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 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

		Page
Part I.	Financial Information
Item 1.	Financial Statements
	Consolidated Statements of Income (Unaudited) for the quarters and six months ended March 28, 2008 and March 30, 2007	1
	Consolidated Balance Sheets (Unaudited) as of March 28, 2008 and September 28, 2007	2
	Consolidated Statements of Cash Flows (Unaudited) for the six months ended March 28, 2008 and March 30, 2007	3
	Consolidated Statements of Shareholders' Equity (Unaudited) for the six months ended March 28, 2008 and March 30, 2007	4
	Notes to Consolidated Financial Statements (Unaudited)	5
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	40
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	63
Item 4.	Controls and Procedures	63
Part II.	Other Information
Item 1.	Legal Proceedings	65
Item 1A.	Risk Factors	76
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	76
Item 3.	Defaults Upon Senior Securities	77
Item 4.	Submission of Matters to a Vote of Security Holders	77
Item 5.	Other Information	77
Item 6.	Exhibits	78
Signatures	79

TYCO INTERNATIONAL LTD.

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(in millions, except per share data)

TYCO INTERNATIONAL LTD.

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(in millions, except share data)

TYCO INTERNATIONAL LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(in millions)

TYCO INTERNATIONAL LTD.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED)

For the Six Months Ended March 28, 2008 and March 30, 2007

(in millions)

Basis of Presentation—The unaudited Consolidated Financial Statements include the consolidated results of Tyco International Ltd., a company organized under the laws of Bermuda, 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 and in accordance with the instructions to Form 10-Q under the Securities Exchange Act of 1934, as amended. The year end condensed balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. 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 28, 2007 (the "2007 Form 10-K").

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 results reported in these Consolidated Financial Statements should not be taken as indicative of results that may be expected for the entire year.

References to 2008 and 2007 are to Tyco's fiscal quarters ending March 28, 2008 and March 30, 2007, respectively, unless otherwise indicated.

Reclassifications—Certain prior period amounts have been reclassified to conform with the current period presentation.

Recently Adopted Accounting Pronouncements—In June 2006, the Financial Accounting Standards Board ("FASB") issued Financial Accounting Standards Board Interpretation ("FIN") No. 48, "Accounting for Uncertainty in Income Taxes—an interpretation of FASB Statement No. 109." This Interpretation prescribes a comprehensive model for the financial statement recognition, measurement, presentation and disclosure of uncertain tax positions taken or expected to be taken in income tax returns. FIN No. 48 became effective for Tyco in the first quarter of 2008. As a result of adopting FIN No. 48, Tyco increased its reserve for uncertain tax positions by $55 million and reduced its deferred tax assets by $24 million with a corresponding $79 million cumulative effect adjustment to shareholders' equity. See Note 4 for additional information related to the adoption of FIN No. 48.

Recently Issued Accounting Pronouncements—In March 2008, the FASB issued Statement of Financial Accounting Standards ("SFAS") No. 161, "Disclosures about Derivative Instruments and Hedging Activities." SFAS No. 161 is intended to improve financial reporting about derivative instruments and hedging activities by requiring enhanced disclosures to enable investors to better understand their effects on an entity's financial position, financial performance, and cash flows. The disclosure provisions of SFAS No. 161 are effective for Tyco in the second quarter of 2009.

In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option for Financial Assets and Financial Liabilities." SFAS No. 159 permits an entity, on a contract-by-contract basis, to make an irrevocable election to account for certain types of financial instruments and warranty and insurance contracts at fair value, rather than historical cost, with changes in the fair value, whether realized or unrealized, recognized in earnings. SFAS No. 159 is effective for Tyco in the first quarter of 2009. The Company is currently assessing the impact that SFAS No. 159 will have on the results of its operations, financial position or cash flows.

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

In September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements," which enhances existing guidance for measuring assets and liabilities at fair value. SFAS No. 157 defines fair value, establishes a framework for measuring fair value and expands disclosure about fair value measurements. SFAS No. 157 is effective for Tyco in the first quarter of 2009. The Company is currently assessing the impact, if any, that SFAS No. 157 will have on the results of its operations, financial position or cash flows.

In September 2006, FASB issued SFAS No. 158, "Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans—an amendment of FASB Statements No. 87, 88, 106 and 132(R)." SFAS No. 158 requires that employers recognize the funded status of defined benefit pension and other postretirement benefit plans as a net asset or liability on the balance sheet and recognize as a component of other comprehensive income, net of tax, the gains or losses and prior service costs or credits that arise during the period but are not recognized as a component of net periodic benefit cost. The Company adopted the recognition and disclosure provisions of SFAS No. 158 as of September 28, 2007.

SFAS No. 158 also requires companies to measure plan assets and benefit obligations as of their fiscal year end. The Company presently uses a measurement date of August 31st. The measurement date provisions become effective in fiscal 2009. The Company is currently assessing the impact that SFAS No. 158 measurement date provisions will have on the results of its operations, financial position or cash flows.

In February 2008, the Company executed a definitive agreement to sell Ancon Building Products ("Ancon") for approximately $174 million. Ancon manufactures stainless steel products used in masonry construction. The Company has assessed and determined that the carrying value of Ancon is recoverable and will continue to assess recoverability based on current fair value, less cost to sell, until the business is sold. Fair value used for the impairment assessment was based on existing market conditions and the terms included in the sale agreement. The transaction closed in the third quarter of 2008.

In February 2008, the Company sold Nippon Dry-Chemical Co., Ltd. ("NDC"), one of the leading companies in the Japanese fire protection industry, for $50 million in net cash proceeds and a pre-tax gain of $7 million was recorded.

In January 2008, the Company sold a European manufacturer of public address products and acoustic systems and recorded an $8 million pre-tax loss on sale.

Infrastructure Services provides consulting, engineering, construction management and operating services for the water, wastewater, environmental, transportation and facilities market and are expected to be sold in several transactions. On September 17, 2007, the Company executed a definitive agreement to sell for approximately $295 million in cash 100% of the stock of Empresa de Transmissao de Energia do Oeste Ltda. ("ETEO"), part of Infrastructure Services. The transaction is subject to Brazilian regulatory approval and normal closing conditions and is expected to close by the end of 2008. On February 11, 2008, the Company executed a definitive agreement to sell the remaining portion of Infrastructure Services for approximately $510 million, excluding Earth Tech Brasil Ltda. ("ET Brasil") and certain assets and contingent liabilities to be retained by the Company as described

in "Other Matters" in Note 9. The transaction is subject to regulatory approval and normal closing conditions and is expected to close by the end of 2008. The Company has assessed and determined that the carrying values of Infrastructure Services and ETEO are recoverable and will continue to assess recoverability based on current fair value, less cost to sell, until the businesses are sold. During the second quarter of 2008, the Company recorded a pre-tax impairment charge of approximately $22 million to write down ET Brasil to its fair value, less cost to sell. Fair value used for the impairment assessment was based on existing market conditions as well as terms and conditions expected to be included in the sales agreement.

During September 2007, Tyco entered into an economic hedge of the Brazilian Real denominated contractual sale price of the ETEO business. Since this hedging transaction is directly linked to the expected proceeds from the sale of a business that is reflected in discontinued operations, Tyco began including the impact of this hedge in discontinued operations during the first quarter of 2008. During the quarter and six months ended March 28, 2008, Tyco incurred losses of $5 million and $15 million, respectively, on this hedge. The impact of this hedge in the prior year was not material.

During the first quarter of 2007, Aquas Industriales de Jose, C.A. ("AIJ"), a joint venture that was majority owned by Infrastructure Services, was sold for $42 million in net cash proceeds and a pre-tax gain on sale of $19 million was recorded.

All of the above businesses met the held for sale and discontinued operations criteria and have been included in discontinued operations in all periods presented.

During the third quarter of 2007, Tyco completed the spin-offs of Covidien and Tyco Electronics (the "Separation") and has presented its Healthcare and Electronics businesses as discontinued operations in all periods prior to the completion of the Separation in June 2007.

Net interest amounts were proportionally allocated to Covidien and Tyco Electronics based on the debt amounts that Tyco believes were utilized by Covidien and Tyco Electronics historically inclusive of amounts directly incurred. Allocated net interest was calculated using our historical weighted-average interest rate on debt, including the impact of interest rate swap agreements. These allocated amounts were included in discontinued operations. During the quarter ended March 30, 2007, allocated interest income and interest expense was $16 million and $91 million, respectively. During the six months ended March 30, 2007, allocated interest income and interest expense was $29 million and $181 million, respectively.

During the quarter and six months ended March 30, 2007, the Company incurred pre-tax separation costs of $75 million and $132 million, respectively, related to professional services and employee-related costs.

The Company has used available information to develop its best estimates for certain assets and liabilities related to the Separation. In limited instances, final determination of the balances will be made in subsequent periods. During the six months ended March 28, 2008, $18 million was recorded through shareholders' equity, primarily related to adjustments to certain pre-separation tax liabilities. Adjustments may be recorded to shareholders' equity in the future for the impact of filing final income tax returns in certain jurisdictions where those returns include a combination of Tyco, Covidien and/or Tyco Electronics legal entities and for certain amended income tax returns for the periods prior to the Separation.

Net revenue, income from operations, (loss) gain on sale, separation costs and income tax expense for discontinued operations are as follows ($ in millions):

Balance sheet information for discontinued operations is as follows ($ in millions):

		March 28, 2008		September 28, 2007
Accounts receivable, net		$	331	$	392
Inventories			24		36
Prepaid expenses and other current assets			37		30
Property, plant and equipment, net			66		150
Goodwill and other intangibles, net			55		55
Other assets			470		421

	Total assets	$	983	$	1,084

Loans payable and current maturities of long-term debt		$	6	$	5
Accounts payable			140		199
Accrued and other current liabilities			192		303
Long-term debt			17		18
Other liabilities			171		73

	Total liabilities	$	526	$	598

Minority interest		$	33	$	30

Restructuring and asset impairment charges, net during the quarters are as follows ($ in millions):

	For the Quarters Ended						For the Six Months Ended
	March 28, 2008			March 30, 2007			March 28, 2008			March 30, 2007
ADT Worldwide	$	11		$	25		$	18		$	56
Flow Control		—			6			2			11
Fire Protection Services		1			2			1			2
Electrical and Metal Products		3			—			7			—
Safety Products		26			5			27			12
Corporate and Other		2			5			2			18

		43			43			57			99
Charges in cost of sales and selling, general and administrative		(6	)		(1	)		(9	)		(1	)

Restructuring and asset impairment charges, net	$	37		$	42		$	48		$	98

During the first quarter of 2007, the Company launched a restructuring program across all segments, including the corporate organization, which will streamline some of the businesses and reduce the operational footprint. The Company expects to incur aggregate charges related to the program of approximately $350 million to $400 million primarily through the end of 2008. Since the inception of this program, through the second quarter of 2008, the Company has incurred charges of $263 million related to this program.

The restructuring program includes numerous actions which are designed to improve operating efficiency and strengthen the Company's competitive position in the future. Many of the actions initiated related to improving field efficiencies and consolidating certain administrative functions in the European operations of ADT Worldwide and Fire Protection Services. In addition, Tyco consolidated certain corporate headquarter functions. During the quarter ended March 28, 2008, the Company recognized employee severance and benefits charges related to the closure of a Safety Products manufacturing facility in Puerto Rico. The restructuring actions were largely reductions in workforce and are expected to be completed by the end of calendar year 2008 and into 2009.

Net restructuring and asset impairment charges during the quarter ended March 28, 2008 were $43 million, which include $6 million for the non-cash write down in carrying value of inventory and accelerated depreciation (which was classified in cost of sales and selling, general and administrative) related to assets expected to become obsolete as a result of the restructuring. The remaining charge is comprised of restructuring charges of $40 million, which include $35 million of employee severance and benefits and $5 million of facility exit charges and other cash charges, and $1 million of asset impairments. During the quarter ended March 28, 2008, the Company completed restructuring activities announced in prior years for amounts less than originally estimated, and accordingly reversed $4 million of restructuring reserves as restructuring credits.

Net restructuring and asset impairment charges during the six months ended March 28, 2008 were $57 million, which include $9 million for the non-cash write down in carrying value of inventory and accelerated depreciation (which was classified in cost of sales and selling, general and administrative) related to assets expected to become obsolete as a result of the restructuring. The remaining charge is comprised of restructuring charges of $55 million, which include $41 million of employee severance and benefits and $14 million of facility exit charges and other cash charges, and $2 million of asset impairments. During the six months ended March 28, 2008, the Company completed restructuring activities announced in prior years for amounts less than originally estimated, and accordingly reversed $9 million of restructuring reserves as restructuring credits.

Net restructuring and asset impairment charges during the quarter ended March 30, 2007 were $43 million, which includes $1 million for the non-cash write down in carrying value of inventory (cost of sales). The remaining charge is comprised of restructuring charges of $36 million, which include $34 million of employee severance and benefits and $2 million of facility exit charges and other cash charges, and $7 million of asset impairments. During the quarter ended March 30, 2007, the Company completed restructuring activities announced in prior years for amounts less than originally estimated, and accordingly reversed $1 million of restructuring reserves as restructuring credits.

Net restructuring and asset impairment charges during the six months ended March 30, 2007 were $99 million, which includes $1 million for the non-cash write down in carrying value of inventory (cost of sales). The remaining charge is comprised of restructuring charges of $92 million, which include $88 million of employee severance and benefits and $4 million of facility exit charges and other cash charges, and $8 million of asset impairments. During the six months ended March 30, 2007, the Company completed restructuring activities announced in prior years for amounts less than originally estimated, and accordingly reversed $2 million of restructuring reserves as restructuring credits.

