TYCO INTERNATIONAL LTD.
(Exact name of Registrant as specified in its charter)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ý No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No ý

TYCO INTERNATIONAL LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(in millions, except per share data)

		For the Quarters Ended						For the Nine Months Ended

		June 24, 2011			June 25, 2010			June 24, 2011			June 25, 2010
Revenue from product sales		$	2,336		$	2,532		$	6,962		$	7,366
Service revenue			1,957			1,742			5,702			5,157

	Net revenue		4,293			4,274			12,664			12,523
Cost of product sales			1,629			1,781			4,871			5,218
Cost of services			1,011			912			2,963			2,694
Selling, general and administrative expenses			1,143			1,163			3,365			3,380
Restructuring, asset impairments and divestiture charges (gain), net (see Notes 2 and 3)			35			43			(153	)		26

	Operating income		475			375			1,618			1,205
Interest income			8			7			26			24
Interest expense			(59	)		(71	)		(184	)		(221	)
Other expense, net			(3	)		(85	)		(9	)		(73	)

	Income from continuing operations before income taxes		421			226			1,451			935
Income tax (expense) benefit			(58	)		26			(278	)		(78	)

	Income from continuing operations		363			252			1,173			857
(Loss) income from discontinued operations, net of income taxes			(5	)		4			160			14

	Net income		358			256			1,333			871
Less: noncontrolling interest in subsidiaries net (loss) income			(1	)		2			—			5

	Net income attributable to Tyco common shareholders	$	359		$	254		$	1,333		$	866

Amounts attributable to Tyco common shareholders:
	Income from continuing operations	$	364		$	250		$	1,173		$	852
	(Loss) income from discontinued operations		(5	)		4			160			14

	Net income attributable to Tyco common shareholders	$	359		$	254		$	1,333		$	866

Basic earnings per share attributable to Tyco common shareholders:
	Income from continuing operations	$	0.78		$	0.51		$	2.46		$	1.77
	(Loss) income from discontinued operations		(0.01	)		0.01			0.34			0.03

	Net income attributable to Tyco common shareholders	$	0.77		$	0.52		$	2.80		$	1.80

Diluted earnings per share attributable to Tyco common shareholders:
	Income from continuing operations	$	0.76		$	0.50		$	2.44		$	1.76
	Income from discontinued operations		—			0.01			0.33			0.03

	Net income attributable to Tyco common shareholders	$	0.76		$	0.51		$	2.77		$	1.79

Weighted average number of shares outstanding:
	Basic		468			492			476			481
	Diluted		475			496			481			484

TYCO INTERNATIONAL LTD.

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(in millions, except per share data)

			June 24, 2011			September 24, 2010

Assets
Current Assets:
	Cash and cash equivalents		$	1,629		$	1,775
	Accounts receivable, less allowance for doubtful accounts of $125 and $161, respectively			2,470			2,493
	Inventories			1,406			1,443
	Prepaid expenses and other current assets			946			936
	Deferred income taxes			367			382
	Assets held for sale			—			324

		Total current assets		6,818			7,353
Property, plant and equipment, net				4,007			4,156
Goodwill				9,895			9,577
Intangible assets, net				3,558			3,446
Other assets				2,699			2,596

		Total Assets	$	26,977		$	27,128

Liabilities and Equity
Current Liabilities:
	Loans payable and current maturities of long-term debt		$	42		$	536
	Accounts payable			1,230			1,340
	Accrued and other current liabilities			2,708			2,671
	Deferred revenue			638			618
	Liabilities held for sale			—			103

		Total current liabilities		4,618			5,268
Long-term debt				4,145			3,652
Deferred revenue				1,156			1,106
Other liabilities				2,876			3,001

		Total Liabilities		12,795			13,027

Commitments and Contingencies (see Note 10)
Tyco Shareholders' Equity:
	Common shares, CHF 6.70 par value, 825,222,070 shares authorized, 486,414,669 shares issued as of June 24, 2011; CHF 6.70 par value, 814,801,671 shares authorized, 514,502,770 shares issued as of September 24, 2010			2,792			2,948
	Common shares held in treasury, 22,640,966 and 26,097,158 shares, as of June 24, 2011 and September 24, 2010, respectively			(988	)		(976	)
	Contributed surplus			10,721			12,121
	Accumulated earnings			1,642			312
	Accumulated other comprehensive income (loss)			10			(321	)

		Total Tyco Shareholders' Equity		14,177			14,084
Noncontrolling interest				5			17

		Total Equity		14,182			14,101

		Total Liabilities and Equity	$	26,977		$	27,128

TYCO INTERNATIONAL LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(in millions)

				For the Nine Months Ended

				June 24, 2011			June 25, 2010
Cash Flows From Operating Activities:
Net income attributable to Tyco common shareholders				$	1,333		$	866
	Noncontrolling interest in subsidiaries net income				—			5
	Income from discontinued operations, net of income taxes				(160	)		(14	)

Income from continuing operations					1,173			857
Adjustments to reconcile net cash provided by operating activities:
	Depreciation and amortization				976			869
	Non-cash compensation expense				86			92
	Deferred income taxes				119			(127	)
	Provision for losses on accounts receivable and inventory				61			93
	Gain on divestitures				(227	)		(43	)
	Other non-cash items				54			101
	Changes in assets and liabilities, net of the effects of acquisitions and divestitures:
		Accounts receivable, net			(183	)		—
		Inventories			(195	)		(127	)
		Prepaid expenses and other current assets			(18	)		12
		Accounts payable			(53	)		33
		Accrued and other liabilities			(172	)		(6	)
		Other			—			(87	)

			Net cash provided by operating activities		1,621			1,667

			Net cash (used in) provided by discontinued operating activities		(9	)		12

Cash Flows From Investing Activities:
Capital expenditures					(548	)		(512	)
Proceeds from disposal of assets					7			26
Acquisition of businesses, net of cash acquired					(228	)		(600	)
Accounts purchased by ADT					(451	)		(400	)
Divestiture of businesses, net of cash divested					711			26
Other					(6	)		16

			Net cash used in investing activities		(515	)		(1,444	)

			Net cash provided by (used in) discontinued investing activities		259			(7	)

Cash Flows From Financing Activities:
Proceeds from issuance of short-term debt					161			26
Repayment of short-term debt					(653	)		(268	)
Proceeds from issuance of long-term debt					497			1,001
Repayment of long-term debt					(3	)		(962	)
Proceeds from exercise of share options					112			33
Dividends paid					(342	)		(311	)
Repurchase of common shares by treasury					(1,300	)		(276	)
Transfer from discontinued operations					250			5
Other					9			11

			Net cash used in financing activities		(1,269	)		(741	)

			Net cash used in discontinued financing activities		(250	)		(5	)

Effect of currency translation on cash					27			(13	)

Net decrease in cash and cash equivalents					(136	)		(531	)
Decrease in cash and cash equivalents from deconsolidation of variable interest entity					(10	)		—
Cash and cash equivalents at beginning of period					1,775			2,354

Cash and cash equivalents at end of period				$	1,629		$	1,823

TYCO INTERNATIONAL LTD.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED)

For the Nine Months Ended June 24, 2011 and June 25, 2010

(in millions)

					Common Shares at Par Value			Treasury Shares			Contributed Surplus			Accumulated (Deficit) Earnings			Accumulated Other Comprehensive (Loss) Income			Total Tyco Shareholders' Equity			Noncontrolling Interest			Total Equity

Balance as of September 25, 2009			474		$	3,122		$	(214	)	$	10,940		$	(820	)	$	(87	)	$	12,941		$	13		$	12,954
Comprehensive income:
	Net income														866						866			5			871
	Currency translation, net of income tax benefit of $1 million																	(565	)		(565	)					(565	)
	Unrealized loss on marketable securities and derivative instruments, net of income taxes																	(2	)		(2	)					(2	)
	Retirement plans, net of income taxes of $39 million																	69			69						69

	Total comprehensive income																				368			5			373
Dividends declared (see Note 12)						(423	)														(423	)					(423	)
Issuance of shares in connection with the acquisition of Brinks Home Security Inc.			35			241			2			1,119									1,362						1,362
		Replacement of share based equity awards issued in connection with the acquisition of Brinks Home Security Inc.										27									27						27
Shares issued from treasury for vesting of share based equity awards			2						95			(62	)								33						33
Repurchase of common shares by treasury			(7	)					(276	)											(276	)					(276	)
Compensation expense												93									93						93
Other																								(2	)		(2	)

Balance as of June 25, 2010			504		$	2,940		$	(393	)	$	12,117		$	46		$	(585	)	$	14,125		$	16		$	14,141

				Common Shares at Par Value			Treasury Shares			Contributed Surplus			Accumulated Earnings			Accumulated Other Comprehensive (Loss) Income			Total Tyco Shareholders' Equity			Noncontrolling Interest			Total Equity

Balance as of September 24, 2010		488		$	2,948		$	(976	)	$	12,121		$	312		$	(321	)	$	14,084		$	17		$	14,101
Comprehensive income:
	Net income													1,333						1,333						1,333
	Deconsolidation of variable interest entity due to adoption of an accounting standard (See Note 1)																						(11	)		(11	)
	Currency translation, net of income tax expense of $1 million																289			289						289
	Unrealized loss on marketable securities																(1	)		(1	)					(1	)
	Retirement plans, net of income taxes of $5 million																43			43						43

	Total comprehensive income																			1,664			(11	)		1,653
Cancellation of treasury shares					(160	)		1,075			(915	)								—						—
Dividends declared (See Note 12)					4						(465	)								(461	)					(461	)
Shares issued from treasury for vesting of share based equity awards		6						218			(106	)								112						112
Repurchase of common shares by treasury		(30	)					(1,300	)											(1,300	)					(1,300	)
Compensation expense											86									86						86
Other								(5	)					(3	)					(8	)		(1	)		(9	)

Balance as of June 24, 2011		464		$	2,792		$	(988	)	$	10,721		$	1,642		$	10		$	14,177		$	5		$	14,182

Basis of Presentation—The Consolidated Financial Statements included herein are unaudited, but in the opinion of management, such financial statements include all adjustments, consisting of normal recurring adjustments, necessary to summarize fairly the Company's financial position, results of operations and cash flows for the interim period. The unaudited Consolidated Financial Statements include the consolidated results of Tyco International Ltd., a corporation organized under the laws of Switzerland, and its subsidiaries (Tyco and all its subsidiaries, hereinafter collectively referred to as the "Company" or "Tyco"). The Financial Statements have been prepared in United States dollars ("USD") and in accordance with the instructions to Form 10-Q under the Securities Exchange Act of 1934, as amended. The results reported in these Consolidated Financial Statements should not be taken as indicative of results that may be expected for the entire year. These financial statements should be read in conjunction with the Consolidated Financial Statements and accompanying notes contained in the Company's Annual Report on Form 10-K for the fiscal year ended September 24, 2010 (the "2010 Form 10-K").

During the first quarter of fiscal 2011, the Company realigned its Safety Products segment between its ADT Worldwide and Fire Protection Services segments to create two new segments: Tyco Security Solutions and Tyco Fire Protection. Tyco Security Solutions consists of the former ADT Worldwide segment as well as the portion of the former Safety Products segment that manufactures security products including intrusion, security, access control and video management systems. Tyco Fire Protection consists of the former Fire Protection Services segment as well as a number of businesses from the former Safety Products segment including the fire suppression and life safety products businesses. In addition, various businesses were realigned between Tyco Security Solutions and Tyco Fire Protection. See Note 15.

As a result of this realignment, as well as the sale of a majority interest in the Electrical and Metal Products business (See Note 2), the Company has three core businesses: Tyco Security Solutions, Tyco Fire Protection and Tyco Flow Control.

References to 2011 and 2010 are to Tyco's fiscal quarters ending June 24, 2011 and June 25, 2010, respectively, unless otherwise indicated.

Reclassifications—As a result of the segment realignment, prior period segment amounts have been recast to conform to the current period presentation. See Note 15.

Recently Adopted Accounting Pronouncements—In September 2009, the Financial Accounting Standards Board ("FASB") issued authoritative guidance for the accounting for revenue arrangements with multiple deliverables. The guidance establishes a selling price hierarchy for determining the selling price of a deliverable. The selling price used for each deliverable will be based on vendor-specific objective evidence ("VSOE") if available, third-party evidence ("TPE") if VSOE is not available, or estimated selling price if neither VSOE nor TPE is available. The guidance requires arrangements under which multiple revenue generating activities to be performed be allocated at inception. The residual method under the existing accounting guidance has been eliminated. The guidance became effective for Tyco for revenue arrangements entered into or materially modified beginning in the first quarter of fiscal 2011. The adoption of the guidance did not have a material impact on the Company's financial position, results of operations or cash flows.

In June 2009, the FASB issued authoritative guidance which amended the existing guidance for the consolidation of variable interest entities ("VIE"), to address the elimination of the concept of a

1. Basis of Presentation and Summary of Significant Accounting Policies (Continued)

qualifying special purpose entity. The guidance also replaces the quantitative-based risks and rewards calculation for determining which enterprise has a controlling financial interest in a VIE with an approach focused on identifying which enterprise has the power to direct the significant activities of a VIE, and the obligation to absorb losses or the right to receive benefits that may be significant to the VIE. The guidance became effective for Tyco in the first quarter of fiscal 2011. The Company's population of VIE's is primarily composed of joint ventures that are not material to the Company's consolidated operations and are not material to the Company's financial position, results of operations or cash flows. The adoption of this guidance resulted in the deconsolidation of a joint venture in the Tyco Fire Protection segment, but it did not have a material impact on the Company's financial position, results of operations or cash flows.

Recently Issued Accounting Pronouncements—In June 2011, the FASB issued authoritative guidance for the presentation of comprehensive income. The guidance amended the reporting of Other Comprehensive Income ("OCI") by eliminating the option to present OCI as part of the Statement of Changes in Shareholder's Equity. The amendment will not impact the accounting for OCI, but only its presentation in the Company's consolidated financial statements. The guidance requires that all nonowner changes in Tyco's shareholders' equity be presented either in a single continuous statement of comprehensive income or in two separate but consecutive statements which include total net income and its components, consecutively followed by total OCI and its components to arrive at total comprehensive income. The guidance must be applied retrospectively and is effective for Tyco in the first quarter of fiscal 2013, with early adoption permitted. The Company is currently assessing the timing of its adoption of the guidance.

The Company has continued to assess the strategic fit of its various businesses and has pursued divestiture of certain businesses which do not align with its long-term strategy.

On November 9, 2010, the Company announced that it entered into an investment agreement (the "Agreement") to sell a majority interest in its Electrical and Metal Products business to an affiliate of the private equity firm Clayton, Dubilier & Rice, LLC (the "Investor"). The Company formed a newly incorporated holding company, Atkore International Group Inc. ("Atkore"), to hold the Company's Electrical and Metal Products business. On December 22, 2010, the transaction closed and the Investor acquired shares of a newly-created class of cumulative convertible preferred stock of Atkore (the "Preferred Stock"). The Preferred Stock initially represented 51% of the outstanding capital stock (on an as-converted basis) of Atkore. In connection with the closing, the Company received cash proceeds of approximately $713 million and recorded a gain of $259 million (including a $49 million gain recognized in connection with determining the fair value of the Company's retained ownership interest discussed below) during the first quarter of 2011. During the quarter and nine months ended June 24, 2011, the Company recorded net working capital adjustments of $2 million and $11 million, respectively, that reduced the gain on disposal. The gain on disposal is recorded within restructuring, asset impairments and divestiture charges (gain), net in the Company's Consolidated Statements of Operations.

In connection with the sale, the Company was required to determine the fair value of its retained ownership interest in Atkore. The fair value of the retained ownership interest was determined by implying a total equity value of Atkore using the price paid by the Investor for the Preferred Stock less

the expected present value of dividends to be paid on the Preferred Stock (the "Implied Equity Value"). The discount rate used to determine the present value of the expected dividends was calculated by taking the average of the stated return on the Preferred Stock pursuant to the Agreement and Atkore's estimated cost of equity. The Implied Equity Value was then allocated to the Company's retained ownership interest. To arrive at the fair value of the Company's retained ownership interest the Company applied a discount factor to the Company's allocated Implied Equity Value due to the lack of marketability of the common stock of Atkore, which is now privately held. The fair value of the Company's retained ownership interest was determined to be $137 million, resulting in the Company recognizing a $49 million gain upon deconsolidation during the first quarter of fiscal 2011. Tyco's retained ownership interest in Atkore is accounted for under the equity method of accounting and is recorded in other assets in the Company's Consolidated Balance Sheet as of June 24, 2011. The Company's proportionate share of Atkore's net income (loss) is recorded within Other expense, net in the Company's Consolidated Statements of Operations as the amounts were not material. The company recorded equity income of $9 million and $2 million for the quarter and nine months ended June 24, 2011, respectively.

During the fourth quarter of 2009, the Company approved a plan to sell its French security business, which was part of the Company's Tyco Security Solutions segment. The results of operations were presented in continuing operations as the criteria for discontinued operations had not been met. During the second quarter of 2010, the Company completed the sale and recorded a $53 million pre-tax gain within restructuring, asset impairments and divestiture charges (gain), net in the Company's Consolidated Statement of Operations.

On September 30, 2010, the Company sold its European water business, which was part of the Company's Flow Control segment. The sale was completed for approximately $264 million in cash proceeds, net of $7 million of cash divested on sale, and a pre-tax gain of $168 million was recorded, which was largely exempt from tax. The gain was recorded in (loss) income from discontinued operations, net of income taxes in the Company's Consolidated Statement of Operations.

Net revenue, pre-tax income (loss) from discontinued operations, pre-tax (loss) income on sale of discontinued operations, income tax expense and (loss) income from discontinued operations, net of income taxes are as follows ($ millions):

There were no material pending divestitures as of June 24, 2011. Balance sheet information for material pending divestitures as of September 24, 2010 was as follows ($ in millions):

During the quarter and nine months ended June 24, 2011, the Company recorded a net loss of $6 million and a net gain of $227 million, respectively, in restructuring, asset impairments and divestiture charges (gain), net in the Company's Consolidated Statements of Operations in connection with the divestiture and write-down to fair value less cost to sell of certain businesses that did not meet the criteria for discontinued operations. The net gain for the nine months ended June 24, 2011 includes a gain of $248 million, net of working capital adjustments, recognized in conjunction with the sale of a majority interest in the Company's Electrical and Metal Products business, as discussed above.

During the quarter and nine months ended June 25, 2010, the Company recorded a net loss of $1 million and a net gain of $43 million, respectively, in restructuring, asset impairments and divestiture charges (gain), net in the Company's Consolidated Statements of Operations in connection with the divestiture and write-down to fair value less cost to sell of certain businesses that did not meet the criteria for discontinued operations. The net gain for the nine months ended June 25, 2010 includes the $53 million gain recognized upon the sale of the Company's French security business, as discussed above.

The Company continues to identify and pursue opportunities for cost savings through restructuring activities and workforce reductions to improve operating efficiencies across the Company's businesses during fiscal 2011. The Company expects to incur restructuring and restructuring related charges of approximately $150 million in fiscal 2011.

The Company recorded restructuring and asset impairment charges by program and Consolidated Statement of Operations classification as follows ($ in millions):

	For the Quarter Ended June 24, 2011		For the Quarter Ended June 25, 2010			For the Nine Months Ended June 24, 2011			For the Nine Months Ended June 25, 2010

2011 program	$	25	$	—		$	70		$	—
2009 program		4		40			—			69
2007 and pre-2006 programs		1		1			4			1

Total restructuring and asset impairment charges, net	$	30	$	41		$	74		$	70

Charges reflected in cost of sales		1		(1	)		1			—
Charges reflected in selling, general and administrative ("SG&A")		—		—			(1	)		1
Charges reflected in restructuring, asset impairments and divestiture charges (gain), net	$	29	$	42		$	74		$	69

Restructuring and asset impairment charges, net, during the quarter and nine months ended June 24, 2011 are as follows ($ in millions):

The rollforward of the reserves from September 24, 2010 to June 24, 2011 is as follows ($ in millions):

Restructuring reserves for businesses that have met the held for sale criteria are included in liabilities held for sale on the Consolidated Balance Sheets and excluded from the table above. See Note 2.

During fiscal 2010 and 2009 the Company identified and pursued opportunities for cost savings through restructuring activities and workforce reductions to improve operating efficiencies across the Company's businesses (the "2009 Program"). As of September 24, 2010, the Company had substantially completed the 2009 Program.

