833444--11/19/2008--TYCO_INTERNATIONAL_LTD

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Risks Relating to Our Businesses General economic and cyclical industry conditions may adversely affect our financial condition, results of operations or cash flows. We face intense competition in each of our businesses, and competitive challenges from lower cost manufacturers in overseas markets. If we cannot successfully compete in an increasingly global market-place, our operating results may be adversely affected. Our future growth is largely dependent upon our ability to develop or acquire new technologies that achieve market acceptance with acceptable margins. Our ADT business may experience higher rates of customer attrition, which may reduce our future revenue and cause us to change the estimated useful lives of assets related to our security monitoring customers, increasing our depreciation and amortization expense. We have significant foreign operations, which are subject to political, economic and other risks inherent in operating in foreign countries. Volatility in currency exchange rates, commodity prices and interest rates may adversely affect our financial condition, result of operations or cash flows. Divestitures of some of our businesses or product lines may materially adversely affect our financial condition, results of operations or cash flows. Our business strategy includes acquiring companies and making investments that complement our existing businesses. These acquisitions and investments could be unsuccessful or consume significant resources, which could adversely affect our operating results. If we cannot obtain sufficient quantities of materials, components and equipment required for our manufacturing activities at competitive prices and quality and on a timely basis, or if our manufacturing capacity does not meet demand, our financial condition, results of operations or cash flows may suffer. Failure to retain or attract qualified personnel could adversely affect our business. We may be required to recognize additional impairment charges. Risks Related to Legal, Regulatory and Compliance Matters We are named as a defendant in a variety of litigation in the course of our business that could cause a material adverse effect on our financial condition, results of operations or cash flows. Legislative and other measures that may be taken by U.S. governmental authorities could materially increase our tax burden or otherwise adversely affect our financial conditions, results of operations or cash flows. Changes in legislation or governmental regulations or policies can have a significant impact on our financial condition, results of operations or cash flows. We could be adversely affected by violations of the U.S. Foreign Corrupt Practices Act and similar anti-bribery laws outside the United States. Our failure to satisfy international trade compliance regulations may adversely affect us. We continue to be subject to a number of lawsuits stemming from the actions of our prior senior management. Adverse outcomes of these matters could have a material adverse effect on our financial condition, results of operations or cash flows. We continue to be responsible for a portion of our contingent and other corporate liabilities following the Separation, primarily those relating to shareholder litigation. We could face product liability claims relating to products we manufacture or install. These claims could result in significant costs and liabilities and reduce our profitability. Our operations expose us to the risk of material environmental liabilities, litigation and violations. We are subject to ongoing governmental investigations that may have an adverse effect on our business. Risks Related to Our Liquidity Recent disruptions in the financial markets could have adverse effects on us, our customers and our suppliers, as access to liquidity may be negatively impacted by disruptions in the credit markets, leading to increased funding costs or unavailability of credit. Covenants in our debt instruments may adversely affect us. Material adverse legal judgments, fines, penalties or settlements could adversely affect our financial health and prevent us from fulfilling our obligations under our outstanding indebtedness. Risks Relating to Tax Matters We have disclosed a material weakness in our internal control over financial reporting relating to our accounting for income taxes that could adversely affect our ability to report our financial condition, results of operations or cash flows accurately and on a timely basis. Examinations and audits by tax authorities, including the Internal Revenue Service, could result in additional tax payments for prior periods. If the distribution of Covidien and Tyco Electronics common shares to our shareholders or certain internal transactions undertaken in connection with the Separation are determined to be taxable for U.S. federal income tax purposes, we could incur significant U.S. federal income tax liabilities. We share responsibility for certain of our, Covidien's and Tyco Electronics' income tax liabilities for tax periods prior to and including June 29, 2007. We might not be able to engage in desirable strategic transactions and equity issuances following the Separation because of restrictions relating to U.S. federal income tax requirements for tax-free distributions. Risks Relating to Our Jurisdiction of Incorporation Bermuda law differs from the laws in effect in the United States and may afford less protection to holders of our securities.

Full 10-K form ▸

833444--11/19/2008--TYCO_INTERNATIONAL_LTD_/BER/