the healthcare industry,] and [removed: related] [added: the economic downturn in Japan together with] foreign currency [removed: volatility] [added: volatility, particularly the yen, euro and the pound,] impact our current performance and continue to represent a risk to our performance for fiscal year [removed: 2014.][added: 2015.]

[added: CooperVision -] We compete in the worldwide contact lens market with our spherical, toric and multifocal contact lenses offered in a variety of materials including using silicone hydrogel Aquaform® technology and phosphorylcholine technology [removed: (PC Technology™).][added: (PC) Technology™.]

Our ability to compete successfully with a full range of silicone hydrogel products is an important factor to achieving our [removed: projected] [added: desired] future levels of sales growth and profitability.

CooperVision markets monthly and two-week silicone hydrogel spherical and toric lens products under our Biofinity® and Avaira® [removed: brands and] [added: brands,] a [added: monthly] multifocal [added: silicone hydrogel] lens under [removed: Biofinity.][added: Biofinity and a single-use spherical silicone hydrogel lens under MyDayTM.]

We believe that the global market for single-use contact lenses [removed: is expanding and] will continue to [removed: grow.][added: grow and that competitive silicone hydrogel single-use products are gaining market share and that they represent a risk to our business.]

[removed: In fiscal 2013, we launched MyDayTM,] [added: We compete with MyDay,] our single-use spherical silicone hydrogel lens, [removed: in Europe,] and [removed: in fiscal 2012 we launched] [added: our Proclear 1 Day products including] Proclear® 1 Day multifocal.

To meet this anticipated demand, in fiscal [removed: 2014] [added: 2015] we plan to continue the implementation of capital projects to invest in increased single-use manufacturing capacity.

On October 31, 2013, we completed a transaction to sell Aime, our rigid gas-permeable contact lens and solutions business in Japan, to Nippon Contact Lens Inc. [removed: In our fiscal fourth quarter of 2013, we recorded a pre-tax loss] [added: The business was originally obtained as part] of [removed: approximately $21.1 million.][added: the December 1, 2010, acquisition which included obtaining the rights to market Biofinity in Japan.]

The divestiture [removed: is] [added: was] consistent with [removed: the] [added: CooperVision’s] strategy to focus on [removed: our] [added: its] core soft contact lens business.

Additionally, Aime revenue [removed: has] [added: had] declined in recent periods, and the products [removed: have] [added: had] lower than average company margins.

Results from operations of Aime are included in our Consolidated Statements of Income for fiscal [removed: 2013, 2012] [added: 2013] and [removed: 2011.][added: 2012, and we have not segregated the results of operations or net assets of Aime on our financial statements for any period presented.]

[removed: The] [added: CooperSurgical - Our CooperSurgical business competes in the highly fragmented] medical device segment of the women's healthcare [removed: market is highly fragmented.][added: market.]

CooperSurgical product sales are categorized based on the point of healthcare delivery including products used in medical office and surgical procedures by obstetricians and gynecologists (ob/gyns) [removed: representing 67%] [added: that represented 65%] of CooperSurgical's net [removed: sales.][added: sales in fiscal 2014.]

At October 31, [removed: 2013,] [added: 2014,] we had [removed: $999.8] [added: $25.2] million [added: in cash, primarily outside the United States, and $720.3 million] available under [removed: the] [added: our existing] revolving Credit Agreement.

We believe that our cash and cash equivalents, cash flow from operating activities and borrowing capacity under existing credit [removed: facilities] [added: facilities, including the August 4, 2014, $700.0 million term loan,] will fund operations both in the next 12 months and in the longer term as well as current and long-term cash requirements for capital expenditures, acquisitions, share repurchases and cash dividends.

| • | Net sales up 10% to $1.6 billion from $1.4 billion in fiscal year [removed: 2012.] [added: 2012] |

| • | Gross margin 65% of net sales up from [removed: 64%.] [added: 64%] |

| • | Operating income up 8% to $305.9 million from $283.4 [removed: million.] [added: million] |

| • | Interest expense down 22% to $9.2 million from $11.8 [removed: million.] [added: million] |

| • | Diluted earnings per share up 18% to $5.96 from [removed: $5.05.] [added: $5.05] |

| • | Operating cash flow $415.9 million up 32% from $315.1 [removed: million.] [added: million] |

Fiscal 2013 pre-tax results [removed: include] [added: included $30.2 million for amortization of intangible assets,] a $21.1 million loss on divestiture of Aime, $14.1 million of insurance proceeds related to a business interruption claim and $0.6 million of costs related to the acquisition of Origio.

Fiscal 2012 pre-tax results [removed: include] [added: included $24.0 million for amortization of intangible assets,] a $1.4 million loss related to the May 31, 2012, amendment to our revolving Credit Agreement, and costs related to the acquisition of Origio consisting of $4.9 million in direct acquisition costs and a $0.4 million net gain related to the repayment of debt acquired recorded in interest expense.

The contact lens market consists primarily of [removed: disposable] [added: single-use] and frequently replaced lenses.

[removed: Disposable] [added: Single-use] lenses are designed for [removed: either daily, two-week or monthly replacement;] [added: daily replacement and] frequently replaced lenses are designed for [removed: replacement after one to three months.][added: two-week or monthly replacement.]

Significantly, the market for spherical lenses is growing with [removed: value-][added: value-added spherical lenses to]

[removed: added spherical lenses to] alleviate dry eye symptoms as well as lenses with aspherical optical properties or higher oxygen permeable lenses such as silicone hydrogels.

We believe [removed: that it is important to develop a full range of multifocal and] [added: the clariti] single-use silicone hydrogel [added: lens] products [removed: due] [added: acquired with Sauflon are important] to [added: address] increased pressure from [added: multifocal and single-use] silicone hydrogel products offered by our major competitors.

CooperVision [added: fiscal 2013] net sales growth included increases in total sphere lenses up 4%, representing 56% of net sales and total toric lenses up 9%, representing 31% of net sales.

CooperVision’s [added: fiscal 2013] worldwide net sales grew 7% in the year-to-year comparison.

CooperVision’s net sales growth was driven primarily by increases in the volume of lenses [removed: sold and introduction of new products, primarily] [added: sold, including recently introduced] silicone hydrogel [removed: lenses.][added: products and products from the acquisition of Sauflon.]

Sales of products used in medical office and surgical procedures by ob/gyns declined 1% as compared to the prior year and now [added: represent 67% of CooperSurgical's net sales compared to 84% in the prior year.]

[removed: During our fiscal fourth] quarter of [removed: 2012 and our fiscal first quarter of] 2013, we completed a mandatory redemption to obtain the remaining shares in accordance with the Danish Companies Act.

| • | Net sales up [removed: 9%] [added: 8%] to [removed: $1.4] [added: $1.72] billion from [removed: $1.3] [added: $1.59] billion in fiscal year [removed: 2011.] [added: 2013] |

| • | Gross margin 64% of net sales [removed: up] [added: down] from [removed: 60%.] [added: 65%] |

| • | Interest expense down [removed: 32%] [added: 13%] to [removed: $11.8] [added: $8.0] million from [removed: $17.3 million.] [added: $9.2 million] |

| • | Diluted earnings per share [removed: up 39%] [added: down 8%] to [removed: $5.05] [added: $5.51] from [removed: $3.63.] [added: $5.96] |

| • | Operating cash flow [removed: $315.1] [added: $454.8] million [removed: down 6%] [added: up 9%] from [removed: $336.3 million.] [added: $415.9 million] |

| Years Ended October 31, | [removed: 2012] [added: 2014] | | | [removed: 2012] [added: 2014] vs. [removed: 2011] [added: 2013] % Change | | | [removed: 2011] [added: 2013] | | | [removed: 2011] [added: 2013] vs. [removed: 2010] [added: 2012] % Change | | | [removed: 2010] [added: 2012] | |

Consistent with this strategy, on August 6, 2014, we acquired Sauflon Pharmaceuticals Limited (Sauflon), a privately-held European manufacturer and distributor of soft contact lenses and aftercare solutions.

The acquisition of Sauflon expands our contact lens product portfolio particularly with Sauflon's clariti® 1day brand of single-use sphere, toric and multifocal silicone hydrogel lenses.

Clariti lenses received United States FDA clearance in August 2013.

Sauflon is headquartered in the United Kingdom and has a global presence with manufacturing facilities in the United Kingdom and Hungary.

We paid approximately $1,131.1 million for Sauflon, consisting of approximately $1,073.2 million in cash and approximately $58.0 million in the form of loan notes.

We financed the acquisition with available offshore cash and credit facilities along with funds from the new $700.0 million term loan facility described below and in the notes to consolidated financial statements.

We are in the process of determining the purchase price allocation for this acquisition which is described in more detail in the notes to consolidated financial statements.

The Sauflon acquisition is intended to accelerate the growth in sales of our single-use products by enabling a multi-tier, single-use strategy with a full suite of hydrogel and silicone hydrogel product offerings in the major product categories of sphere, toric and multifocal lenses.

This acquisition is also intended to provide for enhanced relationships with key European retailers and opportunities for operational synergies.

In October 2014, CooperSurgical acquired EndoSee Corporation, a developer of an office-based disposable hysteroscopy system that has FDA clearance.

We paid $44.0 million for EndoSee and expect the acquisition to be neutral to earnings per share excluding acquisition costs and related amortization.

Capital Resources - On August 4, 2014, we entered into a three-year, $700.0 million senior unsecured term loan agreement by and among the Company, the lenders party thereto and KeyBank National Association as administrative agent.

This syndicated credit facility will mature and the balance is payable on August 4, 2017.

There is no amortization of principal and we may prepay loan balances from time to time, in whole or in part, without premium or penalty.

We utilized this facility to fund the acquisition of Sauflon Pharmaceuticals Limited, as well as to provide working capital and for general corporate purposes.

The $700.0 million term loan entered into on August 4, 2014, and the $300.0 million term loan entered into on September 12, 2013, remain outstanding as of October 31, 2014.

In our fiscal fourth quarter of 2014, we completed the acquisition of Sauflon for $1.13 billion, discussed above.

Looking forward, our cash and availability under existing credit facilities will be reduced due to the use of cash outside the United States and the use of existing credit facilities to fund the acquisition of Sauflon.

However, depending on the size or timing of these business activities, we may seek to raise additional debt financing.

2014 Compared with 2013

| • | Operating income up 0.2% to $306.5 million from $305.9 million |

Fiscal 2014 pre-tax results include $35.7 million for amortization of intangible assets and $62.8 million of acquisition, integration and restructuring costs primarily related to the acquisition of Sauflon.

We expect amortization of intangible assets will recur in future periods; however, the amounts are affected by the timing and size of our acquisitions.

Expenses such as the acquisition related and integration expenses generally diminish over time with respect to past acquisitions.