Restructuring reserves from September 28, 2007 to March 28, 2008 by the year in which the restructuring action was initiated are as follows ($ in millions):

	Year of Restructuring Action
	2008			2007			Prior			Total
Balance at September 28, 2007	$	—		$	115		$	22		$	137
Charges		40			14			1			55
Reversals		—			(8	)		(1	)		(9	)
Utilization		(4	)		(70	)		(3	)		(77	)
Currency translation		—			6			—			6

Balance at March 28, 2008	$	36		$	57		$	19		$	112

	March 28, 2008		September 28, 2007
ADT Worldwide	$	44	$	71
Flow Control		7		13
Fire Protection Services		17		22
Electrical and Metal Products		6		6
Safety Products		29		10
Corporate and Other		9		15

	$	112	$	137

At March 28, 2008, $88 million of restructuring reserves are included in accrued and other current liabilities and $24 million are included in other liabilities. At September 28, 2007, $113 million of restructuring reserves are included in accrued and other current liabilities and $24 million are included in other liabilities.

Tyco adopted the recognition, measurement and disclosure provisions of FIN No. 48 on September 29, 2007. As a result of this adoption, Tyco increased its reserve for uncertain tax positions by $55 million and reduced its deferred tax assets by $24 million with a corresponding $79 million cumulative effect of adoption adjustment to shareholders' equity. As of the adoption date, Tyco had unrecognized tax benefits of $370 million, of which $241 million, if recognized, would affect income tax expense. Also as of the adoption date, Tyco had accrued interest and penalties related to the unrecognized tax benefits of $40 million. Tyco recognizes interest and penalties accrued related to unrecognized tax benefits in income tax expense.

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

Jurisdiction		Years Open To Audit
United States		1997-2007
Australia		2004-2007
France		1999-2007
Germany		1998-2007
United Kingdom		2000-2007
Canada		1999-2007

Based on the current status of its income tax audits, the Company does not anticipate a significant change to its unrecognized tax benefits in the next twelve months.

In connection with the spin-offs of Covidien and Tyco Electronics from Tyco, Tyco entered into a Tax Sharing Agreement that generally governs Covidien's, Tyco Electronics' and Tyco's respective rights, responsibilities, and obligations after the distribution 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 Tyco Electronics 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, with certain exceptions, Tyco generally is responsible for the payment of 27% of any additional U.S. and certain non-U.S. income taxes that are required to be paid to tax authorities as a result of tax audits of Covidien's, Tyco Electronics' or Tyco's subsidiaries' income tax returns for all periods prior to the spin-offs.

Under the Tax Sharing Agreement, the Company shares responsibility for certain of Tyco's, Covidien's and Tyco Electronics' income tax liabilities based on a sharing formula for periods prior to and including June 29, 2007. More specifically, Tyco, Covidien and Tyco Electronics 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 Tyco Electronics' U.S. income tax returns. All costs and expenses associated with the management of these shared tax liabilities are shared equally among the parties. Tyco has recorded a receivable from Covidien and Tyco Electronics of $153 million at March 28, 2008 and $103 million at September 28, 2007 which is included in other assets as our estimate of their portion of the Tax Sharing obligations. Other liabilities include $554 million at March 28, 2008 and $543 million at September 28, 2007 for the fair value of Tyco's obligations under the Tax Sharing Agreement, determined in accordance with FIN No. 45, "Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others." Tyco assesses the shared tax liabilities and related FIN No. 45 liability at each reporting period. The receivable and liability were initially recognized with an offset to shareholders' equity in 2007. In the first quarter of 2008, in connection with the adoption of FIN No. 48, Tyco increased its receivable from Covidien and Tyco Electronics under the Tax Sharing Agreement with a corresponding increase to other income, net by $40 million ($0.08 for both basic and diluted earnings per share), as the Company concluded that this was an indirect effect of adopting a new accounting standard. In addition, $10 million for other activity was recorded through the first quarter of 2008 in accordance with the Tax Sharing Agreement.

Tyco will provide payment under the Tax Sharing Agreement as the shared income tax liabilities are settled. Settlement is expected to occur as the audit process by local taxing authorities is completed for the impacted years. Given the nature of the shared liabilities, the maximum amount of potential future payments is not determinable.

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 Tyco Electronics, the party responsible for such failure would be responsible for all taxes imposed on Tyco, Covidien or Tyco Electronics as a result thereof. If such determination is not the result of actions taken after the Separation by Tyco, Covidien or Tyco Electronics, then Tyco, Covidien and Tyco Electronics would be responsible for 27%, 42% and 31%, respectively, of any taxes imposed on Tyco, Covidien or Tyco Electronics 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 Tyco Electronics 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 legally 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 Tyco Electronics' tax liabilities. See Note 14 for further discussion of guarantees and indemnifications extended between Tyco, Covidien and Tyco Electronics.

The Company and its subsidiaries' income tax returns periodically are examined by various tax authorities. In connection with these examinations, tax authorities, including the Internal Revenue Service ("IRS"), have raised issues and proposed tax adjustments. The Company is reviewing and contesting certain of the proposed tax adjustments. Management has assessed the issues related to these adjustments for recognition and measurement under FIN No. 48 and has recorded unrecognized tax benefits in accordance with FIN No. 48.

In 2004, in connection with the IRS audit of the 1997 through 2000 years, the Company submitted to the IRS proposed adjustments to certain prior period U.S. federal income tax returns resulting in a reduction in the taxable income previously filed. During 2006, the IRS accepted substantially all of the proposed adjustments, and the Company developed proposed amendments to U.S. federal income tax returns for additional periods through 2002. On the basis of previously accepted amendments, the Company has determined that these adjustments will more-likely-than-not be accepted and, accordingly, has recorded them in the Consolidated Financial Statements. Such adjustments did not have a material impact on the Company's financial condition, results of operations or cash flows.

During the third quarter of 2007, the IRS concluded its field examination of certain of Tyco's U.S. federal income tax returns for the years 1997 through 2000 and issued anticipated Revenue Agents' Reports ("RARs") which reflect the IRS' determination of proposed tax adjustments for the periods under audit. The RARs propose tax audit adjustments to certain of the Company's previously filed tax return positions. The Company agreed with the IRS on adjustments totaling $498 million, with an estimated cash impact to the Company of $458 million, and during the third quarter of 2007, the Company paid $458 million, of which $163 million related to the Company's discontinued operations. The Company appealed other proposed tax audit adjustments totaling approximately $1 billion relating to Tyco, Covidien and Tyco Electronics, and, as Audit Managing Party as specified in the Tax Sharing Agreement, the Company intends to vigorously defend its prior filed tax return positions.

and indemnifications liability recorded in conjunction with the Tax Sharing Agreement discussed in Note 14—Guarantees. Additionally, the IRS is auditing the prior tax returns of the Company which includes legal entities of Tyco, Covidien and Tyco Electronics for the 2001 to 2004 period. The Company will manage the audit as Audit Managing Party.

In connection with the adoption of FIN No. 48, the Company reassessed its related uncertain tax positions for recognition and measurement and has made any necessary adjustments. These adjustments were not material. The Company believes that the amounts recorded in its financial statements relating to these tax adjustments are sufficient. However, the ultimate resolution of these matters is uncertain and could result in a material impact to the Company's financial position, results of operations, cash flows or effective tax rate in future reporting periods.

The IRS proposed civil fraud penalties against a prior subsidiary that was distributed to Tyco Electronics arising from alleged actions of former executives in connection with certain intercompany transfers of stock of Simplex Technologies in 1998 and 1999. Based on statutory guidelines, we estimate the proposed penalties could range between $30 million and $50 million. The Company, as Audit Managing Party, will vigorously oppose the assertion of any such penalties against Tyco Electronics, in part, because beginning in 2003 the Company discovered, investigated and reported the conduct at issue to the IRS and fully cooperated in the criminal prosecution of the Company's former Chief Tax Officer on a charge of willful filing of a false tax return. This is a pre-separation shared tax matter under the Tax Sharing Agreement.

Additionally, during 2008 the Company expects to complete proposed amendments to its U.S. federal income tax returns for periods subsequent to 2002, which will primarily reflect the roll forward through 2006 of the amendments for the periods 1997 to 2002. When the Company's tax return positions are updated additional adjustments may be identified and recorded in the Consolidated Financial Statements. While the final adjustments cannot be determined until the income tax return amendment process is completed, the Company believes that any resulting adjustments will not have a material impact on its financial condition, results of operations or cash flows.

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

		Quarter Ended March 28, 2008					Quarter Ended March 30, 2007
		Income		Shares	Per Share		Income		Shares	Per Share
Basic earnings per share:
	Income from continuing operations	$	273	486	$	0.56	$	164	493	$	0.33
	Share options, restricted share awards and deferred stock units		—	3				—	4
	Exchange of convertible debt		—	—				2	9

Diluted earnings per share:
	Income from continuing operations, giving effect to dilutive adjustments	$	273	489	$	0.56	$	166	506	$	0.33

		Six Months Ended March 28, 2008					Six Months Ended March 30, 2007
		Income		Shares	Per Share		Income		Shares	Per Share
Basic earnings per share:
	Income from continuing operations	$	633	489	$	1.29	$	322	494	$	0.65
	Share options, restricted share awards and deferred stock units		—	4				—	4
	Exchange of convertible debt		—	—				4	9

Diluted earnings per share:
	Income from continuing operations, giving effect to dilutive adjustments	$	633	493	$	1.28	$	326	507	$	0.64

The computation of diluted earnings per share for both the quarter and six months ended March 28, 2008 excludes the effect of the potential exercise of options to purchase approximately 20 million shares and excludes restricted share awards and deferred stock units of approximately 4 million shares because the effect would be anti-dilutive.

The computation of diluted earnings per share for the quarter and six months ended March 30, 2007 excludes the effect of the potential exercise of options to purchase approximately 13 million shares and 15 million shares, respectively, and excludes restricted share awards and deferred stock units of approximately 1 million shares in both periods because the effect would be anti-dilutive.

The following table sets forth the gross carrying amount and accumulated amortization of the Company's intangible assets ($ in millions):

Intangible asset amortization expense for the quarters ended March 28, 2008 and March 30, 2007 was $138 million and $129 million, respectively. Intangible asset amortization expense for the six months ended March 28, 2008 and March 30, 2007 was $263 million and $260 million, respectively.

The estimated aggregate amortization expense on intangible assets currently owned by the Company is expected to be approximately $250 million for the remainder of 2008, $450 million for 2009, $350 million for 2010, $300 million for 2011, $250 million for 2012 and $200 million for 2013.

	March 28, 2008		September 28, 2007
364-day senior bridge loan facility due 2008⁽²⁾	$	—	$	367
6.125% public notes due 2008⁽¹⁾		300		300
6.125% public notes due 2009⁽¹⁾		215		215
6.75% public notes due 2011		516		516
6.375% public notes due 2011		849		849
Revolving senior credit facility due 2012		725		308
6.0% notes due 2013		655		654
3.125% convertible senior debentures due 2023		19		21
7.0% public notes due 2028		437		437
6.875% public notes due 2029		723		723
Other⁽¹⁾⁽²⁾		63		72

Total debt		4,502		4,462
Less current portion		525		380

Long-term debt	$	3,977	$	4,082

On April 25, 2007, Tyco, certain of its subsidiaries and a syndicate of banks entered into a 364-day unsecured bridge loan facility. This facility has a variable interest rate based on LIBOR. The margin over LIBOR payable by Tyco International Finance S.A. ("TIFSA"), a wholly-owned subsidiary of the Company and successor company to Tyco International Group S.A., a wholly-owned subsidiary of the Company organized under the laws of Luxembourg ("TIGSA"), can vary based on changes in its credit rating. On October 1, 2007, the commitments with respect to the unused portion of the Company's unsecured bridge loan facility expired, but were subsequently renewed as described below. As of March 28, 2008, no amounts were outstanding under the bridge loan facility.

The Company's unsecured revolving credit facility and its letter of credit facility described below provide the lenders under those facilities with the right to demand repayment of outstanding amounts, and to terminate commitments to extend additional credit, if (i) certain of the Company's outstanding public debt is declared due and payable and (ii) the Company does not have sufficient liquidity available under its unsecured bridge loan facility to refinance such debt. As a result, on November 27, 2007, the Company secured additional firm commitments from certain of its lenders under the bridge loan facility. These additional commitments provide the Company with sufficient liquidity to repay the outstanding public debt with borrowings of up to $4.0 billion. The additional commitments expire on, and any borrowings under the facility would mature on, November 25, 2008. The facility may only be used to repay, settle or otherwise extinguish the public debt described above, which is the subject of ongoing litigation between the Company and the trustee for such public debt. In April 2008, the Company reached a preliminary agreement to settle this litigation. For more information, see "Indenture Trustee Litigation" in Note 9.

In addition to signing the bridge loan facility, on April 25, 2007, Tyco, certain of its subsidiaries and a syndicate of banks entered into a 5-year $1.25 billion unsecured revolving credit facility. This revolving credit facility will be used for working capital, capital expenditures and other corporate purposes. At March 28, 2008, $725 million was outstanding under the unsecured revolving credit facility, with $367 million of the proceeds drawn on the revolver used to repay the bridge loan facility. This facility has a variable interest rate based on LIBOR. The margin over LIBOR payable by TIFSA can vary based on changes in its credit rating.

On June 21, 2007, Tyco and TIFSA entered into a $500 million letter of credit facility, with Citibank N.A. as administrative agent, that was originally scheduled to expire on December 15, 2007. The facility provides for the issuance of letters of credit supported by a related line of credit facility. TIFSA may only borrow under the line of credit agreement to reimburse the bank for obligations with respect to letters of credit issued under this facility. The covenants under this facility are similar to the covenants under the bridge loan and revolving credit facilities. TIFSA would pay interest on any outstanding borrowings at a variable interest rate, based on the bank's base rate or the Eurodollar rate, as defined. On October 19, 2007, the facility was amended to extend the maturity date to June 15, 2008 and adjust the interest rate spreads and fees applicable to extensions of credit thereunder. Loans under the amended letter of credit agreement will continue to bear interest based on LIBOR plus the applicable margin. As of March 28, 2008, letters of credit of $477 million have been issued under the $500 million credit facility. There were no amounts borrowed under this credit facility at March 28, 2008.