Restructuring and asset impairment charges, net, during the quarter and nine months ended June 24, 2011 and June 25, 2010 related to the 2009 Program are as follows ($ in millions):

Restructuring and asset impairment charges, net, incurred cumulative to date from initiation of the 2009 Program are as follows ($ in millions):

The rollforward of the reserves from September 24, 2010 to June 24, 2011 is as follows ($ in millions):

During fiscal 2007 and 2008, the Company launched a restructuring program across all of the Company's segments, including the corporate organization, to streamline some of the businesses and reduce the operational footprint (the "2007 Program"). The Company maintained a restructuring reserve related to the 2007 Program of $21 million and $26 million as of June 24, 2011 and September 24, 2010, respectively. The Company incurred $1 million and $4 million of charges and utilized $3 million and $8 million of the restructuring reserve balance during the quarter and nine months ended June 24, 2011, respectively. In addition, the Company continues to maintain restructuring reserves related to certain programs initiated prior to 2006. The total amount of these reserves was $14 million as of both June 24, 2011 and September 24, 2010. The aggregate remaining reserves related to the 2007 and pre-2006 programs primarily relate to facility exit costs for long-term non-cancelable lease obligations with expiration dates that range from 2011 to 2022 primarily within the Company's Tyco Security Solutions segment. The Company incurred $1 million of charges for both the quarter and nine months ended June 25, 2010.

As of June 24, 2011 and September 24, 2010, restructuring reserves related to all programs were included in the Company's Consolidated Balance Sheets as follows ($ in millions):

During the quarter and nine months ended June 24, 2011, cash paid for acquisitions included in continuing operations totaled $219 million and $228 million, respectively, which primarily related to the acquisition of Oceania Capital Partners Limited's Signature Security Group. Signature Security Group is an electronic security company operating in Australia and New Zealand primarily in small business and residential markets. Cash paid for Signature Security Group totaled approximately $184 million, net of cash acquired of $2 million by the Company's Tyco Security Solutions segment.

On March 21, 2011, the Company signed a definitive agreement to acquire a 75% equity stake in privately-held KEF Holdings Ltd. ("KEF"), a vertically integrated valve manufacturer in the Middle East, for approximately $300 million. Following the close of the transaction, the Company intends to combine KEF with the Company's Tyco Flow Control Segment. See Note 20.

During the quarter and nine months ended June 24, 2011, the Company paid $172 million and $451 million of cash, respectively, to acquire approximately 159,000 and 419,000 customer contracts for electronic security services in its Tyco Security Solutions segment.

Acquisition costs are expensed as incurred. During the quarter and nine months ended June 24, 2011, the Company incurred acquisition costs of $1 million and $4 million, respectively, primarily in connection with its acquisitions of Signature Security Group and KEF. Such costs are recorded in selling, general and administrative expenses in the Company's Consolidated Statements of Operations.

During the quarter and nine months ended June 24, 2011, the Company incurred integration costs of $8 million and $22 million, respectively, primarily in connection with its acquisition of Brink's Home Security Holdings, Inc ("BHS" or "Broadview Security"). Such costs are recorded within selling, general and administrative expenses in the Company's Consolidated Statements of Operations.

During the quarter and nine months ended June 25, 2010, cash paid for acquisitions included in continuing operations totaled $448 million and $600 million, respectively, net of cash acquired of $136 million and $137 million, respectively, which primarily related to the acquisition of Broadview Security and Hiter Industria e Comercio de Controle Termo-Hidraulico Ltda ("Hiter"). Net cash paid for Broadview Security totaled $448 million by the Company's Tyco Security Solutions segment during the quarter ended June 25, 2010. During the nine months ended June 25, 2010, the Company's Flow Control segment acquired two Brazilian valve companies, including Hiter, a valve manufacturer which serves a variety of industries including the oil and gas, chemical and petrochemical markets. Net cash paid for the Brazilian valve companies totaled $104 million.

During the quarter and nine months ended June 25, 2010, the Company paid $134 million and $400 million of cash, respectively, to acquire approximately 122,000 and 356,000 customer contracts for electronic security services in the Tyco Security Solutions segment.

Acquisition costs are expensed as incurred. The Company has incurred approximately $14 million and $17 million of costs directly related to the Broadview Security acquisition during the quarter and nine months ended June 25, 2010. In addition, the Company recorded $10 million of integration costs during the quarter and $11 million during the nine months ended June 25, 2010. Both acquisition and integration costs have been recorded within selling, general and administrative expenses in the Company's Consolidated Statement of Operations for the quarter and nine months ended June 25, 2010. The Company's Tyco Security Solutions segment recorded $24 million and $25 million of acquisition and integration costs for the quarter and nine months ended June 25, 2010, respectively. The Company's Corporate and Other segment recorded nil and $3 million of acquisition costs for the quarter and nine months ended June 25, 2010, respectively. In addition, the Company's Tyco Security Solutions segment recorded $13 million of restructuring expenses, in conjunction with the acquisition of Broadview Security, which have been recorded within restructuring, asset impairments and divestiture charges, net in the Company's Consolidated Statement of Operations for the quarter and nine months ended June 25, 2010.

On May 14, 2010, the Company's Tyco Security Solutions segment acquired all of the outstanding equity of Broadview Security, a publicly traded company that was formerly owned by The Brink's Company, in a cash-and-stock transaction valued at approximately $2.0 billion. Under the terms of the transaction, each outstanding share of BHS common stock was converted into the right to receive: (1) $13.15 in cash and 0.7562 Tyco common shares, for those shareholders who made an all-cash election, (2) 1.0951 Tyco common shares, for those shareholders who made an all stock election or (3) $12.75 in cash and 0.7666 Tyco common shares, for those shareholders who made a mixed cash/stock election or who failed to make an election.

Prior to its acquisition, Broadview Security's core business was to provide security alarm monitoring services for residential and commercial properties in North America. Broadview Security had a large residential recurring customer base and was also a leader in technologies and services. The acquisition of Broadview Security has expanded the Company's presence in the North American residential security business as well as enhanced the Company's service offerings to its customers.

The calculation of the consideration transferred to acquire BHS is as follows. Certain amounts below cannot be recalculated as the exact BHS common share amounts have not been presented. ($ and common share data in millions, except per share data):


*Cash consideration*
All cash consideration
Number of shares of BHS common shares outstanding as of May 14, 2010 electing all cash				37
Cash consideration per common share outstanding			$	13.15

	Total cash paid to BHS shareholders making all cash election		$	490
Mixed cash/stock consideration
Number of shares of BHS common shares outstanding as of May 14, 2010 electing mixed consideration or not making an election				7
Cash consideration per common share outstanding			$	12.75

	Total cash paid to BHS shareholders making a mixed election or not making an election		$	95

		Total cash consideration	$	585

*Stock consideration*
All cash consideration
Number of shares of BHS common shares outstanding as of May 14, 2010 electing all cash				37
Exchange ratio				0.7562

	Tyco shares issued to BHS shareholders making an all cash election			28
All stock consideration
Number of shares of BHS common shares outstanding as of May 14, 2010 electing all stock				1
Exchange ratio				1.0951

	Tyco shares issued to BHS shareholders making an all stock election			1
Mixed cash/stock consideration
Number of shares of BHS common shares outstanding as of May 14, 2010 electing mixed consideration or not making an election				7
Exchange ratio				0.7666

	Tyco shares issued to BHS shareholders making a mixed election or not making an election			6

Total Tyco common shares issued				35

Tyco's average common share price on May 14, 2010			$	38.73

		Total stock consideration	$	1,362

Fair value of BHS stock option, restricted stock unit and deferred stock unit replacement awards⁽¹⁾			$	27

Total fair value of consideration transferred			$	1,974

Fair Value Allocation of Consideration Transferred to Assets Acquired and Liabilities Assumed

The consideration transferred for BHS has been allocated to identifiable assets acquired and liabilities assumed as of the acquisition date. The following amounts represent the fair value of the identifiable assets acquired and liabilities assumed ($ in millions):


Net current assets⁽¹⁾			$	78
	Subscriber systems			624
	Other property, plant and equipment			49

		Total property, plant and equipment		673

	Contracts and related customer relationships (10-year weighted average useful life)			738
	Other intangible assets (4-year weighted average useful life)			12

		Total intangible assets		750

Net non-current liabilities⁽²⁾				(459	)

	Net assets acquired			1,042
Goodwill⁽³⁾				932

Purchase price			$	1,974

BHS actual results from the acquisition date, May 14, 2010, which are included in the Consolidated Statement of Operations for the quarter and nine months ended June 25, 2010, are as follows ($ in millions):

The supplemental pro forma financial information for the quarter and nine months ended June 25, 2010 is as follows ($ in millions):

The supplemental pro forma financial information is based on the historical financial information for Tyco and BHS. The supplemental pro forma financial information for the period ended June 25, 2010 utilized BHS' historical financial information for its fiscal fourth quarter ended December 31, 2009 and the pre-acquisition period from January 1, 2010 through the acquisition date. The supplemental pro forma financial information reflect primarily the following pro forma pre-tax adjustments:

The supplemental pro forma financial information for the quarter and nine months ended June 25, 2010 reflect the following non-recurring adjustments:

The supplemental pro forma financial information gives effect to the acquisition, but should not be considered indicative of the results that would have occurred in the periods presented above, nor are they indicative of future results. In addition, the supplemental pro forma financial information does not reflect the potential realization of cost savings relating to the integration of the two companies.

The Company did not have a significant change to its unrecognized tax benefits during the quarter ended June 24, 2011.

Many of Tyco's uncertain tax positions relate to tax years that remain subject to audit by the taxing authorities in U.S. federal, state and local or foreign jurisdictions. Open tax years in significant jurisdictions are as follows:

Based on the current status of its income tax audits, the Company believes that it is reasonably possible that between nil and $65 million in unrecognized tax benefits may be resolved in the next twelve months.

At each balance sheet date, management evaluates whether it is more likely than not that the Company's deferred tax assets will be realized and if sufficient future taxable income will be available by assessing current period and projected operating results and other pertinent data. As of June 24, 2011, the Company had recorded deferred tax assets of $1.4 billion, which is comprised of $2.9 billion gross deferred tax assets net of $1.5 billion valuation allowances.

In connection with the spin-offs of Covidien and TE Connectivity, formerly Tyco Electronics, from Tyco (the "Separation"), Tyco entered into a Tax Sharing Agreement that generally governs Covidien's, TE Connectivity's and Tyco's respective rights, responsibilities, and obligations after the Separation with respect to taxes, including ordinary course of business taxes and taxes, if any, incurred as a result of any failure of the distribution of all of the shares of Covidien or TE Connectivity to qualify as a tax-free distribution for U.S. federal income tax purposes within the meaning of Section 355 of the Code or certain internal transactions undertaken in anticipation of the spin-offs to qualify for tax-favored treatment under the Code.

Under the Tax Sharing Agreement, Tyco shares responsibility for certain of its, Covidien's and TE Connectivity's income tax liabilities, which result in cash payments, based on a sharing formula for periods prior to and including June 29, 2007. More specifically, Tyco, Covidien and TE Connectivity share 27%, 42% and 31%, respectively, of shared income tax liabilities that arise from adjustments made by tax authorities to Tyco's, Covidien's and TE Connectivity's U.S. and certain non-U.S. income tax returns. The costs and expenses associated with the management of these shared tax liabilities are generally shared equally among the parties. In connection with the execution of the Tax Sharing Agreement, Tyco established a net receivable from Covidien and TE Connectivity representing the amount Tyco expected to receive for pre-Separation uncertain tax positions, including amounts owed to the Internal Revenue Service ("IRS"). As of June 24, 2011 and September 24, 2010, respectively, the aggregate amount of the net receivable was $87 million and $114 million, respectively, of which $68 million and $89 million, respectively, was included in other assets and $19 million and $25 million, respectively, was included in prepaid expenses and other current assets on the Consolidated Balance Sheets. Tyco also established liabilities representing the fair market value of its share of Covidien's and TE Connectivity's estimated obligations, primarily to the IRS, for their pre-Separation taxes covered by the Tax Sharing Agreement. As of June 24, 2011 and September 24, 2010, Tyco had recorded $366 million and $398 million, respectively, in other liabilities, and $188 million and $156 million, respectively, in accrued and other current liabilities. During 2011, Tyco reclassified $32 million from other liabilities to accrued and other current liabilities for a change in the net payment due to Covidien and TE Connectivity related to the resolution of certain IRS audit and pre-Separation tax matters.

Tyco assesses the shared tax liabilities and related guaranteed liabilities at each reporting period. The receivable and liability were initially recognized with an offset to shareholders' equity in 2007. During the quarters ended June 24, 2011 and June 25, 2010, Tyco recorded expense of $12 million and nil, respectively, in accordance with the Tax Sharing Agreement. During the nine months ended June 24, 2011 and June 25, 2010, Tyco recorded expense of $11 million and income of $11 million, respectively, in accordance with Tax Sharing Agreement. Tyco will provide payment to Covidien and TE Connectivity under the Tax Sharing Agreement as the shared income tax liabilities are settled. Settlement is expected to occur as the audit process by applicable taxing authorities is completed for the impacted years and cash payments are made. Due to the resolution of certain income tax liabilities by Covidien and TE Connectivity during the quarter ended June 24, 2011, Tyco is expected to make a net cash payment of approximately $188 million to Covidien and TE Connectivity prior to the end of calendar 2011, which, when payment is made, will reduce the guarantor liability under the Tax Sharing Agreement by a corresponding amount. Notwithstanding the resolution of these items, certain significant items regarding pre-Separation shared tax liabilities remain open, and given the nature of these liabilities, the maximum amount of potential future payments under the Tax Sharing Agreement is

not determinable. Such cash payments, when they occur, will reduce the guarantor liability as such payments represent an equivalent reduction of risk. Tyco also assesses the sufficiency of the Tax Sharing Agreement guarantee liability on a quarterly basis and will increase the liability when it is probable that cash payments expected to be made under the Tax Sharing Agreement exceed the recorded balance.

Tyco and its subsidiaries' income tax returns are examined periodically by various tax authorities. In connection with these examinations, tax authorities, including the IRS, have raised issues and proposed tax adjustments, in particular with respect to years preceding the Separation. The issues and proposed adjustments related to such years are generally subject to the sharing provisions of the Tax Sharing Agreement. Tyco is reviewing and contesting certain of the proposed tax adjustments. With respect to adjustments raised by the IRS, although the Company expects to resolve a substantial number of these adjustments, a few significant items are expected to remain open with respect to the audit of the 1997 through 2004 years. As of the date hereof, it is unlikely that Tyco will be able to resolve the open items, which primarily involve the treatment of certain intercompany debt transactions during the period, through the IRS appeals process. As a result, Tyco may be required to litigate these matters. The Company has assessed its obligations under the Tax Sharing Agreement, including with respect to the proposed civil fraud penalties discussed below, to determine that its recorded liability of $554 million is sufficient to cover the indemnifications made by the Company under such agreement. See Note 18. However, the ultimate resolution of these matters is uncertain and could result in a material adverse impact to the Company's financial position, results of operations, cash flows or the effective tax rate in future reporting periods.

In connection with the aforementioned audits, the IRS proposed civil fraud penalties against a prior subsidiary that was distributed to TE Connectivity in connection with the Separation. The penalties allegedly arise from actions of former executives taken in connection with intercompany transfers of stock of Simplex Technologies in 1998 and 1999. Based on statutory guidelines, the Company estimates the proposed penalties could range between $30 million and $50 million. This is a pre-Separation tax liability that is covered by the provisions of the Tax Sharing Agreement.

In addition to dealing with pre-Separation tax liabilities of each of the three entities party thereto, the Tax Sharing Agreement contains sharing provisions to address the contingency that the Separation itself, or internal transactions related to the Separation, may be deemed taxable by U.S. or non U.S. taxing authorities. In the event the Separation is determined to be taxable and such determination was the result of actions taken after the Separation by Tyco, Covidien or TE Connectivity, the party responsible for such failure would be responsible for all taxes imposed on each company as a result thereof. If such determination is not the result of actions taken by any of the three companies after the Separation, then Tyco, Covidien and TE Connectivity would be responsible for 27%, 42% and 31%, respectively, of any taxes imposed on any of the companies as a result of such determination. Such tax amounts could be significant. The Company is responsible for all of its own taxes that are not shared pursuant to the Tax Sharing Agreement's sharing formula. In addition, Covidien and TE Connectivity are responsible for their tax liabilities that are not subject to the Tax Sharing Agreement's sharing formula.

If any party to the Tax Sharing Agreement were to default in its obligation to another party to pay its share of the distribution taxes that arise as a result of no party's fault, each non-defaulting party would be required to pay, equally with any other non-defaulting party, the amounts in default. In addition, if another party to the Tax Sharing Agreement that is responsible for all or a portion of an

income tax liability were to default in its payment of such liability to a taxing authority, the Company could be liable under applicable tax law for such liabilities and required to make additional tax payments. Accordingly, under certain circumstances, the Company may be obligated to pay amounts in excess of its agreed-upon share of Tyco's, Covidien's and TE Connectivity's tax liabilities. See Note 18.

Except for earnings that are currently distributed, no additional material provision has been made for U.S. or non-U.S. income taxes on the undistributed earnings of subsidiaries or for unrecognized deferred tax liabilities for temporary differences related to investments in subsidiaries, since the earnings are expected to be permanently reinvested, the investments are essentially permanent in duration, or the Company has concluded that no additional tax liability will arise as a result of the distribution of such earnings. A liability could arise if amounts are distributed by such subsidiaries or if such subsidiaries are ultimately disposed. It is not practicable to estimate the additional income taxes related to permanently reinvested earnings or the basis differences related to investments in subsidiaries.

The reconciliations between basic and diluted earnings per share attributable to Tyco common shareholders are as follows (in millions, except per share data):

The computation of diluted earnings per share for the quarter and nine months ended June 24, 2011 excludes the effect of the potential exercise of share options to purchase approximately 6 million and 10 million shares, respectively, and excludes restricted stock units of approximately nil and 1 million shares, respectively, because the effect would be anti-dilutive.

The computation of diluted earnings per share for the quarter and nine months ended June 25, 2010 excludes the effect of the potential exercise of share options to purchase approximately 14 million and 16 million shares, respectively, and excludes restricted stock units of approximately 2 million in both periods because the effect would be anti-dilutive.

Annually, in the fiscal fourth quarter, and more frequently if triggering events occur, the Company tests goodwill for impairment by comparing the fair value of each reporting unit with its carrying amount. Fair value for each reporting unit is determined utilizing a discounted cash flow analysis based on the Company's forecast cash flows discounted using an estimated weighted-average cost of capital of market participants. A market approach is utilized to corroborate the discounted cash flow analysis performed at each reporting unit. If the carrying amount of a reporting unit exceeds its fair value, goodwill is considered potentially impaired. In determining fair value, management relies on and considers a number of factors, including operating results, business plans, economic projections, including expectations and assumptions regarding the timing and degree of any economic recovery, anticipated future cash flow, comparable market transactions (to the extent available), other market data and the Company's overall market capitalization.

During the first quarter of fiscal 2011, the Company realigned its Safety Products segment between its ADT Worldwide and Fire Protection segments to create two new segments: Tyco Security Solutions and Tyco Fire Protection. Also, various businesses were realigned between Tyco Security Solutions and Tyco Fire Protection. As a result of the realignment of business activities, the balances as of September 25, 2009 have been recast. As part of the realignment the Company tested the related goodwill balances for recoverability and determined goodwill continues to be recoverable.

