-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, DyGN2PeHP/0r8lfvRYJxlpWZfelrLe4B3kKwicJ3hXCYdwX2cH+wbogKfHEprxfs kk2pGuJ7kb9iUL690izgGw== 0001047469-02-008372.txt : 20021226 0001047469-02-008372.hdr.sgml : 20021225 20021226150257 ACCESSION NUMBER: 0001047469-02-008372 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20020630 FILED AS OF DATE: 20021226 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TYCO INTERNATIONAL LTD /BER/ CENTRAL INDEX KEY: 0000833444 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRONIC CONNECTORS [3678] IRS NUMBER: 000000000 STATE OF INCORPORATION: D0 FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13836 FILM NUMBER: 02869057 BUSINESS ADDRESS: STREET 1: 90 PITTS BAY ROAD STREET 2: THE ZURICH CENTRE SECOND FLOOR CITY: PEMROKE HM 08 BERMU STATE: D0 BUSINESS PHONE: 4412928674 MAIL ADDRESS: STREET 1: C/O TYCO INTERNATIONAL (US) INC STREET 2: ONE TYCO PARK CITY: EXETER STATE: NH ZIP: 03833 FORMER COMPANY: FORMER CONFORMED NAME: ADT LIMITED DATE OF NAME CHANGE: 19930601 11-K 1 a2096912z11-k.txt 11-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K [ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended June 30, 2002 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 333-48476 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: INVESTMENT PLAN FOR EMPLOYEES OF Mallinckrodt Inc. One Tyco Park Exeter, NH 03833-1108 B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: TYCO INTERNATIONAL LTD. The Zurich Centre Second Floor 90 Pitts Bay Road Pembroke HM 08, Bermuda (441) 292-8674 SIGNATURES THE PLAN. Pursuant to the requirements of the Securities Exchange Act of 1934, the Retirement Committee of the Investment Plan for Employees of Mallinckrodt Inc. has duly caused this Annual Report to be signed on its behalf by the undersigned hereunto duly authorized. Investment Plan For Employees of Mallinckrodt, Inc. Date: December 26, 2002 Signature: /s/ Robert A. Bent ------------------------------ Robert A. Bent Clerk Tyco International (US) Inc. Retirement Committee INVESTMENT PLAN FOR EMPLOYEES OF MALLINCKRODT INC. Financial Statements and Supplemental Schedules Years ended June 30, 2002 and 2001 with Indenpendent Auditor's Report INVESTMENT PLAN FOR EMPLOYEES OF MALLINCKRODT INC. Financial Statements and Supplemental Schedules Years ended June 30, 2002 and 2001 CONTENTS INDEPENDENT AUDITORS' REPORT............................................ 2 FINANCIAL STATEMENTS Statements of Net Assets Available for Benefits...................... 3 Statements of Changes in Net Assets Available for Benefits........... 4 Notes to Financial Statements........................................ 5-12 SUPPLEMENTAL SCHEDULES Schedule of Assets Held for Investment Purposes...................... 14 Schedule of Reportable Transactions.................................. 15 Independent Auditors' Report Plan Administrator Investment Plan for Employees of Mallinckrodt Inc. We have audited the accompanying statements of net assets available for benefits of the Investment Plan for Employees of Mallinckrodt Inc. as of June 30, 2002 and 2001 and the related statements of changes in net assets available for benefits for the years then ended. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan at June 30, 2002 and 2001, and the changes in net assets available for benefits for the years then ended in conformity with accounting principles generally accepted in the United States of America. Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The accompanying supplemental schedules of assets held for investment purposes as of June 30, 2002 and reportable transactions for the year then ended are presented for purposes of complying with the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974 and are not a required part of the basic financial statements. The supplemental schedules have been subjected to the auditing procedures applied in our audit of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the financial statements taken as a whole. /s/ Stone Carlie & Company, L.L.C. St. Louis, Missouri December 6, 2002 INVESTMENT PLAN FOR EMPLOYEES OF MALLINCKRODT INC. Statements of Net Assets Available for Benefits
JUNE 30, --------------------------------- 2002 2001 ----------------- ----------------- Investments at fair value: Participant directed $287,699,260 $309,210,334 Non-participant directed - 86,604,196 ----------------- ------------------ Total investments 287,699,260 395,814,530 ----------------- ------------------ Receivables: Employer contributions - 5,181,078 Participant contributions - 742,131 ----------------- ------------------ Total receivables - 5,923,209 ----------------- ------------------ Net assets available for benefits $287,699,260 $401,737,739 ----------------- ------------------ ----------------- ------------------