However, we generally will incur similar expenses in connection with any future acquisitions.

We incurred significant expenses in connection with our acquisitions and also incurred certain other operating expenses or income, which we generally would not have otherwise incurred in the periods presented as a part of our continuing operations.

Many of these costs relate to our acquisition of Sauflon in our fiscal fourth quarter of 2014.

Acquisition related and integration expenses consist of personnel related costs for transitional employees, other acquired employee related costs and integration related professional services.

Restructuring expenses consist of employee severance, product rationalization, facility and other exit costs.

The fiscal 2014 integration and restructuring costs include $16.5 million in charges to cost of sales primarily for product rationalization arising from the acquisition of Sauflon.

The charge for product rationalization is based on our review of products, materials and manufacturing processes of Sauflon.

Included in our selling, general and administrative expense (SGA) is $44.5 million in costs for CooperVision's acquisition of Sauflon and the related integration and restructuring activities, severance costs in our CooperSurgical fertility business along with other acquisition costs.

Research and development expense includes $0.6 million of severance costs related to integration and restructuring activities.

Fiscal 2013 pre-tax results include $30.2 million for amortization of intangible assets, a $21.1 million loss on divestiture of Aime, $14.1 million of insurance proceeds related to a business interruption claim and $0.6 million of costs, included in SGA expense, related to the acquisition of Origio.

| Loss on divestiture of Aime | — | | | — | | | 2 | % | | — | | | — | |

| CooperVision | $ | 124.3 | | | 10 | % | | $ | 79.1 | | | 7 | % |

| CooperSurgical | 5.7 | | | | 2 | % | | 63.5 | | | | 25 | % |

| | $ | 130.0 | | | 8 | % | | $ | 142.6 | | | 10 | % |

CooperVision fiscal 2014 net sales increased 10% from fiscal 2013 to $1.4 billion including Sauflon's net sales, subsequent to the acquisition, of $49.7 million.

CooperVision net sales growth included increases in total sphere lenses up 9%, representing 56% of net sales, the same as the prior year, and total toric lenses up 11%, representing 31% of net sales, the same as in the prior year.

Competitive silicone hydrogel single-use lens products are gaining market share and represent a risk to our business.

The business was originally obtained as part of the December 1, 2010, acquisition which included obtaining the rights to market Biofinity in Japan.

Post divestiture, we expect the transaction to be neutral to earnings per share.

CooperSurgical's remaining sales represent products used in fertility clinics that now represent 33% of CooperSurgical's net sales up from 16% in the prior year period due to the July 2012 acquisition of Origio, a global in-vitro fertilization medical device company.

As part of the new health care reform law, a 2.3% excise tax on any entity that manufactures or imports medical devices offered for sale in the United States, with limited exceptions, became effective January 1, 2013.

CooperVision's products are not subject to this new tax because contact lenses are excluded from the tax.

However, United States sales of CooperSurgical's products are subject to this new tax which is primarily recorded in selling, general and administrative expense on the Statement of Income.

On September 12, 2013, we entered into a five-year, $300.0 million, senior unsecured term loan agreement (Term Loan) that will mature on September 12, 2018, and will be subject to amortization of principal of 5% per year payable quarterly beginning October 31, 2016, with the balance payable at maturity.

We utilized the funds provided by this Term Loan to repay amounts outstanding on our revolving Credit Agreement, and at October 31, 2013, $300.0 million remained outstanding on the Term Loan.

represent 67% of CooperSurgical's net sales compared to 84% in the prior year.

2012 Compared with 2011

Highlights: 2012 vs. 2011

| • | Operating income up 25% to $283.4 million from $227.6 million. |

Fiscal 2012 pre-tax results include a $1.4 million loss related to the May 31, 2012, amendment to our revolving Credit Agreement, and costs related to the acquisition of Origio consisting of $4.9 million in direct acquisition costs and a $0.4 million net gain related to the repayment of debt acquired recorded in interest expense.

Fiscal 2011 pre-tax results included a charge of $20.4 million related to the limited recall of Avaira contact lenses, costs of $16.5 million related to the redemption of our Senior Notes, a $10.0 million charge related to the settlement of all claims in a patent infringement lawsuit and restructuring costs of $1.9 million related to the CooperVision manufacturing restructuring plan that was completed in fiscal 2011.

| CooperVision | $ | 68.1 | | | 6 | % | | $ | 150.6 | | | 16 | % |

| CooperSurgical | 46.2 | | | | 22 | % | | 21.7 | | | | 12 | % |

| | $ | 114.3 | | | 9 | % | | $ | 172.3 | | | 15 | % |

Net sales growth included increases in single-use spheres up 10%, representing 22% of net sales.

Total toric lenses grew 5% and were 30% of net sales, and multifocal lenses grew 26% to 8% of net sales up from 7% in the prior year.

Silicone hydrogel products grew 28% worldwide and represented 36% of net sales up from 30% in the prior year.

| ($ in millions) | 2012 | | | | 2011 | | | | % Change | |

| Americas | $ | 498.9 | | | $ | 469.7 | | | 6 | % |

| EMEA | 402.3 | | | | 398.5 | | | | 1 | % |

| Asia Pacific | 288.0 | | | | 252.9 | | | | 14 | % |

| | $ | 1,189.2 | | | $ | 1,121.1 | | | 6 | % |

EMEA net sales grew 1% primarily driven by sales growth of silicone hydrogel lenses, as sales in fiscal 2012 were negatively impacted due to the weakening euro and the British pound compared to the United States dollar.

CooperSurgical’s fiscal 2012 net sales increased 22% from fiscal 2011 to $255.9 million with net sales growth excluding acquisitions of 6%.

Origio net sales of $25.1 million are included in fiscal 2012 beginning on July 1, 2012.

Sales of products used in surgical procedures grew 19% and represented 36% of CooperSurgical’s fiscal 2012 net sales, 40% excluding Origio's IVF business, compared to 37% in the prior year.

The increase in CooperVision's gross margin is largely attributable to the lower royalty payment on our silicone hydrogel products beginning on January 1, 2013, increased manufacturing efficiencies and product mix.

Sales of higher margin Biofinity products increased as compared to the prior year.

Sales of our lower margin Avaira family of products also grew in the fiscal 2013 as we completed the relaunch of these products that compete in the two-week modality market.

The sequential increases in gross margin over the fiscal years presented are largely attributable to improvements in manufacturing efficiencies and product mix, primarily the shift to higher margin Biofinity silicone hydrogel products.

We expect our plans to ramp up production of MyDay, our single-use spherical silicone hydrogel lens, to provide headwinds to our gross margin over future fiscal periods.

The decrease in CooperSurgical's gross margin for fiscal 2013 as compared to fiscal 2012 is largely attributable to product mix and increased sales of lower margin fertility products due to the acquisition of Origio in July 2012.

The increase in CooperSurgical’s gross margin for fiscal 2012 as compared to fiscal 2011 is largely attributable to manufacturing efficiency improvements and product mix.

The changes in product mix included higher margins on products used in surgical procedures that grew 19% over the prior year and represented 36% of net sales in fiscal 2012, or 40% excluding Origio sales for the last four months of 2012, compared to 37% in fiscal 2011.

The increase was partially offset by the inclusion of four months of sales of lower margin fertility products from the acquisition of Origio in July 2012.

SGA as a percent of net sales decreased to 35% from 36% and 37% in fiscal 2012 and 2011, respectively, primarily due to reduced legal costs and the $10.0 million patent litigation settlement in fiscal 2011 discussed below.

We are exposed to risks caused by changes in foreign exchange, primarily to the British [removed: pound, euro and] [added: pound sterling, euro,] Japanese [removed: yen.][added: yen, Danish krone, Swedish krona, Australian dollar and Canadian dollar.]

A hypothetical [removed: 10%] [added: 5%] increase or decrease in the foreign currency exchange rates in comparison to the United States dollar would not have a material adverse impact on our financial condition or results of operations.

We are also exposed to risks associated with changes in interest rates, as the interest rate on our senior unsecured syndicated credit facilities, including the revolving Credit Agreement and [removed: Term Loan,] [added: term loans,] may vary with the London Interbank Offered Rate (LIBOR).

We have decreased this interest rate risk by hedging a [removed: significant] portion of variable rate debt effectively converting it to fixed rate debt for varying periods through December 2014.

On September 12, 2013, we entered into a five-year, $300.0 million, senior unsecured term loan agreement [removed: (Term Loan)] that will mature on September 12, 2018, and will be subject to amortization of principal of 5% per year payable quarterly beginning October 31, 2016, with the balance payable at maturity.

| October 31, (In millions) | [removed: 2013] [added: 2014] | | | | [removed: 2012] [added: 2013] | | |

| Short-term debt | $ | [removed: 43.0] [added: 101.5] | | | $ | [removed: 25.3] [added: 43.0] | |

| Long-term debt | [removed: 301.7] [added: 1,280.8] | | | | [removed: 348.4] [added: 301.7] | | |

| Total | $ | [removed: 344.7] [added: 1,382.3] | | | $ | [removed: 373.7] [added: 344.7] | |

At October 31, [removed: 2013] [added: 2014,] the scheduled maturities of our fixed and variable rate long-term debt obligations, their weighted average interest rates and their estimated fair values were as follows:

| Expected Maturity Date Fiscal Year ($ in millions) | [removed: 2014 | | | |] 2015 | | | | 2016 | | | | 2017 | | | | 2018 | | | | [added: 2019 | | | |] Thereafter | | | | Total | | | | Fair Value | | |

| Fixed interest rate | $ | — | | | $ | 0.4 | | | $ | [removed: 0.4] [added: 0.3] | | | $ | [removed: 0.4] [added: 0.3] | | | $ | — | | | $ | [removed: 0.5] [added: 0.3] | | | $ | [removed: 1.7] [added: 1.3] | | | $ | [removed: 1.7] [added: 1.3] | |

| Average interest rate | 1.0 | | % | | 1.0 | | % | | 1.0 | | % | | 1.0 | | % | | [removed: 1.0] [added: —] | | [removed: %] | | — | | | | | | | | | | |

As the table incorporates only those exposures that existed as of October 31, [removed: 2013,] [added: 2014,] it does not consider those exposures or positions which could arise after that date.

As of October 31, [removed: 2013,] [added: 2014,] we had [added: one] interest rate [removed: swaps] [added: swap] outstanding that [removed: are] [added: is] designed to fix the variable borrowing costs related to [removed: $200.0] [added: $40.0] million of the outstanding balance on our credit agreements.

If interest rates were to increase or decrease by 1% or 100 basis points, annual interest expense would increase or decrease by about [removed: $1.0] [added: $12.8] million.

Risk Factors and Note 1 and Note [removed: 4] [added: 5] to the consolidated financial statements.