The changes in the carrying amount of goodwill by segment are as follows ($ in millions):

	As of September 25, 2009			Acquisitions/ Purchase Accounting Adjustments		Divestitures			Currency Translation			As of September 24, 2010

Tyco Security Solutions
Gross Goodwill	$	5,921		$	929	$	(3	)	$	(48	)	$	6,799
Impairments		(1,332	)		—		—			—			(1,332	)

Carrying Amount of Goodwill		4,589			929		(3	)		(48	)		5,467

Tyco Fire Protection
Gross Goodwill		2,638			—		(10	)		5			2,633
Impairments		(429	)		—		—			—			(429	)

Carrying Amount of Goodwill		2,209			—		(10	)		5			2,204

Tyco Flow Control
Gross Goodwill		1,993			76		(106	)		(57	)		1,906
Impairments		—			—		—			—			—

Carrying Amount of Goodwill		1,993			76		(106	)		(57	)		1,906

Electrical and Metal Products
Gross Goodwill		935			—		—			—			935
Impairments		(935	)		—		—			—			(935	)

Carrying Amount of Goodwill		—			—		—			—			—

TOTAL
Gross Goodwill		11,487			1,005		(119	)		(100	)		12,273
Impairments		(2,696	)		—		—			—			(2,696	)

Carrying Amount of Goodwill	$	8,791		$	1,005	$	(119	)	$	(100	)	$	9,577

	As of September 24, 2010			Acquisitions/ Purchase Accounting Adjustments		Divestitures			Currency Translation		As of June 24, 2011

Tyco Security Solutions
Gross Goodwill	$	6,799		$	123	$	—		$	72	$	6,994
Impairments		(1,332	)		—		—			—		(1,332	)

Carrying Amount of Goodwill		5,467			123		—			72		5,662

Tyco Fire Protection
Gross Goodwill		2,633			—		(3	)		29		2,659
Impairments		(429	)		—		—			—		(429	)

Carrying Amount of Goodwill		2,204			—		(3	)		29		2,230

Tyco Flow Control
Gross Goodwill		1,906			4		—			93		2,003
Impairments		—			—		—			—		—

Carrying Amount of Goodwill		1,906			4		—			93		2,003

Electrical and Metal Products
Gross Goodwill		935			—		(935	)		—		—
Impairments		(935	)		—		935			—		—

Carrying Amount of Goodwill		—			—		—			—		—

TOTAL
Gross Goodwill		12,273			127		(938	)		194		11,656
Impairments		(2,696	)		—		935			—		(1,761	)

Carrying Amount of Goodwill	$	9,577		$	127	$	(3	)	$	194	$	9,895

The following table sets forth the gross carrying amount and accumulated amortization of the Company's intangible assets as of June 24, 2011 and September 24, 2010 ($ in millions):

		June 24, 2011					September 24, 2010

		Gross Carrying Amount		Accumulated Amortization		Weighted Average Amortization Period	Gross Carrying Amount		Accumulated Amortization		Weighted Average Amortization Period
Amortizable:
	Contracts and related customer relationships	$	8,292	$	5,133	14 years	$	7,664	$	4,606	14 years
	Intellectual property		553		487	20 years		546		477	20 years
	Other		51		20	9 years		29		15	8 years

	Total	$	8,896	$	5,640	14 years	$	8,239	$	5,098	14 years

Non-Amortizable:
	Intellectual property	$	215				$	213
	Other		87					92

	Total	$	302				$	305

Intangible asset amortization expense for the quarters ended June 24, 2011 and June 25, 2010 was $157 million and $141 million, respectively. Intangible asset amortization expense was $461 million and $397 million for the nine months ended June 24, 2011 and June 25, 2010, respectively.

The estimated aggregate amortization expense on intangible assets is expected to be approximately $175 million for the remainder of 2011, $575 million for 2012, $500 million for 2013, $400 million for 2014, $350 million for 2015 and $300 million for 2016.

	June 24, 2011		September 24, 2010

Commercial paper⁽¹⁾	$	40	$	—
6.75% public notes due 2011⁽²⁾		—		516
6.0% public notes due 2013		655		655
4.125% public notes due 2014		499		499
3.375% public notes due 2015		498		498
3.75% public notes due 2018		249		—
8.5% public notes due 2019		750		750
7.0% public notes due 2019		432		432
6.875% public notes due 2021		715		715
4.625% public notes due 2023		248		—
Other⁽¹⁾⁽²⁾		101		123

Total debt		4,187		4,188
Less current portion		42		536

Long-term debt	$	4,145	$	3,652

The carrying amount of Tyco's debt subject to the fair value disclosure requirements as of June 24, 2011 and September 24, 2010 was $4,086 million and $4,065 million, respectively. The Company has determined the fair value of such debt to be $4,645 million and $4,730 million as of June 24, 2011 and September 24, 2010, respectively. The Company utilizes various valuation methodologies to determine the fair value of its debt, which is primarily dependent on the type of market in which the Company's debt is traded. When available, the Company uses quoted market prices to determine the fair value of its debt that is traded in active markets. As of June 24, 2011 and September 24, 2010, the fair value of the Company's debt which was actively traded was $4,605 million and $4,730 million, respectively. Additionally, the Company believes the carrying amount of its commercial paper of $40 million as of June 24, 2011 approximates fair value based on the short-term nature of such debt.

During the third quarter of fiscal 2011, Tyco International Finance, S.A. ("TIFSA"), the Company's finance subsidiary, issued commercial paper to U.S. institutional accredited investors and qualified institutional buyers. Borrowings under the commercial paper program are available for general corporate purposes. As of June 24, 2011, TIFSA had $40 million of commercial paper outstanding, which bore interest at an average rate of 0.37%. As of September 24, 2010, TIFSA had no commercial paper outstanding.

On March 24, 2011, TIFSA, as the Borrower, and the Company as the Guarantor, entered into a Four-Year Senior Unsecured Credit Agreement, providing for revolving credit commitments in the aggregate amount of $750 million (the "Credit Agreement"). In connection with entering into the Credit Agreement, TIFSA and the Company terminated the existing Three-Year Senior Unsecured Credit Agreement, dated June 24, 2008, which provided for revolving credit commitments in the aggregate amount of $500 million, and which was scheduled to expire in June 2011. The Credit Agreement also reduced the lenders' commitments under the existing Five-Year Senior Unsecured Credit Agreement, dated April 25, 2007, from an aggregate of $1.19 billion to $750 million, and which is scheduled to expire in April 2012.

As a result of entering into the Credit Agreement and the termination and reduction described above, the Company's committed revolving credit facilities totaled $1.5 billion as of June 24, 2011. These revolving credit facilities may be used for working capital, capital expenditures and general corporate purposes. As of June 24, 2011, there were no amounts drawn under the Company's revolving credit facilities, although the Company had dedicated $40 million of availability to backstop outstanding commercial paper. As of September 24, 2010, no amounts were drawn under the Company's former credit facilities. Interest under the revolving credit facilities is variable and is calculated by reference to LIBOR or an alternate base rate.

On January 12, 2011, TIFSA issued $250 million aggregate principal amount of 3.75% Notes due on January 15, 2018 (the "2018 Notes") and $250 million aggregate principal amount of 4.625% Notes due on January 15, 2023 (the "2023 Notes"), which are fully and unconditionally guaranteed by the Company. TIFSA received total net proceeds of approximately $494 million after deducting debt issuance costs of approximately $1 million for the 2018 Notes and $2 million for the 2023 Notes, as well as debt discount of approximately $1 million for the 2018 Notes and $2 million for the 2023 Notes. The net proceeds of the aforementioned debt issuances, along with other available funds, were used to fund the repayment upon maturity of all of the Company's outstanding 6.75% Notes due February 2011 with a principal amount of $516 million. The 2018 Notes and the 2023 Notes are unsecured and rank equally with TIFSA's other unsecured and unsubordinated debt.

Prior to January 15, 2018 in the case of the 2018 Notes and prior to October 15, 2022 in case of the 2023 Notes, TIFSA may redeem any of the notes at a redemption price equal to the greater of the principal amount of the notes of such series or a make-whole amount, plus in each case, accrued and unpaid interest. On or after October 15, 2022, TIFSA may redeem the 2023 Notes at a redemption price equal to 100% of the principal amount of the notes plus accrued and unpaid interest. The holders

of both the 2018 Notes and the 2023 Notes have the right to require TIFSA to repurchase all or a portion of the notes at a purchase price equal to 101% of the principal amount of the notes repurchased, plus accrued and unpaid interest upon the occurrence of a change of control triggering event, which requires both a change of control and rating event, each as defined in the indenture governing the notes. The debt issuance costs will be amortized from the date of issuance to the maturity date of each series of the notes. Interest is payable semi-annually on January 15th and July 15th for both the 2018 Notes and 2023 Notes.

On May 5, 2010, TIFSA issued $500 million aggregate principal amount of 3.375% notes due on October 15, 2015, which are fully and unconditionally guaranteed by the Company (the "2015 notes"). TIFSA received net proceeds of approximately $495 million after deducting debt issuance costs of approximately $3 million and a debt discount of approximately $2 million. The net proceeds, along with other available funds, were used to redeem all of the Company's outstanding 6.375% notes due October 2011. The 2015 notes are unsecured and rank equally with TIFSA's other unsecured and unsubordinated debt. TIFSA may redeem any of the 2015 notes at any time by paying the greater of the principal amount of the notes or a "make-whole" amount, plus accrued and unpaid interest. The holders of the 2015 notes have the right to require TIFSA to repurchase all or a portion of the notes at a purchase price equal to 101% of the principal amount of the notes repurchased, plus accrued and unpaid interest upon the occurrence of a change of control triggering event which requires the occurrence of both a change of control and a rating event, each as defined in the Indenture governing the notes. The debt issuance costs will be amortized from the date of issuance to the maturity date. Interest is payable semiannually on April 15^th and October 15^th.

On May 28, 2010, the Company redeemed all of its 6.375% public notes due 2011 (the "2011 notes"), 7% notes due 2028 and 6.875% notes due 2029, outstanding at that time, which aggregated $878 million in principal amount. As a result of the debt redemption, the Company recorded an $87 million charge to other expense, net as a loss on extinguishment of debt. The charge is comprised of the make-whole premium, write-off of the unamortized debt issuance costs and discount related to the extinguished bonds and a net loss recognized upon termination of the associated interest rate swap contracts related to the 2011 notes.

On October 5, 2009, TIFSA issued $500 million aggregate principal amount of 4.125% notes due on October 15, 2014, which are fully and unconditionally guaranteed by the Company (the "2014 notes"). TIFSA received net proceeds of approximately $495 million after deducting debt issuance costs of approximately $3 million and a debt discount of approximately $2 million. The 2014 notes are unsecured and rank equally with TIFSA's other unsecured and unsubordinated debt. TIFSA may redeem any of the 2014 notes at any time by paying the greater of the principal amount of the notes or a "make-whole" amount, plus accrued and unpaid interest. The holders of the 2014 notes have the right to require TIFSA to repurchase all or a portion of the notes at a purchase price equal to 101% of the principal amount of the notes repurchased, plus accrued and unpaid interest upon the occurrence of a change of control triggering event, which requires both a change of control and a rating event, each as defined in the Indenture governing the notes. The debt issuance costs will be amortized from the date of issuance to the maturity date. Interest is payable semiannually on April 15^th and October 15^th.

The Company's financial instruments consist primarily of cash and cash equivalents, accounts receivable, investments, accounts payable, debt and derivative financial instruments. The fair value of cash and cash equivalents, accounts receivable and accounts payable approximated book value as of June 24, 2011 and September 24, 2010. The fair value of derivative financial instruments was not material to any of the periods presented. See below for the fair value of investments and Note 8 for the fair value of debt.

In the normal course of business, Tyco is exposed to market risk arising from changes in currency exchange rates, interest rates and commodity prices. The Company uses derivative financial instruments to manage exposures to foreign currency, interest rate and commodity price risks. The Company's objective for utilizing derivative financial instruments is to manage these risks using the most effective methods to eliminate or reduce the impacts of these exposures. The Company does not use derivative financial instruments for trading or speculative purposes.

For derivative instruments that are designated and qualified as hedging instruments for accounting purposes, the Company documented and linked the relationships between the hedging instruments and hedged items. The Company also assessed and documented at the hedge's inception whether the derivatives used in hedging transactions were effective in offsetting changes in fair values associated with the hedged items. These hedges did not result in any hedge ineffectiveness for the quarters and nine months ended June 24, 2011 and June 25, 2010.

All derivative financial instruments are reported on the Consolidated Balance Sheet at fair value with changes in the fair value of the derivative financial instruments recognized currently in the Company's Statement of Operations, with the exception of net investment hedges for which changes in fair value are reported in the cumulative translation component of accumulated other comprehensive income (loss) to the extent the hedges are effective. The ineffective portion of the hedge, if any, is recognized in the Consolidated Statement of Operations. The derivative financial instruments and impact of such changes in the fair value of the derivative financial instruments was not material to the Consolidated Balance Sheets as of June 24, 2011 and September 24, 2010 or Consolidated Statements of Operations and Statement of Cash Flows for the quarters and nine months ended June 24, 2011 and June 25, 2010.

The Company manages foreign currency exchange rate risk through the use of derivative financial instruments comprised principally of forward contracts on foreign currency which are not designated as hedging instruments for accounting purposes. The objective of the derivative instruments is to minimize the income statement impact and potential variability in cash flows associated with intercompany loans and accounts receivable, accounts payable and forecasted transactions that are denominated in certain foreign currencies. As of June 24, 2011 and September 24, 2010, the total gross notional amount of the Company's foreign exchange contracts was $815 million and $860 million, respectively.

Effective March 17, 2009, Tyco changed its jurisdiction of incorporation from Bermuda to Switzerland. Tyco made the final dividend payment in the form of a reduction of capital in February 2011, denominated in Swiss francs (See Note 12). The Company paid dividends in U.S. dollars, based on the exchange rate in effect shortly before the payment date. Fluctuations in the value of the U.S.

dollar compared to the Swiss franc between the date the dividend was approved and paid increased or decreased the U.S. dollar amount required to be paid. The Company managed the potential variability in cash flows associated with the dividend payments by entering into derivative financial instruments used as economic hedges of the underlying risk. Beginning in May 2011, the Company makes dividend payments out of contributed surplus in U.S. dollars, which has eliminated the need to use currency hedges for dividend payments.

The Company hedges its net investment in certain foreign operations through the use of foreign exchange forward contracts. The objective is to minimize the exposure to changes in the value of the foreign currency denominated net investment. The aggregate notional amount of these hedges was $227 million and $255 million as of June 24, 2011 and September 24, 2010, respectively. Changes in the fair value of forward contracts qualifying as net investment hedges are reported in cumulative translation component of accumulated other comprehensive income (loss) to the extent the hedges are effective. The ineffective portion of the hedge was not material to the Company's Consolidated Statement of Operations. These contracts did not have a material impact to the Company's Consolidated Balance Sheets as of June 24, 2011 and September 24, 2010.

The Company manages interest rate risk through the use of interest rate swap transactions with financial institutions acting as principal counterparties, which are designated as fair value hedges for accounting purposes. Since the third quarter of 2009, TIFSA has been entering into interest rate swap transactions with the objective of managing the exposure to interest rate risk by converting interest rates of fixed-rate debt to variable rates. During the second quarter of 2011, TIFSA also entered into interest rate swap contracts to hedge $155 million notional amount of the 4.125% public notes due 2014. In these contracts, TIFSA agrees with financial institutions acting as principal counterparties to exchange, at specified intervals, the difference between fixed and floating interest amounts calculated on an agreed-upon notional principal amount. In connection with the maturity of the 6.75% public notes during the second quarter of 2011, TIFSA settled the corresponding interest rate swaps. As of June 24, 2011 and September 24, 2010, the total gross notional amount of the Company's interest rate swap contracts was $1.2 billion and $1.5 billion, respectively.

During fiscal 2011 and 2010, the Company entered into commodity swaps for copper which are not designated as hedging instruments for accounting purposes, which did not have a material impact on the Company's financial position, results of operations or cash flows.

The use of derivative financial instruments exposes the Company to counterparty credit risk. If the counterparty fails to perform, the Company is exposed to losses if the derivative is in an asset position. When the fair value of a derivative instrument is an asset, the counterparty has to pay the Company to settle the contract. This exposes the Company to credit risk. However, when the fair value of a derivative instrument is a liability, the Company has to pay the counterparty to settle the contract and therefore there is no counterparty credit risk. Tyco has established policies and procedures to limit the potential for counterparty credit risk, including establishing limits for credit exposure and continually

assessing the creditworthiness of counterparties. As a matter of practice, the Company deals with major banks worldwide having long-term Standard & Poor's and Moody's credit ratings of A-/A3 or higher. To further reduce the risk of loss, the Company generally enters into International Swaps and Derivatives Association master agreements with substantially all of its counterparties. Master netting agreements provide protection in bankruptcy in certain circumstances and, in some cases, enable receivables and payables with the same counterparty to be offset on the Consolidated Balance Sheets, providing for a more meaningful balance sheet presentation of credit exposure. The Company's derivative contracts do not contain any credit risk related contingent features and do not require collateral or other security to be furnished by the Company or the counterparties.

The Company's exposure to credit risk associated with its derivative instruments is measured on an individual counterparty basis, as well as by groups of counterparties that share similar attributes. As of June 24, 2011, the Company was exposed to industry concentration with financial institutions as well as risk of loss if an individual counterparty or issuer failed to perform its obligations under contractual terms. The maximum amount of loss that the Company would incur as of June 24, 2011 without giving consideration to the effects of legally enforceable master netting agreements was approximately $45 million.

Authoritative guidance for fair value measurements establishes a three-level hierarchy that ranks the quality and reliability of information used in developing fair value estimates. The hierarchy gives the highest priority to quoted prices in active markets and the lowest priority to unobservable data. In cases where two or more levels of inputs are used to determine fair value, a financial instrument's level is determined based on the lowest level input that is considered significant to the fair value measurement in its entirety. The three levels of the fair value hierarchy are summarized as follows:

Investments primarily include cash equivalents, U.S. government obligations, U.S. government agency securities and corporate debt securities.

When available, the Company uses quoted market prices to determine the fair value of investment securities. Such investments are included in Level 1. When quoted market prices are not readily available, pricing determinations are made based on the results of market approach valuation models using observable market data such as recently reported trades, bid and offer information and benchmark securities. These investments are included in Level 2 and consist primarily of U.S. government agency securities and corporate debt securities.

As described above, under the caption "Derivative Instruments" derivative assets and liabilities consist principally of forward foreign currency exchange contracts and interest rate swaps. The fair values for these derivative financial instruments are derived from market approach pricing models that take into account the contractual terms and features of each instrument, forward foreign currency rates for the Company's foreign exchange contracts and yield curves for the Company's interest rate swaps existing at the end of the period. Valuations are adjusted to reflect creditworthiness of the counterparty for assets and the creditworthiness of the Company for liabilities. Such adjustments are based on observable market evidence and are categorized as Level 2 exposures. Derivative financial instruments are not presented in the following tables as the derivative financial instruments were not material to any of the periods presented.

The following tables present the Company's assets and liabilities measured at fair value on a recurring basis as of June 24, 2011 and September 24, 2010, by level within the fair value hierarchy. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the valuation.

During the nine months ended June 24, 2011, the Company did not have any significant transfers within the fair value hierarchy.

The Company had $3.0 billion of intercompany loans designated as permanent in nature as of June 24, 2011 and September 24, 2010, for both periods. For the quarters ended June 24, 2011 and June 25, 2010, the Company recorded $37 million of cumulative translation gain and $59 million of cumulative translation loss, respectively, through accumulated other comprehensive income (loss) related to these loans. For the nine months ended June 24, 2011 and June 25, 2010, the Company recorded $169 million of cumulative translation gain and $174 million of cumulative translation loss, respectively, through accumulated comprehensive income (loss) related to these loans.

In connection with the Separation, the Company entered into a liability sharing agreement regarding certain legal actions that were pending against Tyco prior to the Separation. Under the Separation and Distribution Agreement, the Company, Covidien and TE Connectivity are jointly and severally liable for the full amount of any judgments resulting from the actions subject to the agreement, which generally relate to legacy matters that were not specific to the business operations of any of the companies. Substantially all of these legacy matters have been resolved. Additionally, at the time of the Separation, the Company, Covidien and TE Connectivity agreed to allocate responsibility for certain legacy tax claims pursuant to the same formula under the Tax Sharing Agreement. A number of the legacy tax claims remain outstanding. See Note 5.

Since June 2007, the Company has resolved substantially all of the legacy claims related to securities fraud and similar matters, with the exception of the claims related to former management and Mr. Frank Walsh Jr., a former director, described below. During the quarter ended December 24, 2010 certain contingencies related to the previously disclosed settlement of Stumpf v. Tyco International Ltd. class action lawsuit elapsed, and the Company adjusted its remaining reserves for this and other legacy securities matters, recognizing a net gain of $7 million during such quarter.

Tyco is a party to several lawsuits involving disputes with former management, among which are affirmative cases brought by Tyco against Mr. Dennis L. Kozlowski, Tyco's former chief executive officer, Mr. Mark Swartz, its former chief financial officer, and Mr. Frank Walsh Jr., a former director. In connection with these affirmative actions, Mr. Kozlowski, through counterclaims, and Mr. Swartz, through demand letters, are seeking an aggregate of approximately $137 million allegedly due in connection with their compensation and retention arrangements and under the Employee Retirement Income Security Act ("ERISA").

With respect to Mr. Kozlowski, on December 1, 2010, the U.S. District Court for the Southern District of New York ruled in favor of several of the Company's affirmative claims against him before trial, while dismissing all of Mr. Kozlowski's counterclaims for pay and benefits after 1995. With respect to Mr. Swartz, on March 3, 2011, the same Court granted the Company's motion for summary judgment. The Court further ruled that issues related to damages will need to be resolved at trial. No trial date has been set. The Company expects Mr. Kozlowski and Mr. Swartz to contest these decisions. As a result, the Company has and will continue to maintain the reserve recorded in its Consolidated Balance Sheet for the amounts allegedly due under their compensation and retention arrangements and under ERISA until the appeals process is complete. Although the ultimate resolution of these matters

could differ materially from these estimates, the Company does not believe such resolution would have a material adverse effect on its financial position, results of operations or cash flows.