Tyco uses various options, swaps, and forward contracts not designated as hedging instruments, to manage foreign currency exposures on accounts and notes receivable, accounts payable, intercompany loans and forecasted transactions denominated in certain foreign currencies. For derivatives not designated as hedging instruments, the Company records changes in fair value in selling, general and administrative expenses in the income statement in the period of change. The fair value of these instruments totaled $46 million of a net liability at March 28, 2008.

In connection with the Separation, the Company entered into a liability sharing agreement regarding certain class actions that were pending against Tyco prior to the Separation. Subject to the terms and conditions of the Separation and Distribution Agreement, the Company will manage and control all the legal matters related to assumed contingent liabilities as described in the Separation and Distribution Agreement, including the defense or settlement thereof, subject to certain limitations.

Tyco has assumed 27%, Covidien has assumed 42% and Tyco Electronics has assumed 31% of certain Tyco pre-Separation contingent and other corporate liabilities, which include securities class action litigation, Employee Retirement Income Security Act ("ERISA") class action litigation, certain legacy tax contingencies and any actions with respect to the spin-offs or the distributions made or brought by any third party except for litigation related to our public debt. Any amounts relating to these contingent and other corporate liabilities paid by Tyco after the spin-offs that are subject to the allocation provisions of the Separation and Distribution Agreement will be shared among Tyco, Covidien and Tyco Electronics pursuant to the same allocation ratio. As described in the Separation and Distribution Agreement, Tyco, Tyco Electronics and Covidien are jointly and severally liable for all amounts relating to the previously disclosed securities class action settlement. All costs and expenses that Tyco incurs in connection with the defense of such litigation, other than the amount of any judgment or settlement, which will be allocated in the manner described above, will be borne equally by Covidien, Tyco Electronics and Tyco.

As a result of actions taken by certain of the Company's former senior corporate management, Tyco, some members of the Company's former senior corporate management, including former members of its Board of Directors and former General Counsel are named defendants in a number of purported class actions alleging violations of the disclosure provisions of the federal securities laws. In addition, Tyco, certain of its current and former employees, some members of the Company's former senior corporate management and some former members of the Company's Board of Directors are named as defendants in several ERISA class actions. The Company is generally obligated to indemnify its directors and officers and its former directors and officers who are named as defendants in some or all of these matters to the extent required by Bermuda law. The Company's insurance carriers may decline coverage, or the Company's coverage may be insufficient to cover its expenses and liability, in some or all of these matters.

duties, violated certain RICO statutes and otherwise engaged in fraudulent acts by making materially false and misleading statements and omissions concerning, among other things, the following: unauthorized and improper compensation of certain of our former executives; their improper use of our funds for personal benefit and their improper self-dealing in real estate. On April 29, 2008, the Company signed a definitive agreement with the plaintiff to settle this lawsuit. The agreement calls for the Company to make a payment of $73.25 million to the plaintiffs in exchange for the plaintiff's agreement to dismiss the case against the Company and certain of its former directors and a former employee. Pursuant to the Separation and Distribution Agreement, the Company's share of the settlement amount is approximately $20 million, with Covidien and Tyco Electronics responsible for approximately $30 million and $23 million, respectively. The Company has recorded the settlement and related receivables from each of Covidien and Tyco Electronics for their respective shares of the settlement amount in its fiscal second quarter resulting in a net charge to selling, general and administrative expenses for its share of the settlement of approximately $20 million. Payment of the settlement is to be made on or before June 2, 2008. Upon the full execution of the definitive agreement by each of the other defendants party thereto and payment of the $73.25 million, the parties shall file the agreed upon order of dismissal with the Court, the entry of which will dismiss the litigation with prejudice. The Company expects to pay the full amount of the settlement to the State and concurrently receive payment from Covidien and Tyco Electronics.

Under the terms of the settlement, the plaintiffs agreed to release all claims against Tyco, the other settling defendants and ten other individuals in consideration for the payment of $2.975 billion from Tyco to the certified class. The deadline for deciding not to participate in the class settlement was September 28, 2007. As of such date, Tyco received opt-out notices from individuals and entities totaling approximately 4% of the shares owned by class members, which includes shares owned by the New Jersey pension funds mentioned above. A number of these individuals and entities have filed claims separately against Tyco. Any judgments resulting from such claims or from claims that are filed in the future would not reduce the settlement amount. Generally, the claims asserted by these plaintiffs include claims similar to those asserted by the settling defendants; namely, violations of the disclosure provisions of federal securities laws. Tyco intends to vigorously defend any litigation resulting from opt-out claims. Other than with respect to the New Jersey v. Tyco International, et al matter described above, it is not possible at this time to predict the final outcome or to estimate the amount of loss or range of possible loss, if any, that might result from an adverse resolution of the asserted or unasserted claims from individuals that have opted-out or from any other legacy securities litigation. Should any of these cases result in an adverse judgment or be settled for a significant amount, they could have a material adverse effect on our financial position, results of operations or cash flows.

Under the terms of the Separation and Distribution Agreement entered into in connection with the Separation, each of Tyco, Covidien and Tyco Electronics are jointly and severally liable for the full amount of the class action settlement and any judgments resulting from opt-out claims. Additionally, under the Separation and Distribution Agreement, the companies share in the liability and related

escrow accounts, with Tyco assuming 27%, Covidien 42% and Tyco Electronics 31% of the settlement amount.

Tyco incurred a charge to expense, for which no tax benefit is available, and a current liability of $2.975 billion in the third quarter of 2007. The Company has also recovered or expects to recover certain of these costs from insurers. As such, the Company recorded $113 million of recoveries in connection with the class action settlement in its Consolidated Statements of Operations for 2007. Based on the Separation and Distribution Agreement, the Company recorded payables to Covidien and Tyco Electronics in 2007 for their portion of the recoveries with an offset to shareholders' equity. Tyco borrowed under its unsecured bridge and credit facilities to fund the liability and placed the proceeds in escrow for the benefit of the class. In connection with the Separation, Covidien and Tyco Electronics assumed their portion of the related borrowing.

Since all legal contingencies that could have affected the settlement were exhausted on February 21, 2008, the administration and distribution of the settlement funds in escrow are now managed by the counsel of the certified class and Tyco is not subject to any further liability related to the class action settlement. As such, Tyco has extinguished the class action liability and no longer has claim to the escrow account. The escrow accounts earned interest that was payable to the class. As such, interest was also accrued on the class action settlement liability. On February 21, 2008, the class action liability and escrow account balances including interest were each $3.02 billion.

Based on the Separation and Distribution Agreement, Tyco had a receivable from Covidien and Tyco Electronics for their portion of the liability of $1,257 million and $927 million, respectively at September 28, 2007 and corresponding payables to Covidien and Tyco Electronics for their interest in the escrow accounts. Receivables and payables that pertain to the class action settlement and related escrow accounts with the same counterparty were presented net in the Consolidated Balance Sheet. Tyco's portion of the liability was $808 million at September 28, 2007. These amounts have been extinguished as of March 28, 2008.

The Company and others have received various subpoenas and requests from the Securities and Exchange Commission ("SEC") Division of Enforcement, the United States Department of Labor, state departments of labor, the General Service Administration and others seeking the production of voluminous documents in connection with various investigations into the Company's governance, management, operations, accounting and related controls. The Department of Labor is investigating Tyco and the administrators of certain of its benefit plans. The Company cannot predict when these investigations will be completed, nor can the Company predict what the results of these investigations may be. It is possible that the Company will be required to pay material fines, consent to injunctions on future conduct, lose the ability to conduct business with government entities or instrumentalities (which in turn could negatively impact the Company's business with non-governmental customers) or suffer other penalties or adverse impacts, each of which could have a material adverse effect on the Company's business. It is not possible to estimate the amount of loss, or range of possible loss, if any, that might result from an adverse resolution of these matters.

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 March 28, 2008, Tyco concluded that it was probable that it would incur remedial costs in the range of approximately $36 million to $63 million. As of March 28, 2008, Tyco concluded that the best estimate within this range is approximately $39 million, of which $7 million is included in accrued and other current liabilities and $32 million is included in other liabilities on Tyco's Consolidated Balance Sheets. In view of the Company's financial position and reserves for environmental matters, the Company believes that any potential payment of such estimated amounts will not have a material adverse effect on its financial position, results of operations or cash flows.

Tyco and some of its subsidiaries and certain subsidiaries of Covidien are named as defendants in personal injury lawsuits based on alleged exposure to asbestos-containing materials. Pursuant to the Separation and Distribution Agreement, Covidien has assumed all liabilities for pending cases filed against Covidien's subsidiaries. Consistent with the national trend of increased asbestos-related litigation, the Company has observed an increase in the number of these lawsuits in the past several years. A limited number of the cases allege premises liability, based on claims that individuals were exposed to asbestos while on a subsidiary's property. A majority of the cases involve product liability claims, based principally on allegations of past distribution of heat-resistant industrial products incorporating asbestos or the past distribution of industrial valves that incorporated asbestos-containing gaskets or packing. Each case typically names between dozens to hundreds of corporate defendants.

Tyco's involvement in asbestos cases has been limited because its subsidiaries did not mine or produce asbestos. Furthermore, in the Company's experience, a large percentage of these claims were never substantiated and, as a result, have been dismissed by the courts. The Company will continue to vigorously defend the lawsuits that have been filed against it and its subsidiaries, but cannot predict whether it will be successful in those cases that proceed to trial. When appropriate, the Company settles claims. Although in the past the total amount paid in any year to settle and defend all asbestos claims has been immaterial, Tyco has recently experienced an increase in the number of lawsuits that have proceeded to trial. Of the lawsuits that have proceeded to trial in 2008, Tyco has won or settled all but one case, with that one case returning an adverse jury verdict for approximately $7.7 million, which included both compensatory and punitive damages. Tyco intends to appeal this verdict and believes that the jury verdict will be overturned. As of March 28, 2008, there were approximately 5,800 asbestos liability cases pending against the Company and its subsidiaries.

The Company estimates its pending asbestos claims and claims that were incurred but not reported, as well as related insurance and indemnification recoveries for certain of these claims. The Company's estimate of the liability for pending and future claims is based on claim experience over the past five years and covers claims expected to be filed over the next seven years. The Company believes that it has adequate amounts recorded related to these matters. While it is not possible at this time to determine with certainty the ultimate outcome of these asbestos-related proceedings, the Company believes that the final outcome of all known and anticipated future claims, after taking into account its substantial indemnification rights and insurance coverage, will not have a material adverse effect on the Company's financial position, results of operations or cash flows.

Tyco has received and responded to various allegations and other information that certain improper payments were made by Tyco subsidiaries in recent years. As previously reported, we have been informed that two subsidiaries in our Flow Control business in Italy have been named in a request for criminal charges filed by the Milan public prosecutor's office. Tyco has 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 the allegations. Tyco also informed the DOJ and the SEC that it has 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"), that it would continue to make periodic progress reports to these agencies, and that it would present its factual findings upon conclusion of the baseline review. 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 payments identified by the Company in the course of its ongoing compliance activities. Covidien and Tyco Electronics agreed, in connection with the Separation, to cooperate with the Company in its response to these allegations. To date, the baseline review has revealed that some business practices may not comply with Tyco and FCPA requirements. At this time, Tyco cannot predict the outcome of these matters and other allegations reported to regulatory and law enforcement authorities and therefore cannot estimate the range of potential loss or extent of risk, if any, that may result from an adverse resolution of these matters. However, it is possible that the Company may be required to pay material fines, consent to injunctions on future conduct, or suffer other penalties or adverse impacts, each of which could have a material adverse effect on its financial position, results of operations or cash flows.

Any judgment required to be paid or settlement or other cost incurred by Tyco in connection with these 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 Tyco to Covidien or Tyco Electronics, respectively, and provides that Tyco will retain liabilities primarily related to its continuing operations. Any liabilities not primarily related to a particular business will be shared equally among Tyco, Covidien and Tyco Electronics.

The German Federal Cartel Office ("FCO") charged in early 2007 that certain German subsidiaries in Tyco's Flow Control business had engaged in anti-competitive practices, in particular with regard to its hydrant, valve, street box and fittings business. Tyco investigated this matter and determined that the conduct may have violated German anti-trust law. Tyco is cooperating with the FCO in its investigation of this violation. Tyco 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 4, 2007, The Bank of New York ("BONY"), at that time the indenture trustee under the indenture, dated June 9, 1998 (as supplemented, the "1998 Indenture") and the indenture, dated as of November 12, 2003 (as supplemented, the "2003 Indenture" and together with the 1998 Indenture, the "Indentures"), pursuant to which notes evidencing approximately $3.7 billion in principal amount of indebtedness (the "Notes") were issued, commenced an action against Tyco International Group S.A. ("TIGSA") and Tyco in the United States District Court for the Southern District of New York

captioned The Bank of New York v. Tyco International Group S.A. BONY served an amended complaint on October 18, 2007, which added Tyco International Finance S.A. ("TIFSA") as an additional defendant. As amended, the complaint alleges that the Separation of the Electronics and Healthcare businesses and related assets and liabilities of Tyco and its subsidiaries and the distribution of such Electronics and Healthcare businesses and related assets and liabilities to Tyco's shareholders, breached the Indentures and seeks damages in excess of $4.1 billion on behalf of noteholders. The amended complaint also seeks a judgment declaring that BONY was not required to sign supplemental indentures proposed by TIGSA, TIFSA and Tyco in connection with the Separation that added TIFSA as a co-obligor on the Notes issued under the Indentures and transferred TIGSA's obligations under the Indentures to Tyco. BONY also seeks a declaratory judgment that TIGSA is obligated to pay BONY reasonable compensation and to reimburse BONY for all reasonable expenses, including attorneys' fees incurred in connection with the Separation and in resolving the proper interpretation of the Indentures. Tyco and TIFSA filed counterclaims against BONY, alleging that its refusal to sign the supplemental indentures in connection with the Separation and the filing of the amended complaint constituted a breach of the Indentures and a breach of the duty of good faith and fair dealing implied in the Indentures. Tyco and TIFSA seek unspecified damages on these claims. Tyco and TIFSA also seek a declaratory judgment that no default has occurred and that BONY is required to sign the supplemental indentures proposed by TIGSA, TIFSA and Tyco.