On August 4, 2014, we entered into a three-year, $700.0 million, senior unsecured term loan agreement that will mature on August 4, 2017.

There is no amortization of the principal, and we may prepay the loan balances from time to time, in whole or in part, with premium or penalty.

At October 31, 2014, $700.0 million remained outstanding on this term loan.

At October 31, 2014, $300.0 million remained outstanding on this term loan.

At October 31, 2014, we had $720.3 million available under the revolving Credit Agreement.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

| Average interest rate | 3.5 | | % | | 3.5 | | % | | 3.5 | | % | | 3.5 | | % | | 3.5 | | % | | 3.5 | | % | | | | | | | | |

| Variable interest rate | $ | — | | | $ | — | | | $ | 979.5 | | | $ | 300.0 | | | $ | — | | | $ | — | | | $ | 1,279.5 | | | $1,279.5 | | |

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

We utilized the funds provided by this Term Loan to repay amounts outstanding on our revolving Credit Agreement, and at October 31, 2013, $300.0 million remained outstanding on the Term Loan.

In February 2011, we redeemed all $339.0 million aggregate principal amount outstanding of our 7.125% Senior Notes issued on January 31, 2007, in accordance with the terms of the Indenture from borrowings under the Credit Agreement.

In accordance with the Indenture, the redemption price for the Notes was 103.563% of their principal amount plus accrued and unpaid interest to February 15, 2011, the redemption date.

In fiscal 2011, we recorded a $16.5 million loss on the repurchase that includes the write-off of about $4.4 million of unamortized costs and the redemption premium of $12.1 million related to the Senior Notes on our Consolidated Statement of Income.

| Average interest rate | 2.1 | | % | | 2.5 | | % | | 3.1 | | % | | 4.8 | | % | | 4.8 | | % | | 4.8 | | % | | | | | | | | |

| Variable interest rate | $ | — | | | $ | — | | | $ | 3.8 | | | $15.0 | | | | $281.2 | | | | $ | — | | | $300.0 | | | | $300.0 | | |

CooperVision develops, manufactures and markets a broad range of [removed: monthly,] [added: single-use,] two-week and [removed: single-use] [added: monthly] contact lenses, featuring advanced materials and optics.

CooperVision's products are primarily manufactured at its facilities located in Hampshire, United Kingdom, Juana Diaz, Puerto Rico, [added: Budapest, Hungary] and Scottsville, New York.

CooperSurgical products support the point of healthcare delivery in the hospital, [removed: clinicians] [added: clinician's] office and fertility clinics.

CooperSurgical's major manufacturing and distribution facilities are located in Trumbull, Connecticut, Malov, Denmark, Pasadena, California, Stafford, Texas, [removed: Golden, Colorado,] and Berlin, Germany.

We believe that in order to compete successfully in the numerous niches of the contact lens market, companies must offer differentiated products that are priced competitively and manufactured [removed: efficiently.]

This [added: increased] manufacturing flexibility [removed: allows] [added: should allow] CooperVision to compete in its markets by:

| • | Producing high, medium and low volumes of lenses made with a variety of materials for a broader range of market niches: single-use, two-week, monthly and quarterly disposable [removed: sphere and] [added: sphere,] toric [added: and multifocal] lenses and custom toric lenses for patients with a high degree of astigmatism. |

Under the Biofinity brand, CooperVision [removed: has launched] [added: markets] monthly silicone hydrogel spherical, toric and multifocal lens [removed: products over the past five years.][added: products.]

In addition to its PC Technology™ and silicone hydrogel product offerings, CooperVision competes in the contact lens market with [removed: its] [added: our] traditional hydrogel products.

Toric and Multifocal: Net sales of CooperVision's toric [removed: lenses, representing] [added: lenses represented] 31 percent of CooperVision's net [removed: sales, grew 9 percent] [added: sales] in fiscal [removed: 2013, as compared to fiscal 2012.][added: 2014.]

[removed: Multifocal lens net sales,] [added: Net sales of fertility products,] representing [removed: 10 percent] [added: 35%] of [added: CooperSurgical's] net sales, grew [removed: 29 percent] [added: 7%] in fiscal [added: 2014 as compared to fiscal] 2013.

Proclear: Net sales of CooperVision's PC Technology products - which consist of spherical, toric and multifocal products, including Biomedics® XC and Proclear® 1 Day - [removed: grew 6 percent in fiscal 2013 as compared to fiscal 2012 and] represented [removed: 25] [added: 24] percent of CooperVision's net [removed: sales.][added: sales in fiscal 2014.]

Silicone Hydrogel: CooperVision's silicone hydrogel spherical, toric and multifocal lens [removed: products grew 26 percent] [added: products, including Sauflon's clariti lenses] in [removed: fiscal 2013 as compared to] [added: the] fiscal [removed: 2012] [added: fourth quarter of 2014] and [added: not in fiscal 2013,] represented [removed: 43] [added: 49] percent of CooperVision's net sales as compared to [removed: 36] [added: 43] percent in fiscal [removed: 2012.][added: 2013.]

CooperVision's three largest competitors in the worldwide market and its primary competitors in the spherical, toric and multifocal lens categories of that market are Johnson & Johnson Vision Care, Inc., CIBA Vision [removed: (owned] [added: owned] by Novartis [removed: AG)] [added: AG] and Bausch & Lomb Incorporated [removed: (owned] [added: owned] by Valeant Pharmaceuticals International, [removed: Inc.).][added: Inc.]

Over the past decade, the contact lens industry has experienced a global shift toward silicone hydrogel lenses [removed: and toward single-use lenses.][added: that now represent approximately 50% of the global contact lens market.]

CooperVision [removed: was late] [added: competes] in [removed: entering] the silicone hydrogel segment of the market [removed: but now has significant sales of] [added: with our Biofinity] monthly [removed: and two-week] spherical, toric and multifocal [removed: silicone hydrogel offerings,] [added: lenses, Avaira two-week spherical] and [removed: it has recently introduced a silicone hydrogel] [added: toric lenses and MyDay] single-use spherical [removed: lens.][added: lenses.]

In the toric lens market, a similar shift toward silicone hydrogel lenses has [removed: occurred] [added: occurred,] but we believe that lens manufacturers also continue to compete to provide the highest possible level of visual acuity and patient satisfaction by offering a wide range of lens parameters, superior wearing comfort and a high level of customer service, both for patients and contact lens practitioners.

CooperVision competes based on its three manufacturing [added: processes, including manufacturing] processes [added: recently acquired with Sauflon,] yielding wider ranges of toric lens parameters, providing wide choices for patient and practitioner and superior visual acuity, as well as by offering excellent customer service, including high standards of on-time product delivery.

CooperSurgical offers a broad array of products used in the care and treatment of [removed: women's health.][added: women.]

[added: In July 2012, CooperSurgical acquired] Origio [removed: is] [added: to form] a [removed: global in-vitro fertilization (IVF)] [added: combined] medical device company that develops, manufactures and distributes highly specialized products that target IVF treatment with a goal to make fertility treatment safer, more efficient and convenient.

CooperSurgical [removed: products are] [added: participates] in [added: the market for women's healthcare with its diversified product lines in] three major categories based on the point of healthcare delivery: [removed: hospitals,] [added: hospitals and surgical centers,] obstetricians and gynecologists (ob/gyns) medical offices and fertility clinics.

[removed: Based on United States Census estimates,] CooperSurgical expects patient visits to [added: ob/gyns in the] United States [removed: ob/gyns] to increase over the next decade.

Driving this growth is [removed: an increasing base] [added: a steady number] of reproductive age [removed: women,] [added: women with increasing fertility issues,] a large and stable middle-aged population and a [removed: rapidly] growing population of women over the age of [removed: 65.][added: 65 according the United States Census estimates.]

Another trend in the market for women's healthcare includes the migration of ob/gyn clinicians away from private practice ownership and toward aligning with group practices or employment with hospitals and [removed: health] [added: healthcare] systems.

While general medical practitioners play an important role in women's primary care, the ob/gyn specialist is the primary market for [removed: associated] [added: CooperSugical's] medical devices.

| • | Ob/gyns traditionally provide the initial evaluation for women and their partners who seek infertility assistance. Ovulatory drugs and intrauterine insemination (IUI) are common treatments [removed: of] [added: in] these cases along with embryo transfer procedures. |

| • | The trend to move hospital-based procedures to an office or clinical setting is continuing as [removed: seen with] [added: a method to reduce cost to] the [removed: endometrial ablation procedure.] [added: healthcare system while maintaining positive clinical outcomes.] |

Competitive factors in these segments include technological and scientific advances, product quality, price, customer service and effective communication of product information to [removed: physicians] [added: physicians, fertility clinics] and hospitals.

CooperSurgical competes based on [removed: its] [added: our] sales and marketing expertise and the technological [removed: advantages of its products.]

As CooperSurgical expands [removed: its] [added: our] product line, [removed: it] [added: we] also [removed: offers training] [added: offer educational programs] for medical professionals in the appropriate use of [removed: its] [added: our] products.

CooperSurgical is seeking to expand [removed: its] [added: our] presence in the significantly larger hospital and outpatient surgical procedure segment of the market that is at present dominated by bigger competitors such as Johnson & Johnson's Ethicon [removed: Endo-Surgery and Ethicon Women's Health and Urology companies,] [added: Endo-Surgery,] Boston Scientific, Gyrus ACMI and Covidien.

These competitors have [removed: well established] [added: well-established] positions within the operating room [added: environment.]

CooperSurgical intends to leverage [removed: its] [added: our] relationship with gynecologic surgeons and focus on devices specific to gynecologic surgery to facilitate [removed: its] [added: our] expansion within the surgical segment of the market.

Cooper employs about [removed: 245] [added: 250] people in [removed: its] [added: our] research and development and manufacturing engineering departments.

CooperVision's research and development activities primarily include programs to develop new contact lens [removed: designs.][added: designs along with improving formulations and manufacturing processes.]

CooperSurgical conducts research and development in-house and also has consulting agreements with external [removed: surgical] specialists.

CooperSurgical's research and development activities include the design and [removed: upgrading] [added: improvement] of surgical procedure devices, the [removed: upgrade] [added: advancement] and expansion of CooperSurgical's portfolio of assisted reproductive technology products, [removed: including Origio products,] as well as products within the general obstetrics and gynecology offerings.

Cooper-sponsored research and development expenditures during fiscal [removed: 2013, 2012] [added: 2014, 2013] and [removed: 2011] [added: 2012] were [removed: $58.8] [added: $66.3] million, [removed: $51.7] [added: $58.8] million and [removed: $43.6] [added: $51.7] million, respectively.

Research and development expenditures represented 4 percent of net sales in fiscal [removed: 2013 and 2012, and 3 percent in 2011.][added: 2012 - 2014.]