Tyco has also brought an action against Mr. Walsh in connection with the damages suffered by Tyco arising from Mr. Walsh's breach of his fiduciary duties to Tyco. In October 2010, the U.S. District Court for the Southern District of New York denied Tyco's affirmative claims for recovery of damages against Mr. Walsh. Tyco is pursuing an appeal. This affirmative matter, and the affirmative matters against Messrs. Kozlowski and Swartz, are not subject to the liability sharing provisions of the Separation and Distribution Agreement. Separately, Mr. Walsh is pursuing a New York state court claim against the Company asserting his entitlement to indemnification. This action is subject to the liability sharing provisions of the Separation and Distribution Agreement.

Tyco is involved in various stages of investigation and cleanup related to environmental remediation matters at a number of sites. The ultimate cost of site cleanup is difficult to predict given the uncertainties regarding the extent of the required cleanup, the interpretation of applicable laws and regulations and alternative cleanup methods. As of June 24, 2011, Tyco concluded that it was probable that it would incur remedial costs in the range of approximately $24 million to $79 million. As of June 24, 2011, Tyco concluded that the best estimate within this range is approximately $31 million, of which $11 million is included in accrued and other current liabilities and $20 million is included in other liabilities in the Company's Consolidated Balance Sheet. In view of the Company's financial position and reserves for environmental matters, the Company believes that any potential payments of such estimated amounts will not have a material adverse effect on its financial position, results of operations or cash flows.

The Company and certain of its subsidiaries along with numerous other companies are named as defendants in personal injury lawsuits based on alleged exposure to asbestos-containing materials. These cases typically involve product liability claims based primarily on allegations of manufacture, sale or distribution of industrial products that either contained asbestos or were attached to or used with asbestos-containing components manufactured by third-parties. Each case typically names between dozens to hundreds of corporate defendants. While the Company has observed an increase in the number of these lawsuits over the past several years, including lawsuits by plaintiffs with mesothelioma-related claims, a large percentage of these suits have not presented viable legal claims and, as a result, have been dismissed by the courts. The Company's strategy has been, and continues to be, to mount a vigorous defense aimed at having unsubstantiated suits dismissed, and, where appropriate, settling suits before trial. Although a large percentage of litigated suits have been dismissed, the Company cannot predict the extent to which it will be successful in resolving lawsuits in the future. As of June 24, 2011, there were approximately 4,400 lawsuits pending against the Company, its subsidiaries or entities for which the Company has assumed responsibility. Each lawsuit typically includes several claims, and the Company has determined that there were approximately 5,100 claims outstanding as of June 24, 2011, which reflects the Company's current estimate of the number of viable claims made against it, its affiliates or entities for which it has assumed responsibility in connection with acquisitions or divestitures. This amount includes adjustments for claims that are not actively being prosecuted, identify incorrect defendants or are duplicative of other actions.

Annually, during the Company's third quarter, the Company performs an analysis with the assistance of outside counsel and other experts to update its estimated asbestos-related assets and liabilities. Due to a high degree of uncertainty regarding the pattern and length of time over which claims will be made and then settled or litigated, the Company uses multiple estimation methodologies based on varying scenarios of potential outcomes to estimate the range of loss. The Company's estimate of the liability and corresponding insurance recovery for pending and future claims and defense costs is predominantly based on claim experience over the past five years, and a projection which covers claims expected to be filed, including related defense costs, over the next seven years on an undiscounted basis. The Company has concluded that estimating the liability beyond the seven year period will not provide a reasonable estimate, as these uncertainties increase significantly as the projection period lengthens. The Company's estimate of asbestos-related insurance recoveries represents estimated amounts due to the Company for previously paid and settled claims and the probable reimbursements relating to its estimated liability for pending and future claims. In determining the amount of insurance recoverable, the Company considers a number of factors, including available insurance, allocation methodologies, solvency and creditworthiness of the insurers. On a quarterly basis, the Company re-evaluates the assumptions used to perform the annual analysis and records an expense as necessary to reflect changes in its estimated liability and related insurance asset. As of June 24, 2011, the Company's estimated net liability of $91 million was recorded within the Company's Consolidated Balance Sheet as a liability for pending and future claims and related defense costs of $327 million, and separately as an asset for insurance recoveries of $236 million. Similarly, as of September 24, 2010, the Company's estimated net liability of $106 million was recorded within the Company's Consolidated Balance Sheet as a liability for pending and future claims and related defense costs of $309 million, and separately as an asset for insurance recoveries of $203 million.

The amounts recorded by the Company for asbestos-related liabilities and insurance-related assets are based on currently available information as well as estimates and assumptions. Key variables and assumptions include the number and type of new claims that are filed each year, the average cost of resolution of claims, the resolution of coverage issues with insurance carriers, amount of insurance and the solvency risk with respect to the Company's insurance carriers. Furthermore, predictions with respect to these variables are subject to greater uncertainty in the later portion of the projection period. Other factors that may affect the Company's liability and cash payments for asbestos-related matters include uncertainties surrounding the litigation process from jurisdiction to jurisdiction and from case to case, reforms of state or federal tort legislation and the applicability of insurance policies among subsidiaries. The Company believes that its asbestos-related reserves as of June 24, 2011 are appropriate. However, actual liabilities or insurance recoveries could be significantly higher or lower than those recorded if assumptions used in the Company's calculations vary significantly from actual results.

investigative steps and remedial measures that it has taken in response to these and other allegations and its internal investigations. In 2005, the Company informed the DOJ and the SEC that it retained outside counsel to perform a Company-wide baseline review of its policies, controls and practices with respect to compliance with the Foreign Corrupt Practices Act ("FCPA"), and that it would continue to investigate and make periodic progress reports to these agencies. The Company has and will continue to communicate with the DOJ and SEC to provide updates on the baseline review and follow-up investigations, including, as appropriate, briefings concerning additional instances of potential improper conduct identified by the Company in the course of its ongoing compliance activities. The baseline review, which has been completed, has revealed that some business practices may not comply with Tyco and FCPA requirements, and in February 2010, the Company initiated discussions with the DOJ and SEC aimed at resolving these matters. Discussions remain ongoing, and the Company cannot predict the timing of their resolution or their outcome and cannot estimate the range of potential loss or the form of penalty that may result from an adverse resolution. It is possible that the Company may be required to pay material fines, consent to injunctions on future conduct, consent to the imposition of a compliance monitor, or suffer other criminal or civil penalties or adverse impacts, including being subject to lawsuits brought by private litigants, each of which may have a material adverse effect on the Company's financial position, results of operations or cash flows.

Covidien and TE Connectivity agreed, in connection with the Separation, to cooperate with the Company in its responses regarding these matters. Any judgment required to be paid or settlement or other cost incurred by the Company in connection with the FCPA investigations matters would be subject to the liability sharing provisions of the Separation and Distribution Agreement, which assigned liabilities primarily related to the former Healthcare and Electronics businesses of the Company to Covidien and TE Connectivity, respectively, and provides that the Company will retain liabilities primarily related to its continuing operations. Any liabilities not primarily related to a particular segment will be shared equally among the Company, Covidien and TE Connectivity.

As previously disclosed, in early 2007 certain former subsidiaries in the Company's Flow Control business were charged, prior to their divestiture, by the German Federal Cartel Office ("FCO") with engaging in anti-competitive practices, in particular with regard to its hydrant, valve, street box and fittings business. The Company investigated this matter and determined that the conduct may have violated German competition law. The Company is cooperating with the FCO in its ongoing investigation of this violation. The Company cannot estimate the range of potential loss that may result from this violation. It is possible that the Company may be subject to civil or criminal proceedings and may be required to pay judgments, suffer penalties or incur settlements in amounts that may have a material adverse effect on its financial position, results of operations or cash flows.

On June 8, 2007, SimplexGrinnell received a notice alleging that it had partially withdrawn from the National Automatic Sprinkler Industry Pension Fund (the "Fund"). Under Title IV of ERISA, if the Fund can prove that an employer completely or partially withdraws from a multi-employer pension plan such as the Fund, the employer is liable for withdrawal liability equal to its proportionate share of the plan's unfunded vested benefits. The alleged withdrawal results from a 1994 labor dispute between Grinnell Fire Protection Systems, SimplexGrinnell's predecessor, and Road Sprinkler Fitters Local Union No. 669.

ERISA requires that payment of withdrawal liability be made in full or in quarterly installments commencing upon receipt of a liability assessment from the plan. A plan's assessment of withdrawal liability generally may be challenged only in arbitration, and ERISA requires that quarterly payments must continue to be made during the pendency of the arbitration. If the employer prevails in arbitration (and any subsequent appeals), its quarterly withdrawal liability payments are refunded with interest. The Fund's total withdrawal liability assessment against SimplexGrinnell is approximately $25 million. The quarterly withdrawal liability payments are $1.1 million, $17.6 million of which has been cumulatively paid through June 24, 2011. While the ultimate outcome is uncertain, SimplexGrinnell believes that it has strong arguments that no withdrawal liability is owed to the Fund, and it plans to vigorously defend against the Fund's withdrawal liability assessment. The matter is currently in arbitration. The Company has made no provision for this contingency and believes that its quarterly payments are recoverable.

On May 14, 2010, the Company acquired Broadview Security, which is a business that was formerly owned by The Brink's Company. Under the Coal Industry Retiree Health Benefit Act of 1992, as amended (the "Coal Act"), The Brink's Company and its majority-owned subsidiaries at July 20, 1992 (including certain legal entities acquired in the Broadview Security acquisition) are jointly and severally liable with certain of The Brink's Company's other current and former subsidiaries for health care coverage obligations provided for by the Coal Act. A Voluntary Employees' Beneficiary Associate ("VEBA") trust has been established by The Brink's Company to pay for these liabilities, although the trust may have insufficient funds to satisfy all future obligations. At the time of its spin-off from The Brink's Company, Broadview Security entered into an agreement in which The Brink's Company agreed to indemnify it for any and all liabilities and expenses related to The Brink's Company's former coal operations, including any health care coverage obligations. The Brink's Company has agreed that this indemnification survives the Company's acquisition of Broadview Security. The Company has evaluated its potential liability under the Coal Act as a contingency in light of all known facts, including the funding of the VEBA, and indemnification provided by The Brinks Company. The Company has concluded that no accrual is necessary due to the existence of the indemnification and its belief that The Brink's Company and VEBA will be able to satisfy all future obligations under the Coal Act.

As previously reported, in 2002, the SEC's Division of Enforcement conducted an investigation related to past accounting practices for dealer connect fees that ADT had charged to its authorized dealers upon purchasing customer accounts. The investigation related to accounting practices employed by the Company's former management, which were discontinued in 2003. Although the Company settled with the SEC in 2006, a number of former dealers and related parties have filed lawsuits against the Company in the United States and in other countries, including a class action lawsuit filed in the District Court of Arapahoe County, Colorado, alleging breach of contract and other claims related to ADT's decision to terminate certain authorized dealers in 2002 and 2003. In February 2010, the Court granted a directed verdict in ADT's favor dismissing a number of the plaintiffs' key claims. The plaintiffs have appealed this verdict. While it is not possible at this time to predict the final outcome of these lawsuits, the Company does not believe these claims will have a material adverse effect on the Company's financial position, results of operations or cash flows.

In addition to the foregoing, the Company is subject to claims and suits, including from time to time, contractual disputes and product and general liability claims, incidental to present and former operations, acquisitions and dispositions. With respect to many of these claims, the Company either self-insures or maintains insurance through third-parties, with varying deductibles. While the ultimate outcome of these matters cannot be predicted with certainty, the Company believes that the resolution of any such proceedings, whether the underlying claims are covered by insurance or not, will not have a material adverse effect on the Company's financial condition, results of operations or cash flows beyond amounts recorded for such matters.

See Note 5 for a more detailed discussion of the status of the Company's outstanding income tax audits.

Defined Benefit Pension Plans—The Company sponsors a number of pension plans. The following disclosures exclude the impact of plans which are immaterial individually and in the aggregate. The net periodic benefit cost for the Company's material U.S. and non-U.S. defined benefit pension plans is as follows ($ in millions):

The estimated net actuarial loss for U.S. pension benefit plans that will be amortized from accumulated other comprehensive income (loss) into net periodic benefit cost over the current fiscal year is expected to be $10 million.

The estimated net actuarial loss for non-U.S. pension benefit plans that will be amortized from accumulated other comprehensive income (loss) into net periodic benefit cost over the current fiscal year is expected to be $12 million.

The Company's funding policy is to make contributions in accordance with the laws and customs of the various countries in which it operates and to make discretionary voluntary contributions from time-to-time. The Company anticipates that it will contribute at least the minimum required to its pension plans in fiscal year 2011 of $10 million for U.S. plans and $65 million for non-U.S. plans. During the nine months ended June 24, 2011 the Company made required contributions of $6 million to its U.S. pension plans and $51 million to its non-U.S. pension plans. The Company also made voluntary contributions of $15 million to its U.S. plans during the nine months ended June 24, 2011.

Postretirement Benefit Plans—Net periodic postretirement benefit cost was insignificant for both periods.

Pursuant to Swiss law, dividend payments made prior to January 1, 2011 in the form of a return of capital from the Company's registered share capital were not subject to Swiss withholding taxes. As a result, the Company paid dividends in the form of a reduction of registered share capital through February 2011. Due to a change in Swiss law effective January 1, 2011, the Company may now make dividend payments from its contributed surplus equity position in its Swiss statutory accounts free of Swiss withholding taxes. Unlike payments made in the form of a reduction to registered share capital, which are required to be denominated in Swiss francs and converted to U.S. dollars at the time of payment, payments from the contributed surplus account may effectively be denominated in U.S. dollars.

Under Swiss law, the authority to declare dividends is vested in the general meeting of shareholders, and on March 9, 2011, the Company's shareholders approved an annual dividend on the Company's common shares of $1.00 per share, which will be paid from contributed surplus in four installments of $0.25 per share. As a result, the Company recorded an accrued dividend of $468 million as of March 9, 2011 and a corresponding reduction to contributed surplus. The first installment of $0.25 was paid on May 25, 2011 to shareholders of record on April 29, 2011. The second installment of $0.25 will be paid on August 24, 2011 to shareholders of record on July 29, 2011. The Company records its accrued dividend in accrued and other current liabilities in the Company's Consolidated Balance Sheet.

On March 10, 2010, the Company's shareholders approved an annual dividend on the Company's common shares of CHF 0.90 per share, which was paid in the form of a return on capital in four installments of CHF 0.22, CHF 0.22, CHF 0.23 and CHF 0.23 to shareholders on record on May 14, 2010, July 30, 2010, October 29, 2010 and January 28, 2011, respectively. As a result, the Company recorded an accrued dividend of CHF 428 million as of March 10, 2010, which approximated

$399 million based on the exchange rate in effect on that date. The accrued dividend was recorded in accrued and other current liabilities in the Company's Consolidated Balance Sheet as of March 26, 2010 and as a corresponding reduction of common shares, which reduced the par value of the Company's common shares from CHF 7.60 to CHF 6.70. The installments were paid in U.S. dollars converted from Swiss Francs at the USD/CHF exchange rate in effect shortly before the payment dates.

On May 14, 2010, the Company acquired all of the outstanding equity of BHS. BHS shareholders who received Tyco common stock as consideration in the merger were included in the first installment of dividend payments that were paid on May 26, 2010. As a result, the Company recorded an accrued dividend of CHF 32 million as of May 14, 2010, which is approximately $28 million based on the exchange rate in effect on that date.

As of June 24, 2011, the Company's share capital amounted to CHF 3,258,632,435, or 486,363,050 registered common shares with a par value of CHF 6.70 per share following the cancellation of 28,088,101 registered shares which had been approved at the March 9, 2011 annual general meeting. Until March 9, 2013, the Board of Directors may increase the Company's share capital by a maximum amount of CHF 1,628,100,000 by issuing a maximum of 243,000,000 shares. In addition, until March 9, 2013 (i) the share capital of the Company may be increased by an amount not exceeding CHF 321,127,717 through the issue of a maximum of 47,929,510 shares through the exercise of conversion and/or option or warrant rights granted in connection with bonds, notes or similar instruments and (ii) the share capital of the Company may be increased by an amount not exceeding CHF 321,127,717 through the issue of a maximum of 47,929,510 shares to employees and other persons providing services to the Company. Although the Company states its par value in Swiss francs, it continues to use the U.S. dollar as its reporting currency for preparing its Consolidated Financial Statements.

The Company's Board of Directors approved the $1.0 billion 2011 share repurchase program, the $1.0 billion 2010 share repurchase program and the $1.0 billion 2008 share repurchase program, in April 2011, September 2010 and July 2008, respectively. During the nine months ended June 24, 2011, the Company repurchased approximately 30 million shares for approximately $1.3 billion under these programs, which reduced the amount of common shares outstanding and decreased the dividends declared on the Consolidated Statement of Shareholders' Equity as of June 24, 2011. Both the 2008 and 2010 share repurchase programs were completed during the nine months ended June 24, 2011. As of June 24, 2011, approximately $700 million remained outstanding under the 2011 share repurchase program.

During the quarter ended December 24, 2010, the Company issued its annual share-based compensation grants. The total number of awards issued was approximately 6 million, of which 4 million were share options, 1 million were restricted unit awards and 1 million were performance share unit awards. The options and restricted stock units vest in equal annual installments over a period of 4 years, and the performance share unit awards vest after a period of 3 years based on the

level of attainment of the applicable performance metrics, which are determined by the Compensation and Human Resources Committee of the Board. The weighted-average grant-date fair value of the share options, restricted unit awards and performance share unit awards was $9.13, $37.29 and $41.17, respectively. The weighted-average assumptions used in the Black-Scholes option pricing model included an expected stock price volatility of 33%, a risk free interest rate of 1.26%, an expected annual dividend per share of $0.84 and an expected option life of 5.2 years.

During the quarter ended December 25, 2009, the Company issued its annual share-based compensation grants. The total number of awards issued was approximately 6 million, of which 4 million were share options, 1 million were restricted unit awards and 1 million were performance share unit awards. The options and restricted stock units vest in equal annual installments over a period of 4 years, and the performance share unit awards vest after a period of 3 years based on the level of attainment of the applicable performance metrics, which are determined by the Compensation and Human Resources Committee of the Board. The weighted-average grant-date fair value of the share options, restricted unit awards and performance share unit awards was $9.17, $33.75 and $40.19, respectively. The weighted-average assumptions used in the Black-Scholes option pricing model included an expected stock price volatility of 34%, a risk free interest rate of 2.47%, an expected annual dividend per share of $0.80 and an expected option life of 5.4 years.

The components of accumulated other comprehensive income (loss) are as follows ($ in millions):

The Company, from time to time, may realign businesses and management responsibility within its operating segments based on considerations such as opportunity for market or operating synergies and/or to more fully leverage existing capabilities and enhance development for future products and services.

During the first quarter of fiscal 2011, the Company realigned its Safety Products segment between its ADT Worldwide and Fire Protection segments to create two new segments: Tyco Security Solutions and Tyco Fire Protection. Tyco Security Solutions consists of the former ADT Worldwide segment as well as the portion of the former Safety Products segment that manufactures security products including intrusion, security, access control and video management systems. Tyco Fire Protection consists of the former Fire Protection Services segment as well as a number of businesses from the former Safety Products segment including the fire suppression and life safety products businesses. In addition, various businesses were realigned between Tyco Security Solutions and Tyco Fire Protection.

As a result of the realignment of these business activities the revenue and operating income for the quarter and nine months ended June 25, 2010 have been recast. Selected information by segment is presented in the following tables ($ in millions):

Inventories are recorded at the lower of cost (primarily first-in, first-out) or market value.

Certain of the Company's business segments have guaranteed the performance of third-parties and provided financial guarantees for uncompleted work and financial commitments. The terms of these guarantees vary with end dates ranging from the current fiscal year through the completion of such transactions. The guarantees would typically be triggered in the event of nonperformance and performance under the guarantees, if required, would not have a material effect on the Company's financial position, results of operations or cash flows.

