ADT 2010 Annual Report Download - page 250

TYCO INTERNATIONAL LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
25. Subsequent Events
On September 30, 2010, the Company received the necessary consents and approval to complete
the sale of its European water business and received net cash proceeds of approximately $267 million.
The Company expects to recognize a gain on the transaction.
Consistent with its annual equity compensation practices, on October 12, 2010, the Company
granted Tyco employees 3.9 million share options with a weighted-average grant-date fair value of $9.13
per share at the date of grant. Additionally, the Company granted 1.4 million and 0.6 million restricted
stock units and performance share units with a fair value of $37.29 and $41.17 per share on the date of
grant, respectively.
On November 9, 2010, the Company announced that it entered into an agreement to sell a 51%
interest in its Electrical and Metal Products business to an affiliate of the private equity firm Clayton,
Dubilier & Rice, LLC (the ‘‘Investor’’). The Company will form a newly incorporated holding company,
Atkore, to hold the Company’s Electrical and Metal Products business. Upon closing, Tyco is expected
to receive total cash proceeds of approximately $720 million and anticipates recognizing a gain on the
transaction. Pursuant to the Investment Agreement entered into in connection with the transaction,
Tyco and its affiliates have agreed to sell shares of a newly-created class of cumulative convertible
preferred stock of Atkore (the ‘‘Preferred Stock’’) to the Investor for $306 million. The preferred stock
to be sold to Investor will initially represent 51% of the outstanding capital stock (on an as-converted
basis) of Atkore immediately following the closing. Under the terms of the Investment Agreement, it is
anticipated that Atkore will incur new third party indebtedness of up to $465 million and use such
proceeds in part to repay approximately $400 million in intercompany indebtedness to subsidiaries of
Tyco. The transaction is subject to the satisfaction of customary closing conditions and is expected to
close in the first half of fiscal 2011. The Company will continue to present Atkore in continuing
operations. Upon completion of the transaction, Tyco’s ownership interest in Atkore will be accounted
for under the equity method of accounting.
162 2010 Financials