On November 8, 2007, BONY delivered to Tyco a Notice of Events of Default, claiming that the actions taken by Tyco in connection with the Separation constituted events of default under the Indentures. The claims made in the Notice of Events of Default are the same as those alleged by BONY in the litigation, and Tyco continues to believe that no default or event of default has occurred. The Indentures provide for a 90-day cure period following delivery of a Notice of Events of Default. That period has ended, which means the indenture trustee could now claim that it can declare any outstanding amounts under the Indentures immediately due and payable. Tyco, TIGSA and TIFSA would contest such an acceleration. On January 24, 2008, BONY notified Tyco of its resignation as trustee under the Indentures. Wilmington Trust Company (the "Trustee") was later appointed as the successor trustee.

On March 3, 2008, the Court issued an opinion and order denying BONY's motion for summary judgment. The Court held that the decision in Sharon Steel Corp. v. Chase Manhattan Bank, 691 F.2d 1039 (2d Cir. 1982), the case on which BONY principally relied for purposes of the summary judgment motion, did not apply to the facts of the Separation. The court held that Tyco, TIGSA and TIFSA did not violate the Indentures by virtue of TIGSA having transferred its assets to Tyco, and that, if the Separation were otherwise permitted by the Indentures, BONY's failure to sign the supplemental indentures in connection therewith would not by itself mean that the Separation transactions breached the Indentures. The Court held that the record thus far was insufficient to make a determination as to whether the Separation violated the Indentures by virtue of Tyco's Electronics and Healthcare businesses constituting "substantially all" of Tyco's assets.

noteholders under the Indentures of any and all alleged defaults under the Indentures. The consent solicitation would also provide all noteholders with the right to require Tyco to repurchase the debt outstanding under the Indentures at a fixed price under certain circumstances in the event of a change in control. In addition, Tyco has commenced the exchange offer described above only to qualified institutional buyers pursuant to Rule 144A. The new Notes issued in the exchange will have substantially the same terms as the existing Notes (as amended in accordance with the consent solicitation), with the exception of the shortened maturities described above.

The closing of the transaction is conditioned upon Tyco receiving the consent of holders of at least a majority in principal amount of each outstanding series of Notes. The closing is also subject to other conditions, including the agreement of the Trustee to dismiss the litigation and the entry of an order by the Court dismissing the litigation with prejudice. As of May 5, 2008, Tyco has received irrevocable consents from over 88% of the principal amount of each series of notes, and holders of over 95% of the principal amount of each of the series of Notes due 2028 and 2029 have validly tendered their Notes for exchange. In addition, on April 30, 2008, the Court entered an order dismissing the litigation, and the Company expects to conclude the consent solicitations and exchange offers by the end of May 2008.

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 court appeals), its quarterly withdrawal liability payments are refunded with interest. The Fund's total withdrawal liability assessment against SimplexGrinnell is approximately $25 million, and the quarterly withdrawal liability payments are $1.1 million, which payments commenced on August 1, 2007. 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 and has filed for arbitration. The Company has made no provision for this contingency and believes that its quarterly payments are recoverable.

On February 11, 2008, Tyco announced that it had entered into an agreement to sell substantially all of the remaining portion of Infrastructure Services to AECOM Technology Corporation for approximately $510 million. The sale agreement provides that certain assets and contingent liabilities related to Infrastructure Services are to be retained by Tyco. Among those assets and contingent liabilities are all costs and expenses related to the ongoing litigation between Earth Tech and the City of Phoenix, which is described below.

Earth Tech v. City of Phoenix is a contract dispute arising from Earth Tech's contract with the City of Phoenix, Arizona for expansion of the City's 91^st Avenue Waste Water Treatment Plant. Earth Tech filed a lawsuit against the City of Phoenix in the Maricopa County Superior Court alleging a total of more than $75 million in damages arising from the City's breach of its contract with Earth Tech. In connection with this matter, the Company has assets under the original contract, which it has assessed as recoverable, of $50 million at March 28, 2008 and September 28, 2007.

In connection with the foregoing, the City of Phoenix filed a lawsuit against Earth Tech, Inc., its surety, Federal Insurance Company and other unnamed parties in the Maricopa County Superior Court, The City of Phoenix v. Earth Tech, Inc., Federal Insurance Company and John Does 1-50. The City alleges that Earth Tech breached its contracts with the City of Phoenix and that Earth Tech did not properly, reasonably or timely manage, supervise or inspect the work under the contracts. The City of Phoenix also claims that Federal Insurance breached the terms and conditions of the performance bond and that Federal Insurance failed to investigate the City's bond claims. The City of Phoenix alleges damages of $128 million.

The Presiding Judge of Maricopa County Superior Court on July 11, 2006 consolidated all of the pending lawsuits related to this dispute on the Court's complex litigation docket. The Court has granted several of Earth Tech's motions for partial summary judgment, ordering that application of Arizona's Prompt Payment Act was appropriate and that any material inconsistencies in the contract be resolved in favor of the Act's requirements. Earth Tech expects to file additional summary judgment motions related to the Prompt Payment Act. Tyco cannot predict the outcome of this matter and therefore cannot estimate the range of potential loss or extent of risk, if any, that may result from an adverse resolution of this matter.

Fitzpatrick Contractors Limited v. Tyco Fire and Integrated Solutions (UK) Ltd. On July 18, 2007, Fitzpatrick Contractors Limited ("FCL") commenced an action against Tyco Fire and Integrated Solutions (UK) Ltd. in the High Court of Justice, Queen Bench Division, Technology and Construction Court, United Kingdom, alleging that Tyco entered into a binding contract in 2002 for the design, manufacture and installation of mechanical and electrical works for the refurbishment of a portion of London Transport's Blackwall Tunnel. FCL seeks damages for breach of contract in the amount of approximately $38 million. Tyco intends to defend this action vigorously. While it is not possible at this time to predict the final outcome of this dispute, Tyco does not believe this action will have a material adverse effect on its financial position, results of operations or cash flows. Trial is expected to begin in November 2008.

Sensormatic Security Corp. v. Sensormatic Electronics Corp., ADT Security Services, Inc. and Wallace Computer Services, Inc. In April 2002, litigation was commenced in the United States District Court for the District of Maryland by a Sensormatic franchisee, Sensormatic Security Corp. ("SSC"), alleging breach of contract against Sensormatic and tortious interference with contract against ADT and Wallace Computer Services, Inc., a party unrelated to Tyco. The litigation was based on allegedly unpaid commissions under a franchise agreement. The lawsuit also alleges that Sensormatic improperly authorized third parties (including ADT and Wallace) to sell in SSC's exclusive territory of Maryland, Virginia and the District of Columbia. Sensormatic has agreed to indemnify Wallace. SSC seeks an accounting, monetary damages (including punitive damages against ADT and Wallace), and injunctive relief. Sensormatic and ADT have denied SSC's allegations and asserted affirmative defenses. Sensormatic also filed a counterclaim seeking recovery of overpayments made to SSC. Both the trial and appellate court have ruled on a number of motions filed by the parties in this litigation, some of

which rulings have been favorable to the plaintiff and some of which have been favorable to ADT and Sensormatic. Trial has been scheduled for December 2008. Sensormatic and ADT will continue to vigorously defend the litigation. While it is not possible at this time to predict the final outcome of this dispute, Tyco has reserved its estimate of loss for this matter, and does not believe this action will have a material adverse effect on its financial position, results of operations or cash flows.

The Company is a defendant in a number of other pending legal proceedings incidental to present and former operations, acquisitions and dispositions. The Company does not expect the outcome of these proceedings, either individually or in the aggregate, to have a material adverse effect on its financial position, results of operations or cash flows.

Defined Benefit Pension Plans—The net periodic benefit cost for all U.S. and non-U.S. defined benefit pension plans was as follows ($ in millions):

		U.S. Plans
		For the Quarters Ended						For the Six Months Ended
		March 28, 2008			March 30, 2007			March 28, 2008			March 30, 2007
Service cost		$	2		$	2		$	4		$	4
Interest cost			12			12			24			24
Expected return on plan assets			(15	)		(14	)		(30	)		(28	)
Amortization of net actuarial loss			2			3			4			6

	Net periodic benefit cost	$	1		$	3		$	2		$	6

		Non-U.S. Plans
		For the Quarters Ended						For the Six Months Ended
		March 28, 2008			March 30, 2007			March 28, 2008			March 30, 2007
Service cost		$	12		$	12		$	24		$	24
Interest cost			21			19			42			38
Expected return on plan assets			(21	)		(19	)		(42	)		(38	)
Amortization of prior service credit			(1	)		(1	)		(2	)		(2	)
Amortization of net actuarial loss			5			8			10			16

	Net periodic benefit cost	$	16		$	19		$	32		$	38

The Company anticipates that it will contribute at least the minimum required to its pension plans in 2008 of $5 million for U.S. plans and $64 million for non-U.S. plans. During the six months ended March 28, 2008, the Company has contributed $36 million to its U.S. and non-U.S. pension plans.

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

Rabbi Trust—During the six months ended March 30, 2007, the Company, as permitted under the trust agreement, sold substantially all of the assets from one of the trusts and received $271 million of proceeds. Trust assets were primarily composed of corporate-owned life insurance policies.

During the six months ended March 28, 2008, there were no material share-based compensation grants.

During the six months ended March 30, 2007, the Company issued its annual share-based compensation grants. The number of awards issued for the annual share-based compensation grant were approximately 10 million of which 7 million were share options and 3 million were restricted share awards. These options are exercisable in equal annual installments over a period of four years and the restricted share awards vest in one-third increments over a period of four years beginning in year two. The weighted-average grant-date fair value of the share options and restricted share awards was $15.16 and $48.14, respectively. The weighted-average assumptions used in the Black-Scholes option pricing model included an expected stock price volatility of 32%, a risk free interest rate of 4.3%, an expected annual dividend per share of $0.64 and an expected option life of 5.1 years.

Grant information has been adjusted for the conversion of Tyco share options to share options of Covidien and Tyco Electronics, the conversion of Tyco restricted share awards to restricted share awards of Covidien and Tyco Electronics, the Separation and the one for four reverse stock split.

The segment data presented have been reclassified to exclude the results of discontinued operations. Selected information by segment is presented in the following tables ($ in millions):

		For the Quarters Ended				For the Six Months Ended
		March 28, 2008		March 30, 2007		March 28, 2008		March 30, 2007
Net revenue⁽¹⁾:
	ADT Worldwide	$	1,966	$	1,887	$	3,965	$	3,750
	Flow Control		1,024		878		2,098		1,713
	Fire Protection Services		861		819		1,690		1,607
	Electrical and Metal Products		542		479		1,029		922
	Safety Products		469		424		916		830
	Corporate and Other		4		3		8		7

	Net revenue	$	4,866	$	4,490	$	9,706	$	8,829

		For the Quarters Ended						For the Six Months Ended
		March 28, 2008			March 30, 2007			March 28, 2008			March 30, 2007
Operating income:
	ADT Worldwide	$	222		$	195		$	471		$	396
	Flow Control		143			102			314			210
	Fire Protection Services		77			62			150			120
	Electrical and Metal Products		72			26			113			67
	Safety Products		54			66			140			137
	Corporate and Other		(125	)		(247	)		(252	)		(477	)

	Operating income	$	443		$	204		$	936		$	453

Selected supplementary balance sheet information was as follows ($ in millions):

		March 28, 2008			September 28, 2007
Purchased materials and manufactured parts		$	748		$	620
Work in process			272			267
Finished goods			1,005			924

	Inventories	$	2,025		$	1,811

Land		$	163		$	155
Buildings			772			723
Subscriber systems			5,232			5,061
Machinery and equipment			2,347			2,215
Property under capital leases⁽¹⁾			53			52
Construction in progress			158			138
Accumulated depreciation⁽²⁾			(5,112	)		(4,801	)

	Property, plant and equipment, net	$	3,613		$	3,543

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 2008 through the completion of such transactions. The guarantees would be triggered in the event of nonperformance and the potential exposure for nonperformance under the guarantees 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 between Tyco, Covidien and Tyco Electronics 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. See Note 4 for further discussion of 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 accordance with FIN No. 45. To value the initial obligation under FIN No. 45 related to the Tax Sharing Agreement, the Company considered a range of discounted probability-weighted future cash flows, which included an estimated premium to reflect the cost an independent insurance carrier or guarantor would charge to assume such obligation, related to the unresolved (asserted and unasserted) pre-separation shared tax matters of Covidien and Tyco Electronics. The liability necessary to reflect the fair value of the guarantees and indemnifications under the Tax Sharing Agreement is $554 million, which is included in other liabilities on our Consolidated Balance Sheets.