During fiscal [removed: 2013,] [added: 2014,] CooperVision represented 79 percent and CooperSurgical represented 21 percent of the total research and development [removed: expenses.][added: expenses, the same as fiscal 2013.]

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

efficiently.

We also believe that the manufacturing processes acquired in connection with the Sauflon acquisition will be of value to us as these new platforms and processes may add greater flexibility and reduce time to market of our combined product offerings.

We believe our ability to compete successfully with a full range of silicone hydrogel products is an important factor to achieving our desired future levels of sales growth and profitability.

We believe that the global market for single-use contact lenses will continue to grow, that competitive silicone hydrogel single-use lens products are gaining market share and that they represent a risk to our business.

To meet this anticipated demand, we plan to launch MyDay in more geographical regions, such as the United States during fiscal 2015, and to continue the implementation of capital projects to invest in increased single-use manufacturing capacity.

Consistent with this strategy, on August 6, 2014, we completed the acquisition of Sauflon Pharmaceuticals Limited (Sauflon), a privately-held European manufacturer and distributor of soft contact lenses and aftercare solutions.

The acquisition of Sauflon expands our contact lens product portfolio particularly with Sauflon's clariti® 1day brand of single-use sphere, toric and multifocal silicone hydrogel lenses.

Clariti lenses received United States FDA clearance in August 2013.

Sauflon is headquartered in the United Kingdom and has a global presence with manufacturing facilities in the United Kingdom and Hungary.

The Sauflon acquisition is intended to accelerate the growth of sales of our single-use products by enabling a multi-tier, single-use strategy with a full suite of hydrogel and silicone hydrogel product offerings in the major product categories of sphere, toric and multifocal lenses.

This acquisition is also intended to provide for an enhanced relationship with key European retailers and opportunities for operational synergies.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

Spheres: Net sales of CooperVision's spherical lenses represented 56 percent of CooperVision's net sales in fiscal 2014 including net sales of single-use spherical lens that represented 22 percent of net sales in the fiscal year.

Net sales of multifocal lenses represented 11 percent of net sales in the fiscal year.

We believe that the addition of Sauflon's clariti 1day brand of single-use sphere, toric and multifocal lenses provides CooperVision with the broadest product portfolio in the single-use silicone hydrogel market.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

CooperSurgical competes in the global in-vitro fertilization (IVF) market with a product portfolio of IVF media and assisted reproductive technology (ART) solutions that enhance the work of fertility professionals to the benefit of families.

This trend includes the increasing influence of supply chain controls, such as value analysis committees, on product evaluation and procurement.

The response in the United States market to the Affordable Care Act (ACA) includes the development of new models of healthcare delivery.

One goal of these new models is to deliver more cost-effective healthcare including a trend to move treatment out of hospitals and surgery centers and into the office setting without compromising care.

We expect this trend to continue in the near term.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

| • | We estimate that approximately one-third of the office visits to ob/gyns are patients seeking diagnosis and treatment for the symptoms of abnormal uterine bleeding. |

| • | IVF is performed by reproductive endocrinologists, a subgroup of ob/gyns, along with partner embryologists. |

| | |

| --- | --- |

| | |

| --- | --- |

Woman's Healthcare Product Sales

Net sales of CooperSurgical products used in office and surgical procedures, representing 65% of CooperSurgical's net sales, decreased 1% in fiscal 2014 as compared to fiscal 2013.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

advantages of our products.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

significant regulatory fines or penalties.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

serious injury if it were to recur.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

Administration health programs and TRICARE.

Spheres: Net sales of CooperVision's spherical lenses, representing 56 percent of CooperVision's net sales, grew 4 percent in fiscal 2013, as compared to fiscal 2012.

Single-use spherical lens net sales, representing 21 percent of net sales, grew 1 percent.

Acquisition of Origio

In July 2012, CooperSurgical completed a voluntary tender offer for the outstanding shares of Origio a/s.

Based in Malov, Denmark, Origio, with approximately 320 employees, is a leader in delivering innovative Assisted Reproductive Technology (ART) solutions that enhance the work of ART professionals to the benefit of families.

With 13 subsidiaries and several distributors, Origio has a worldwide presence with a broad product portfolio for the ART market along with professional training programs.

CooperSurgical participates in the market for women's healthcare with its diversified product lines of over 600 products.

CooperSurgical believes that the resurgence of population growth in the reproductive age group will result in increased office visits related to birth control and childbearing.

CooperSurgical's Fiscal 2013 Net Sales Growth

During fiscal 2013, CooperSurgical's net sales grew 25 percent, or 3 percent excluding acquisitions, to $319.4 million from $255.9 million in fiscal 2012, representing 20 percent of Cooper's net sales in fiscal 2013 compared to 18 percent in fiscal 2012.

With the acquisition of Origio in July 2012, sales of fertility products now represent 33 percent of CooperSurgical's net sales as compared to 16 percent in fiscal 2012.

environment.

Quality System Regulation, facility registration and product listing, reporting of adverse medical events, and appropriate, truthful and non-misleading labeling, advertising, and promotional materials (General Controls).

On October 31, 2013, the Company had about 8,000 employees.

On or about November 11, 2014, Johnson & Johnson Vision Care (JJVC) filed an action in the district court of Dusseldorf, Germany, against CooperVision GmbH and CooperVision, Inc. (collectively “CooperVision”) for patent infringement.

In the action, JJVC alleges that certain CooperVision products infringe JJVC’s European Patent No. EP 1 754 728 B1, and is seeking damages and to enjoin these products from selling in Germany.

CooperVision is challenging the validity of the patent before the European Patent Office.

CooperVision denies JJVC’s allegations of infringement and intends to defend the action vigorously and to continue its challenge to the patent before the European Patent Office.

We are not in a position to assess whether any loss or adverse effect on our financial condition is probable or remote or to estimate the range of potential loss, if any.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

PART II

Securities Litigation

On November 28, 2011, Harold Greenberg filed a complaint in the United States District Court for the Northern District of California, Case No. 4:11-cv-05697-YGR, against the following defendants: the Company; Robert S.

Weiss, its President, Chief Executive Officer and a director; Eugene J.

Midlock, its former Senior Vice President and Chief Financial Officer; and Albert G.

White, III, its Vice President and Chief Strategy Officer.

On December 12, 2011, a second individual, Ross Wallen, filed a related complaint against the same defendants in the Northern District of California, Case No. 4:11-cv-06214-YGR.

The Wallen complaint largely repeats the allegations in the Greenberg complaint.

Greenberg and Wallen each sought to represent a class of persons who purchased the Company's common stock between March 4, 2011 and November 15, 2011.

On February 29, 2012, the court ordered the Greenberg and Wallen actions consolidated and appointed Universal-Investment-Gesellschaft mbH as lead plaintiff.

On May 4, 2012, the lead plaintiff filed a Consolidated Amended Complaint, which alleges that the Company, Robert S.

Weiss and Eugene J.

Midlock violated Section 10(b) of the Securities Exchange Act of 1934 by, among other things, making misrepresentations with an intent to deceive investors concerning the safety of the Avaira® Toric and Avaira Sphere contact lenses, which the Company recalled in 2011.

On August 7, 2012, the Court heard argument on defendants' motion to dismiss the Consolidated Amended Complaint.

On January 7, 2013, the Court granted defendants' motion to dismiss the Consolidated Amended Complaint, with leave to amend.

On February 4, 2013, the lead plaintiff filed a Second Consolidated Amended Complaint, which again alleges that the Company, Robert S.

Weiss and Eugene J.

Midlock violated Section 10(b) of the Securities Exchange Act of 1934 by, among other things, making misrepresentations with an intent to deceive investors concerning the 2011 recall of Avaira contact lenses.

The Second Consolidated Amended Complaint seeks unspecified damages on behalf of a purported class of persons who purchased the Company's common stock between August 19, 2011 and November 15, 2011.

On March 6, 2013, the defendants moved to dismiss the Second Consolidated Amended Complaint.

On April 16, 2013 the Court heard argument on defendants' motion to dismiss the Second Consolidated Amended Complaint.

On May 31, 2013, the Court granted defendants' motion to dismiss the Second Consolidated Amended Complaint without leave to amend and entered final judgment in favor of defendants.

Plaintiff did not file a notice of appeal within the time prescribed by law.

Derivative Litigation

On January 9, 2012, Joseph Operman filed a purported shareholder derivative complaint in the United States District Court for the Northern District of California, Case No. 4:12-cv-00143-YGR, against members of the Company's board of directors.

The derivative complaint seeks recovery on behalf of the Company, which is named as a “nominal defendant.” The derivative complaint purports to allege causes of action for breach of fiduciary duties and failure to exercise oversight responsibilities against all defendants and a cause of action for contribution against Mr. Weiss for alleged violations of Section 10(b) of the Securities Exchange Act of 1934.

On May 18, 2012, Operman filed an amended derivative complaint.

The amended derivative complaint largely repeats the allegations of misrepresentations in the securities class action complaints described above, and includes allegations of false projections of future financial results.

On June 13, 2013, Operman voluntarily moved the Court to dismiss the derivative action without prejudice.

On July 24, 2013, after the Company's shareholders were provided with notice of the voluntary motion for dismissal and an opportunity to object, and no objections were received, the Court entered a final order of dismissal in the derivative action.

10-K 1 [removed: coo_20131031-10k.htm] [added: coo_20141031-10k.htm] 10-K

FOR THE FISCAL YEAR ENDED OCTOBER 31, [removed: 2013][added: 2014]

Yes x No [removed: ¨][added: o]

Yes [removed: ¨] [added: o] No x

Yes x No [removed: ¨][added: o]

Yes x No [removed: ¨][added: o]

Large accelerated filer x Accelerated filer [removed: ¨] [added: o] Non-accelerated filer [removed: ¨] [added: o] Smaller reporting company [removed: ¨][added: o]

Yes [removed: ¨] [added: o] No x

On November 30, [removed: 2013,] [added: 2014,] there were [removed: 47,655,018] [added: 47,842,980] shares of the registrant's common stock held by non-affiliates with aggregate market value of [removed: $5.2] [added: $6.3] billion on April 30, [removed: 2013,] [added: 2014,] the last day of the registrant's most recently completed fiscal second quarter.