There are certain guarantees or indemnifications extended among Tyco, Covidien and TE Connectivity in accordance with the terms of the Separation and Distribution Agreement and the Tax Sharing Agreement. The guarantees primarily relate to certain contingent tax liabilities included in the Tax Sharing Agreement. At the time of the Separation, Tyco recorded a liability necessary to recognize the fair value of such guarantees and indemnifications. In the absence of observable transactions for identical or similar guarantees, the Company determined the fair value of these guarantees and indemnifications utilizing expected present value measurement techniques. Significant assumptions utilized to determine fair value included determining a range of potential outcomes, assigning a probability weighting to each potential outcome and estimating the anticipated timing of resolution. The probability weighted outcomes were discounted using the Company's incremental borrowing rate. The liability necessary to reflect the fair value of guarantees and indemnifications under the Tax Sharing agreement was $554 million (of which $188 million and $156 million are included in accrued and other current liabilities and the remaining amounts in other liabilities as of June 24, 2011 and September 24, 2010, respectively), on the Company's Consolidated Balance Sheets as of both June 24, 2011 and September 24, 2010. During 2011, the Company reclassified $32 million from other liabilities to accrued and other current liabilities as it expects to make a net payment within the next twelve months to Covidien and TE Connectivity related to the resolution of certain IRS audit and pre-Separation tax matters. The guarantees primarily relate to certain contingent tax liabilities included in the Tax Sharing Agreement. See Note 5.

In addition, Tyco historically provided support in the form of financial and/or performance guarantees to various Covidien and TE Connectivity operating entities. In connection with the Separation, the Company worked with the guarantee counterparties to cancel or assign these guarantees to Covidien or TE Connectivity. To the extent these guarantees were not assigned prior to the Separation date, Tyco assumed primary liability on any remaining such support. The Company's obligations were $4 million, which were included in other liabilities on the Company's Consolidated Balance Sheets as of June 24, 2011 and September 24, 2010, respectively, with an offset to shareholders' equity on the Separation date.

In disposing of assets or businesses, the Company often provides representations, warranties and/or indemnities to cover various risks including, for example, unknown damage to the assets, environmental risks involved in the sale of real estate, liability to investigate and remediate environmental contamination at waste disposal sites and manufacturing facilities and unidentified tax liabilities and legal fees related to periods prior to disposition. The Company has no reason to believe that these uncertainties would have a material adverse effect on the Company's financial position, results of operations or cash flows. The Company has recorded liabilities for known indemnifications included as part of environmental liabilities. See Note 10.

In the normal course of business, the Company is liable for contract completion and product performance. In the opinion of management, such obligations will not significantly affect the Company's financial position, results of operations or cash flows.

The Company records estimated product warranty costs at the time of sale. The changes in the carrying amount of the Company's warranty accrual from September 24, 2010 to June 24, 2011 were as follows ($ in millions):

Warranty accruals for businesses that have met the held for sale criteria are included in liabilities held for sale on the Consolidated Balance Sheets and excluded from the table above. See Note 2.

TIFSA, a wholly-owned subsidiary of the Company, has public debt securities outstanding which are fully and unconditionally guaranteed by Tyco. See Note 8. The following tables present condensed consolidating financial information for Tyco, TIFSA and all other subsidiaries. Condensed financial information for Tyco and TIFSA on a stand-alone basis is presented using the equity method of accounting for subsidiaries.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
For the Quarter Ended June 24, 2011
($ in millions)

		Tyco International Ltd.			Tyco International Finance S.A.			Other Subsidiaries			Consolidating Adjustments			Total

Net revenue		$	—		$	—		$	4,293		$	—		$	4,293
Cost of product sales and services			—			—			2,640			—			2,640
Selling, general and administrative expenses			3			2			1,138			—			1,143
Restructuring, asset impairments and divestiture charges, net			—			—			35			—			35

	Operating (loss) income		(3	)		(2	)		480			—			475
Interest income			—			—			8			—			8
Interest expense			—			(57	)		(2	)		—			(59	)
Other (expense) income, net			(12	)		—			9			—			(3	)
Equity in net income of subsidiaries			610			356			—			(966	)		—
Intercompany interest and fees			(231	)		76			155			—			—

	Income from continuing operations before income taxes		364			373			650			(966	)		421
Income tax expense			—			(4	)		(54	)		—			(58	)

	Income from continuing operations		364			369			596			(966	)		363
Loss from discontinued operations, net of income taxes			(5	)		(5	)		(5	)		10			(5	)

	Net income		359			364			591			(956	)		358
Less: noncontrolling interest in subsidiaries net loss			—			—			(1	)		—			(1	)

	Net income attributable to Tyco common shareholders	$	359		$	364		$	592		$	(956	)	$	359

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
For the Quarter Ended June 25, 2010
($ in millions)

		Tyco International Ltd.			Tyco International Finance S.A.			Other Subsidiaries			Consolidating Adjustments			Total

Net revenue		$	—		$	—		$	4,274		$	—		$	4,274
Cost of product sales and services			—			—			2,693			—			2,693
Selling, general and administrative expenses			2			3			1,158			—			1,163
Restructuring, asset impairments and divestiture charges, net			—			—			43			—			43

	Operating (loss) income		(2	)		(3	)		380			—			375
Interest income			—			—			7			—			7
Interest expense			—			(70	)		(1	)		—			(71	)
Other (expense) income, net			—			(87	)		2			—			(85	)
Equity in net income of subsidiaries			595			301			—			(896	)		—
Intercompany interest and fees			(343	)		86			257			—			—

	Income from continuing operations before income taxes		250			227			645			(896	)		226
Income tax benefit			—			22			4			—			26

	Income from continuing operations		250			249			649			(896	)		252
Income from discontinued operations, net of income taxes			4			4			4			(8	)		4

	Net income		254			253			653			(904	)		256
Less: noncontrolling interest in subsidiaries net income			—			—			2			—			2

	Net income attributable to Tyco common shareholders	$	254		$	253		$	651		$	(904	)	$	254

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
For the Nine Months Ended June 24, 2011
($ in millions)

		Tyco International Ltd.			Tyco International Finance S.A.			Other Subsidiaries			Consolidating Adjustments			Total

Net revenue		$	—		$	—		$	12,664		$	—		$	12,664
Cost of product sales and services			—			—			7,834			—			7,834
Selling, general and administrative expenses			4			7			3,354			—			3,365
Restructuring, asset impairments and divestiture charges (gain), net			—			—			(153	)		—			(153	)

	Operating (loss) income		(4	)		(7	)		1,629			—			1,618
Interest income			—			—			26			—			26
Interest expense			—			(179	)		(5	)		—			(184	)
Other (expense) income, net			(11	)		—			2			—			(9	)
Equity in net income of subsidiaries			2,071			1,100			—			(3,171	)		—
Intercompany interest and fees			(883	)		256			627			—			—

	Income from continuing operations before income taxes		1,173			1,170			2,279			(3,171	)		1,451
Income tax expense			—			(19	)		(259	)		—			(278	)

	Income from continuing operations		1,173			1,151			2,020			(3,171	)		1,173
Income from discontinued operations, net of income taxes			160			160			160			(320	)		160

	Net income		1,333			1,311			2,180			(3,491	)		1,333
Less: noncontrolling interest in subsidiaries net income			—			—			—			—			—

	Net income attributable to Tyco common shareholders	$	1,333		$	1,311		$	2,180		$	(3,491	)	$	1,333

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
For the Nine Months Ended June 25, 2010
($ in millions)

		Tyco International Ltd.			Tyco International Finance S.A.			Other Subsidiaries			Consolidating Adjustments			Total

Net revenue		$	—		$	—		$	12,523		$	—		$	12,523
Cost of product sales and services			—			—			7,912			—			7,912
Selling, general and administrative expenses			11			6			3,363			—			3,380
Restructuring, asset impairments and divestiture charges, net			—			—			26			—			26

	Operating (loss) income		(11	)		(6	)		1,222			—			1,205
Interest income			—			—			24			—			24
Interest expense			—			(217	)		(4	)		—			(221	)
Other income (expense), net			12			(87	)		2			—			(73	)
Equity in net income of subsidiaries			1,874			873			—			(2,747	)		—
Intercompany interest and fees			(1,023	)		256			767			—			—

	Income from continuing operations before income taxes		852			819			2,011			(2,747	)		935
Income tax benefit (expense)			—			18			(96	)		—			(78	)

	Income from continuing operations		852			837			1,915			(2,747	)		857
Income from discontinued operations, net of income taxes			14			14			14			(28	)		14

	Net income		866			851			1,929			(2,775	)		871
Less: noncontrolling interest in subsidiaries net income			—			—			5			—			5

	Net income attributable to Tyco common shareholders	$	866		$	851		$	1,924		$	(2,775	)	$	866

			Tyco International Ltd.		Tyco International Finance S.A.		Other Subsidiaries			Consolidating Adjustments			Total

Assets
Current Assets:
	Cash and cash equivalents		$	—	$	—	$	1,629		$	—		$	1,629
	Accounts receivable, net			—		—		2,470			—			2,470
	Inventories			—		—		1,406			—			1,406
	Intercompany receivables			1,091		39		15,541			(16,671	)		—
	Prepaid expenses and other current assets			22		—		924			—			946
	Deferred income taxes			—		—		367			—			367
	Assets held for sale			—		—		—			—			—

		Total current assets		1,113		39		22,337			(16,671	)		6,818
Property, plant and equipment, net				—		—		4,007			—			4,007
Goodwill				—		—		9,895			—			9,895
Intangible assets, net				—		—		3,558			—			3,558
Investment in subsidiaries				47,520		18,419		—			(65,939	)		—
Intercompany loans receivable				—		12,787		21,729			(34,516	)		—
Other assets				69		317		2,313			—			2,699

		Total Assets	$	48,702	$	31,562	$	63,839		$	(117,126	)	$	26,977

Liabilities and Equity
Current Liabilities:
	Loans payable and current maturities of long-term debt		$	—	$	40	$	2		$	—		$	42
	Accounts payable			—		—		1,230			—			1,230
	Accrued and other current liabilities			555		71		2,082			—			2,708
	Deferred revenue			—		—		638			—			638
	Intercompany payables			10,817		4,750		1,104			(16,671	)		—
	Liabilities held for sale			—		—		—			—			—

		Total current liabilities		11,372		4,861		5,056			(16,671	)		4,618
Long-term debt				—		4,088		57			—			4,145
Intercompany loans payable				22,776		3,114		8,626			(34,516	)		—
Deferred revenue				—		—		1,156			—			1,156
Other liabilities				377		—		2,499			—			2,876

		Total Liabilities		34,525		12,063		17,394			(51,187	)		12,795

Tyco Shareholders' Equity:
	Preference shares			—		—		2,500			(2,500	)		—
	Common shares			2,792		—		—			—			2,792
	Common shares held in treasury			—		—		(988	)		—			(988	)
	Other shareholders' equity			11,385		19,499		44,928			(63,439	)		12,373

		Total Tyco Shareholders' Equity		14,177		19,499		46,440			(65,939	)		14,177
Noncontrolling interest				—		—		5			—			5

		Total Equity		14,177		19,499		46,445			(65,939	)		14,182

		Total Liabilities and Equity	$	48,702	$	31,562	$	63,839		$	(117,126	)	$	26,977

CONDENSED CONSOLIDATING BALANCE SHEET

As of September 24, 2010

($ in millions)

			Tyco International Ltd.			Tyco International Finance S.A.		Other Subsidiaries			Consolidating Adjustments			Total

Assets
Current Assets:
	Cash and cash equivalents		$	—		$	—	$	1,775		$	—		$	1,775
	Accounts receivable, net			—			—		2,493			—			2,493
	Inventories			—			—		1,443			—			1,443
	Intercompany receivables			1,082			160		15,770			(17,012	)		—
	Prepaid expenses and other current assets			69			2		865			—			936
	Deferred income taxes			—			—		382			—			382
	Assets held for sale			221			221		324			(442	)		324

		Total current assets		1,372			383		23,052			(17,454	)		7,353
Property, plant and equipment, net				—			—		4,156			—			4,156
Goodwill				—			—		9,577			—			9,577
Intangible assets, net				—			—		3,446			—			3,446
Investment in subsidiaries				45,396			16,482		—			(61,878	)		—
Intercompany loans receivable				—			11,695		20,387			(32,082	)		—
Other assets				90			323		2,183			—			2,596

		Total Assets	$	46,858		$	28,883	$	62,801		$	(111,414	)	$	27,128

Liabilities and Equity
Current Liabilities:
	Loans payable and current maturities of long-term debt		$	—		$	517	$	19		$	—		$	536
	Accounts payable			—			—		1,340			—			1,340
	Accrued and other current liabilities			421			64		2,186			—			2,671
	Deferred revenue			—			—		618			—			618
	Intercompany payables			10,581			5,189		1,242			(17,012	)		—
	Liabilities held for sale			—			—		103			—			103

		Total current liabilities		11,002			5,770		5,508			(17,012	)		5,268
Long-term debt				—			3,593		59			—			3,652
Intercompany loans payable				21,362			1,772		8,948			(32,082	)		—
Deferred revenue				—			—		1,106			—			1,106
Other liabilities				410			—		2,591			—			3,001

		Total Liabilities		32,774			11,135		18,212			(49,094	)		13,027

Tyco Shareholders' Equity:
	Preference shares			—			—		2,500			(2,500	)		—
	Common shares			2,948			—		—			—			2,948
	Common shares held in treasury			(575	)		—		(401	)		—			(976	)
	Other shareholders' equity			11,711			17,748		42,473			(59,820	)		12,112

		Total Tyco Shareholders' Equity		14,084			17,748		44,572			(62,320	)		14,084
Noncontrolling interest				—			—		17			—			17

		Total Equity		14,084			17,748		44,589			(62,320	)		14,101

		Total Liabilities and Equity	$	46,858		$	28,883	$	62,801		$	(111,414	)	$	27,128

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the Nine Months Ended June 24, 2011

($ in millions)

		Tyco International Ltd.			Tyco International Finance S.A.			Other Subsidiaries			Consolidating Adjustments			Total

Cash Flows From Operating Activities:
	Net cash (used in) provided by operating activities	$	(646	)	$	1,510		$	757		$	—		$	1,621
	Net cash used in discontinued operating activities		—			—			(9	)		—			(9	)
Cash Flows From Investing Activities:
Capital expenditures			—			—			(548	)		—			(548	)
Proceeds from disposal of assets			—			—			7			—			7
Acquisition of businesses, net of cash acquired			—			—			(228	)		—			(228	)
Accounts purchased by ADT			—			—			(451	)		—			(451	)
Divestiture of businesses, net of cash divested			—			—			711			—			711
Intercompany dividend from subsidiary			9			9			—			(18	)		—
Net increase in intercompany loans			—			(1,518	)		—			1,518			—
Decrease (increase) in investment in subsidiaries			46			(5	)		(72	)		31			—
Other			—			(12	)		6			—			(6	)

	Net cash provided by (used in) investing activities		55			(1,526	)		(575	)		1,531			(515	)
	Net cash provided by discontinued investing activities		—			—			259			—			259
Cash Flows From Financing Activities:
Net borrowings (repayments) of debt			—			21			(19	)		—			2
Proceeds from exercise of share options			—			—			112			—			112
Dividends paid			(342	)		—			—			—			(342	)
Intercompany dividend to parent			—			—			(18	)		18			—
Repurchase of common shares by treasury			(500	)		—			(800	)		—			(1,300	)
Net intercompany loan borrowings			1,414			—			104			(1,518	)		—
Increase in equity from parent			—			—			31			(31	)		—
Transfer from discontinued operations			—			—			250			—			250
Other			19			(5	)		(5	)		—			9

	Net cash provided by (used in) financing activities		591			16			(345	)		(1,531	)		(1,269	)
	Net cash used in discontinued financing activities		—			—			(250	)		—			(250	)
Effect of currency translation on cash			—			—			27			—			27

Net decrease in cash and cash equivalents			—			—			(136	)		—			(136	)
Decrease in cash from deconsolidation of variable interest entity			—			—			(10	)		—			(10	)
Cash and cash equivalents at beginning of period			—			—			1,775			—			1,775

Cash and cash equivalents at end of period		$	—		$	—		$	1,629		$	—		$	1,629

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the Nine Months Ended June 25, 2010

($ in millions)

		Tyco International Ltd.			Tyco International Finance S.A.			Other Subsidiaries			Consolidating Adjustments			Total

Cash Flows From Operating Activities:
	Net cash (used in) provided by operating activities	$	(54	)	$	(670	)	$	2,391		$	—		$	1,667
	Net cash provided by discontinued operating activities		—			—			12			—			12
Cash Flows From Investing Activities:
Capital expenditures			—			—			(512	)		—			(512	)
Proceeds from disposal of assets			—			—			26			—			26
Acquisition of businesses, net of cash acquired			—			—			(600	)		—			(600	)
Accounts purchased by ADT			—			—			(400	)		—			(400	)
Divestiture of businesses, net of cash divested			—			—			26			—			26
Net decrease in intercompany loans			—			378			—			(378	)		—
Decrease (increase) in investment in subsidiaries			913			457			(1,500	)		130			—
Other			—			—			16			—			16

	Net cash provided by (used in) investing activities		913			835			(2,944	)		(248	)		(1,444	)
	Net cash used in discontinued investing activities		—			—			(7	)		—			(7	)
Cash Flows From Financing Activities:
Net repayments of debt			—			(158	)		(45	)		—			(203	)
Proceeds from exercise of share options			—			—			33			—			33
Dividends paid			(311	)		—			—			—			(311	)
Repurchase of common shares by treasury			(250	)		—			(26	)		—			(276	)
Net intercompany loan repayments			(301	)		—			(77	)		378			—
Increase in equity from parent			—			—			130			(130	)		—
Transfer from discontinued operations			—			—			5			—			5
Other			18			(6	)		(1	)		—			11

	Net cash (used in) provided by financing activities		(844	)		(164	)		19			248			(741	)
	Net cash used in discontinued financing activities		—			—			(5	)		—			(5	)
Effect of currency translation on cash			—			—			(13	)		—			(13	)

Net increase (decrease) in cash and cash equivalents			15			1			(547	)		—			(531	)
Cash and cash equivalents at beginning of period			—			—			2,354			—			2,354

Cash and cash equivalents at end of period		$	15		$	1		$	1,807		$	—		$	1,823

On June 29, 2011, the Company finalized the acquisition of a 75% equity stake in privately-held KEF Holdings Ltd. ("KEF"), a provider of steel castings to the oil and gas, chemical, mining and power industries, for approximately $300 million in cash.

On July 6, 2011, the Company entered into a definitive agreement to acquire Chemguard, Inc. ("Chemguard"), a provider of firefighting foam concentrates and equipment, foam systems, services and specialty chemicals. The transaction is expected to close in the second half of calendar 2011 and is subject to customary closing conditions, including clearance under the Hart-Scott-Rodino Act. Following the closing of the transaction, the Company intends to combine Chemguard with its Fire Protection segment.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of the Company's financial condition and results of operations should be read together with our Consolidated Financial Statements and the related notes included in this Quarterly Report. This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. The Company's actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including but not limited to those under the headings "Risk Factors" and "Forward-Looking Information."

The unaudited Consolidated Financial Statements include the consolidated results of Tyco International Ltd., a company organized under the laws of Switzerland, and its subsidiaries (hereinafter collectively referred to as "we", the "Company" or "Tyco"). The financial statements have been prepared in United States dollars ("USD"), in accordance with accounting principles generally accepted in the United States ("GAAP").

During the first quarter of fiscal 2011, we realigned our Safety Products segment between our ADT Worldwide and Fire Protection segments to create two new segments: Tyco Security Solutions and Tyco Fire Protection. Tyco Security Solutions consists of the former ADT Worldwide segment as well as the portion of the former Safety Products segment that manufactures security products including intrusion, security, access control and video management systems. Tyco Fire Protection consists of the former Fire Protection Services segment as well as a number of businesses from the former Safety Products segment including the fire suppression, fire detection and life safety products businesses. In addition, various businesses were realigned between Tyco Security Solutions and Tyco Fire Protection.

As a result of this realignment, as well as the sale of a majority interest in our Electrical and Metal Products business further described below, we have three core businesses: Tyco Security Solutions, Tyco Fire Protection and Tyco Flow Control. See Note 15 to the Consolidated Financial Statements.

As noted below, we sold a majority interest in our Electrical and Metal Products business on December 22, 2010. During the first fiscal quarter of 2011, we began operating in the following business segments:

We also provide general corporate services to our segments and these costs are reported as Corporate and Other.

During fiscal 2011, we made investments that strategically fit within our three core businesses. On April 29, 2011, our Tyco Security Solutions segment completed the acquisition of Signature Security Group for $184 million in cash. Signature Security Group is an electronic security company operating in Australia and New Zealand primarily in small business and residential markets. On June 29, 2011, our Tyco Flow Control segment finalized the acquisition of a 75% equity stake in privately-held KEF a vertically integrated valve manufacturer in the Middle East for approximately $300 million in cash. KEF is a provider of steel castings to the oil and gas, chemical, mining and power industries. On July 6, 2011, our Fire Protection segment entered into a definitive agreement to acquire Chemguard, a provider of firefighting foam concentrates and equipment, foam systems, services and specialty chemicals. The transaction is expected to close in the second half of calendar 2011.