In addition, Tyco historically provided support in the form of financial and/or performance guarantees to various Covidien and Tyco Electronics operating entities. In connection with the Separation, the Company worked with the guarantee counterparties to cancel or assign these guarantees to Covidien or Tyco Electronics. To the extent these guarantees were not assigned prior to the Separation date, Tyco assumed primary liability on any remaining such support. The estimated fair values of these obligations are $7 million, which are included in other liabilities on our Consolidated Balance Sheets, and were recorded in accordance with FIN No. 45.

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 is not aware of any potential liabilities related to such indemnities which could have a material adverse effect on the Company's financial position, results of operations or cash flows.

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.

	For the Quarter Ended March 28, 2008			For the Six Months Ended March 28, 2008
Balance at beginning of period	$	153		$	163
Warranties issued during the period		3			10
Changes in estimates		(7	)		(6	)
Settlements		(23	)		(42	)
Currency translation		3			4

Balance at March 28, 2008	$	129		$	129

In 2001, a division of Safety Products initiated a Voluntary Replacement Program ("VRP") associated with the acquisition of Central Sprinkler. The VRP relates to the replacement of certain O-ring seal sprinkler heads which were originally manufactured by Central Sprinkler prior to Tyco's acquisition. Under this program, the sprinkler heads are being replaced free of charge to property owners. On May 1, 2007, the Consumer Product Safety Commission and the Company announced an August 31, 2007 deadline for filing claims to participate in the VRP. The Company will fulfill all valid claims for replacement of qualifying sprinklers. The related warranty reserve reflects the Company's best estimate of the expected costs to complete the program in light of claims received through August 31, 2007 and estimated material and labor costs. Settlements during the quarter and six months ended March 28, 2008 include cash expenditures of $13 million and $25 million, respectively, related to the VRP.

TIFSA, a wholly-owned subsidiary of the Company, has public debt securities outstanding (see Note 7) which are fully and unconditionally guaranteed by Tyco. 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.

During the second quarter of 2008, the Company completed a tax-free restructuring involving the transfer of certain investments from Tyco to TIFSA. Since the transactions were entirely among wholly-owned subsidiaries of Tyco there was no impact on the Company's financial position, results of operations and cash flows. The transactions did, however, result in an increase to TIFSA's investment in subsidiaries of $1.9 billion. Since these transactions were among entities under common control, their effects have been reflected as of the beginning of the earliest period presented.

CONDENSED CONSOLIDATING STATEMENT OF INCOME

For the Quarter Ended March 28, 2008

(in millions)

CONDENSED CONSOLIDATING STATEMENT OF INCOME

For the Quarter Ended March 30, 2007

(in millions)

CONDENSED CONSOLIDATING STATEMENT OF INCOME

For the Six Months Ended March 28, 2008

(in millions)

CONDENSED CONSOLIDATING STATEMENT OF INCOME

For the Six Months Ended March 30, 2007

(in millions)

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the Six Months Ended March 28, 2008

(in millions)

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the Six Months Ended March 30, 2007

(in millions)

On April 11, 2008, Tyco reached a preliminary agreement regarding the Indenture Trustee Litigation. In addition, on April 30, 2008, the Court entered an order dismissing the litigation, and the Company expects to conclude the related consent solicitations and exchange offers by the end of May 2008—see Note 9 Commitments and Contingencies.

On April 14, 2008, the Company's ADT Security business reached an agreement to acquire FirstService Security, a division of FirstService Corporation, for approximately $187 million. FirstService Security is a leading commercial security systems integrator and provides a full range of integrated security system services, including design, engineering, installation, servicing and monitoring of access control, closed-circuit television and intrusion systems. FirstService Security had total net revenue of more than $200 million during the last twelve months. The transaction is subject to regulatory approval and normal closing conditions.

On April 29, 2008, the Company signed a definitive agreement with the State of New Jersey to settle the outstanding litigation surrounding several state pension funds—see Note 9 Commitments and Contingencies.

In May 2008, TIFSA commenced issuing commercial paper to U.S. institutional accredited investors and qualified institutional buyers as part of the Company's ongoing effort to enhance financial flexibility and to potentially decrease the cost of borrowings. Borrowings under the commercial paper program are available for general corporate purposes.

Since March 28, 2008, the Company repurchased 3.1 million common shares for $145 million under the $1.0 billion share repurchase program approved by the Board of Directors in September 2007.

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 Bermuda, and its subsidiaries (hereinafter collectively referred to as "we," the "Company" or "Tyco") and have been prepared in United States dollars, in accordance with accounting principles generally accepted in the United States ("GAAP").

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

References to the segment data are to the Company's continuing operations. Prior period amounts have been reclassified to exclude the results of discontinued operations.

We remain committed to returning excess cash to shareholders. During the quarter and six months ended March 28, 2008, we repurchased 6.6 million and 12.0 million of our common shares for $245 million and $475 million, respectively, under the $1.0 billion share repurchase program approved by the Board of Directors in September 2007. Since March 28, 2008, we repurchased an additional 3.1 million common shares for $145 million under this program. During the quarter and six months ended March 28, 2008, we paid dividends of $74 million and $148 million, respectively, to shareholders of record.

We are continuing to assess the strategic fit of our various businesses and are considering strategic alternatives for under-performing or non-strategic businesses including additional divestitures where businesses do not align with our long term vision. As part of these portfolio refinement efforts, we entered into agreements to sell our Infrastructure Services businesses and sold our Ancon Building

Products business and our Nippon Dry-Chemical business. Additionally, we recently announced an agreement to acquire FirstService Security to strengthen ADT's system integration capabilities.

We continue to focus on operational execution to drive earnings growth. To further improve operating efficiency, during the first quarter of 2007, we launched a restructuring program across all segments, including the corporate organization, which will streamline some of the businesses and reduce the operational footprint. We expect to incur aggregate charges related to the program of approximately $350 million to $400 million primarily through the end of 2008. Since the inception of this program, through the second quarter of 2008, the Company has incurred charges of $263 million related to this program. We believe this restructuring program will strengthen our competitive position over the long term.

Additionally, we have made progress towards reducing our corporate expenses and we are well positioned to achieve our corporate expense run rate of $500 million for 2008.

Under the terms of the settlement, the plaintiffs agreed to release all claims against Tyco, the other settling defendants and ten other individuals in consideration for the payment of $2.975 billion from Tyco to the certified class. The deadline for deciding not to participate in the class settlement was September 28, 2007. As of such date, Tyco received opt-out notices from individuals and entities totaling approximately 4% of the shares owned by class members. A number of these individuals and entities have filed claims separately against Tyco. Any judgments resulting from such claims or from claims that are filed in the future would not reduce the settlement amount. Generally, the claims asserted by these plaintiffs include claims similar to those asserted by the settling defendants; namely, violations of the disclosure provisions of federal securities laws. Tyco intends to vigorously defend any litigation resulting from opt-out claims. While it is not possible to predict the final outcome of unresolved opt-out cases, should any of these cases result in an adverse judgment or be settled for a significant amount, they could have a material adverse effect on our financial position, results of operations or cash flows.

Under the terms of the Separation and Distribution Agreement entered into in connection with the spin-offs of Covidien and Tyco Electronics (the "Separation"), each of Tyco, Covidien and Tyco Electronics are jointly and severally liable for the full amount of the class action settlement and any judgments resulting from opt-out claims. Additionally, under the Separation and Distribution Agreement, the companies share in the liability and related escrow account, with Tyco assuming 27%, Covidien 42% and Tyco Electronics 31% of the settlement amount.

the class action settlement. As such, Tyco has extinguished the class action liability and no longer has claim to the escrow account. The escrow accounts earned interest that was payable to the class. As such, interest was also accrued on the class action settlement liability. On February 21, 2008, the class action liability and escrow account balances including interest were each $3.02 billion.

Net revenue increased $376 million, or 8.4%, for the second quarter and $877 million, or 9.9%, for the first six months of 2008 as compared to the same periods last year. The increases in both periods reflect net revenue growth in all of our segments led by solid year over year increases in Flow Control and ADT Worldwide. The increase in net revenue in Flow Control resulted from volume growth due to continued strength in most industrial end markets with significant project growth in the valves business. In addition, net revenue growth in ADT Worldwide was attributable to strong growth in all geographic regions led by Asia and Latin America, as well as growth in its recurring revenue base in North America. Foreign currency exchange rates positively affected the second quarter by $228 million and the first six months of 2008 by $478 million. The net impact of acquisitions, divestitures and other activity negatively affected the same periods by $12 million and $25 million, respectively.

Operating income increased $239 million, or 117.2%, for the second quarter, while operating margin increased 4.6 percentage points to 9.1%. Operating income increased $483 million, or 106.6%, for the first six months of 2008, while operating margin increased 4.5 percentage points to 9.6%. Strong year over year income growth in a majority of the business segments for the quarter and all segments for the six months led by Flow Control and ADT Worldwide and lower corporate expenses contributed

to the increases in operating income. Additionally, operating income was negatively impacted by net charges of $58 million and $82 million in the quarter and six months ended March 28, 2008, respectively, compared to net charges of $78 million and $159 million in the quarter and six months ended March 30, 2007, respectively.

Net charges of $58 million in the quarter ended March 28, 2008 were comprised of net restructuring and asset impairment charges of $43 million and a legacy legal settlement charge of $20 million slightly offset by a $5 million credit related to separation costs. Net charges of $82 million in the six months ended March 28, 2008 resulted from net restructuring and asset impairment charges of $57 million, a legacy legal settlement charge of $20 million and $5 million of separation costs.

Net charges of $78 million in the quarter ended March 30, 2007 were comprised of net restructuring, asset impairment and divestiture charges of $46 million and $32 million of separation costs. The six months ended March 30, 2007 included net charges of $159 million including $102 million of net restructuring, impairment and divestiture charges and $57 million of separation costs.

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, operating income and operating margin for ADT Worldwide were as follows ($ in millions):

	For the Quarters Ended
	March 28, 2008			March 30, 2007
Revenue from product sales	$	672		$	675
Service revenue		1,294			1,212

Net revenue	$	1,966		$	1,887

Operating income	$	222		$	195
Operating margin		11.3	%		10.3	%

Net revenue by geographic area for ADT Worldwide was as follows ($ in millions):

	For the Quarters Ended
	March 28, 2008		March 30, 2007
North America	$	1,031	$	1,020
Europe, Middle East and Africa ("EMEA")		652		638
Rest of World		283		229

	$	1,966	$	1,887

Net revenue for ADT Worldwide increased $79 million, or 4.2%, during the quarter ended March 28, 2008, with service revenue up 6.8%, as compared to the quarter ended March 30, 2007. Revenue from product sales includes sales and installation of electronic security and other systems. Service revenue is comprised of electronic security services and maintenance, including the monitoring of burglar alarms, fire alarms and other life safety systems as well as services related to retailer anti-theft systems. The 1.1% revenue growth in North America resulted largely from solid growth in recurring residential revenue offset by order weakness in the retailer end market. Revenue in the EMEA region grew 2.2% driven by favorable changes in foreign currency exchange rates offset by a decline in contracting revenue in the United Kingdom. The 23.6% revenue growth in the Rest of World geographies was primarily driven by strong growth in Asia, Latin America and Australia/New Zealand, and to a lesser extent, by favorable changes in foreign currency exchange rates. Overall, the ADT Worldwide net revenue increase included the favorable impact of changes in foreign currency exchange rates of $69 million.

Attrition rates for customers in our ADT Worldwide business continued to improve, declining to an average of 12.2% on a trailing 12-month basis as of March 28, 2008 as compared to 12.3% as of September 28, 2007 and 13.1% as of March 30, 2007.

Operating income increased $27 million, or 13.8%, in the quarter ended March 28, 2008 from the same period in the prior year. Factors that positively impacted operating income included increased recurring revenue, operational efficiencies, including those achieved from restructuring activities in Europe, and lower depreciation and amortization expense. The decrease to depreciation and amortization expense occurred primarily in North America and resulted from changes to the depreciation method and estimated useful lives for pooled subscriber assets and changes to the estimated useful lives of dealer intangible assets. The reduction in depreciation and amortization expense was more than offset by increased net expenses of $27 million primarily related to converting customers from analog to digital signal transmissions in North America. In addition, results for the quarter ended March 28, 2008 included net restructuring and asset impairment charges of $11 million, which were primarily related to improving field efficiencies and consolidating certain administrative functions in Europe. The same period in the prior year included net restructuring charges of $25 million.

Operating margin in ADT Worldwide increased to 11.3% in the quarter ended March 28, 2008 from 10.3% for the same period in the prior year reflecting operational improvement in all geographic areas. The recent restructuring actions and management changes that have been implemented in Europe are expected to continue to drive further improvements to the operating margin in EMEA.

Net revenue, operating income and operating margin for Flow Control were as follows ($ in millions):

	For the Quarters Ended
	March 28, 2008			March 30, 2007
Revenue from product sales	$	980		$	848
Service revenue		44			30

Net revenue	$	1,024		$	878

Operating income	$	143		$	102
Operating margin		14.0	%		11.6	%

Net revenue for Flow Control increased $146 million, or 16.6%, in the quarter ended March 28, 2008 as compared to the quarter ended March 30, 2007. The increase in net revenue was largely driven

by volume growth from continued strength in the energy end market with significant project growth in the valves business and to a lesser extent the thermal controls business. Growth in these areas were strong across all geographical regions, and, in particular, North America and Europe. This growth was offset by reduced project activity in the water and irrigation markets. Favorable changes in foreign currency exchange rates positively impacted revenue by $86 million, while the net impact of acquisitions, divestitures and other activity negatively affected revenue by $1 million.

The increase in operating income of $41 million, or 40.2%, in the quarter ended March 28, 2008 as compared to the same period in the prior year was primarily due to revenue growth, as well as volume efficiencies. The same period in the prior year included net restructuring charges of $6 million, as well as $3 million of divestiture charges and $1 million of separation related costs.