Number of shares outstanding of the registrant's common stock, as of November 30, [removed: 2013: 48,000,571][added: 2014: 48,158,484]

| Portions of the Proxy Statement for the Annual Meeting of Stockholders scheduled to be held in March [removed: 2014] [added: 2015] | | Part III |

for the Fiscal Year Ended October 31, [removed: 2013][added: 2014]

| Item 1. | Business | [removed: [6](#sB24AE0AD90391E2B46E656438F707EED)] [added: [5](#s3B80977DA3348008C4D265D1E6624FEC)] |

| Item 1A. | Risk Factors | [removed: [18](#sF181D7EE0E10EE4DF3E856438F8FE01B)] [added: [17](#s955992BFEDCA1E73E8D265D1E6951742)] |

| Item 1B. | Unresolved Staff Comments | [removed: [32](#s5F043F4D884D51C5A6EE56438FC1C194)] [added: [32](#sC56B5EE2D654E734A63065D1E6B9D9BF)] |

| Item 2. | Properties | [removed: [33](#s1DDFACFAAFF1D8B76DF856438FE26D55)] [added: [33](#s61831BBBEFCA1F4D01A565D1E6EB6F45)] |

| Item 3. | Legal Proceedings | [removed: [35](#sF659A9C04E9909ED44F3564390159135)] [added: [34](#sA31738AF0B39B753CA9065D1E70AB96B)] |

| Item 5. | Market for Registrant's Common [removed: Equity and] [added: Equity,] Related Stockholder Matters [added: and Issuer Purchases of Equity Securities] | [removed: [37](#s7D4D632A4AAF2418767C564390897BFE)] [added: [35](#s069E74D43EEEAB11F9B065D1E78FF6DA)] |

| Item 6. | Selected Financial Data | [removed: [41](#sFDB91D93BC3B96ABE36B5643910FDDDD)] [added: [39](#s5B3EB1BAC06ADABED2E165D1D47ABA6A)] |

| Item 7. | Management's Discussion and Analysis of Financial Condition and Results of Operations | [removed: [42](#s041450ED9CDFD634BB5E564391311DCE)] [added: [40](#s3FB7B6D07755C7A2492D65D1E835B6BA)] |

| Item 7A. | Quantitative and Qualitative Disclosure about Market Risk | [removed: [61](#sBF7A94DB46CCACA7EB83564392099783)] [added: [61](#s7FA3A56102427C37112565D1D62713FF)] |

| Item 8. | Financial Statements and Supplementary Data | [removed: [63](#s1273B262724AF7609F805643922CADFB)] [added: [63](#s439C726AC527EE04962865D1E92FFC5C)] |

| Item 9. | Changes In and Disagreements With Accountants on Accounting and Financial Disclosure | [removed: [103](#sD5D4FE4CC2E773F154A956439729022A)] [added: [109](#s8A7A9EBCE5A6BE272F0965D1EDC144A3)] |

| Item 9A. | Controls and Procedures | [removed: [103](#s6E099515FF9C6E821D3A5643972E6270)] [added: [109](#s4FEC33371D4775A92CD165D1EDDFFBEA)] |

| Item 9B. | Other Information | [removed: [104](#s4EFC1EA99A44F405A1BD5643973EE963)] [added: [110](#sBD1238CB8B3EFF0F369065D1EE106AA7)] |

| Item 10. | Directors, Executive Officers and Corporate Governance | [removed: [105](#s0DAC879BB24B26252A0F56439792AF73)] [added: [111](#sC8B52A323BCB7F00837865D1EE658560)] |

| Item 11. | Executive Compensation | [removed: [105](#s6F87B038BEFF27BE2913564397B57971)] [added: [111](#sBE0DDE9A70A4EB50E3D365D1EE89AE96)] |

| Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | [removed: [105](#s35252C4D33D8969EBE1A564397E441F7)] [added: [111](#s7527332C71605836D7C465D1EEBB07B3)] |

| Item 13. | Certain Relationships and Related Transactions, and Director Independence | [removed: [105](#s9381E6F8FE674935DDFD564398064BEE)] [added: [111](#s8B9A11F8C6E0473155A865D1EED83CAA)] |

| Item 14. | Principal Accounting Fees and Services | [removed: [105](#s742A39D8DAC9991708C156439837B310)] [added: [111](#s522A306854FCE205FBCD65D1EF0B88DA)] |

| Item 15. | Exhibits and Financial Statement Schedules | [removed: [106](#sAB547932750E19DC25205643988A6272)] [added: [112](#sDEFBDEECBC8B169F3E0B65D1EF5F0DDE)] |

| • | Adverse changes in global or regional general business, political and economic conditions due to the current global economic downturn, including the impact of continuing uncertainty and instability of certain European Union countries [removed: which] [added: that] could adversely affect our global markets. |

| • | Foreign currency exchange rate and interest rate fluctuations including the risk of [removed: further declines] [added: fluctuations] in the value of the [removed: yen] [added: yen, pound and euro] that would decrease our revenues and earnings. |

| • | A major disruption in the operations of our manufacturing, research and development or distribution facilities, due to technological problems, [added: including any related to our information systems maintenance or enhancements,] natural disasters or other causes. |

| • | Limitations on sales following [removed: new] product introductions due to poor market acceptance. |

| • | [removed: Failures] [added: Failure] to receive, or delays in receiving, U.S. or foreign regulatory approvals for products. |

| • | Compliance costs and potential liability in connection with U.S. and foreign healthcare regulations, including product recalls, [added: warning letters] and potential losses resulting from sales of counterfeit and other infringing products. |

| • | Legal costs, insurance expenses, settlement costs and the risk of an adverse decision or settlement related to product liability, patent [removed: protection] [added: infringement] or other litigation. |

| • | The success of [removed: the Company’s] [added: our] research and development activities and other start-up projects. |

| • | Dilution to earnings per share from [added: the Sauflon acquisition or other] acquisitions or issuing stock. |

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

| • | Acquisition-related adverse effects including the failure to successfully obtain the anticipated revenues, margins and earnings benefits of acquisitions, including the Sauflon acquisition; integration delays or costs and the requirement to record significant adjustments to the preliminary fair value of assets acquired and liabilities assumed within the measurement period, required regulatory approvals for an acquisition not being obtained or being delayed or subject to conditions that are not anticipated, adverse impacts of changes to accounting controls and reporting procedures, contingent liabilities or indemnification obligations, increased leverage and lack of access to available financing (including financing for the acquisition or refinancing of debt owed by us on a timely basis and on reasonable terms). |

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

| | |

| --- | --- |

| Item 4. | Submission of Matters to a Vote of Security Holders | [36](#s88DF6A765147616B51C056439036C4B4) |

| • | Acquisition integration delays or costs or the requirement to record significant adjustments to the preliminary fair value of assets acquired and liabilities assumed within the measurement period. |

| • | The impact of acquisitions or divestitures on revenues, earnings or margins. |

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

The following is a summary of Cooper's principal facilities as of October 31, [removed: 2013.][added: 2014.]

| United [removed: States] [added: States:] | | | | |

| California | [removed: 112,727] [added: 136,369] | | | Executive offices; CooperVision research & development and [removed: CooperVision] administrative offices; CooperSurgical manufacturing and distribution |

| [removed: Juana Diaz] [added: Puerto Rico] | 333,124 | | | CooperVision manufacturing and distribution |

| [removed: Ontario] [added: Canada] | 11,647 | | | CooperVision marketing |

| [removed: Sao Paulo] [added: Brazil] | 17,545 | | | CooperVision marketing and distribution |

| [removed: Hampshire] [added: United Kingdom] | [removed: 493,128] [added: 675,553] | | | CooperVision manufacturing, marketing, distribution, research & development and administrative offices; CooperSurgical marketing |

| [removed: Liege] [added: Belgium] | 119,146 | | | CooperVision distribution |

| [removed: Malov] [added: Denmark] | 63,787 | | | CooperSurgical manufacturing, marketing and administrative offices |

| [removed: Berlin] [added: Germany] | [removed: 13,255] [added: 75,887] | | | [added: CooperVision marketing and distribution;] CooperSurgical manufacturing, marketing and distribution |

| [removed: Frankfurt] [added: France] | [removed: 14,694] [added: 12,388] | | | CooperVision marketing and [removed: distribution] [added: distribution; CooperSurgical marketing] |

| [removed: Milan] [added: Italy] | [removed: 29,150] [added: 31,197] | | | CooperVision marketing and [removed: distribution] [added: distribution; CooperSurgical marketing] |

| [removed: Madrid] [added: Netherlands] | [removed: 29,301] [added: 33,865] | | | CooperVision [added: and CooperSurgical] marketing and distribution |

| [removed: Johannesburg] [added: South Africa] | 13,250 | | | CooperVision marketing and distribution |

| [removed: Nice] [added: Spain] | [removed: 12,184] [added: 30,678] | | | CooperVision marketing and [removed: distribution] [added: distribution; CooperSurgical marketing] |

| Japan | [removed: 63,590] [added: 74,684] | | | CooperVision manufacturing, marketing, distribution and administrative offices; CooperSurgical marketing |

| Australia | [removed: 29,973] [added: 33,952] | | | CooperVision manufacturing, marketing, distribution and administrative offices |

| Other Asia Pacific | [removed: 45,187] [added: 55,526] | | | CooperVision and CooperSurgical marketing and distribution |

We also own Sauflon's corporate headquarters in Twickenham, United Kingdon, at 7,916 square feet.

| Other United States | 42,200 | | | CooperSurgical manufacturing; CooperVision marketing |

| | | | | |

| Hungary | 158,300 | | | CooperVision manufacturing and marketing |

| | | | | |

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

| Texas | 33,630 | | | CooperSurgical manufacturing |

| Wisconsin | 18,000 | | | CooperSurgical manufacturing |

| New Jersey | 10,600 | | | CooperSurgical marketing |

| Puerto Rico | | | | |

| Canada | | | | |

| Brazil | | | | |

| United Kingdom | | | | |

| Belgium | | | | |

| Denmark | | | | |

| Germany | | | | |

| Italy | | | | |

| Firenze | 2,047 | | | CooperSurgical marketing |

| Spain | | | | |

| Barcelona | 1,377 | | | CooperSurgical marketing |

| South Africa | | | | |

| France | | | | |

Cooper's common stock, par value $0.10 per share, is traded on the New York Stock Exchange under the symbol “COO.” In the table that follows, we indicate the high and low selling prices of our common stock for each three-month period of [removed: 2013] [added: 2014] and [removed: 2012:][added: 2013:]

| January 31 | $ | [removed: 102.47] [added: 135.00] | | | $ | [removed: 88.80] [added: 118.58] | | | $ | [removed: 73.28] [added: 102.47] | | | $ | [removed: 52.60] [added: 88.80] | |

| April 30 | $ | [removed: 110.85] [added: 145.34] | | | $ | [removed: 100.24] [added: 116.95] | | | $ | [removed: 88.74] [added: 110.85] | | | $ | [removed: 72.41] [added: 100.24] | |

| July 31 | $ | [removed: 129.06] [added: 163.24] | | | $ | [removed: 105.71] [added: 127.02] | | | $ | [removed: 89.31] [added: 129.06] | | | $ | [removed: 72.44] [added: 105.71] | |

| October 31 | $ | [removed: 135.41] [added: 166.52] | | | $ | [removed: 124.00] [added: 143.62] | | | $ | [removed: 100.92] [added: 135.41] | | | $ | [removed: 71.40] [added: 124.00] | |

At November 30, [removed: 2013,] [added: 2014,] there were [removed: 544] [added: 489] common stockholders of record.