On November 9, 2010, we announced that we entered into an investment agreement (the "Agreement") to sell a majority interest in our Electrical and Metal Products business to an affiliate of the private equity firm Clayton, Dubilier & Rice, LLC (the "Investor"). We formed a newly incorporated holding company, Atkore International Group Inc. ("Atkore"), to hold our Electrical and Metal Products business. On December 22, 2010 the transaction closed and the Investor acquired shares of a newly-created class of cumulative convertible preferred stock of Atkore (the "Preferred Stock"). The Preferred Stock initially represented 51% of the outstanding capital stock (on an as-converted basis) of Atkore. In connection with the closing, we received cash proceeds of approximately $713 million and recorded a gain of $259 million, (including a $49 million gain recognized in connection with determining the fair value of the Company's retained ownership interest) during the first quarter of 2011. During the nine months ended June 24, 2011, we recorded working capital adjustments of $11 million that reduced the gain on disposal. The gain on disposal is recorded within restructuring, asset impairments and divestiture charges (gain), net in our Consolidated Statement of Operations.

Additionally, during the third quarter of fiscal 2010, our Board of Directors approved a plan to sell our European water business, which was part of our Tyco Flow Control segment. The business met the held for sale and discontinued operations criteria and has been included in discontinued operations for all periods presented. The sale was completed for approximately $264 million in cash proceeds, net of $7 million of cash divested on sale, and a pre-tax gain of $168 million, which was largely exempt from tax. The gain was recorded in (loss) income from discontinued operations, net of income taxes in the Company's Consolidated Statement of Operations.

References to the segment data are to the Company's continuing operations. As discussed above, the Company realigned certain business operations during the quarter ended December 24, 2010 and accordingly has recast prior period segment amounts. See Notes 2 and 15, respectively, to the Consolidated Financial Statements.

Net revenue of $4.3 billion increased $19 million, or 0.4%, for the quarter ended June 24, 2011 as compared to the quarter ended June 25, 2010, which included favorable changes in foreign currency exchange rates of $219 million. Net revenue increased during the quarter ended June 24, 2011 despite the sale of a majority interest in our Electrical and Metal Products business on December 22, 2010, which contributed $390 million in net revenue during the third quarter of fiscal 2010 and none during the third quarter of fiscal 2011. Net revenue increased across all of our segments and was primarily attributable to strength in our Tyco Security Solutions and Tyco Fire Protection segments. On a nine month basis, net revenue increased $141 million, or 1.1%, to $12.7 billion, which included favorable changes in foreign currency exchange rates of $302 million. Net revenue for the nine months ended June 24, 2011 increased despite the contribution of $1.0 billion during the nine months ended June 25,

2010 from the Electrical and Metal Products business as compared to net revenue of $347 million from this business during the nine months ended June 24, 2011. The increase in net revenue was attributable to strength in our Tyco Security Solutions and Tyco Fire Protection segments and to a lesser extent our Tyco Flow Control segment.

Service revenue, which is primarily recurring in nature, represented approximately 46% and 45% of our overall revenue for the quarter and nine months ended June 24, 2011, respectively, compared to 41% for both the quarter and nine months ended June 25, 2010. Service revenue as a percentage of net revenue increased primarily due to the divestiture of our Electrical and Metal Products business, which was primarily a non-service revenue business. Service revenues are principally derived from our Tyco Security Solutions and Tyco Fire Protection businesses, and represent a consistent source of revenue from monitoring and maintenance services under contractual agreements. Recurring revenue in our Tyco Security Solutions business grew to approximately 57% of Tyco Security Solutions' total revenue for both the quarter and nine months ended June 24, 2011, compared to approximately 56% and 55% for the quarter and nine months ended June 25, 2010, respectively, which is primarily due to the Broadview Security acquisition. In the Tyco Fire Protection business, service revenue increased approximately 5.6% and 2.5% for the quarter and nine months ended June 24, 2011, respectively, to $454 million and approximately $1.3 billion, respectively, from the comparable periods in 2010. For the quarter and nine months ended June 24, 2011, non-service revenue in Tyco Security Solutions and Tyco Fire Protection improved slightly compared to the prior periods, due to strength in systems installation and related products and product sales in Tyco Security Solutions and product sales in Tyco Fire Protection. These improvements were partially offset by continued weakness in our Tyco Flow Control segment's Water & Environmental Systems business.

Operating income for the quarter and nine months ended June 24, 2011 was $475 million and $1.6 billion, respectively, compared to operating income of $375 million and $1.2 billion for the quarter and nine months ended June 25, 2010. The increase in operating income in both periods reflects strong growth in our Tyco Security Solutions business. In addition, the increase in operating income for the nine month period includes a net gain on divestitures of $227 million primarily related to a gain of $248 million, net of working capital adjustments, due to the sale of a majority interest in the Electrical and Metal products business. Operating income for the quarter and nine months ended June 24, 2011 included restructuring and asset impairment charges of $30 million and $74 million, respectively, and $41 million and $70 million for the quarter and nine months ended June 25, 2010, respectively. Operating income for the quarter and nine months ended June 24, 2011 included a loss on divestiture of $6 million and a gain on divestiture of $227 million, respectively, and a loss on divestiture of $1 million and a gain on divestiture of $43 million for the quarter and nine months ended June 25, 2010, respectively. Operating income for the quarter and nine months ended June 24, 2011 included acquisition and integration costs of $9 million and $26 million, respectively, and $24 million and $28 million for the quarter and nine months ended June 25, 2010, respectively.

Our cash balance was $1.6 billion and $1.8 billion as of June 24, 2011 and September 24, 2010, respectively. We generated approximately $1.6 billion of cash from operating activities and utilized $515 million of cash in investing activities and $1.3 billion of cash in financing activities during the nine months ended June 24, 2011. During the nine months ended June 24, 2011, approximately $1.0 billion of cash was generated from divestitures, primarily related to $713 million for the sale of the majority interest in our Electrical and Metal Products business and $264 million for the sale of our European water business, which was presented in net cash provided by (used in) discontinued investing activities in our Consolidated Statement of Cash Flows. During the nine months ended June 24, 2011, uses of cash primarily included $1.3 billion to repurchase our common shares, $548 million of capital expenditures, $451 million to purchase customer contracts in our Tyco Security Solutions segment and $342 million to pay cash dividends. We expect to continue to use our cash to fund internal growth

opportunities, improve productivity across all of our businesses, make bolt-on acquisitions that strategically fit within our businesses and return capital to shareholders.

	For the Quarters Ended						For the Nine Months Ended

	June 24, 2011			June 25, 2010⁽¹⁾			June 24, 2011⁽¹⁾			June 25, 2010⁽¹⁾
Revenue from product sales	$	2,336		$	2,532		$	6,962		$	7,366
Service revenue		1,957			1,742			5,702			5,157

Net revenue	$	4,293		$	4,274		$	12,664		$	12,523

Operating income	$	475		$	375		$	1,618		$	1,205
Interest income		8			7			26			24
Interest expense		(59	)		(71	)		(184	)		(221	)
Other expense, net		(3	)		(85	)		(9	)		(73	)

Income from continuing operations before income taxes		421			226			1,451			935
Income tax (expense) benefit		(58	)		26			(278	)		(78	)

Income from continuing operations		363			252			1,173			857
(Loss) income from discontinued operations, net of income taxes		(5	)		4			160			14

Net income	$	358		$	256		$	1,333		$	871
Less: noncontrolling interest in subsidiaries net (loss) income		(1	)		2			—			5

Net income attributable to Tyco common shareholders	$	359		$	254		$	1,333		$	866

⁽¹⁾: On December 22, 2010, we sold a majority interest in our Electrical and Metal Products business. As a result, there was no net revenue or operating income generated by the Electrical and Metal Products business during the quarter ended June 24, 2011, and there is no quarterly or nine months discussion related to the Electrical and Metal Products business. Net revenue and operating income was $347 million and $7 million, respectively, for the quarter ended December 24, 2010 and the nine months ended June 24, 2011. Net revenue was $390 million and $1.0 billion for the quarter and nine months ended June 25, 2010, respectively, and operating income was $40 million and $87 million for the quarter and nine months ended June 25, 2010, respectively, for the Electrical and Metal Products business. This information has been provided in order to reconcile to the above net revenue and operating income for the quarter and nine months ended June 24, 2011 and June 25, 2010.

The segment discussions that follow describe the significant factors contributing to the changes in results for each of our segments included in continuing operations.

Net revenue for Tyco Security Solutions of $2.2 billion increased by $244 million, or 12.7%, during the quarter ended June 24, 2011, as compared to the quarter ended June 25, 2010. Net revenue was favorably impacted by the estimated net impact of acquisitions and divestitures of $70 million, or 3.6%, substantially all of which was related to the acquisitions of Broadview Security in May 2010 and Signature Security Group in April 2011. Changes in foreign currency exchange rates also favorably impacted revenues by $85 million, or 4.4%. The remaining increase in net revenue was primarily due to incremental account growth, net of attrition, in the recurring revenue businesses of North America and Rest of World ("ROW") regions, and strength in our non-recurring businesses related to construction project activity and security system upgrades in North America and retail store expansion activity in ROW.

Recurring revenue is generated from contractual monitoring and maintenance agreements that are long-term in nature, and is primarily driven by the addition or loss of customer accounts and average revenue per customer.

Recurring net revenue increased by $173 million, or 16.2%, to approximately $1.2 billion during the quarter ended June 24, 2011 compared to the quarter ended June 25, 2010, primarily due to the net impact of acquisitions and divestitures of $79 million, or 7.4%, relating to the acquisitions of

Broadview Security and Signature Security Group. Changes in foreign currency exchange rates favorably impacted recurring net revenue by $35 million, or 3.3%. The increase in the average monthly revenue per customer of $2.56 from June 25, 2010 to June 24, 2011 was partially due to favorable foreign exchange rates and partially due to higher average monthly revenue associated with new accounts across all regions.

Non-recurring revenue is generated from product sales (including sales and installation of electronic security and products related to retailer anti-theft systems, as well as other life safety systems) and from services such as the provisioning of armored guards and one-time repair, security system upgrades or inspection jobs. Non-recurring net revenue increased by $71 million, or 8.3%, to $924 million in the quarter ended June 24, 2011. Changes in foreign currency exchange rates favorably impacted non-recurring net revenue by $50 million, or 5.9%. Net revenue was unfavorably impacted by various divestitures within our EMEA Security business which contributed all of the $9 million in divested revenue for the quarter ended June 25, 2010. The remaining increase of $30 million was primarily due to strength in the commercial end-markets in North America, and new retail store expansion activity in the ROW regions.

North American revenue consists of residential and small business, primarily a recurring revenue business, and commercial, primarily a non-recurring revenue business. Europe, Middle East and Africa ("EMEA") and ROW revenue are primarily commercial. Net revenue by geography for Tyco Security Solutions was as follows ($ in millions):

Net revenue in North America increased by $145 million, or 12.9%, primarily as a result of the acquisition of Broadview Security. Changes in foreign currency exchange rates favorably impacted North American revenue by $7 million, or 0.6%. Residential and small business net revenue increased by 18.8%, compared to the quarter ended June 25, 2010, primarily due to the acquisition of Broadview Security. Commercial net revenue increased by 4.5%, as compared to the quarter ended June 25, 2010, due to strength in the commercial end-markets.

Net revenue in EMEA increased by $38 million, or 9.5%, as compared to the quarter ended June 25, 2010. Changes in foreign currency exchange rates favorably impacted EMEA revenue by $44 million, or 11.1%. Revenue was unfavorably impacted by $12 million, or 3.0%, due to divested businesses. The remaining slight increase in net revenue for EMEA was primarily due to stronger systems installation across the region.

Net revenue in ROW increased by $50 million, or 16.4%, as compared to the quarter ended June 25, 2010. Changes in foreign currency exchange rates favorably impacted net revenue by

$28 million, or 9.2%. The remaining increase was primarily attributable to increases in the customer account bases and increased systems installation activity in the Asia Pacific and Latin America regions.

Net revenue in Tyco Security Products increased by $11 million, or 11.6%, as compared to the quarter ended June 25, 2010. Changes in foreign currency exchange rates favorably impacted net revenue by $6 million, or 6.3%. The remaining increase in net revenue was due to growth across multiple product lines globally.

Operating income and operating margin for Tyco Security Solutions were as follows ($ in millions):

Operating income of $327 million increased $96 million, or 41.6%, in the quarter ended June 24, 2011 as compared to the same period in the prior year. Changes in foreign currency exchange rates favorably impacted operating income by $9 million, or 3.9%. Both the operating margin and operating income were favorably impacted by higher sales volume, efficiencies gained through restructuring actions taken in the prior year and other cost containment activities. Operating income was also favorably impacted by decreases in restructuring, asset impairment and divestiture charges, net and acquisition and integration costs of $6 million and $17 million, respectively. During the quarter ended June 25, 2010, restructuring and divestiture charges, net were $30 million as compared to restructuring, asset impairment and divestiture charges, net for the quarter ended June 24, 2011 of $24 million. The quarter ended June 24, 2011 included $7 million of acquisition and integration costs primarily related to the acquisitions of Broadview Security and Signature Security Group, as compared to $24 million during the quarter ended June 25, 2010. Additionally, operating income for the prior year comparable period included a curtailment gain of $12 million, which was recognized upon the freezing of certain defined benefit plans in the United Kingdom.

Net revenue for Tyco Fire Protection of $1.2 billion increased by $86 million, or 7.7%, during the quarter ended June 24, 2011, as compared to the quarter ended June 25, 2010. Changes in foreign currency exchange rates favorably impacted net revenue by $57 million, or 5.1%, while the deconsolidation of a joint venture in our Fire Protection Services business as a result of adopting a new accounting standard during the first quarter unfavorably impacted net revenue by $18 million, or 1.6%. The remaining increase in revenue was primarily driven by increased volume in product sales as a result of generally improved end-market demand and implementation of pricing actions to offset commodity inflationary pressures across all regions.

Revenue from product sales includes sales and installation of fire protection and other systems. Revenue from systems installation increased by $15 million, or 3.8%, during the quarter ended June 24, 2011, as compared to the quarter ended June 25, 2010. Changes in foreign currency exchange rates favorably impacted systems installation revenue by $19 million, or 4.9%, while the deconsolidation of a joint venture discussed above unfavorably impacted net revenue by $12 million, or 3.1%. In addition, systems installation revenue declined as a result of project selectivity primarily in EMEA which was partially offset by an increase in systems installations in North America.

Revenue from product sales increased by $47 million, or 16.0%, during the quarter ended June 24, 2011, as compared to the quarter ended June 25, 2010. Changes in foreign currency exchange rates favorably impacted revenue from product sales by $15 million, or 5.1%. The remaining increase in revenue was driven by increased volume primarily due to improved end-market demand and implementation of pricing actions to offset commodity inflationary pressures.

Service revenue consists of inspection, maintenance, monitoring and repair of fire detection, suppression, and other life safety systems. Service revenue increased by $24 million, or 5.6%, during the quarter ended June 24, 2011, as compared to the quarter ended June 25, 2010. Changes in foreign currency exchange rates favorably impacted net revenue by $23 million, or 5.3%, partially offset by the deconsolidation of a joint venture discussed above, which unfavorably impacted net revenue by $6 million, or 1.4%. The remaining increase in service revenue was as a result of management's continued focus on expanding our recurring service revenue across all regions.

Operating income and operating margin for Tyco Fire Protection were as follows ($ in millions):

Operating income of $146 million increased $12 million, or 9.0%, during the quarter ended June 24, 2011 as compared to the same period in the prior year. Changes in foreign currency exchange rates favorably impacted operating income by $4 million, or 3.0%, offset by a decrease in operating income due to the deconsolidation of a joint venture discussed above of $1 million, or 0.7%. Included in the operating income for the prior year comparable period is a curtailment gain of $8 million which was recognized upon the freezing of certain defined benefit plans in the United Kingdom. The remaining increase in operating income and operating margin was primarily driven by increased sales volume, implementation of pricing actions to offset commodity inflationary pressures, and project selectivity focused on higher margin products and services as well as cost-containment initiatives. During the quarter ended June 24, 2011, $3 million of restructuring charges, net and a loss on divestiture of $9 million were incurred as compared to $6 million of restructuring charges, net and nil of divestiture charges during the quarter ended June 25, 2010.

Net revenue for Tyco Flow Control of $928 million increased $79 million, or 9.3%, during the quarter ended June 24, 2011 compared to the quarter ended June 25, 2010. Changes in foreign currency exchange rates favorably impacted revenue by $77 million, or 9.1%. The remaining slight increase was due primarily to improved market demand in our Valves and Controls and Thermal Controls businesses, which was almost entirely offset by continued weakness in our Water and Environmental Systems business. Revenue for the quarter ended June 25, 2010 included revenue from a large desalinization project in our Water and Environmental Systems business in Australia that was completed at the beginning of the second quarter of fiscal 2011 and therefore had no impact in the current quarter.

Operating income and operating margin for Tyco Flow Control were as follows ($ in millions):

Operating income of $103 million decreased $10 million, or 8.8%, in the quarter ended June 24, 2011 as compared to the same period in the prior year. Operating income was favorably impacted by changes in foreign exchange rates of $10 million, or 8.8%. Restructuring charges, net were $2 million during the quarter ended June 24, 2011 as compared to $6 million in the same period in the prior year. The declines in operating income and operating margin were due primarily to volume declines in our Water & Environmental Systems business, which more than offset the benefit of improved volumes in the rest of Tyco Flow Control, the favorable impacts from changes in foreign currency exchange rates and decreased restructuring charges.

Corporate expense decreased $42 million, or 29%, to $101 million compared to $143 million during the quarter ended June 25, 2010. The decline in Corporate expense was primarily the result of a lower charge recorded in connection with the Company's valuation of its asbestos-related liabilities and insurance assets during the quarter ended June 24, 2011 as compared to the prior year. Included in Corporate expense was a gain on divestiture of $5 million and acquisition related costs of $1 million for the quarter ended June 24, 2011 as compared to a $2 million gain on divestiture and no acquisition costs in the prior year. The quarter ended June 24, 2011 included a net restructuring charge of $3 million and $1 million for the prior year.

Interest income was $8 million and $7 million for the quarters ended June 24, 2011 and June 25, 2010, respectively. The increase in interest income is primarily related to higher investment yields.

Interest expense was $59 million in the quarter ended June 24, 2011 compared to $71 million in the quarter ended June 25, 2010. The decrease in interest expense is primarily related to savings realized from the replacement of higher coupon notes with lower coupon notes over the past year, including the redemption of 6.375% notes due 2011 and issuance of 3.375% notes due 2015 during the third quarter of 2010, and the maturity of 6.75% notes due 2011 and issuances of 3.75% notes due 2018 and 4.625% notes due 2023 during the second quarter of 2011.

Other expense, net was $3 million and $85 million during the quarters ended June 24, 2011 and June 25, 2010, respectively. Other expense, net for the quarter ended June 24, 2011 primarily related to amounts due to Covidien and TE Connectivity, formerly Tyco Electronics, under the Tax Sharing Agreement partially offset by $9 million, our share of Atkore's net income, which is accounted for under the equity method of accounting. Other expense, net for the quarter ended June 25, 2010 primarily related to a charge of $87 million for a loss on extinguishment of debt on the redemption of 6.375% public notes due 2011, 7% notes due 2028 and 6.875% notes due 2029.

Our effective income tax rate was 13.8% during the quarter ended June 24, 2011 and was a benefit of 11.5% during the quarter ended June 25, 2010. The increase in the effective tax rate primarily relates to increased profitability in higher tax rate jurisdictions during the quarter as well as a non-recurring tax benefit associated with the release of deferred tax valuation allowance during the comparable period. The effective tax rate was positively impacted by favorable audit resolutions in multiple jurisdictions during the quarter ended June 24, 2011. The rate can vary from quarter to quarter due to the discreet items, such as the settlement of income tax audits and changes in tax laws, as well as recurring factors such as the geographic mix of income before taxes.

Nine Months Ended June 24, 2011 Compared to Nine Months Ended June 25, 2010

Net revenue for Tyco Security Solutions of $6.4 billion increased by $664 million, or 11.7%, during the nine months ended June 24, 2011, as compared to the nine months ended June 25, 2010. Net revenue was favorably impacted by the estimated net impact of acquisitions and divestitures of $237 million, or 4.2%, substantially all of which was related to the acquisition of Broadview Security in May 2010, and to a lesser extent, Signature Security Group in April 2011 offset by divested revenue from our French Security business, which was sold in March 2010. Changes in foreign currency exchange rates also favorably impacted net revenue by $119 million, or 2.1%. The remaining increase in net revenue was primarily due to incremental account growth, net of attrition, in the recurring revenue businesses in North America and ROW, and strength in our non-recurring businesses related to construction project activity and security system upgrades in North America and retail store expansion activity in ROW.

