Medtronic 2015 Annual Report Download - page 42

Shareholders resident in the U.S. that hold their shares through DTC will not be subject to dividend withholding tax, provided
the addresses of the beneficial owners of such shares in the records of the brokers holding such shares are recorded as being in
the U.S. (and such brokers have further transmitted the relevant information to a qualifying intermediary appointed by us).
However, other shareholders may be subject to dividend withholding tax, which could adversely affect the price of their shares.
Shareholders entitled to an exemption from Irish dividend withholding tax on dividends received from us will not be subject to
Irish income tax in respect of those dividends unless they have some connection with Ireland other than their shareholding in
our Company (for example, they are resident in Ireland). Shareholders who receive dividends subject to Irish dividend
withholding tax will generally have no further liability to Irish income tax on those dividends.
Our shares received by means of a gift or inheritance could be subject to Irish capital acquisitions tax.
Irish capital acquisitions tax (CAT) could apply to a gift or inheritance of our shares irrespective of the place of residence,
ordinary residence or domicile of the parties. This is because our shares will be regarded as property situated in Ireland. The
person who receives the gift or inheritance has primary liability for CAT. Gifts and inheritances passing between spouses are
exempt from CAT. Children have a tax-free threshold of €225,000 in respect of taxable gifts or inheritances received from their
parents.
Risks Relating to the Covidien Acquisition (the Transactions)
We may not realize all of the anticipated benefits of the Transactions or those benefits may take longer to realize than
expected. We may also encounter significant unexpected difficulties in integrating Medtronic, Inc. and Covidien.
Our ability to realize the anticipated benefits of the Transactions will depend, to a large extent, on our ability to integrate the
Medtronic, Inc. and Covidien businesses. The combination of two independent businesses is a complex, costly and time-
consuming process. As a result, we will be required to devote significant management attention and resources to integrating the
business practices and operations of Medtronic, Inc. and Covidien. The integration process may disrupt the businesses and, if
implemented ineffectively or if impacted by unforeseen negative economic or market conditions or other factors, we may not
realize the full anticipated benefits of the transaction. Our failure to meet the challenges involved in integrating the two
businesses to realize the anticipated benefits of the transaction could cause an interruption or a loss of momentum in, our
activities and could adversely affect our results of operations.
In addition, the overall integration of the businesses may result in material unanticipated problems, expenses, liabilities,
competitive responses, loss of customer relationships, and diversion of management’s attention. The difficulties of combining
the operations of the companies include, among others:
•the diversion of management’s attention to integration matters;
•difficulties in achieving anticipated cost savings, synergies, business opportunities and growth prospects
from combining the businesses;
•difficulties in the integration of operations and systems;
•difficulties in the assimilation of employees;
•difficulties in managing the expanded operations of a significantly larger and more complex company;
•challenges in keeping existing customers and obtaining new customers; and
•challenges in attracting and retaining key personnel.
Many of these factors will be outside of our control and any one of them could result in increased costs, decreases in the amount
of expected revenues and diversion of management’s time and energy, which could materially impact our business, financial
condition and results of operations. In addition, even if the operations of the businesses of Medtronic, Inc. and Covidien are
integrated successfully, we may not realize the full benefits of the transaction, including the synergies, cost savings or sales or
growth opportunities that we expect. These benefits may not be achieved within the anticipated time frame, or at all.
Furthermore, additional unanticipated costs may be incurred in the integration of the businesses of Medtronic, Inc. and
Covidien. All of these factors could negatively impact our earnings per share, decrease or delay the expected accretive effect of
the transaction, and negatively impact the price of our ordinary shares. As a result, we cannot assure you that the combination of
the Medtronic, Inc. and Covidien businesses will result in the realization of the full benefits anticipated from the transaction.
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