In dollar terms, we paid cash for dividends of about $2.9 million in fiscal [removed: 2013] [added: 2014] and $2.9 million in fiscal [removed: 2012.][added: 2013.]

The following graph compares the cumulative total return on the Company's common stock with the cumulative total return of the Standard & Poor's Smallcap 600 Stock Index and the Standard & Poor's Health Care Equipment Index for the five-year period ended October 31, [removed: 2013.][added: 2014.]

The graph assumes that the value of the investment in the Company and in each index was $100 on October 31, [removed: 2008,] [added: 2009,] and assumes that all dividends were reinvested.

and the S&P Health Care Equipment [removed: Index][added: Index]

*$100 invested on [removed: 10/31/08] [added: 10/31/09] in stock or index, including reinvestment of dividends.

Copyright© [removed: 2013] [added: 2014] S&P, a division of The McGraw-Hill Companies Inc. All rights reserved.

During the three-month period ended October 31, [removed: 2013,] [added: 2014,] we repurchased shares of our common stock as follows:

| [removed: 8/1/13] [added: 8/1/14] – [removed: 8/31/13] [added: 8/31/14] | | — | | | $ | — | | | — | | | $ | [removed: 184,500,000] [added: 211,500,000] | |

At October 31, [removed: 2013,] [added: 2014,] the remaining repurchase authorization under the 2012 Share Repurchase Program was approximately [removed: $61.5 million and was subsequently increased $200.0 million, by a December 12, 2013 amendment to the program, for a total remaining repurchase authorization of $261.5] [added: $185.7] million.

(1) The amount of total securities to be issued under [added: the Company's] equity plans shown in Column A includes [removed: 647,185] [added: 598,667] Restricted Stock Units granted pursuant to the Company's equity plans.

As of October 31, [removed: 2013,] [added: 2014,] up to [removed: 1,609,325] [added: 1,507,591] shares of common stock may be issued pursuant to the 2007 Plan and [removed: 246,516] [added: 334,212] shares of common stock may be issued pursuant to the 2006 Directors’ Plan.

The 1996 Directors' Plan and 2001 Plan have expired by their terms, but up to [removed: 354,200] [added: 80,800] shares of common stock may be issued pursuant to awards that remain outstanding under these plans.

| | 2014 | | | | | | | | 2013 | | | | | | |

THE COOPER COMPANIES, INC. AND SUBSIDIARIES


| | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | | | | | | | | | | | | |

| | 10/09 | | | | 10/10 | | | | 10/11 | | | | 10/12 | | | | 10/13 | | | | 10/14 | | |

| The Cooper Companies, Inc. | $ | 100.00 | | | $ | 176.43 | | | $ | 248.02 | | | $ | 343.79 | | | $ | 463.06 | | | $ | 587.64 | |

| S&P Smallcap 600 | $ | 100.00 | | | $ | 126.27 | | | $ | 139.58 | | | $ | 158.56 | | | $ | 220.53 | | | $ | 241.03 | |

| S&P Health Care Equipment | $ | 100.00 | | | $ | 104.00 | | | $ | 110.86 | | | $ | 126.57 | | | $ | 158.91 | | | $ | 197.97 | |

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

| 9/1/14 – 9/30/14 | | — | | | $ | — | | | — | | | $ | 211,500,000 | |

| 10/1/14 – 10/31/14 | | 175,786 | | | $ | 146.64 | | | 175,786 | | | $ | 185,700,000 | |

| Total | | 175,786 | | | | | | | 175,786 | | | | | |

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

| Equity compensation plans approved by shareholders(2) | 1,922,603 | | $63.32 | | 1,696,162 |

| Total | 1,922,603 | | $63.32 | | 1,696,162 |

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

| | 2013 | | | | | | | | 2012 | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | | | | | | | | | | | | | |

| | 10/08 | | | 1 | | 10/09 | | | | 10/10 | | | | 10/11 | | | | 10/12 | | | | 10/13 | | |

| The Cooper Companies, Inc. | $ | 100.00 | | | | $ | 170.42 | | | $ | 300.66 | | | $ | 422.67 | | | $ | 585.89 | | | $ | 789.16 | |

| S&P Smallcap 600 | $ | 100.00 | | | | $ | 105.56 | | | $ | 133.30 | | | $ | 147.34 | | | $ | 167.38 | | | $ | 232.80 | |

| S&P Health Care Equipment | $ | 100.00 | | | | $ | 95.53 | | | $ | 99.35 | | | $ | 105.90 | | | $ | 120.91 | | | $ | 151.80 | |

| 9/1/13 – 9/30/13 | | 177,526 | | | $ | 129.72 | | | 177,526 | | | $ | 161,500,000 | |

| 10/1/13 – 10/31/13 | | 782,725 | | | $ | 127.68 | | | 782,725 | | | $ | 61,500,000 | |

| Total | | 960,251 | | | $ | 128.06 | | | 960,251 | | | | | |

| Equity compensation plans approved by shareholders(2) | 2,355,861 | | $54.58 | | 1,855,841 |

| Total | 2,355,861 | | $54.58 | | 1,855,841 |

| Years Ended October 31, (In thousands, except per share amounts) | [removed: 2013] [added: 2014] | | | | [removed: 2012] [added: 2013] | | | | [removed: 2011] [added: 2012] | | | | [removed: 2010] [added: 2011] | | | | [removed: 2009] [added: 2010] | | |

| Net sales | $ | [removed: 1,587,725] [added: 1,717,776] | | | $ | [removed: 1,445,136] [added: 1,587,725] | | | $ | [removed: 1,330,835] [added: 1,445,136] | | | $ | [removed: 1,158,517] [added: 1,330,835] | | | $ | [removed: 1,080,421] [added: 1,158,517] | |

| Gross profit | $ | [removed: 1,026,808] [added: 1,091,570] | | | $ | [removed: 924,010] [added: 1,026,808] | | | $ | [removed: 804,804] [added: 924,010] | | | $ | [removed: 676,723] [added: 804,804] | | | $ | [removed: 596,494] [added: 676,723] | |

| Income before income taxes | $ | [removed: 312,271] [added: 296,534] | | | $ | [removed: 275,452] [added: 312,271] | | | $ | [removed: 192,764] [added: 275,452] | | | $ | [removed: 124,426] [added: 192,764] | | | $ | [removed: 114,828] [added: 124,426] | |

| Net income attributable to Cooper stockholders | $ | [removed: 296,151] [added: 269,856] | | | $ | [removed: 248,339] [added: 296,151] | | | $ | [removed: 175,430] [added: 248,339] | | | $ | [removed: 112,803] [added: 175,430] | | | $ | [removed: 100,548] [added: 112,803] | |

| Diluted earnings per share attributable to Cooper stockholders | $ | [removed: 5.96] [added: 5.51] | | | $ | [removed: 5.05] [added: 5.96] | | | $ | [removed: 3.63] [added: 5.05] | | | $ | [removed: 2.43] [added: 3.63] | | | $ | [removed: 2.21] [added: 2.43] | |

| Number of shares used to compute diluted earnings per share | [removed: 49,685] [added: 48,960] | | | | [removed: 49,152] [added: 49,685] | | | | [removed: 48,309] [added: 49,152] | | | | [removed: 46,505] [added: 48,309] | | | | [removed: 45,478] [added: 46,505] | | |

| Current assets | $ | [removed: 747,241] [added: 791,617] | | | $ | [removed: 657,860] [added: 747,241] | | | $ | [removed: 540,347] [added: 657,860] | | | $ | [removed: 491,340] [added: 540,347] | | | $ | [removed: 503,878] [added: 491,340] | |

| Property, plant and equipment, net | [removed: 739,867] [added: 937,325] | | | | [removed: 640,255] [added: 739,867] | | | | [removed: 609,205] [added: 640,255] | | | | [removed: 593,887] [added: 609,205] | | | | [removed: 602,568] [added: 593,887] | | |

| Goodwill | [removed: 1,387,611] [added: 2,220,921] | | | | [removed: 1,370,247] [added: 1,387,611] | | | | [removed: 1,276,567] [added: 1,370,247] | | | | [removed: 1,261,976] [added: 1,276,567] | | | | [removed: 1,257,029] [added: 1,261,976] | | |

| Other intangible assets, net | [removed: 198,769] [added: 453,605] | | | | [removed: 214,783] [added: 198,769] | | | | [removed: 128,341] [added: 214,783] | | | | [removed: 114,177] [added: 128,341] | | | | [removed: 114,700] [added: 114,177] | | |

| Other assets | [removed: 63,773] [added: 54,872] | | | | [removed: 58,239] [added: 63,773] | | | | [removed: 70,058] [added: 58,239] | | | | [removed: 63,638] [added: 70,058] | | | | [removed: 73,732] [added: 63,638] | | |

| | $ | [removed: 3,137,261] [added: 4,458,340] | | | $ | [removed: 2,941,384] [added: 3,137,261] | | | $ | [removed: 2,624,518] [added: 2,941,384] | | | $ | [removed: 2,525,018] [added: 2,624,518] | | | $ | [removed: 2,551,907] [added: 2,525,018] | |

| Short-term debt | $ | [removed: 42,987] [added: 101,518] | | | $ | [removed: 25,284] [added: 42,987] | | | $ | [removed: 52,979] [added: 25,284] | | | $ | [removed: 19,159] [added: 52,979] | | | $ | [removed: 9,844] [added: 19,159] | |

| Other current liabilities | [removed: 278,266] [added: 340,664] | | | | [removed: 237,268] [added: 278,266] | | | | [removed: 214,227] [added: 237,268] | | | | [removed: 180,361] [added: 214,227] | | | | [removed: 165,570] [added: 180,361] | | |

| Long-term debt | [removed: 301,670] [added: 1,280,833] | | | | [removed: 348,422] [added: 301,670] | | | | [removed: 327,453] [added: 348,422] | | | | [removed: 591,977] [added: 327,453] | | | | [removed: 771,630] [added: 591,977] | | |

| Other liabilities | [removed: 90,844] [added: 146,885] | | | | [removed: 117,252] [added: 90,844] | | | | [removed: 92,371] [added: 117,252] | | | | [removed: 66,745] [added: 92,371] | | | | [removed: 64,521] [added: 66,745] | | |

| Total liabilities | [removed: 713,767] [added: 1,869,900] | | | | [removed: 728,226] [added: 713,767] | | | | [removed: 687,030] [added: 728,226] | | | | [removed: 858,242] [added: 687,030] | | | | [removed: 1,011,565] [added: 858,242] | | |

| Stockholders' equity | [removed: 2,423,494] [added: 2,588,440] | | | | [removed: 2,213,158] [added: 2,423,494] | | | | [removed: 1,937,488] [added: 2,213,158] | | | | [removed: 1,666,776] [added: 1,937,488] | | | | [removed: 1,540,342] [added: 1,666,776] | | |

| | $ | [removed: 3,137,261] [added: 4,458,340] | | | $ | [removed: 2,941,384] [added: 3,137,261] | | | $ | [removed: 2,624,518] [added: 2,941,384] | | | $ | [removed: 2,525,018] [added: 2,624,518] | | | $ | [removed: 2,551,907] [added: 2,525,018] | |

In our fiscal fourth quarter of 2014, Cooper acquired Sauflon Pharmaceuticals Limited, as discussed in Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations and Note 2 of our notes to consolidated financial statements.