Recurring net revenue increased by $518 million, or 16.6%, to approximately $3.6 billion during the nine months ended June 24, 2011, as compared to the nine months ended June 25, 2010. Recurring net revenue was favorably impacted by the estimated impact of acquisitions and divestitures of $311 million, or 9.9% relating to our acquisition of Broadview Security in May 2010 and to a lesser extent the acquisition of Signature Security Group in April 2011. Changes in foreign currency exchange rates also favorably impacted recurring net revenue by $55 million, or 1.8%. The increase in average monthly revenue per customer of $2.56 from June 25, 2010 to June 24, 2011 was partially due to favorable foreign exchange rates along with incremental account growth, net of attrition, in the North America and ROW regions.

Non-recurring revenue is generated from product sales (including sales and installation of electronic security and products related to retailer anti-theft systems, as well as other life safety systems) and from services such as the provisioning of armored guards and one-time repair, security system upgrades or inspection jobs. Non-recurring net revenue increased by $146 million, or 5.7%, to $2.7 billion for the nine months ended June 24, 2011 despite the unfavorable net impact of acquisitions and divestitures of $74 million or 2.9%, primarily relating to the sale of our French Security business in March 2010. Changes in foreign currency exchange rates favorably impacted non-recurring net revenue by $64 million, or 2.5%. The remaining increase of $156 million was primarily due to strength in commercial end markets with new retail store expansion activity in ROW and increased demand within North America for construction projects and security systems upgrades.

North American revenue consists of residential and small business, primarily a recurring revenue business, and commercial, primarily a non-recurring revenue business. EMEA and ROW revenue are

primarily commercial. Net revenue by geography for Tyco Security Solutions was as follows ($ in millions):

Net revenue in North America increased by $567 million, or 17.7%, primarily as a result of the acquisition of Broadview Security. Changes in foreign currency exchange rates favorably impacted North American revenue by $18 million, or 0.6%. Residential and small business net revenue increased by 25.9% compared to the nine months ended June 25, 2010, primarily due to the acquisition of Broadview Security. Commercial net revenue increased by 6.6%, as compared to the nine months ended June 25, 2010, primarily as a result of increase in construction projects and security system upgrades in the commercial end markets partially offset by softness in the retail market.

Net revenue in EMEA decreased by $56 million, or 4.2%, as compared to the nine months ended June 25, 2010, primarily due to the unfavorable net impact of acquisitions and divestitures of $119 million, or 8.9%, resulting from the sale of certain businesses, including the French security business in March 2010, and several smaller businesses in Europe over the course of fiscal 2010. Changes in foreign currency exchange rates favorably impacted EMEA revenue by $39 million, or 2.9%. The remaining increase in net revenue for EMEA was primarily due to stronger systems installation across Continental Europe.

Net revenue in ROW increased by $108 million, or 12.2%, as compared to the nine months ended June 25, 2010. Changes in foreign currency exchange rates favorably impacted net revenue by $53 million, or 6.0%. The remaining increase in net revenue in ROW was primarily attributable to increases in the customer account bases and increased systems installation activity in the Asia Pacific and Latin America regions.

Net revenue in Tyco Security Products increased by $45 million, or 17.5%, as compared to the nine months ended June 25, 2010. Changes in foreign currency exchange rates favorably impacted net revenue by $9 million, or 3.5%. The remaining increase in net revenue was primarily due to growth across multiple product lines globally.

Operating income and operating margin for Tyco Security Solutions were as follows ($ in millions):

Operating income of $997 million increased by $186 million, or 22.9%, in the nine months ended June 24, 2011 as compared to the same period in the prior year. Changes in foreign currency exchange rates favorably impacted operating income by $15 million, or 1.8%. Both operating income and operating margin for the nine months ended June 24, 2011 were also favorably impacted by higher sales volume, efficiencies gained through restructuring actions taken in the prior year and other cost containment activities. Included in operating income for the nine months ended June 25, 2010 was $37 million of restructuring charges, net as compared to $22 million of restructuring charges, net for the nine months ended June 24, 2011. The nine months ended June 25, 2010 included a $48 million gain on divestiture, net primarily related to the sale of our French security business, as compared to a $4 million loss on divestiture, net for the nine months ended June 24, 2011. In addition, included in operating income for the nine months ended June 24, 2011 is $22 million of acquisition and integration costs primarily related to the acquisition of Broadview Security and Signature Security Group, as compared to $25 million of acquisition and integration costs during the nine months ended June 25, 2010. Included in the operating income for the prior year comparable period is a curtailment gain of $12 million, which was recognized upon the freezing of certain defined benefit plans in the United Kingdom.

		For the Nine Months Ended

		June 24, 2011		June 25, 2010			% Change
Revenue from product sales
	Systems installation and related products	$	1,157	$	1,186	⁽¹⁾		(2.4	)%
	Products		944		847			11.5	%

Total revenue from product sales		$	2,101	$	2,033			3.3	%
Service revenue			1,307		1,275	⁽¹⁾		2.5	%

Net revenue		$	3,408	$	3,308			3.0	%

⁽¹⁾: Revenue related to the sale of certain products is classified as revenue from product sales. In reporting periods prior to the first quarter of fiscal 2011, revenue related to certain systems installation products was misclassified as service revenue. The service revenue and systems installation revenue during the nine months ended June 25, 2010 have not been changed for this misclassification, as the effect is not material. The impact of the misclassification for the nine months ended June 25, 2010 would have been to decrease service revenue by $27 million with a corresponding increase to systems installation within revenue from product sales. If the revenue from these products for the comparable prior period were classified as product sales, service revenue would have increased as compared to the comparable period in the prior year by $59 million or 4.7%. In addition, product sales would have increased as compared to the comparable period in the prior year by $41 million or 2.0%.

Net revenue for Tyco Fire Protection of $3.4 billion increased by $100 million, or 3.0%, during the nine months ended June 24, 2011, as compared to the nine months ended June 25, 2010. Changes in foreign currency exchange rates favorably impacted net revenue by $73 million, or 2.2%, while the deconsolidation of a joint venture in our Fire Protection services business as a result of adopting a new accounting standard during the first quarter unfavorably impacted net revenue by $55 million, or 1.7%.

The remaining increase in revenue was primarily driven by increased volume in product sales as a result of generally improved end-market demand, implementation of pricing actions to offset commodity inflationary pressures and continued emerging markets expansion, partially offset by a decline in systems installation revenue as a result of project selectivity across all regions.

Revenue from product sales includes sales and installation of fire protection and other systems. Revenue from systems installation decreased by $29 million, or 2.4%, during the nine months ended June 24, 2011, as compared to the nine months ended June 25, 2010. Changes in foreign currency exchange rates favorably impacted systems installation revenue by $26 million, or 2.2%, while the deconsolidation of a joint venture discussed above unfavorably impacted systems installation by $40 million, or 3.4%. The remaining decrease was due to project selectivity resulting from a focus on higher margin projects across all regions.

Revenue from product sales increased by $97 million, or 11.5%, during the nine months ended June 24, 2011, as compared to the nine months ended June 25, 2010. Changes in foreign currency exchange rates favorably impacted product revenue by $13 million, or 1.5%. The remaining increase in net revenue was driven by increased volumes due to improved end-market demand and implementation of pricing actions to offset commodity inflationary pressures.

Service revenue consists of inspection, maintenance, monitoring and repair of fire detection suppression and other life safety systems. Service revenue increased by $32 million, or 2.5%, during the nine months ended June 24, 2011, as compared to the nine months ended June 25, 2010. Changes in foreign currency exchange rates favorably impacted net revenue by $34 million, or 2.7%, while the deconsolidation of a joint venture discussed above unfavorably impacted service revenue by $15 million, or 1.2%. The remaining increase in service revenue was as a result of management's continued focus on expanding our recurring service revenue across all regions.

Operating income and operating margin for Tyco Fire Protection were as follows ($ in millions):

Operating income of $362 million increased $16 million, or 4.6%, in the nine months ended June 24, 2011 as compared to the same period in the prior year. Changes in foreign currency exchange rates favorably impacted operating income by $9 million, or 2.6%, partially offset by a decrease in operating income due to the deconsolidation of a joint venture of $4 million, or 1.2%. Included in the operating income for the prior year comparable period is a curtailment gain of $8 million, which was recognized upon the freezing of certain defined benefit plans in the United Kingdom. The remaining net increase in operating income and operating margin was primarily driven by increased sales volume, implementation of pricing actions to offset commodity inflationary pressures, and project selectivity focused on higher margin products and services as well as cost-containment initiatives. During the nine months ended June 24, 2011, $34 million of restructuring charges, net and losses on divestitures of $24 million were incurred as compared to $11 million of restructuring charges, net and a loss on divestiture of $2 million during the nine months ended June 25, 2010.

Net revenue for Tyco Flow Control of $2.6 billion increased $53 million, or 2.1%, during the nine months ended June 24, 2011 compared to the nine months ended June 25, 2010. Revenue was favorably impacted by changes in foreign currency exchange rates of $108 million, or 4.3%. Increases in net revenue at both our Valves and Controls and Thermal Controls businesses, as a result of continued strength in end market demand, were more than offset by a revenue decrease in our Water & Environmental Systems business. The revenue decline in our Water and Environmental Systems business was primarily due to the completion of a large desalinization project in Australia that commenced during the second quarter of fiscal 2010, and was completed at the beginning of the second quarter fiscal 2011.

Operating income and operating margin for Tyco Flow Control were as follows ($ in millions):

Operating income of $289 million decreased $17 million, or 5.6%, in the nine months ended, June 24, 2011 as compared to the same period in the prior year. Operating income was favorably impacted by changes in foreign currency exchange rates of $14 million, or 4.6%. Restructuring and divestiture charges, net were $7 million during the nine months ended June 24, 2011 as compared to $17 million in the same period in the prior year. The decline in operating income and operating margin was primarily due to volume declines in our Water and Environmental Systems business, which more than offset the benefit of improved volumes in the remainder of Tyco Flow Control, the favorable impacts from changes in foreign currency exchange rates and decreased restructuring charges.

Corporate expense for the nine months ended June 24, 2011 included a net gain of $255 million, primarily related to the divestiture of our Electrical and Metal Products business. As a result, Corporate and Other had expense of $37 million during the nine months ended June 24, 2011 as compared to expense of $345 million during the nine months ended June 25, 2010. Also favorably impacting Corporate expense is a lower charge recorded in connection with the Company's valuation of its asbestos-related liabilities and insurance assets during the quarter ended June 24, 2011 as compared to the prior year. The nine months ended June 24, 2011 also included income of $6 million related to legacy legal matters, which was offset by a restructuring charge of $10 million and acquisition costs of

$3 million, while the nine months ended June 25, 2010 included acquisition costs, a loss on divestiture and net restructuring charges of $3 million, $4 million and $1 million, respectively.

Interest income was $26 million and $24 million for the nine months ended June 24, 2011 and June 25, 2010, respectively. The increase in interest income is primarily related to higher investment yields.

Interest expense was $184 million for the nine months ended June 24, 2011 compared to $221 million for the same period in the prior year. The decrease in interest expense is primarily related to savings realized from the replacement of higher coupon notes with lower coupon notes over the past year, including the redemption of 6.375% notes due 2011 and issuance of 3.375% notes due 2015 during the third quarter of 2010 and the maturity of 6.75% notes due 2011 and issuances of 3.75% notes due 2018 and 4.625% notes due 2023 during the second quarter of 2011.

Other expense, net was $9 million and $73 million during the nine months ended June 24, 2011 and June 25, 2010, respectively. Other expense, net for the nine months ended June 24, 2011 primarily related to amounts due to Covidien and TE Connectivity under the Tax Sharing Agreement. Other expense, net for the nine months ended June 25, 2010 primarily related to a charge of $87 million as a loss on extinguishment of debt on the redemption of 6.375% public notes due 2011, 7% notes due 2028 and 6.875% notes due 2029.

Our effective income tax rate was 19.2% and 8.3% during the nine months ended June 24, 2011 and June 25, 2010, respectively. The increase in our effective income tax rate was primarily related to the tax charge recorded in conjunction with the sale of a majority interest in our Electrical and Metal Products business during the first quarter of 2011, a non-recurring transaction generating a tax benefit in 2010 and a release of a deferred tax valuation allowance in 2010. The effective income tax rate was positively impacted by favorable audit resolutions in multiple jurisdictions during 2011. The rate can vary from quarter to quarter due to discreet items such as the settlement of income tax audits and changes in tax laws as, as well as recurring factors, such as the geographic mix of income before taxes.

The preparation of the Consolidated Financial Statements in conformity with US GAAP requires management to use judgment in making estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities and the reported amounts of revenue and expenses. We believe that our accounting policies for depreciation and amortization methods of security monitoring-related assets, revenue recognition, loss contingencies, income taxes, goodwill and indefinite-lived intangible assets, long-lived assets and pension and postretirement benefits are based on, among other things, judgments and assumptions made by management that include inherent risks and uncertainties. During fiscal 2011, there have been no significant changes to these policies or in the underlying accounting assumptions and estimates used in the above critical accounting policies from those disclosed in the Consolidated Financial Statements and accompanying notes contained in the Company's Annual Report on Form 10-K for the fiscal year ended September 24, 2010 (the "2010 Form 10-K"). See Note 1 to the Consolidated Financial Statements for the adoption and issuance of new accounting standards during fiscal 2011.

A fundamental objective of the Company is to have sufficient liquidity, balance sheet strength, and financial flexibility to fund the operating and capital requirements of its core businesses around the world. The primary source of funds to finance our operations and capital expenditures is cash generated by operations. In addition, we maintain a commercial paper program, have access to committed revolving credit facilities and have access to equity and debt capital from public and private sources. We continue to balance our operating, investing and financing uses of cash through investment in our core businesses, strategic acquisitions and divestitures, dividends and share repurchases. We believe our cash position, amounts available under our credit facilities and cash provided by operating activities will be adequate to cover our operational and business needs.

We had $1.6 billion and $1.8 billion of cash and cash equivalents as of June 24, 2011 and September 24, 2010, respectively. Cash generated by operating activities decreased to $1.6 billion for the nine months ended June 24, 2011 compared to $1.7 billion for the nine months ended June 25, 2010. Cash used in investing activities was $515 million for the nine months ended June 24, 2011 compared to $1.4 billion for the nine months ended June 25, 2010. Cash used in financing activities was $1.3 billion for the nine months ended June 24, 2011 compared to $741 million for the nine months ended June 25, 2010.

As of June 24, 2011, our shareholder's equity was $14.2 billion and our total debt was $4.2 billion. In addition, we had lines of credit totaling approximately $1.5 billion none of which were drawn. Our ratio of total debt to total capital (the sum of our short- and long-term debt and shareholders' equity) was 23% at June 24, 2011 and September 24, 2010, respectively. This ratio is a measure of our long-term liquidity and is an indicator of financial flexibility.

On January 12, 2011, TIFSA, our finance subsidiary, issued $250 million aggregate principal amount of 3.75% notes due on January 15, 2018 and $250 million aggregate principal amount of 4.625% notes due on January 15, 2023, which are fully and unconditionally guaranteed by the Company. TIFSA received net cash proceeds of approximately $494 million. The net proceeds, along with other available funds, were used to fund the repayment of all of our outstanding 6.75% notes due in February 2011 with a principal amount of $516 million.

The sources of our cash flow from operating activities and the use of a portion of that cash in our operations for the quarters and nine months ended June 24, 2011 and June 25, 2010 are as follows ($ in millions):

	For the Quarters Ended						For the Nine Months Ended

	June 24, 2011			June 25, 2010			June 24, 2011			June 25, 2010
Cash flows from operating activities:
Operating income	$	475		$	375		$	1,618		$	1,205
Depreciation and amortization⁽¹⁾		331			304			976			869
Loss (gain) on divestitures		6			2			(227	)		(43	)
Non-cash compensation expense		27			30			86			92
Deferred income taxes		(3	)		(91	)		119			(127	)
Provision for losses on accounts receivable and inventory		13			29			61			93
Other, net		15			(6	)		45			28
Net change in working capital		(47	)		55			(621	)		(175	)
Interest income		8			7			26			24
Interest expense		(59	)		(71	)		(184	)		(221	)
Income tax (expense) benefit		(58	)		26			(278	)		(78	)

Net cash provided by operating activities	$	708		$	660		$	1,621		$	1,667

Other cash flow items:
Capital expenditures, net⁽²⁾	$	(185	)	$	(173	)	$	(541	)	$	(486	)
(Decrease) increase in the sale of accounts receivable		—			(1	)		—			1
Accounts purchased by ADT		(172	)		(134	)		(451	)		(400	)
Purchase accounting and holdback liabilities		—			—			1			(3	)
Voluntary pension contributions		15			—			15			—

The net change in working capital decreased operating cash flow by $621 million in the nine months ended June 24, 2011. The significant changes in working capital included a $195 million increase in inventories, a $183 million increase in accounts receivable and a $172 million decrease in accrued and other liabilities.

The net change in working capital decreased operating cash flow by $175 million in the nine months ended June 25, 2010. The significant changes in working capital included a $127 million increase in inventories and a $32 million net increase in contracts in process.

During the nine months ended June 24, 2011 and June 25, 2010, we paid approximately $86 million and $131 million, respectively, in cash related to restructuring activities. See Note 3 to our Consolidated Financial Statements for further information regarding our restructuring activities.

During the nine months ended June 24, 2011, we made required contributions of $6 million to our U.S. pension plans and $51 million to our non-U.S. pension plans, respectively. We anticipate contributing at least the minimum required to our pension plans in fiscal year 2011 of $10 million for our U.S. plans and $65 million for our non-U.S. plans. We also made voluntary contributions of approximately $15 million to our U.S. plans during the nine months ended June 24, 2011.

Income taxes paid, net of refunds, related to continuing operations were $159 million and $206 million during the nine months ended June 24, 2011 and June 25, 2010, respectively.

Net interest paid, related to continuing operations were $126 million and $170 million during the nine months ended June 24, 2011 and June 25, 2010, respectively.

We made capital expenditures of $548 million for the nine months ended June 24, 2011 as compared to $512 million during the comparable prior period. The level of capital expenditures in fiscal year 2011 is expected to exceed the spending levels in fiscal year 2010 and is also expected to exceed depreciation expense.

During the nine months ended June 24, 2011 and June 25, 2010, we paid approximately $451 million and $400 million, respectively, to acquire approximately 419,000 and 356,000 customer contracts for electronic security services within our Tyco Security Solutions segment.

During the nine months ended June 24, 2011, we paid cash for acquisitions included in continuing operations totaling $228 million, which primarily related to the acquisition of Signature Security Group within our Tyco Security Solutions segment. During the nine months ended June 25, 2010, cash paid for acquisitions included in continuing operations totaled $600 million, net of cash acquired of $137 million, which primarily related to the acquisition of Broadview Security within our Tyco Security Solutions segment and Hiter within our Tyco Flow Control segment.

During the nine months ended June 24, 2011, we received cash proceeds, net of cash divested of approximately $1 billion for divestitures. The cash proceeds primarily related to the sale of a majority interest in our Electrical and Metal Products business of $713 million, which is presented in continuing operations, and $264 million for the sale of our European water business, which is presented in discontinued operations. See Note 2 to our Consolidated Financial Statements for further information.

On January 12, 2011, TIFSA, our finance subsidiary, issued $250 million aggregate principal amount of 3.75% notes due on January 15, 2018 and $250 million aggregate principal amount of 4.625% notes due on January 15, 2023, which are fully and unconditionally guaranteed by the Company. TIFSA received net cash proceeds of approximately $494 million after deducting debt issuance costs and a debt discount. The net proceeds, along with other available funds, were used to fund the repayment of all of our outstanding 6.75% notes due in February 2011 with a principal amount of $516 million.

On May 5, 2010, TIFSA issued $500 million aggregate principal amount of 3.375% notes due 2015, which are fully and unconditionally guaranteed by the Company. TIFSA received net proceeds of approximately $495 million after deducting debt issuance costs and a debt discount. On May 28, 2010, the Company used the net proceeds of the aforementioned offering and additional cash on hand to redeem all of its 6.375% public notes due 2011, 7% notes due 2028 and 6.875% notes due 2029, outstanding at that time, which aggregated $878 million in principal amount.