See notes to financial statements. page 3 INVESTMENT PLAN FOR EMPLOYEES OF MALLINCKRODT INC. Statements of Changes in Net Assets Available for Benefits
YEARS ENDED JUNE 30, ----------------------------- 2002 2001 -------------- ------------- Additions Investment income (loss): Interest and dividend income $6,928,781 $20,924,870 Realized and unrealized losses, net (93,894,313) (38,090,812) -------------- ----------- Net investment loss (86,965,532) (17,165,942) -------------- ----------- Contributions: Employer cash 3,757,812 2,626,711 Employer common stock - 5,091,260 Participant 9,709,728 22,813,096 -------------- ----------- Total contributions 13,467,540 30,531,067 -------------- ----------- Transfers from other plans - 935,889 -------------- ----------- Total additions (reductions) (73,497,992) 14,301,014 -------------- ----------- Deductions Cash and stock distributed to participants (40,540,487) (70,194,602) -------------- ----------- Total deductions (40,540,487) (70,194,602) -------------- ----------- Net decrease (114,038,479) (55,893,588) Net assets available for benefits at beginning of year 401,737,739 457,631,327 -------------- ----------- Net assets available for benefits at end of year $287,699,260 $401,737,739 -------------- ----------- -------------- -----------
See notes to financial statements. page 4 INVESTMENT PLAN FOR EMPLOYEES OF MALLINCKRODT INC. NOTES TO FINANCIAL STATEMENTS June 30, 2002 and 2001 1. DESCRIPTION OF THE PLAN GENERAL This plan description is provided for general information purposes only. Participants should refer to the September 1997 plan summary, which is part of the prospectus for the Investment Plan for Employees of Mallinckrodt Inc. (the Plan), for a more complete description of the provisions of the Plan. The Plan was established effective July 1, 1970 and has been amended from time to time to incorporate certain changes in plan features and other legislatively required changes. All nonunion employees of Mallinckrodt Inc. (Mallinckrodt or the Company) and certain wholly owned subsidiaries and certain union employees employed in the U.S. or on a U.S. payroll are eligible to participate in the Plan. Effective October 17, 2000, Mallinckrodt Inc. was acquired by a subsidiary of Tyco International Ltd. Effective January 1, 2002 all current participants under the Plan became eligible to participate in the Tyco International (US) Inc. Retirement Savings and Investment Plans I, II, III and V (collectively the "Tyco Plan"). See Note 7 for further information. PLAN MERGER Effective August 1, 2000, the Hobart Employee Stock Ownership Plan was merged into the Plan and its net assets of $935,889 were merged in the Plan's assets. PARTICIPATION AND VESTING Eligible employees may join the Plan immediately upon being hired. Participants are fully vested in all participant and employer contributions and the earnings thereon. PARTICIPANTS' ACCOUNTS Separate accounts are maintained for each participant. Participant account balances are adjusted daily for contributions, distributions, loans, income, gains, and losses. CONTRIBUTIONS Through December 31, 2001, participants generally could contribute up to 15 percent of their base salaries on a pre-tax, after-tax, or combined basis. The Company made matching contributions equal to 20 percent of a participant's eligible contributions. Eligible contributions were limited to 6 percent of a participant's base monthly salary. Effective January 1, 2002, participant contributions were suspended and Plan participants became eligible to contribute to the Tyco Plan. page 5 1. DESCRIPTION OF THE PLAN (continued) Contributions (continued) The Company may make additional discretionary contributions ("Supermatch") each year as determined by its Board of Directors. For the 2001 Plan year, Supermatch contributions were invested in Tyco International Ltd. common stock. For the 2002 Plan year, Supermatch contributions were invested in accordance with participant's individual investment allocation elections. Through January 31, 2002, Supermatch contributions could not be withdrawn, borrowed, or transferred from Company stock into another investment fund except to the extent that the value of these contributions credited to the participant's account after June 30, 1997 plus investment return thereon exceeded 15 percent of the total value of the participant's accounts. Effective February 1, 2002, those restrictions were eliminated. Total employer contributions (including Supermatch) were equal to 64 percent of participants' eligible contributions for each of the years ended June 30, 2002 and 2001. Contributions to the Plan, including employee and employer contributions, are subject to various limitations imposed