We have audited the accompanying consolidated balance sheets of The Cooper Companies, Inc. and subsidiaries (the Company) as of October 31, [removed: 2013] [added: 2014] and [removed: 2012,] [added: 2013,] and the related consolidated statements of income, comprehensive [removed: income (loss), stockholders'] [added: income, stockholders’] equity, and cash flows for each of the years in the three-year period ended October 31, [removed: 2013.][added: 2014.]

We also have audited the [removed: Company's] [added: Company’s] internal control over financial reporting as of October 31, [removed: 2013,] [added: 2014,] based on criteria established in Internal Control - Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

The [removed: Company's] [added: Company’s] management is responsible for these consolidated financial [removed: statements,] [added: statements and financial statement schedule,] for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial [removed: reporting] [added: reporting,] included in the accompanying [removed: Management's] [added: Management’s] Annual Report on Internal Control Over Financial Reporting appearing under item 9A.

Our responsibility is to express an opinion on these consolidated financial [removed: statements] [added: statements, financial statement schedule] and an opinion on the [removed: Company's] [added: Company’s] internal control over financial reporting based on our audits.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of [removed: The Cooper Companies, Inc.] [added: the Company] and subsidiaries as of October 31, [removed: 2013] [added: 2014] and [removed: 2012,] [added: 2013,] and the results of [removed: their] [added: its] operations and [removed: their] [added: its] cash flows for each of the years in the three-year period ended October 31, [removed: 2013,] [added: 2014,] in conformity with U.S. generally accepted accounting principles.

Also in our opinion, [removed: The Cooper Companies, Inc. and subsidiaries] [added: the Company] maintained, in all material respects, effective internal control over financial reporting as of October 31, [removed: 2013,] [added: 2014,] based on criteria established in Internal Control - Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway [removed: Commission.][added: Commission (COSO).]

[added: /s/] KPMG LLP

| Years Ended October 31, (In thousands, except per share amounts) | [removed: 2013] [added: 2014] | | | | [removed: 2012] [added: 2013] | | | | [removed: 2011] [added: 2012] | | |

| Net sales | $ | [removed: 1,587,725] [added: 1,717,776] | | | $ | [removed: 1,445,136] [added: 1,587,725] | | | $ | [removed: 1,330,835] [added: 1,445,136] | |

| Cost of sales | [removed: 560,917] [added: 626,206] | | | | [removed: 521,126] [added: 560,917] | | | | [removed: 526,031] [added: 521,126] | | |

| Gross profit | [removed: 1,026,808] [added: 1,091,570] | | | | [removed: 924,010] [added: 1,026,808] | | | | [removed: 804,804] [added: 924,010] | | |

| Selling, general and administrative expense | [removed: 610,735] [added: 683,115] | | | | [removed: 564,903] [added: 610,735] | | | | [removed: 513,138] [added: 564,903] | | |

| Research and development expense | [removed: 58,827] [added: 66,259] | | | | [removed: 51,730] [added: 58,827] | | | | [removed: 43,581] [added: 51,730] | | |

| Amortization of intangibles | [removed: 30,239] [added: 35,710] | | | | [removed: 23,979] [added: 30,239] | | | | [removed: 20,529] [added: 23,979] | | |

| Loss on divestiture of Aime | [removed: 21,062] [added: —] | | | | [removed: —] [added: 21,062] | | | | — | | |

| Operating income | [removed: 305,945] [added: 306,486] | | | | [removed: 283,398] [added: 305,945] | | | | [removed: 227,556] [added: 283,398] | | |

| Interest expense | [removed: 9,168] [added: 7,965] | | | | [removed: 11,771] [added: 9,168] | | | | [removed: 17,342] [added: 11,771] | | |

| Gain on insurance proceeds | [removed: 14,084] [added: —] | | | | [removed: 5,000] [added: 14,084] | | | | [removed: —] [added: 5,000] | | |

| Loss on extinguishment of debt | — | | | | [removed: 1,404] [added: —] | | | | [removed: 16,487] [added: 1,404] | | |

| Other [removed: income (expense),] [added: expense (income),] net | [removed: 1,410] [added: 1,987] | | | | [removed: 229] [added: (1,410] | | [added: )] | | [removed: (963] [added: (229] | | ) |

| Income before income taxes | [removed: 312,271] [added: 296,534] | | | | [removed: 275,452] [added: 312,271] | | | | [removed: 192,764] [added: 275,452] | | |

| Provision for income taxes | [removed: 15,365] [added: 24,705] | | | | [removed: 26,808] [added: 15,365] | | | | [removed: 17,334] [added: 26,808] | | |

| Net income | [removed: 296,906] [added: 271,829] | | | | [removed: 248,644] [added: 296,906] | | | | [removed: 175,430] [added: 248,644] | | |

| Income attributable to noncontrolling interests | [removed: 755] [added: 1,973] | | | | [removed: 305] [added: 755] | | | | [removed: —] [added: 305] | | |

| Net income attributable to Cooper stockholders | $ | [removed: 296,151] [added: 269,856] | | | $ | [removed: 248,339] [added: 296,151] | | | $ | [removed: 175,430] [added: 248,339] | |

| Earnings per share attributable to Cooper stockholders - basic | $ | [removed: 6.09] [added: 5.61] | | | $ | [removed: 5.18] [added: 6.09] | | | $ | [removed: 3.74] [added: 5.18] | |

| Earnings per share attributable to Cooper stockholders - diluted | $ | [removed: 5.96] [added: 5.51] | | | $ | [removed: 5.05] [added: 5.96] | | | $ | [removed: 3.63] [added: 5.05] | |

| Basic | [removed: 48,615] [added: 48,061] | | | | [removed: 47,913] [added: 48,615] | | | | [removed: 46,904] [added: 47,913] | | |

| Diluted | [removed: 49,685] [added: 48,960] | | | | [removed: 49,152] [added: 49,685] | | | | [removed: 48,309] [added: 49,152] | | |

Consolidated Statements of Comprehensive Income [removed: (Loss)]

| Years Ended October 31, (In thousands) | [removed: 2013] [added: 2014] | | | | [removed: 2012] [added: 2013] | | | | [removed: 2011] [added: 2012] | | |

| Net income | $ | [removed: 296,906] [added: 271,829] | | | $ | [removed: 248,644] [added: 296,906] | | | $ | [removed: 175,430] [added: 248,644] | |

| Other comprehensive [removed: income (loss):] [added: (loss) income:] | | | | | | | | | | | |

| Foreign currency translation adjustment | [removed: 2,607] [added: (87,763] | | [added: )] | | [removed: (4,658] [added: 2,607] | | [removed: )] | | [removed: 5,817] [added: (4,658] | | [added: )] |

| Change in value of derivative instruments, net of tax provision [removed: (benefit)] of [removed: $857, $289] [added: $630, $857] and [removed: $(1,307),] [added: $289,] respectively | [removed: 1,341] [added: 986] | | | | [removed: 452] [added: 1,341] | | | | [removed: (3,798] [added: 452] | | [removed: )] |

| Change in minimum pension liability, net of tax [removed: provision] (benefit) [removed: $7,399, $(5,764)] [added: provision of $(2,348), $7,399] and [removed: $(1,806),] [added: $(5,764),] respectively | [removed: 11,601] [added: (3,643] | | [added: )] | | [removed: (8,986] [added: 11,601] | | [removed: )] | | [removed: (2,804] [added: (8,986] | | ) |

| Unrealized gain on marketable securities, net of tax provision of [removed: $0,] $20 [removed: and $5, respectively] [added: in fiscal 2012] | — | | | | [removed: 41] [added: —] | | | | [removed: 9] [added: 41] | | |

| Reclassification of realized gain on marketable securities to net income, net of tax of $27 [added: in fiscal 2013] | [removed: (50] [added: —] | | [removed: )] | | [removed: —] [added: (50] | | [added: )] | | — | | |

| Other comprehensive [removed: income] (loss) [added: income] | [removed: 15,499] [added: (90,420] | | [added: )] | | [removed: (13,151] [added: 15,499] | | [removed: )] | | [removed: (776] [added: (13,151] | | ) |

| Comprehensive income | [removed: 312,405] [added: 181,409] | | | | [removed: 235,493] [added: 312,405] | | | | [removed: 174,654] [added: 235,493] | | |

In connection with our audits of the consolidated financial statements, we also have audited financial statement schedule II.

The Company acquired Sauflon Pharmaceuticals Limited on August 6, 2014, and management excluded from its assessment of the effectiveness of the Company’s internal control over financial reporting as of October 31, 2014, Sauflon Pharmaceuticals Limited’s internal control over financial reporting which represented 3% and 30%, respectively, of total net sales and total assets of the related consolidated financial statement amounts of the Company as of and for the year ended October 31, 2014.

Our audit of internal control over financial reporting of the Company also excluded an evaluation of the internal control over financial reporting of Sauflon Pharmaceuticals Limited.