Net revenue, operating income and operating margin for Fire Protection Services were as follows ($ in millions):

	For the Quarters Ended
	March 28, 2008			March 30, 2007
Revenue from product sales	$	452		$	431
Service revenue		409			388

Net revenue	$	861		$	819

Operating income	$	77		$	62
Operating margin		8.9	%		7.6	%

Net revenue for Fire Protection Services increased $42 million, or 5.1%, during the quarter ended March 28, 2008 as compared to the quarter ended March 30, 2007 driven by increases in both product sales and service revenues. Revenue from product sales includes sales and installation of fire protection and other systems. Service revenue comprises inspection, maintenance, service and monitoring of fire detection and suppression systems. The increase in product sales was primarily attributable to favorable foreign currency exchange rates. The increase in service revenue related to growth in service work and sprinkler contracting in North America and Asia as well as favorable foreign currency exchange rates. This increase was partially offset by reduced revenue within the Pacific region due to a decline in project work and the planned exit of low performing non-core activities in Latin America and EMEA. Changes in foreign currency exchange rates had a favorable impact of $38 million.

Operating income increased $15 million, or 24.2%, in the quarter ended March 28, 2008 as compared to the same period in the prior year was primarily driven by improved margins in most geographic regions. The quarter ended March 28, 2008 also includes increased sales in higher margin electronic service revenue businesses. In addition, operating income included $1 million of net restructuring charges compared to $2 million in the same period in the prior year.

Net revenue, operating income and operating margin for Electrical and Metal Products were as follows ($ in millions):

	For the Quarters Ended
	March 28, 2008			March 30, 2007
Revenue from product sales	$	540		$	478
Service revenue		2			1

Net revenue	$	542		$	479

Operating income	$	72		$	26
Operating margin		13.3	%		5.4	%

Net revenue for Electrical and Metal Products increased $63 million, or 13.2%, in the quarter ended March 28, 2008 as compared to the quarter ended March 30, 2007. The increase in net revenue was largely driven by steel tubular product volume and selling price increases. Additionally, the selling prices of armored cable increased however, this was more than offset by decreased sales volume. Changes in foreign currency exchange rates had a favorable impact of $12 million.

Operating income increased $46 million, or 176.9%, in the quarter ended March 28, 2008 as compared to the same period in the prior year due to improved spreads for steel tubular and copper products as well as productivity initiatives. In addition, results for the quarter ended March 28, 2008 included net restructuring charges of $3 million.

Net revenue, operating income and operating margin for Safety Products were as follows ($ in millions):

	For the Quarters Ended
	March 28, 2008			March 30, 2007
Revenue from product sales	$	464		$	419
Service revenue		5			5

Net revenue	$	469		$	424

Operating income	$	54		$	66
Operating margin		11.5	%		15.6	%

Net revenue for Safety Products increased $45 million, or 10.6%, during the quarter ended March 28, 2008 as compared to the quarter ended March 30, 2007 primarily from strong performance in the fire suppression, electronic security and life safety businesses. The increase in the fire suppression business was driven by increased sales volume and to a lesser extent pricing. Growth in the electronic security business resulted from new market expansions, while life safety benefited from new product introductions and increased selling prices. Favorable changes in foreign currency exchange rates of $23 million also contributed to the increase in revenue.

Operating income decreased $12 million, or 18.2%, during the quarter ended March 28, 2008 as compared to the same period in the prior year. Increased sales volume along with the impact of cost savings from operational excellence initiatives were more than offset by net restructuring charges of $26 million. The same period in the prior year included net restructuring and impairment charges of $5 million.

Corporate expense in the quarter ended March 28, 2008 was $122 million lower as compared to the same period in the prior year, largely resulting from restructuring and resizing corporate operations post-separation. Corporate expense for the quarter ended March 28, 2008 included net charges of $17 million composed of a $20 million charge for a legacy legal settlement and $2 million of restructuring charges partially offset by a credit of $5 million for separation costs. Corporate expense for the quarter ended March 30, 2007 included Separation related costs of $31 million and net restructuring and asset impairment charges of $5 million primarily related to the consolidation of certain headquarter functions. The remaining decrease in corporate expense is related to cost reduction initiatives and the restructuring program. We continue to target a full year corporate expense run rate of $500 million.

Interest income was $25 million and $11 million during the quarters ended March 28, 2008 and March 30, 2007, respectively. The increase in interest income is primarily related to interest earned on the class action settlement escrow of $14 million.

Interest expense was $115 million in the quarter ended March 28, 2008 as compared to $64 million in the quarter ended March 30, 2007. The increase in interest expense is primarily related to increased costs related to our bridge loan and revolving credit facilities, and to a lesser extent interest on the class action settlement liability of $14 million.

In the quarter ended March 30, 2007, net interest amounts were proportionally allocated to Covidien and Tyco Electronics based on the debt amounts that we believe were utilized by Covidien and Tyco Electronics historically inclusive of amounts directly incurred, and is included in discontinued operations. Allocated net interest was calculated using our historical weighted-average interest rate on debt, including the impact of interest rate swap agreements. The portion of Tyco's interest income and interest expense allocated to Covidien and Tyco Electronics was $16 million and $91 million, respectively.

Our effective income tax rate was 22.4% and (7.9)% during the quarters ended March 28, 2008 and March 30, 2007, respectively. The quarter ended March 30, 2007 included the release of a deferred tax valuation allowance related to non-U.S. tax rulings received during the period and reduced reserve requirements on certain legacy tax matters.

Six Months Ended March 28, 2008 Compared to Six Months Ended March 30, 2007

Net revenue, operating income and operating margin for ADT Worldwide were as follows ($ in millions):

	For the Six Months Ended
	March 28, 2008			March 30, 2007
Revenue from product sales	$	1,379		$	1,342
Service revenue		2,586			2,408

Net revenue	$	3,965		$	3,750

Operating income	$	471		$	396
Operating margin		11.9	%		10.6	%

Net revenue by geographic area for ADT Worldwide was as follows ($ in millions):

	For the Six Months Ended
	March 28, 2008		March 30, 2007
North America	$	2,071	$	2,040
Europe, Middle East and Africa ("EMEA")		1,326		1,247
Rest of World		568		463

	$	3,965	$	3,750

Net revenue for ADT Worldwide increased $215 million, or 5.7%, during the six months ended March 28, 2008, with product revenue up 2.8% and service revenue up 7.4%, as compared to the six months ended March 30, 2007. Revenue from product sales includes sales and installation of electronic security and other systems. Service revenue is comprised of electronic security services and maintenance, including the monitoring of burglar alarms, fire alarms and other life safety systems as well as services related to retailer anti-theft systems. The 1.5% revenue growth in North America resulted largely from growth in recurring residential revenue offset by declines in commercial and government businesses. Revenue in the EMEA region grew 6.3% driven by favorable changes in foreign currency exchange rates offset by a decline in project revenue in the United Kingdom. The 22.7% revenue growth in the Rest of World geographies was primarily driven by strong growth in Asia, Latin America and Australia/New Zealand, and to a lesser extent, by favorable changes in foreign currency exchange rates. Overall, the ADT Worldwide net revenue increase included the favorable impact of changes in foreign currency exchange rates of $153 million.

Operating income increased $75 million, or 18.9%, in the six months ended March 28, 2008 from the same period in the prior year. Factors that positively impacted operating income included increased volume, operational efficiencies, including those achieved from restructuring activities in Europe, and lower depreciation and amortization expense. The decrease to depreciation and amortization expense occurred primarily in North America and resulted from changes to the depreciation method and estimated useful lives for pooled subscriber assets and changes to the estimated useful lives of dealer intangible assets. The reduction in depreciation and amortization expense was more than offset by increased net expenses of $51 million, primarily related to converting customers from analog to digital signal transmissions in North America. In addition, results for the six months ended March 28, 2008 included net restructuring and asset impairment charges of $18 million, which were primarily related to improving field efficiencies and consolidating certain administrative functions in Europe. The same period in the prior year included net restructuring charges of $56 million.

Operating margin in ADT Worldwide increased to 11.9% in the six months ended March 28, 2008 from 10.6% for the same period in the prior year reflecting improvement in North America and EMEA offset by a slight decline in Rest of World. The recent restructuring actions and management changes that have been implemented in Europe are expected to continue to drive further improvements to the operating margin in EMEA.

Net revenue, operating income and operating margin for Flow Control were as follows ($ in millions):

	For the Six Months Ended
	March 28, 2008			March 30, 2007
Revenue from product sales	$	2,010		$	1,650
Service revenue		88			63

Net revenue	$	2,098		$	1,713

Operating income	$	314		$	210
Operating margin		15.0	%		12.3	%

Net revenue for Flow Control increased $385 million, or 22.5%, in the six months ended March 28, 2008 as compared to the six months ended March 30, 2007. The increase in net revenue was largely driven by volume growth from continued strength in most industrial end markets with significant project growth in the valves and water businesses. Growth in these businesses was strong across all geographical regions, and, in particular, North America and Europe. Favorable changes in foreign currency exchange rates positively impacted revenue by $178 million, while the net impact of acquisitions, divestitures and other activity negatively affected revenue by $2 million.

The increase in operating income of $104 million, or 49.5%, in the six months ended March 28, 2008 as compared to the same period in the prior year was primarily due to revenue growth, as well as volume efficiencies. The increase in operating income during the six months ended March 28, 2008 was partially offset by net restructuring charges of $2 million. The same period in the prior year included net restructuring charges of $11 million, as well as $3 million of divestiture charges and $1 million of separation costs.

Net revenue, operating income and operating margin for Fire Protection Services were as follows ($ in millions):

	For the Six Months Ended
	March 28, 2008			March 30, 2007
Revenue from product sales	$	882		$	844
Service revenue		808			763

Net revenue	$	1,690		$	1,607

Operating income	$	150		$	120
Operating margin		8.9	%		7.5	%

Net revenue for Fire Protection Services increased $83 million, or 5.2%, during the six months ended March 28, 2008 as compared to the six months ended March 30, 2007 driven by increases in both product sales and service revenues. Revenue from product sales includes sales and installation of fire protection and other systems. Service revenue comprises inspection, maintenance, service and monitoring of fire detection and suppression systems. The increase in product sales was primarily attributable to favorable foreign currency exchange rates. The increase in service revenue related to growth in service work and sprinkler contracting in North America as well as favorable foreign currency exchange rates. This increase was partially offset by reduced revenue internationally driven largely by the planned exit of low performing non-core activities in Latin America and Asia. Changes in foreign currency exchange rates had a favorable impact of $79 million.

Operating income increased $30 million, or 25.0%, in the six months ended March 28, 2008 as compared to the same period in the prior year and was primarily driven by improved margins in most geographic regions. The six months ended March 28, 2008 also includes increased sales in higher margin electronic service revenue businesses. Additionally, 2007 was favorably impacted by certain restructuring initiatives. The increase in operating income during the six months ended March 28, 2008 was partially offset by net restructuring charges of $1 million. The same period in the prior year included net restructuring charges of $2 million.

Net revenue, operating income and operating margin for Electrical and Metal Products were as follows ($ in millions):

	For the Six Months Ended
	March 28, 2008			March 30, 2007
Revenue from product sales	$	1,026		$	920
Service revenue		3			2

Net revenue	$	1,029		$	922

Operating income	$	113		$	67
Operating margin		11.0	%		7.3	%

Net revenue for Electrical and Metal Products increased $107 million, or 11.6%, in the six months ended March 28, 2008 as compared to the six months ended March 30, 2007. The increase in net revenue was largely driven by steel tubular product volume and selling price increases. Additionally, the selling prices of armored cable increased however, it was more than offset by decreased sales volume. Changes in foreign currency exchange rates had a favorable impact of $22 million.

Operating income increased $46 million, or 68.7%, in the six months ended March 28, 2008 as compared to the same period in the prior year due to improved spreads for steel tubular and copper products as well as improved productivity. In addition, results for the six months ended March 28, 2008 included net restructuring charges of $7 million.

Net revenue, operating income and operating margin for Safety Products were as follows ($ in millions):

	For the Six Months Ended
	March 28, 2008			March 30, 2007
Revenue from product sales	$	907		$	821
Service revenue		9			9

Net revenue	$	916		$	830

Operating income	$	140		$	137
Operating margin		15.3	%		16.5	%

Net revenue for Safety Products increased $86 million, or 10.4%, during the six months ended March 28, 2008 as compared to the six months March 30, 2007 primarily from strong performance in the fire suppression and electronic security businesses. The increase in the fire suppression business was driven by continued growth in the energy and marine sectors, favorable product mix and increased selling prices. The electronic security business also experienced growth as a result of new product introductions and new market expansions. Favorable changes in foreign currency exchange rates of $45 million also contributed to the increase in revenue.

Operating income remained relatively constant in the six months ended March 28, 2008 as compared to the same period in the prior year. Increased sales volume along with the impact of cost savings from operational excellence initiatives were offset by $27 million of net restructuring and asset impairment charges. The same period in the prior year included $12 million of net restructuring and asset impairment charges.

Corporate expense in the six months ended March 28, 2008 was $225 million lower as compared to the same period in the prior year, largely resulting from restructuring and resizing of corporate operations post-separation. Corporate expense for the six months ended March 28, 2008 included net charges of $27 million comprised of a $20 million charge for a legacy legal settlement, $2 million of restructuring charges and $5 million of separation costs. Corporate expense for the six months ended March 30, 2007 included Separation related costs of $56 million and net restructuring and asset impairment charges of $18 million primarily related to the consolidation of certain headquarter functions. The remaining decrease in corporate expense is related to cost reduction initiatives and the restructuring program. We continue to target a full year corporate expense run rate of $500 million.