by the Internal Revenue Code. FUND ASSET VALUATION Participants' equity in each investment fund is valued in dollars each business day (valuation date). As of each valuation date, the market value of the assets in each of the investment funds is determined, and the increase or decrease of each fund is allocated to each participant's account invested in that fund, based on the participant's proportionate interest (units or shares) in such fund as of the previous valuation date. INVESTMENTS Participants direct investment of their contributions as well as employer contributions among the following funds: - - State Street International Index Fund - This fund invests in equity securities of companies located outside North and South America and is structured to match returns of the Morgan Stanley Capital International Europe, Australia, Far East (EAFE) Index. - - American Express Trust Equity Index Fund II - This fund invests in equity securities of companies with sector and industry weighting similar to the Standard and Poor's 500. - - State Street Daily Bond Fund Series C - This fund invests primarily in investment grade corporate, governmental and mortgage-backed bonds with the objective of producing current income. page 6 1. DESCRIPTION OF THE PLAN (continued) Investments (continued) - - American Express Trust Money Market Fund II - This fund invests in high quality commercial paper, bankers acceptance obligations, certificates of deposit, and United States Treasury Bills with the object of providing high liquidity, capital preservation, and generating moderate levels of current income. - - PBHG Growth Fund - This mutual fund invests primarily in equity securities of medium size domestic companies with the objective of long-term capital growth. - - Fidelity Low-Price Stock Fund - This mutual fund invests primarily in equity securities of medium size domestic companies with the objective of long-term capital growth. - - IDS New Dimensions Fund (Y) - This mutual fund invests primarily in equity securities of medium to large companies with the objective of long-term capital growth. - - Dodge & Cox Stock Fund - This mutual fund invests principally in the common stock of large companies with the objective of long-term capital growth. - - Tyco Stock Fund - This fund is invested in Tyco International Ltd. common stock. (Prior to October 17, 2000, Mallinckrodt Inc. common stock.) - - Lifestyle Funds (Aggressive, Moderate, and Conservative) - These funds invest among the other fund options of the Plan in order to maintain an overall investment asset allocation commensurate with either an aggressive, moderate or conservative risk profile. Investments in the component funds are periodically rebalanced in order to maintain the desired risk profile amid market fluctuations. - - Stable Value Fund - This fund invests in Guaranteed Investment Contracts issued by insurance companies and in the American Express Income Fund II. The investment objective is to preserve principal and provide current income. WITHDRAWALS Participants may withdraw their balances in the Plan upon retirement, termination of employment, or becoming disabled as defined by the Plan. Upon termination of employment with Mallinckrodt or its affiliates, plan participants generally may elect to receive a full or partial distribution, or may elect to maintain their balances in the Plan. Active participants can make hardship withdrawals of employee contributions in certain circumstances and can make withdrawals of employer contributions on a hardship or non-hardship basis. All such withdrawals are subject to various restrictions, including Supermatch restrictions, and may be subject to income tax penalties. page 7 1. DESCRIPTION OF THE PLAN (continued) LOANS TO PARTICIPANTS Participants may obtain loans from their plan accounts subject to certain terms, as defined by the Plan. General purpose loans are made for periods of one to five years and residential loans are made for periods of one to ten years. The interest rate charged is the prime rate quoted in THE WALL STREET JOURNAL on the first business day of the month in which the loan is approved. Principal and interest payments are made by payroll deductions or in lump-sum repayments and are invested in the same manner as current contributions. PLAN EXPENSES All expenses incurred in connection with acquisition or disposition of securities and the operation of the investment funds, as well as the mutual funds offered under the Plan, are charged directly against those funds and their investment returns. All other administrative expenses of the Plan, such as recordkeeping and disbursing expenses, trustee fees, counsel and accountant expenses, and communication charges incurred by the Company for plan operations, are charged to and paid by the Plan and allocated against participants' accounts. The maximum administration charge against participant accounts is limited to $28 per participant per plan year. In addition, specific transaction charges, such as loan fees directed by participants, are charged to participant accounts. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF ACCOUNTING Plan accounting records are maintained on the accrual basis. INVESTMENTS Investments in mutual funds are valued at quoted market prices. Investments in the other funds except for the Stable Value Fund are valued at the quoted market prices of the underlying securities. Investments in the Stable Value Fund include insurance contracts valued at contract value, which approximates market value. INVESTMENT IN THE STABLE VALUE FUND At June 30, 2002 and 2001, the Stable Value Fund includes investments in the American Express Trust Income Fund II and a guaranteed interest contract with Transamerica Occidental Life Insurance Company (Transamerica). The contract with Transamerica, dated November 2, 1989, provides guaranteed rates of interest to be set annually on all new monies invested over the contract term. The crediting interest rate and average yield for each of the contract years beginning January 1, 2002 and 2001 was 6.35 and 6.85 percent, respectively, net of investment management fees. page 8 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES INVESTMENT IN THE STABLE VALUE FUND (continued) Because of limitations contained within insurance contracts held in the Stable Value Fund, the plan administrator may be required to limit transfers from that fund to minimize adverse market value adjustments. Also, the Stable Value Fund prohibits direct transfers to the AMEX Trust Money Market Fund II. Transfers from the Stable Value Fund to the AMEX Trust Money Market Fund II must be directed through another fund for 90 days before final transfer to the AMEX Trust Money Market Fund II. The fair value of the stable value fund, reflecting the fair value of the insurance contracts included in the fund, is $52,842,843 and $53,920,664 at June 30, 2002 and 2001, respectively. SECURITY TRANSACTIONS Purchases and sales of securities are accounted for on the trade date (date the order to buy or sell is executed). Dividend income is recorded on the ex-dividend date. Income from other investments is recorded as earned on an accrual basis. USE OF ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts within the financial statements, as well as amounts disclosed in the notes. While the Company uses its best estimates and judgments, actual results could differ from those estimates. page 9 3. INVESTMENTS The following presents investments of the Plan, including investments that represent 5 percent or more of the Plan's net assets.
JUNE 30, ---------------------------- 2002 2001 ------------ ------------- Participant directed investments: State Street International Index Fund $3,039,796 $3,755,142 American Express Trust Equity Index Fund II 54,332,092 77,278,692 State Street Daily Bond Fund Series C 6,621,719 5,649,465 American Express Trust Money Market Fund II 16,633,681 17,476,924 PBHG Growth Fund 10,862,354 19,407,158 Fidelity Low-Price Stock Fund 22,347,146 17,340,466 IDS New Dimensions Fund (Y) 22,250,939 31,383,695 Dodge & Cox Stock Fund 32,064,021 33,535,368 AMEX Aggressive Fund 12,038,433 14,699,993 AMEX Moderate Fund 15,988,537 18,100,447 AMEX Conservative Fund 2,436,933 2,356,149 Stable Value Fund 56,843,843 56,772,364 Tyco Stock Fund 23,190,376 - Loans to participants 9,049,390 11,454,471 -------------- ------------- Total participant directed investments 287,699,260 309,210,334 -------------- ------------- Nonparticipant directed investments: Tyco Stock Fund - 86,604,196 -------------- ------------- Total investments $287,699,260 $395,814,530 -------------- ------------- -------------- -------------
4. NONPARTICIPANT DIRECTED INVESTMENTS As described in Note 1, through January 31, 2002, the ability of plan participants to redirect investments in the Tyco Stock Fund was restricted. Effective February 1, 2002, these restrictions were eliminated and this investment option ceased to be nonparticipant directed. page 10 INVESTMENT PLAN FOR EMPLOYEES OF MALLINCKRODT INC. 4. NONPARTICIPANT DIRECTED INVESTMENTS (continued) The changes in net assets relating to the Tyco Stock Fund, formerly the Mallinckrodt Stock Fund, a nonparticipant directed investment, are as follows:
YEAR ENDED JUNE 30, ------------------------- 2002 2001 ----------- ----------- Investment income Interest and dividend income $38,602 $286,695 Realized and unrealized gains (losses), net (30,182,553) 13,612,934 ----------- ---------- Net investment income (30,143,951) 13,899,629 ----------- ---------- Contributions Employer cash 153,611 233,165 Employer common stock - 5,091,260 Employee 1,358,949 2,743,912 ----------- ---------- Total contributions 1,512,560 8,068,337 ----------- ---------- Cash and stock distributed to participants (4,019,257) (9,773,224) Net transfers (to) from participant directed investments (306,176) 13,652,446 ----------- ---------- (4,325,433) 3,879,222 ----------- ---------- Release of restrictions on investment (58,672,837) - ----------- ---------- Net increase (decrease) (91,629,661) 25,847,188 Nonparticipant directed investments including contributions receivable at beginning of year 91,629,661 65,782,473 ----------- ---------- Nonparticipant directed investments including contributions receivable at end of year - 91,629,661 Less contributions receivable directed to nonparticipant directed investments - (5,025,465) ----------- ---------- Nonparticipant directed investments at end of year $ - $86,604,196 ----------- ---------- ----------- ----------
5. FEDERAL INCOME TAX STATUS On September 26, 1995, the Internal Revenue Service advised that the Plan, as amended, qualifies under Section 401(a) of the Internal Revenue Code (IRC) and that the Investment Trust for Employees of Mallinckrodt Inc., as amended, established thereunder is exempt from federal income taxation under Section 501(a). Once qualified, the Plan is required to operate in conformity with the IRC in order to maintain its qualification. The plan administrator and Mallinckrodt's legal counsel are not aware of any course of action or series of events that have occurred that might adversely affect the Plan's qualified status. page 11 INVESTMENT PLAN FOR EMPLOYEES OF MALLINCKRODT INC. 6. TRANSACTIONS WITH PARTIES-IN-INTEREST The only transactions with parties-in-interest were purchases and sales of assets through AMEX. AMEX's fees are based on customary and reasonable rates for such services and are paid by the Plan. 7. SUBSEQUENT EVENT On December 10, 2002, the Plan was merged into the Tyco Plan. In addition, all assets were transferred to the Tyco Plan. page 12 INVESTMENT PLAN FOR EMPLOYEES OF MALLINCKRODT INC. Supplemental Schedules page 13 INVESTMENT PLAN FOR EMPLOYEES OF MALLINCKRODT INC. Schedule of Assets Held for Investment Purposes June 30, 2002
IDENTITY OF ISSUER, OR PARTY INVOLVED DESCRIPTION COST FAIR VALUE - ------------------------------------------- --------------- ---- ----------- American Express Trust Money Market Fund II Collective Fund * $16,633,681 American Express Trust Equity Index Fund II Collective Fund * 54,332,092 State Street Daily Bond Fund Series C Collective Fund * 6,621,719 State Street International Index Fund Collective Fund * 3,039,796 Dodge & Cox Stock Fund Mutual Fund * 32,064,021 Fidelity Low-Price Stock Fund Mutual Fund * 22,347,146 IDS New Dimensions Fund (Y) Mutual Fund * 22,250,939 Stable Value Fund Mutual Fund * 56,843,843 AMEX Conservative Fund Pooled Fund * 2,436,933 AMEX Moderate Fund Pooled Fund * 15,988,537 AMEX Aggressive Fund Pooled Fund * 12,038,433 PBHG Growth Fund Mutual Fund * 10,862,354 Participant Loans Interest from 4.75% * to 10.5% due through 2010 9,049,390 Tyco Stock Fund Pooled Fund * 23,190,376
* Participant directed investment See independent auditors' report. page 14 INVESTMENT PLAN FOR EMPLOYEES OF MALLINCKRODT INC. Schedule of Reportable Transactions Year Ended June 30, 2002 Category (iii) Series of Transactions in Excess of 5% of the Current Value of Plan Assets at the Beginning of the Year
SELLING/ CURRENT VALUE DESCRIPTION NUMBER OF PURCHASE MATURITY COST OF ON TRANSACTION NET IDENTITY OF PARTY INVOLVED OF ASSET TRANSACTIONS PRICE PRICE ASSET DATE GAIN (LOSS) - --------------------------- ----------- ------------ -------- -------- ------- -------------- ---------- Tyco International Ltd. Stock 153 purchases $20,838,382 $ - $20,838,382 $20,838,382 $ - 151 sales 15,227,888 14,390,921 15,227,888 836,967
See independent auditors' report. page 15 Investment Plan for Employees of Mallinckrodt Inc. Date: December 26, 2002 Signature: /s/ Robert A. Bent --------------------------------------- Robert A. Bent Clerk Tyco International (US) Inc. Retirement Committee EX-23 3 a2096912zex-23.txt EXHIBIT 23 Exhibit 23 Consent of Independent Auditors We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 333-85789) pertaining to the Investment Plan for Employees of Mallinckrodt Inc. and in the related Prospectus of our report dated December 6, 2002, with respect to the financial statements and schedules of the Investment Plan for Employees of Mallinckrodt Inc. included in this Annual Report (Form 11-K) for the year ended June 30, 2002. /s/ Stone Carlie & Company L.L.C. St. Louis, Missouri December 24, 2002 -----END PRIVACY-ENHANCED MESSAGE-----