Also in our opinion, the related financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly, in all material respects, the information set forth therein.

| | 937,325 | | | | 739,867 | | |

| | $ | 4,458,340 | | | $ | 3,137,261 | |

| | $ | 4,458,340 | | | $ | 3,137,261 | |

| Issuance of common stock for stock plans | 720 | | | 72 | | | | (72 | ) | | (7 | | ) | | 1,487 | | | | — | | | | — | | | | 7,033 | | | | — | | | | 8,585 | | |

| Treasury stock repurchase | (572 | ) | | (57 | | ) | | 572 | | | 57 | | | | — | | | | — | | | | — | | | | (75,778 | | ) | | — | | | | (75,778 | | ) |

| Distributions to noncontrolling interests | — | | | — | | | | — | | | — | | | | — | | | | — | | | | — | | | | — | | | | (2,370 | | ) | | (2,370 | | ) |

| Noncontrolling interests | — | | | — | | | | — | | | — | | | | — | | | | — | | | | — | | | | — | | | | 1,973 | | | | 1,973 | | |

| Balance at October 31, 2014 | 48,143 | | | $ | 4,815 | | | 2,840 | | | $ | 284 | | | $ | 1,386,800 | | | $ | (106,182 | ) | | $ | 1,578,823 | | | $ | (294,662 | ) | | $ | 18,562 | | | $ | 2,588,440 | |

Consolidated Statements of Cash Flows (continued)

| On August 6, 2014, The Cooper Companies, Inc. acquired all of the issued share capital of Sauflon Pharmaceuticals Limited for total consideration of approximately $1.13 billion. Liabilities were assumed as follows: | | | |

| Supplemental disclosures of non-cash investing activities: | | | |

| Fair value of assets acquired | $ | 1,305,828 | |

| Less: | | | |

| Cash paid, net of cash acquired | (1,063,077 | | ) |

| Loan notes issued | (57,954 | | ) |

| Liabilities assumed | $ | 184,797 | |

See accompanying notes to consolidated financial statements.

indicated that we had no impairment of goodwill.

We performed our annual impairment test in our fiscal third quarter of 2013 and concluded that we had no impairment of goodwill in that year.

Accounting Pronouncements Issued and Not Yet Adopted

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606).

ASU 2014-09 requires revenue recognition to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

ASU 2014-09 sets forth a new revenue recognition model that requires identifying the contract, identifying the performance obligations, determining the transaction price, allocating the transaction price to performance obligations and recognizing the revenue upon satisfaction of performance obligations.

The amendments in the ASU can be applied either retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of

initially applying the update recognized at the date of the initial application along with additional disclosures.

We are currently evaluating the impact of ASU 2014-09, which is effective for the Company in our fiscal year beginning on November 1, 2017.

swaps.

We received payments

| | $ | 381,474 | | | $ | 338,917 | |

See Note 2 for additional information on the increase in finished goods inventory related to the acquisition of Sauflon.

| | $ | 937,325 | | | $ | 739,867 | |

Sauflon Acquisition

On August 6, 2014, the acquisition date, we completed the acquisition of the entire issued share capital of Sauflon Pharmaceuticals Limited (Sauflon), a privately-owned European manufacturer and distributor of soft contact lenses and solutions, based in Twickenham, United Kingdom.

The fair value of the consideration transferred for Sauflon was approximately $1,073.2 million in cash, $1,063.1 million net of cash acquired, and approximately $58.0 million in the form of loan notes issued by Cooper.

The loan notes are denominated in British pounds and are classified as short-term debt.

The Sauflon acquisition is intended to accelerate the growth in sales of our single-use products by enabling a multi-tier, single-use strategy with a full suite of hydrogel and silicone hydrogel product offerings in the major product categories of sphere, toric and multifocal lenses.

December 20, 2013

| | 739,867 | | | | 640,255 | | |

| | $ | 3,137,261 | | | $ | 2,941,384 | |

| | $ | 3,137,261 | | | $ | 2,941,384 | |

| Balance at October 31, 2010 | 45,827 | | | $ | 4,583 | | | 313 | | | $ | 31 | | | $ | 1,083,779 | | | $ | (17,334 | ) | | $ | 600,522 | | | $ | (4,805 | ) | | $ | — | | | $ | 1,666,776 | |

| Issuance of common stock for stock plans | 2,019 | | | 202 | | | | (144 | ) | | (14 | | ) | | 79,632 | | | | — | | | | — | | | | 2,215 | | | | — | | | | 82,035 | | |

The goodwill impairment test is a two-step process.

including the impact, if any, of additional taxes resulting from tax examinations as well as judging the recoverability of deferred tax assets.

Recently Issued Accounting Pronouncements

In fiscal 2013, the Company adopted the provisions of Financial Accounting Standards Board Accounting Standards Update (ASU) 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income.

ASU 2011-05 requires entities to present net income and other comprehensive income in either a single continuous statement or in two separate, but consecutive, statements of net income and other

comprehensive income.

The Company has elected to present net income and other comprehensive income on two separate but consecutive statements.

In February 2013, the FASB issued ASU 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income.

ASU 2013-02 requires entities to present, either on the face of the statement where net income is presented or as a separate disclosure in the notes, the effect on the respective line items of net income for items required to be reclassified out of accumulated other comprehensive income to net income in its entirety in the same reporting period.

For other amounts that are not required to be reclassified in its entirety to net income in the same reporting period, an entity is required to cross-reference to other required disclosures that provide additional details about those amounts.

The Company does not anticipate that the adoption of this amendment, which is effective for the Company for the fiscal year beginning on November 1, 2013, will have a material impact on our consolidated results of operations, financial condition or cash flows.

The Company does not anticipate the adoption of these amendments, which are effective for the Company for the fiscal year beginning on November 1, 2014, will have a material impact on our consolidated results of operations, financial condition or cash flows.

conditions to closing and facilitated the transfer of manufacturing technology.

| | $ | 338,917 | | | $ | 320,199 | |

| | $ | 739,867 | | | $ | 640,255 | |

| Balance as of October 31, 2011 | $ | 1,046,587 | | | $ | 229,980 | | | $ | 1,276,567 | |

| Translation | (2,793 | | ) | | 865 | | | | (1,928 | | ) |

| Shelf space and market share | 199,379 | | | | 75,700 | | | | 192,566 | | | | 59,269 | | | | 14 |

| | 370,649 | | | | $ | 171,880 | | | 356,000 | | | | $ | 141,217 | | | 13 |

| | $ | 301,670 | | | $ | 348,422 | |

| 2016 | $ | 4,204 | |

| 2017 | $ | 15,404 | |

| 2018 | $ | 281,200 | |

| Thereafter | $ | 458 | |

Term Loan

Our results include the fiscal year 2013 ETR, plus discrete items primarily the loss on divestiture of Aime, the decrease in the United Kingdom's tax rate and the reinstatement of the federal R&D credit.

The ETR used to record the provision for income taxes for the fiscal year 2012 was 9.7%.

As a result, the ratio of domestic income to worldwide income, primarily within CooperVision along with CooperSurgical's July 2012 acquisition of Origio, has decreased over recent fiscal periods.

in the United States.

The completion of the Company's restructuring plan to close a CooperVision manufacturing facility, located in Norfolk, Virginia, with the manufacturing demand subsequently absorbed by our plants in the United Kingdom and Puerto Rico contributed to this change in the geographic mix of income.

As a result of this restructuring, substantially all of CooperVision's contact lens products are manufactured outside of the United States.

The Company adopted the provisions of the interpretation of ASC 740-10-25-5 through 25-17, Basic Recognition Threshold, formerly FIN 48, on November 1, 2007.

As a result of the adoption, the Company reduced its net liability for unrecognized tax benefits (UTB), previously classified in current taxes payable, by $5.3 million, which was accounted for as an increase to retained earnings.

The interpretation also provides guidance on how the interest and penalties related to tax positions may be recorded and classified within the Consolidated Statement of Income and presented in the Consolidated Balance Sheet.

The Company's Chief Executive Officer and Chief Financial Officer, based upon their evaluation as of October 31, [removed: 2013,] [added: 2014,] the end of the fiscal period covered in this report, concluded that the Company's disclosure controls and procedures were effective at the reasonable assurance level.

Management assessed the effectiveness of the Company's internal control over financial reporting as of October 31, [removed: 2013,] [added: 2014,] based on the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control - Integrated Framework (1992).

Based on this assessment, management, under the supervision and with the participation of the Company's Chief Executive Officer and Chief Financial Officer, concluded that the Company's internal control over financial reporting was effective as of October 31, [removed: 2013.][added: 2014.]

The Company's independent registered public accounting firm, KPMG LLP, has audited the effectiveness of the Company's internal control over financial reporting as of October 31, [removed: 2013,] [added: 2014,] as stated in their report in Part II, Item 8 of this Annual Report on Form 10-K.

There has been no change in the Company's internal control over financial reporting during the Company's fiscal quarter ended October 31, [removed: 2013,] [added: 2014,] that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

Management has excluded Sauflon Pharmaceuticals Limited from its assessment of internal control over financial reporting as of October 31, 2014, as permitted by the guidance issued by the Office of the Chief Accountant of the Securities and Exchange Commission.

Sauflon was acquired by the Company in a purchase business combination during the fiscal fourth quarter of 2014 and represented 3% and 30%, respectively, of total net sales and total assets of the related consolidated financial statement amounts as of and for the year ended October 31, 2014.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

The information required by this item is incorporated by reference to the subheadings, “Proposal 1 - Election of Directors,” “Executive Officers of the Company,” “Ownership of the Company - Section 16(a) Beneficial Ownership Reporting Compliance,” “Corporate Governance - The Board of Directors,” “Corporate Governance - Ethics and Business Conduct Policy,” “Corporate Governance - Board Committees - The Audit Committee” and “Report of the Audit Committee” of the Company's Proxy Statement for the Annual Meeting of Stockholders scheduled to be held in March [removed: 2014] [added: 2015] (the [removed: “2014] [added: “2015] Proxy Statement”).

The information required by this item is incorporated by reference to the subheadings [removed: “Compensation Committee Report,”] [added: “Report of the Organization and Compensation Committee,”] “Compensation Discussion and Analysis,” “Executive Compensation Tables” and “Director Compensation” of the [removed: 2014] [added: 2015] Proxy Statement.

Additional information required by this item is incorporated by reference to the subheadings “Securities Held by [removed: Management”] [added: Insiders”] and “Principal Securityholders” of the “Ownership of the Company” section of the [removed: 2014] [added: 2015] Proxy Statement.

The information required by this item is incorporated by reference to the subheadings “Corporate Governance - Related Party Transactions,” “Proposal 1 - Election of Directors” and “Corporate Governance - The Board of Directors” of the [removed: 2014] [added: 2015] Proxy Statement.

The information required by this item is incorporated by reference to “Report of the Audit Committee” section of the [removed: 2014] [added: 2015] Proxy Statement.

THE COOPER COMPANIES, INC. AND SUBSIDIARIES

Statements of Income for the years ended October 31, [removed: 2013, 2012] [added: 2014, 2013] and [removed: 2011][added: 2012]

Statements of Comprehensive Income [removed: (Loss)] for the years ended October 31, [removed: 2013, 2012] [added: 2014, 2013] and [removed: 2011][added: 2012]

Balance Sheets as of October 31, [removed: 2013] [added: 2014] and [removed: 2012][added: 2013]

Statements of Stockholders' Equity for the years ended October 31, [removed: 2013, 2012] [added: 2014, 2013] and [removed: 2011][added: 2012]

Statements of Cash Flows for the years ended October 31, [removed: 2013, 2012] [added: 2014, 2013] and [removed: 2011][added: 2012]

Three Years Ended October 31, [removed: 2013][added: 2014]