During the third quarter of fiscal 2011, TIFSA issued commercial paper to U.S. institutional accredited investors and qualified institutional buyers. Borrowings under the commercial paper program are available for general corporate purposes. As of June 24, 2011, TIFSA had $40 million of

commercial paper outstanding, which bore interest at an average rate of 0.37%. The Company has dedicated $40 million under its revolving credit facilities to backstop outstanding commercial paper. During the first quarter of fiscal 2010, TIFSA had made payments of $200 million to extinguish all of its commercial paper outstanding.

On October 5, 2009, TIFSA issued $500 million aggregate principle amount of 4.125% notes due 2014, which are fully and unconditionally guaranteed by the Company. TIFSA received net proceeds of approximately $495 million after deducting debt issuance costs and a debt discount.

Pursuant to our share repurchase program, we may repurchase Tyco shares from time to time in open market purchases at prevailing market prices, in negotiated transactions off the market, or pursuant to an approved 10b5-1 trading plan in accordance with applicable regulations. During the nine months ended June 24, 2011, we repurchased approximately 30 million common shares for approximately $1.3 billion under the 2011, 2010 and 2008 share repurchase programs, which completed both the 2010 and 2008 programs. During the nine months ended June 25, 2010, we repurchased approximately 7 million common shares for approximately $276 million under the 2008 share repurchase program.

On March 9, 2011, our shareholders approved an annual dividend on our common shares of $1.00 per share, to be paid from contributed surplus in four installments of $0.25 per share. During the nine months ended June 24, 2011 and June 25, 2010, we paid cash dividends of approximately $342 million and $311 million, respectively. See Note 12 to our Consolidated Financial Statements for further information.

Management believes that cash generated by or available to us should be sufficient to fund our capital and liquidity needs for the foreseeable future, including quarterly dividend payments and share repurchases.

For a detailed discussion of contingencies related to tax and litigation matters and governmental investigations, see Notes 5 and 10 to our Consolidated Financial Statements.

We had a backlog of unfilled orders of $9.9 billion and $9.5 billion as of June 24, 2011 and September 24, 2010, respectively. We expect that approximately 89% of our backlog as of June 24, 2011 will be filled during the next 12 months. Backlog by segment was as follows ($ in millions):

Backlog increased $456 million, or 4.8%, to $9.9 billion as of June 24, 2011. Changes in foreign currency rates favorably impacted backlog by $251 million, or 2.7%. The remaining net increase in backlog was primarily due to an increase in recurring revenue-in-force in our Tyco Security Solutions segment and increased bookings in our Tyco Flow Control segment. These increases were partially offset by a decrease in bookings in our Tyco Fire Protection segment. Tyco Security Solutions' backlog includes recurring revenue-in-force and long-term deferred revenue for upfront fees paid by customers for Tyco Security Solutions' owned security systems. Revenue-in-force represents 12 months' revenue associated with monitoring and maintenance services under contract in the security business. Tyco

Security Solutions' backlog of $6.9 billion and $6.6 billion as of June 24, 2011 and September 24, 2010, respectively, consists primarily of $5 billion and $4.7 billion of recurring revenue-in-force as of June 24, 2011 and September 24, 2010, respectively, and $1.1 billion of deferred revenue for both June 24, 2011 and September 24, 2010. Tyco Security Solutions' backlog increased $303 million, or 4.6%. Changes in foreign currency exchange rates favorably impacted Security Solutions' backlog by $123 million, or 1.9%. The remaining net increase was primarily due to an increase in revenue-in-force. Tyco Flow Controls' backlog increased by $267 million, or 18%. Changes in foreign currency exchange rates favorably impacted Tyco Flow Controls' backlog by $87 million, or 5.9%. The remaining net increase was primarily due to increased bookings for several large projects within our Valves and Controls and Thermal Controls businesses. The increase was partially offset by a decline in bookings in our Water & Environmental Systems business. Tyco Fire Protections' backlog decreased by $26 million, or 2%. Changes in foreign currency exchange rates favorably impacted Fire Protections' backlog by $41 million, or 3.2%. This increase was more than offset by a decrease in the Asia Pacific region due to the deconsolidation of a joint venture as a result of adopting of a new accounting standard. In addition, backlog decreased in EMEA as a result of project selectivity resulting from a focus on higher margin projects. These decreases were partially offset by increases in our North American and global Fire Safety Products businesses.

Certain of our international businesses utilize the sale of accounts receivable as short-term financing mechanisms. The aggregate amount outstanding under our international accounts receivable programs was not material as of June 24, 2011 or September 24, 2010.

Certain of our business segments have guaranteed the performance of third-parties and provided financial guarantees for uncompleted work and financial commitments. The terms of these guarantees vary with end dates ranging from the current fiscal year through the completion of such transactions. The guarantees would typically be triggered in the event of nonperformance and performance under the guarantees, if required, would not have a material effect on our financial position, results of operations or cash flows.

In disposing of assets or businesses, we often provide representations, warranties and/or indemnities to cover various risks including, for example, unknown damage to the assets, environmental risks involved in the sale of real estate, liability to investigate and remediate environmental contamination at waste disposal sites and manufacturing facilities, and unidentified tax liabilities and legal fees related to periods prior to disposition. We have no reason to believe that these uncertainties would have a material adverse effect on our financial position, results of operations or cash flows. We have recorded liabilities for known indemnifications included as part of environmental liabilities. See Note 10 to the Consolidated Financial Statements for a discussion of these liabilities.

In the normal course of business, we are liable for contract completion and product performance. We record estimated product warranty costs at the time of sale. In the opinion of management, such obligations will not significantly affect our financial position, results of operations or cash flows.

For a detailed discussion of guarantees and indemnifications, see Note 18 to the Consolidated Financial Statements.

Certain statements in this report are "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. All forward-looking statements involve risks and uncertainties. All statements contained herein that are not clearly historical in nature are forward-looking, and the words "anticipate," "believe," "expect," "estimate," "project" and similar expressions are generally intended to identify forward-looking statements. Any forward-looking statement contained herein, in press releases, written statements or other documents filed with the Securities and Exchange Commission ("SEC"), or in Tyco's communications and discussions with investors and analysts in the normal course of business through meetings, webcasts, phone calls and conference calls, regarding expectations with respect to sales, earnings, cash flows, operating and tax efficiencies, product expansion, backlog, the consummation and benefits of acquisitions and divestitures, as well as financings and repurchases of debt or equity securities, are subject to known and unknown risks, uncertainties and contingencies. Many of these risks, uncertainties and contingencies are beyond our control, and may cause actual results, performance or achievements to differ materially from anticipated results, performances or achievements. Factors that might affect such forward-looking statements include, among other things:

The Company's exposure to market risk from changes in interest rates, foreign currency exchange rates and commodity prices has not changed materially from our exposure discussed in the 2010 Form 10-K. In order to manage the volatility relating to our more significant market risks, we currently enter into forward foreign currency exchange contracts, interest rate swaps and commodity swaps.

We utilize established risk management policies and procedures in executing derivative financial instrument transactions. We do not execute transactions or hold derivative financial instruments for trading or speculative purposes. Derivative financial instruments related to non-functional currency cash flows are used with the goal of mitigating a significant portion of these exposures when it is cost effective to do so. Counterparties to derivative financial instruments are limited to financial institutions with at least an A-/A3 long-term credit rating.

The Company, under the supervision and with the participation of its management, including its Chief Executive Officer and Chief Financial Officer, carried out an evaluation of the effectiveness of the design and operation of its disclosure controls and procedures (as such term is defined under Rule 13a-15 of the Securities and Exchange Act (the Exchange Act)) as of the end of the period covered by this report. There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that, as of June 24, 2011, the Company's disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed in the reports that the Company files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the applicable rules and forms, and that it is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

There has been no change in our internal control over financial reporting during the quarter ended June 24, 2011 that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

For a detailed discussion of asbestos-related matters, see Note 10 of the Consolidated Financial Statements.

In connection with the spin-offs of Covidien and TE Connectivity from Tyco, Tyco entered into a Tax Sharing Agreement that governs the rights and obligations of each party with respect to certain pre-Separation income tax liabilities. More specifically, Tyco, Covidien and TE Connectivity share 27%, 42% and 31%, respectively, of shared income tax liabilities that arise from adjustments made by tax authorities to Tyco's, Covidien's and TE Connectivity' U.S. and certain non-U.S. income tax returns. Costs and expenses associated with the management of these shared tax liabilities are generally shared equally among the parties. Consistent with the sharing provisions of the Tax Sharing Agreement, Tyco had a net receivable from Covidien and TE Connectivity of $87 million and $114 million as of June 24, 2011 and September 24, 2010, respectively. In addition, as of June 24, 2011 and September 24, 2010, the Company had recorded $366 million and $398 million, respectively, in other liabilities, and $188 million and $156 million, respectively, in accrued and other current liabilities. During 2011, we reclassified $32 million from other liabilities to accrued and other current liabilities as we expect to make a payment within the next twelve months to Covidien and TE Connectivity related to the resolution of certain IRS audit matters.

Tyco and its subsidiaries' income tax returns periodically are examined by various tax authorities. In connection with these examinations, tax authorities, including the IRS, have raised issues and proposed tax adjustments. The Company is reviewing and contesting certain of the proposed tax adjustments. Amounts related to these tax adjustments and other tax contingencies and related interest have been assessed as uncertain income tax positions and recorded as appropriate.

For a detailed discussion of contingencies related to Tyco's income taxes, see Note 5 to the Consolidated Financial Statements.

As previously reported in the Company's periodic filings, the Company has received and responded to various allegations and other information that certain improper payments were made by the Company's subsidiaries and agents in recent years. For example, two subsidiaries in the Company's Flow Control business in Italy have been charged, along with numerous other parties, in connection with the Milan public prosecutor's investigation into allegedly improper payments made to certain Italian entities. The Company reported to the U.S. Department of Justice ("DOJ") and the SEC the investigative steps and remedial measures that it has taken in response to these and other allegations and its internal investigations. In 2005, the Company informed the DOJ and the SEC that it retained outside counsel to perform a Company-wide baseline review of its policies, controls and practices with respect to compliance with the Foreign Corrupt Practices Act ("FCPA"), and that it would continue to investigate and make periodic progress reports to these agencies. The Company has and will continue to communicate with the DOJ and SEC to provide updates on the baseline review and follow-up investigations, including, as appropriate, briefings concerning additional instances of potential improper conduct identified by the Company in the course of its ongoing compliance activities. The baseline review, which has been completed, has revealed that some business practices may not comply with Tyco and FCPA requirements, and in February 2010, the Company initiated discussions with the DOJ and SEC aimed at resolving these matters. Discussions remain ongoing, and the Company cannot predict the timing of their resolution or their outcome and cannot estimate the range of potential loss or the form of penalty that may result from an adverse resolution. It is possible that the Company may be required to pay material fines, consent to injunctions on future conduct, consent to the imposition of a compliance monitor, or suffer other criminal or civil penalties or adverse impacts, including being subject to lawsuits brought by private litigants, each of which may have a material adverse effect on the Company's financial position, results of operations or cash flows.

Grinnell Fire Protection Systems, SimplexGrinnell's predecessor, and Road Sprinkler Fitters Local Union No. 669.

Tyco's significant business risks are described in Part I, Item 1A in our 2010 Form 10-K, to which reference is made herein. Management does not believe that there have been any significant changes in the Company's risk factors since the Company filed the 2010 Form 10-K.

The transactions described in the table above represent the repurchase of common shares on the NYSE as part of the $1.0 billion share repurchase program approved by the Board of Directors in April 2011 ("2011 Share Repurchase Program") and the $1.0 billion share repurchase program approved by the Board of Director in September 2010 ("2010 Share Repurchase Program"). In addition, the Company also acquires shares from certain employees in order to satisfy employee tax withholding requirements in connection with the vesting of restricted shares. Approximately 1,063 shares were acquired in these vesting-related transactions outside of the share repurchase program during the quarter ended June 24, 2011. The average price paid per share is calculated by dividing the total cash paid for the shares by the total number of shares repurchased. The shares repurchased during the quarter ended June 24, 2011 completed the 2010 Share Repurchase Program and approximately $700 million remained outstanding under the 2011 Share Repurchase Program as of June 24, 2011.

Exhibit Number		Exhibit

3.1		Articles of Association of Tyco International Ltd. (Tyco International AG) (Tyco International SA), amended to reflect cancellation of treasury shares (incorporated by reference to Exhibit 3.1 to Tyco International Ltd. current report on Form 8-K/A filed on June 2, 2011).
31.1		Certification by the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Filed herewith).
31.2		Certification by the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Filed herewith).
32.1		Certification by the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Filed herewith).
101		Financial statements from the quarterly report on Form 10-Q of Tyco International Ltd. for the quarter ended June 24, 2011 formatted in XBRL: (i) the Consolidated Statements of Operations, (ii) the Consolidated Balance Sheets, (iii) the Consolidated Statements of Cash Flows, (iv) the Consolidated Statements of Shareholders' Equity, and (v) the Notes to Consolidated Financial Statements.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


ý		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended June 24, 2011
or
o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


Switzerland (Jurisdiction of Incorporation)		98-0390500 (I.R.S. Employer Identification Number)
Freier Platz 10, CH-8200 Schaffhausen, Switzerland (Address of registrant's principal executive office)
41-52-633-02-44 (Registrant's telephone number)


Large accelerated filer ý		Accelerated filer o		Non-accelerated filer o (Do not check if a smaller reporting company)		Smaller reporting company o

		Page

Part I.	Financial Information
Item 1.	Financial Statements	1
	Consolidated Statements of Operations (Unaudited) for the quarters and nine months ended June 24, 2011 and June 25, 2010	1
	Consolidated Balance Sheets (Unaudited) as of June 24, 2011 and September 24, 2010	2
	Consolidated Statements of Cash Flows (Unaudited) for the nine months ended June 24, 2011 and June 25, 2010	3
	Consolidated Statements of Shareholders' Equity (Unaudited) for the nine months ended June 24, 2011 and June 25, 2010	4
	Notes to Consolidated Financial Statements (Unaudited)	5
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	54
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	77
Item 4.	Controls and Procedures	77
Part II.	Other Information
Item 1.	Legal Proceedings	78
Item 1A.	Risk Factors	82
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	82
Item 3.	Defaults Upon Senior Securities	82
Item 4.	Reserved	82
Item 5.	Other Information	82
Item 6.	Exhibits	83
Signatures		84

	For the Quarter and Nine Months Ended

	June 25, 2010
Net Revenue	$	54

Loss from continuing operations attributable to Tyco common shareholders		(26	)

Net loss attributable to Tyco common shareholders		(26	)

		September 24, 2010

Accounts receivables, net		$	70
Inventories			71
Prepaid expenses and other current assets			13
Property, plant and equipment, net			59
Goodwill and intangible assets, net			105
Other assets			6

	Total assets	$	324

Accounts payable		$	43
Accrued and other current liabilities			36
Other liabilities			24

	Total liabilities	$	103

	For the Quarter Ended June 24, 2011

	Employee Severance and Benefits		Facility Exit and Other Charges		Charges Reflected in Cost of Sales		Total
Tyco Security Solutions	$	15	$	2	$	—	$	17
Tyco Fire Protection		2		—		1		3
Tyco Flow Control		2		—		—		2
Corporate and Other		—		3		—		3

Total	$	19	$	5	$	1	$	25


Balance as of September 24, 2010	$	—
Charges		74
Reversals		(4	)
Utilization		(19	)
Currency translation		4

Balance as of June 24, 2011	$	55

	For the Quarter Ended June 25, 2010

	Employee Severance and Benefits		Facility Exit and Other Charges		Charges Reflected in Cost of Sales			Total
Tyco Security Solutions	$	23	$	3	$	—		$	26
Tyco Fire Protection		5		1		—			6
Tyco Flow Control		3		3		—			6
Electrical and Metal Products		—		2		(1	)		1
Corporate and Other		1		—		—			1

Total	$	32	$	9	$	(1	)	$	40

	For the Nine Months Ended June 25, 2010

	Employee Severance and Benefits		Facility Exit and Other Charges			Charges Reflected in Cost of Sales			Charges Reflected in SG&A		Total
Tyco Security Solutions	$	29	$	7		$	—		$	—	$	36
Tyco Fire Protection		13		(2	)		—			1		12
Tyco Flow Control		13		4			1			—		18
Electrical and Metal Products		—		3			(1	)		—		2
Corporate and Other		1		—			—			—		1

Total	$	56	$	12		$	—		$	1	$	69

Jurisdiction		Years Open To Audit

Australia			2004-2010
Canada			2001-2010
Germany			1998-2010
Italy			2004-2010
South Korea			2006-2010
Switzerland			2000-2010
United Kingdom			2000-2010
United States			1997-2010

		For the Quarter Ended June 24, 2011						For the Quarter Ended June 25, 2010

		Income		Shares		Per Share Amount		Income		Shares		Per Share Amount
Basic earnings per share attributable to Tyco common shareholders:
	Income from continuing operations	$	364		468	$	0.78	$	250		492	$	0.51
	Share options and restricted share awards		—		7				—		4

Diluted earnings per share attributable to Tyco common shareholders:
	Income from continuing operations attributable to Tyco common shareholders, giving effect to dilutive adjustments	$	364		475	$	0.76	$	250		496	$	0.50

		As of June 24, 2011

($ in millions)		Level 1		Level 2		Total
Available-for-Sale Securities:
	Corporate debt securities	$	—	$	45	$	45
	U.S. Government debt securities		97		106		203

Total		$	97	$	151	$	248

	U.S. Plans

	For the Quarters Ended						For the Nine Months Ended
	June 24, 2011			June 25, 2010			June 24, 2011			June 25, 2010
Service cost	$	2		$	3		$	7		$	7
Interest cost		10			12			31			34
Expected return on plan assets		(12	)		(12	)		(37	)		(36	)
Amortization of prior service cost		—			—			—			1
Amortization of net actuarial loss		3			6			9			20

Net periodic benefit cost	$	3		$	9		$	10		$	26

		Currency Translation⁽¹⁾⁽²⁾			Unrealized Gain (Loss) on Marketable Securities			Retirement Plans			Accumulated Other Comprehensive Loss

Balance as of September 25, 2009		$	415		$	4		$	(506	)	$	(87	)
	Pre-tax current period change		(500	)		(2	)		108			(394	)
	Divestiture of businesses		(66	)		—			—			(66	)
	Income tax benefit (expense)		1			—			(39	)		(38	)

Balance as of June 25, 2010		$	(150	)	$	2		$	(437	)	$	(585	)

		Currency Translation⁽¹⁾⁽²⁾			Unrealized Gain (Loss) on Marketable Securities			Retirement Plans			Accumulated Other Comprehensive (Loss) Income

Balance as of September 24, 2010		$	214		$	4		$	(539	)	$	(321	)
	Pre-tax current period change		325			(1	)		15			339
	Divestiture of the Electrical and Metal Products business		(35	)		—			33			(2	)
	Income tax expense		(1	)		—			(5	)		(6	)

Balance as of June 24, 2011		$	503		$	3		$	(496	)	$	10

		June 24, 2011		September 24, 2010

Purchased materials and manufactured parts		$	492	$	504
Work in process			199		192
Finished goods			715		747

	Inventories	$	1,406	$	1,443

		June 24, 2011			September 24, 2010

Land		$	144		$	154
Buildings			723			816
Subscriber systems			6,540			6,085
Machinery and equipment			2,290			2,457
Property under capital leases⁽¹⁾			63			62
Construction in progress			146			154
Accumulated depreciation⁽²⁾			(5,899	)		(5,572	)

	Property, Plant and Equipment, net	$	4,007		$	4,156


Balance as of September 24, 2010	$	57
Warranties issued		18
Changes in estimates		(2	)
Settlements		(19	)
Currency translation		2

Balance as of June 24, 2011	$	56

	As of

	June 24, 2011	March 25, 2011	June 25, 2010
Number of customer accounts⁽¹⁾	9.0 million	8.9 million	8.8 million
Trailing 12-month attrition⁽¹⁾⁽²⁾	12.7%	12.7%	12.9%
Average monthly revenue per customer⁽¹⁾	$46.30	$45.72	$43.74

	As of

	June 24, 2011	March 25, 2010	June 25, 2010
Number of customer accounts⁽¹⁾	9.0 million	8.9 million	8.8 million
Trailing 12-month attrition⁽¹⁾⁽²⁾	12.7	12.7	12.9
Average monthly revenue per customer⁽¹⁾	$46.30	$45.72	$43.74

	June 24, 2011		September 24, 2010

Tyco Security Solutions	$	6,908	$	6,605
Tyco Flow Control		1,749		1,482
Tyco Fire Protection		1,263		1,289
Electrical and Metal Products		—		88

	$	9,920	$	9,464


		TYCO INTERNATIONAL LTD.
		By:		/s/ FRANK S. SKLARSKY Frank S. Sklarsky Executive Vice President and Chief Financial Officer (Principal Financial Officer)