Medtronic Files 8K - Other Events
January 19 2016 - 07:26AM
Dow Jones News
Medtronic PLC (MDT) filed a Form 8K - Other Events - with the
U.S Securities and Exchange Commission on January 19, 2016.
Medtronic plc ("the Company"), as a result of its acquisition of
Covidien, is a successor to Covidien under a Tax Sharing Agreement
dated September 25, 2007, among the Company (as successor to
Covidien), Tyco International plc and TE Connectivity (together,
the "Tax Sharing Participants"). Under the Tax Sharing Agreement,
the Tax Sharing Participants share certain tax liabilities
associated with the tax year 2007 and prior years. On January 15,
2016, Tyco International plc, as Audit Managing Party under the Tax
Sharing Agreement, entered into Stipulations of Settled Issues with
the United States Internal Revenue Service (the "IRS") intended to
resolve all disputes related to the previously disclosed
intercompany debt issues for the Tax Sharing Participants for the
1997 - 2000 audit cycle, currently before the United States Tax
Court. The Stipulations of Settled Issues are contingent upon the
IRS Appeals Division applying the same settlement to all
intercompany debt issues on appeal for subsequent audit cycles
(2001 - 2007) and the approval of the United States Congress Joint
Committee on Taxation, if required.
If finalized, the tentative resolution would cover all aspects
of the controversy before the U.S. Tax Court and the Appeals
Division of the IRS, and would result in a total cash payment by
the Tax Sharing Participants to the IRS in the range of $475
million to $525 million, which includes all interest and penalties.
This payment would be shared among the Tax Sharing Participants
according to the formula in the Tax Sharing Agreement, and would be
split among the Company, Tyco International plc and TE Connectivity
42%, 27%, and 31%, respectively.
The Company does not expect to recognize any additional charges
related to the tentative resolution, as the Company had previously
recorded sufficient reserves with respect to this controversy and
its obligations under the Tax Sharing Agreement. Any income tax
reserves and associated receivables will not be adjusted until
final resolution is reached. In the event these adjustments result
in a material non-cash gain, the Company would exclude this gain
from its non-GAAP earnings.
The Tax Sharing Participants expect payment to be made to the
IRS and among the parties within the next six months.
FORWARD LOOKING STATEMENTS
This Current Report contains forward-looking statements, which
may be identified by words such as "expect" and "intend" and
include statements related to the tentative resolution of the tax
controversy, the anticipated impact of the Stipulation of Settled
Issues on the Company and the other Tax Sharing Participants and
the timing and amount of expected payments by the Tax Sharing
Participants. These statements are subject to risks and
uncertainties, such as delays in finalizing or changes to the
Stipulation of Settled Issues, the IRS not applying the Stipulation
of Settled Issues to intercompany debt issues on appeal for audit
cycles 2001 - 2007, the Tax Sharing Participants not obtaining
requisite approvals for the Stipulation of Settled Issues or
failing to share payment obligations as provided by the Tax Sharing
Agreement and other risks and uncertainties described in the
Company's periodic reports on file with the U.S. Securities and
Exchange Commission (the "SEC"). Actual results may differ
materially from anticipated results. The Company does not undertake
to update its forward-looking statements or any of the information
contained in this press release.
The full text of this SEC filing can be retrieved at:
http://www.sec.gov/Archives/edgar/data/1613103/000161310316000061/form8-kxotherevents.htm
Any exhibits and associated documents for this SEC filing can be
retrieved at:
http://www.sec.gov/Archives/edgar/data/1613103/000161310316000061/0001613103-16-000061-index.htm
Public companies must file a Form 8-K, or current report, with
the SEC generally within four days of any event that could
materially affect a company's financial position or the value of
its shares.
(END) Dow Jones Newswires
January 19, 2016 07:11 ET (12:11 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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