Interest income was $83 million and $25 million during the six months ended March 28, 2008 and March 30, 2007, respectively. The increase in interest income is primarily related to interest earned on the class action settlement escrow of $47 million.

Interest expense was $232 million in the six months ended March 28, 2008 as compared to $130 million in the six months ended March 30, 2007. The increase in interest expense is primarily related to interest on the class action settlement liability of $47 million, and to a lesser extent increased costs related to our bridge loan and revolving credit facilities.

In the six months ended March 30, 2007, net interest amounts were proportionally allocated to Covidien and Tyco Electronics based on the debt amounts that we believe were utilized by Covidien and Tyco Electronics historically inclusive of amounts directly incurred, and is included in discontinued operations. Allocated net interest was calculated using our historical weighted-average interest rate on debt, including the impact of interest rate swap agreements. The portion of Tyco's interest income and interest expense allocated to Covidien and Tyco Electronics was $29 million and $181 million respectively.

Other income, net for the six months ended March 28, 2008 includes $40 million recorded in connection with the adoption of Financial Accounting Standards Board ("FASB") Interpretation ("FIN") No. 48, "Accounting for Uncertain Income Taxes—an interpretation of FASB Statement No. 109," with a corresponding increase to the receivable from Covidien and Tyco Electronics under the Tax Sharing Agreement, as the Company concluded that this was an indirect effect of adopting a new accounting standard. In addition, $10 million for other activity was recorded through the second quarter of 2008 in accordance with the Tax Sharing Agreement in other income, net.

Our effective income tax rate was 24.3% and 7.7% during the six months ended March 28, 2008 and March 30, 2007, respectively. Enacted tax law changes during the six months ended March 28, 2008 negatively impacted non-U.S. deferred tax assets. Additionally, the six months ended March 30, 2007 were favorably impacted by the release of a deferred tax valuation allowance related to non-U.S. tax rulings received during the period and reduced reserve requirements on certain legacy tax matters.

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 Tyco Electronics 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 legally 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 Tyco Electronics' tax liabilities. See Note 14 to the Consolidated Financial Statements for further discussion of guarantees and indemnifications extended between Tyco, Covidien and Tyco Electronics.

During the third quarter of 2007, the IRS concluded its field examination of certain of Tyco's U.S. federal income tax returns for the years 1997 though 2000 and issued anticipated Revenue Agents' Reports ("RARs") which reflect the IRS' determination of proposed tax adjustments for the periods under audit. The RAR's propose tax audit adjustments to certain of the Company's previously filed tax return positions. The Company agreed with the IRS on adjustments totaling $498 million, with an estimated cash impact to the Company of $458 million, and during the third quarter of 2007, the Company paid $458 million, of which $163 million related to the Company's discontinued operations. The Company appealed other proposed tax audit adjustments totaling approximately $1 billion relating to Tyco, Covidien and Tyco Electronics, and, as Audit Managing Party as specified in the Tax Sharing Agreement, the Company intends to vigorously defend its prior filed tax return positions.

During the second quarter of 2008, the IRS issued additional RARs asserting a withholding tax liability of approximately $106 million associated with the prior proposed tax adjustments related to Tyco, Covidien and Tyco Electronics. The amount related to Tyco is immaterial. The Company, as Audit Managing Party as specified in the Tax Sharing Agreement, intends to vigorously defend its prior filed tax return positions and determined that no adjustment is required to the Company's guarantees and indemnifications liability recorded in conjunction with the Tax Sharing Agreement discussed in Guarantees within Management's Discussion and Analysis of Financial Condition and Results of Operations. Additionally, the IRS is auditing of the prior tax returns of the Company which includes

legal entities of Tyco, Covidien and Tyco Electronics for the 2001 to 2004 period. The Company will manage the audit as Audit Managing Party.

In connection with the adoption of FIN No. 48, the Company reassessed its related uncertain tax positions for recognition and measurement and has made any necessary adjustments. Those adjustments were not material. The Company believes that the amounts recorded in its financial statements relating to these tax adjustments are sufficient. However, the ultimate resolution of these matters is uncertain and could result in a material impact to the Company's financial position, results of operations, cash flows or effective tax rate in future reporting periods.

In January 2008, the Company sold a European manufacturer of public address products and acoustic systems and recorded an $8 million pre-tax loss on sale.

All of the above businesses met the held for sale and discontinued operations criteria and have been included in discontinued operations in all periods presented.

During the third quarter of 2007, Tyco completed the Separation and has presented its Healthcare and Electronics businesses as discontinued operations in all periods prior to the completion of the Separation in June 2007.

The Company has used available information to develop its best estimates for certain assets and liabilities related to the Separation. In limited instances, final determination of the balances will be made in subsequent periods. During the six months ended March 28, 2008, $18 million was recorded through shareholders' equity, primarily related to adjustments to certain pre-Separation tax liabilities. Adjustments may be recorded to shareholders' equity in the future for the impact of filing final income tax returns in certain jurisdictions where those returns include a combination of Tyco, Covidien and/or Tyco Electronics legal entities and for certain amended income tax returns for the periods prior to the Separation.

The preparation of the Consolidated Financial Statements in conformity with 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 the six months ended March 28, 2008, there were 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 28, 2007 (the "2007 Form 10-K") other than the adoption of FIN No. 48.

The sources of our cash flow from operating activities and the use of a portion of that cash in our operations were as follows ($ in millions):

The net change in working capital decreased operating cash flow by $46 million in the quarter ended March 28, 2008. The significant changes in working capital included a $68 million decrease in accounts payable, a $36 million increase in accounts receivable, and a $31 million increase in inventory, offset by a $29 million decrease in other current assets, primarily related to deposits.

The net change in working capital decreased operating cash flow by $856 million in the six months ended March 28, 2008. The components of this change are set forth in detail in the Consolidated Statements of Cash Flows. The significant changes in working capital included a $325 million decrease in accrued and other liabilities, primarily related to bonus accruals, accrued warranties, and accrued restructuring, a $206 million decrease in accounts payable, a $149 million increase in inventories and a $107 increase in accounts receivable.

During the quarter ended March 28, 2008, Tyco released $2,960 million of funds placed in escrow during the third quarter of 2007 as well as $60 million of interest earned on those funds for the benefit of the class as stipulated in the Court's final order to the class action settlement.

During the six months ended March 28, 2008, we purchased approximately 182,000 customer contracts for electronic security services through the ADT dealer program for cash of $187 million.

During the six months ended March 28, 2008, we completed the sale of NDC for $50 million in net cash proceeds.

We continue to fund capital expenditures to improve the cost structure of our businesses, to invest in new processes and technology, and to maintain high quality production standards. The level of capital expenditures in 2008 is expected to exceed the spending levels in 2007 and is also expected to exceed depreciation.

During the quarter and six months ended March 28, 2008, we repurchased 6.6 million and 12.0 million of our common shares for $245 million and $475 million, respectively, under the $1.0 billion share repurchase program approved by the Board of Directors in September 2007.

During the quarter ended December 29, 2006, we launched a $350 million to $400 million company-wide restructuring program. Since the inception of this program, the Company has incurred charges of $263 million related to this program. During the quarter and six months ended March 28, 2008, we paid $34 million and $77 million, respectively, in cash related to these restructuring activities. See Note 3 to our Consolidated Financial Statements for further information regarding our restructuring activities.

Income taxes paid, net of refunds, related to continuing operations was $114 million and $276 million during the quarter and six months ended March 28, 2008 and $105 million and $166 million during the quarter and six months ended March 30, 2007.

As previously discussed, effective June 29, 2007, we completed the Separation. In connection with the Separation, we paid $18 million and $64 million in separation costs during the quarter and six months ended March 28, 2008, respectively. All cash payments in the quarter were included in cash flows from operations and $36 million of the cash payments made during the six months were included in discontinued operating activities. During the quarter and six months ended March 30, 2007, we paid $87 million and $172 million in separation costs, including $66 million and $131 million included in cash provided by discontinued operating activities, respectively.

As previously discussed, we have been very active in refining our portfolio and have announced several divestitures which are expected to generate proceeds of approximately $980 million by the end of 2008. We plan to use the expected proceeds from these sales, as well as the cash generated by our operations, to continue to make investments in our businesses that are intended to grow revenue and improve productivity, including our restructuring actions. We expect to also use cash to selectively pursue acquisitions such as the recently announced purchase of FirstService Security, which we expect will strengthen our ADT business. Additionally, we expect to continue to return any excess cash to our shareholders through share repurchases and dividend payments. Since March 28, 2008, we repurchased an additional 3.1 million common shares for $145 million under our share repurchase program.

We also anticipate that the pending settlement of our bondholder litigation will result in a consent payment to the bondholders of $250 million, which is expected to be paid during the third quarter of 2008.

Management believes that cash generated by or available to Tyco should be sufficient to fund its capital and liquidity needs for the foreseeable future, including quarterly dividend payments and the remainder of its $1 billion share repurchase program.

Shareholders' equity was $16.0 billion, or $32.94 per share, at March 28, 2008, compared to $15.6 billion, or $31.50 per share, at September 28, 2007. Shareholders' equity increased due to net income of $643 million and favorable changes in foreign currency exchange rates of $339 million, partially offset by the repurchase of common shares by a subsidiary of $477 million and dividends declared of $147 million.

Total debt was $4.5 billion at March 28, 2008 and September 28, 2007, respectively. Total debt as a percentage of total capitalization (total debt and shareholders' equity) was 22% at both March 28, 2008 and September 28, 2007.

Our cash balance decreased to $1.1 billion at March 28, 2008, as compared to $1.9 billion at September 28, 2007. The decrease in cash was primarily due to the repurchase of common shares, capital expenditures, dividends paid, and accounts purchased from the ADT dealer network. This decrease was offset by cash generated by the operating segments.

As previously discussed, in September 2007, the Board of Directors approved a $1.0 billion share repurchase program. Pursuant to the 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.

Dividend payments were $148 million in the first six months of 2008 and $395 million in the first six months of 2007. The timing, declaration and payment of future dividends to holders of our common shares falls within the discretion of our Board of Directors and will depend upon many factors, including the statutory requirements of Bermuda law, our financial condition and results of operations, the capital requirements of our businesses, industry practice and any other factors the Board of Directors deems relevant.

On April 25, 2007, we, certain of our subsidiaries and a syndicate of banks entered into a 364-day unsecured bridge loan facility. This facility has a variable interest rate based on LIBOR. The margin over LIBOR payable by Tyco International Finance S.A. ("TIFSA"), a wholly-owned subsidiary of the Company and successor company to Tyco International Group S.A., a wholly-owned subsidiary of the Company organized under the laws of Luxembourg ("TIGSA"), can vary based on changes in our credit rating. On October 1, 2007, the commitments with respect to the unused portion of our unsecured bridge loan facility expired, but were subsequently renewed as described below. As of March 28, 2008, no amounts were outstanding under the bridge loan facility.

Our unsecured revolving credit facility and our letter of credit facility described below provide the lenders under those facilities with the right to demand repayment of outstanding amounts, and to terminate commitments to extend additional credit, if (i) certain of our outstanding public debt is declared due and payable and (ii) we do not have sufficient liquidity available under our unsecured bridge loan facility to refinance such debt. As a result, on November 27, 2007, we secured additional firm commitments from certain of our lenders under the bridge loan facility. These additional commitments provide us with sufficient liquidity to repay the outstanding public debt with borrowings of up to $4.0 billion. The additional commitments expire on, and any borrowings under the facility would mature on, November 25, 2008. The facility may only be used to repay, settle or otherwise extinguish the public debt described above, which is the subject of ongoing litigation between us and the trustee for such public debt. On April 11, 2008, we reached a preliminary agreement with firms that claim to hold or advise holders of approximately 80% of the notes to settle the litigation. For more information regarding such litigation, see Part II, Item 1. Legal Proceedings—Indenture Trustee Litigation.

In addition to signing the bridge loan facility, on April 25, 2007, we, certain of our subsidiaries and a syndicate of banks entered into a 5-year $1.25 billion unsecured revolving credit facility. This revolving credit facility will be used for working capital, capital expenditures and other corporate

purposes. At March 28, 2008, $725 million was outstanding under the unsecured revolving credit facility, with $367 million of the proceeds drawn on the revolver used to repay the bridge loan facility. This facility has a variable interest rate based on LIBOR. The margin over LIBOR payable by TIFSA can vary based on changes in our credit rating.

TIFSA's bank credit agreements contain customary terms and conditions, and financial covenants that limit the ratio of our debt to our earnings before interest, taxes, depreciation, and amortization and that limit our ability to incur subsidiary debt or grant liens on our property. Our indentures contain customary covenants including limits on negative pledges, subsidiary debt and sale/leaseback transactions and will contain change-of-control provisions if the consent solicitations related to the Indenture Trustee Litigation described in Part II, Item 1. Legal Proceedings are successful. None of these covenants are considered restrictive to our business. We believe we are in compliance with all of our debt covenants. The indenture trustee under indentures dated as of June 9, 1998 and November 12, 2003, is contesting whether the Separation transactions were permitted under such indentures. On April 11, 2008, we reached a preliminary agreement with firms that claim to hold or advise holders of approximately 80% of the notes to settle the litigation. See Part II, Item 1. Legal Proceedings—Indenture Trustee Litigation.

In connection with this program, the following short-term debt ratings were issued:

For a detailed discussion of contingencies related to our litigation matters and governmental investigations related to us, see Note 9 to our Consolidated Financial Statements.

At March 28, 2008, Tyco had a backlog of unfilled orders of $9.6 billion, compared to a backlog of $9.0 billion at September 28, 2007. Backlog by segment was as follows ($ in millions):

	March 28, 2008		September 28, 2007
ADT Worldwide	$	6,268	$	6,137
Flow Control		1,906		1,579
Fire Protection Services		1,132		1,048
Electrical and Metal Products		152		113
Safety Products		153		137

	$	9,611	$	9,014

Within ADT Worldwide, backlog increased primarily as a result of recurring revenue-in-force, which represents 12 months' fees for monitoring and maintenance services under contract in the security business. The amount of recurring revenue-in-force at March 28, 2008 and September 28, 2007 was $4.03 billion and $3.93 billion, respectively. Flow Control had increased bookings mostly in the Asia-Pacific and Americas regions. Backlog within Fire Protection Services increased primarily as a result of increased orders in Asia and North America.

Certain of Tyco's international businesses utilize the sale of accounts receivable as short-term financing mechanisms. The aggregate amount outstanding under the Company's remaining international accounts receivable programs was $74 million and $76 million at March 28, 2008 and September 28, 2007, respectively.

There are certain guarantees or indemnifications extended between Tyco, Covidien and Tyco Electronics 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. See Note 4 to the Consolidated Financial Statements for further discussion of 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 accordance with FIN No. 45. To value the initial obligation under FIN No. 45 related to the Tax Sharing Agreement, the Company considered a range of discounted probability-weighted future cash flows, which included an estimated premium to reflect the cost an independent insurance carrier or guarantor would charge to assume such obligation, related to the unresolved (asserted and unasserted) pre-separation shared tax matters of Covidien and Tyco Electronics. The liability necessary to reflect the fair value of the guarantees and indemnifications under the Tax Sharing Agreement is $554 million, which is included in other liabilities on our Consolidated Balance Sheets.

In addition, Tyco historically provided support in the form of financial and/or performance guarantees to various Covidien and Tyco Electronics operating entities. In connection with the

Separation, the Company worked with the guarantee counterparties to cancel or assign these guarantees to Covidien or Tyco Electronics. To the extent these guarantees were not assigned prior to the Separation date, Tyco assumed primary liability on any remaining such support. The estimated fair values of these obligations are $7 million, which are included in other liabilities on our Consolidated Balance Sheets, and were recorded in accordance with FIN No. 45.

The Company records estimated product warranty costs at the time of sale. For further information on estimated product warranty, see Note 14 to the Consolidated Financial Statements.

Recently Adopted Accounting Pronouncements—In June 2006, the Financial Accounting Standards Board ("FASB") issued Financial Accounting Standards Board Interpretation ("FIN") No. 48, "Accounting for Uncertainty in Income Taxes—an interpretation of FASB Statement No. 109." This Interpretation prescribes a comprehensive model for the financial statement recognition, measurement, presentation and disclosure of uncertain tax positions taken or expected to be taken in income tax returns. FIN No. 48 became effective for Tyco in the first quarter of 2008. As a result of adopting FIN No. 48, Tyco increased its reserve for uncertain tax positions by $55 million and reduced its deferred tax assets by $24 million with a corresponding $79 million cumulative effect adjustment to shareholders' equity. See Note 4 to the Consolidated Financial Statements for additional information related to the adoption of FIN No. 48.

In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option for Financial Assets and Financial Liabilities." SFAS No. 159 permits an entity, on a contract-by-contract basis, to make an

irrevocable election to account for certain types of financial instruments and warranty and insurance contracts at fair value, rather than historical cost, with changes in the fair value, whether realized or unrealized, recognized in earnings. SFAS No. 159 is effective for Tyco in the first quarter of 2009. The Company is currently assessing the impact that SFAS No. 159 will have on the results of its operations, financial position or cash flows.

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 efficiencies, product expansion, backlog, the consummation and benefits of acquisitions and divestitures or other matters, 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 and foreign currency exchange rates has not changed materially from our exposure discussed in the 2007 Form 10-K. In order to manage the volatility relating to our more significant market risks, we enter into forward foreign currency exchange contracts and foreign currency options.

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/A2 long-term debt rating.

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures, as defined under Exchange Act Rule 13a-15(e). Based on this evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that, as of March 28, 2008, our disclosure controls and procedures were not effective because of a material weakness in our internal controls over financial reporting as of September 28, 2007, relating to accounting for income taxes, which we view as an integral part of our disclosure controls and procedures as discussed in Part II, Item 9A. Controls and Procedures in Form 10-K to the Annual Report on Form 10-K for the year ended September 28, 2007.

Over the past five years, significant internal control, informational systems and process improvements have been implemented in our tax accounting processes, including certain recently implemented controls in response to the identified material weakness. Over the last several quarters, the following significant changes were made to our internal controls over financial reporting:

While progress has been made, several new tax accounting and control procedures have only recently been implemented and our current environment is still characterized by a highly complex structure of approximately 1,200 legal entities. In light of this, the Company believes the material weakness relating to accounting for income taxes has not been remediated and the Company plans to implement further improvements to achieve appropriate levels of controls, reliability and sustainability in this area.

In addition to the above, we proactively identify opportunities for control improvements. We have ongoing initiatives to standardize, consolidate and upgrade various financial operating systems and eliminate many of the manual and redundant tasks previously performed under older systems or processes. These changes will be implemented in stages over the next several years.

During 2008, we have continued to focus on our internal controls over accounting for income taxes, and are taking further steps to those mentioned earlier to strengthen controls, including the following planned actions:

Except as discussed below, there have been no material developments in the Company's legal proceedings that have occurred during the quarter ended March 28, 2008. For a description of the Company's previously reported legal proceedings, refer to Part I, Item 3. Legal Proceedings, in the 2007 Form 10-K and to Part II, Item 1. Legal Proceedings, in the Form 10-Q for the quarter ended December 28, 2007.

As previously reported in our periodic filings, Tyco and certain of our former directors and officers have been named as defendants in over 40 purported securities class action suits. We stipulated, pursuant to a court order, that each party to the Separation and Distribution Agreement would be primarily liable for a portion of the obligations arising from such litigation. The stipulation also provides that if any party defaults on its obligations, the other parties would be jointly and severally liable for those obligations. Most of the securities class actions have now been transferred to the United States District Court for the District of New Hampshire by the Judicial Panel on Multidistrict Litigation for coordinated or consolidated pretrial proceedings. A consolidated securities class action complaint was filed in these proceedings and on June 12, 2006, the court entered an order certifying a class "consisting of all persons and entities who purchased or otherwise acquired Tyco securities between December 13, 1999 and June 7, 2002, and who were damaged thereby, excluding defendants, all of the officers, directors and partners thereof, members of their immediate families and their legal representatives, heirs, successors or assigns, and any entity in which any of the foregoing have or had a controlling interest."

On December 19, 2007, the United States District Court for the District of New Hampshire entered a final order approving the settlement of 32 purported securities class action lawsuits. All legal contingencies that could have affected the final order approving the settlement expired on February 21, 2008. The settlement did not purport to resolve the following securities cases, which remain outstanding and are discussed below: Hess v. Tyco International Ltd., et al., Stumpf v. Tyco International Ltd., New Jersey v. Tyco International Ltd., et al., Ballard v. Tyco International Ltd., Sciallo v. Tyco International Ltd., et al., Jasin v. Tyco International Ltd., et al., Hall v. Kozlowski, et al. and Davis v. Kozlowski et al. The settlement does not release claims arising under the Employee Retirement Income Security Act of 1974 ("ERISA"), which are not common to all Class Members, including any claims asserted in Overby, et al. v. Tyco International Ltd. In addition, individuals and entities totaling approximately 4% of the shares owned by the class members have opted-out of the settlement.

Under the terms of the settlement, the plaintiffs agreed to release all claims against Tyco, the other settling defendants and ten other individuals in consideration for the payment of $2.975 billion from Tyco to the certified class and assignment to the class of any net recovery of any claims possessed by Tyco and the other settling defendants against Tyco's former auditor, PricewaterhouseCoopers. Defendant PricewaterhouseCoopers was not a settling defendant and is not a party to the memorandum. However, PricewaterhouseCoopers subsequently agreed to participate in the settlement as a settling defendant, and in consideration of a release of all claims against it by the parties to the settlement, agreed to make a payment of $225 million. We and the other settling defendants have denied and continue to deny any wrongdoing and legal liability arising from any of the facts or conduct alleged in the actions.

Pursuant to the terms of the settlement, L. Dennis Kozlowski, Mark H. Swartz and Frank E. Walsh, Jr., also are excluded from the settling defendants, and the class will assign to Tyco all of their

claims against defendants Kozlowski, Swartz and Walsh. In exchange, we will agree to pay to the certified class 50% of any net recovery against these defendants.

The deadline for deciding not to participate in the class settlement was September 28, 2007. As of such date, Tyco received opt-out notices from individuals and entities totaling approximately 4% of the shares owned by class members. A number of these individuals and entities have filed claims separately against Tyco. Any judgments resulting from such claims or from claims that are filed in the future would not reduce the settlement amount. Generally, the claims asserted by these plaintiffs include claims similar to those asserted by the settling defendants; namely, violations of the disclosure provisions of federal securities laws. Tyco intends to vigorously defend any litigation resulting from opt-out claims. While it is not possible to predict the final outcome of unresolved opt-out cases, should any of these cases result in an adverse judgment or be settled for a significant amount, they could have a material adverse effect on our financial position, results of operations or cash flows.

Since all legal contingencies that could have affected the settlement were exhausted on February 21, 2008, the administration and distribution of the settlement funds in escrow are now managed by the counsel of the certified class and Tyco is not subject to any further liability related to the class action settlement. As such, Tyco has extinguished the class action liability and no longer has claim to the escrow account. The escrow accounts earned interest that was payable to the class. As such, interest was also accrued on the class action settlement liability. On February 21, 2008, the class action liability and escrow accounts balances including interest were each $3.02 billion.

As previously reported in our periodic filings, an action entitled Hess v. Tyco International Ltd., et al., was filed on June 3, 2004 in the Superior Court of the State of California for the County of Los Angeles against certain of our former directors and officers, our former auditors and Tyco, which was subsequently amended. The amended complaint asserts claims of fraud, negligent representation, aiding and abetting breach of fiduciary duty, and breach of fiduciary duty in connection with, and subsequent

to, an underlying settlement of litigation brought by shareholders in Progressive Angioplasty Systems, Inc. where the plaintiffs received our stock as consideration. The amended complaint alleges collective losses of not less than $20 million and seeks compensatory and punitive damages. Discovery in this action is ongoing.

As previously reported in our periodic filings, on October 30, 2003, Stumpf v. Tyco International Ltd. was transferred to the District Court of New Hampshire by the Judicial Panel on Multidistrict Litigation. The complaint asserts claims against Tyco based on Sections 11 and 15 of the Securities Act of 1933 and Sections 10(b) and 20(a) of the Securities and Exchange Act of 1934. Discovery in this action is ongoing.

As previously reported in our periodic filings, on November 27, 2002 the State of New Jersey, on behalf of several state pension funds, filed a complaint, New Jersey v. Tyco International Ltd., et al., in the United States District Court for the District of New Jersey against Tyco, our former auditors and certain of our former officers and directors, which was subsequently amended. Plaintiffs assert that the defendants violated federal and state securities laws, committed common law fraud, breached fiduciary duties, violated certain RICO statutes and otherwise engaged in fraudulent acts by making materially false and misleading statements and omissions concerning, among other things, the following: unauthorized and improper compensation of certain of our former executives; their improper use of our funds for personal benefit and their improper self-dealing in real estate. On April 29, 2008, the Company signed a definitive agreement with the plaintiff to settle this lawsuit. The agreement calls for the Company to make a payment of $73.25 million to the plaintiffs in exchange for the plaintiff's agreement to dismiss the case against the Company and certain of its former directors and a former employee. Pursuant to the Separation and Distribution Agreement, the Company's share of the settlement amount is approximately $20 million, with Covidien and Tyco Electronics responsible for approximately $30 million and $23 million, respectively. The Company has recorded the settlement and related receivables from each of Covidien and Tyco Electronics for their respective shares of the settlement amount in its fiscal second quarter resulting in a net charge to selling, general and administrative expenses for its share of the settlement of approximately $20 million. Payment of the settlement amount is to be made on or before June 2, 2008. Upon the full execution of the definitive agreement by each of the other defendants party thereto and payment of the $73.25 million, the parties shall file the agreed upon order of dismissal with the Court, the entry of which will dismiss the litigation with prejudice. The Company expects to pay the full amount of the settlement to the State and concurrently receive payment from Covidien and Tyco Electronics.

As previously reported in our periodic filings, on January 20, 2004, a complaint was filed in the United States District Court for the Southern District of New York, Ballard v. Tyco International Ltd., et al. Plaintiffs are trustees of various trusts that were allegedly major shareholders of AMP, Inc., a company acquired by Tyco in April 1999. Plaintiffs name as defendants Tyco, five of its former officers and directors and PricewaterhouseCoopers LLP ("PWC"). As against all defendants, the complaint asserts causes of action under Sections 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, and Section 11 of the Securities Act of 1933. As against the Tyco defendants, the complaint asserts causes of action under Section 14(a) of the Securities Exchange Act and Rule 14a-9 promulgated thereunder; Section 12(a)(2) of the Securities Act; and for common law fraud and negligent misrepresentation. As against the individual defendants, the complaint asserts causes of action under Section 20(a) of the Securities Exchange Act and Section 15 of the Securities Act. The complaint alleges that defendants engaged in a scheme to artificially inflate Tyco's earnings and to mislead investors as to Tyco's positive earnings, growth and acquisition synergies prior to and in connection with its acquisition of AMP, Inc. The Judicial Panel on Multidistrict Litigation has transferred the action to the District of New Hampshire and discovery in this action is ongoing.

As previously reported in our periodic filings, a complaint, Sciallo v. Tyco International Ltd., et al., was filed on September 30, 2003 in the United States District Court for the Southern District of New

York. The plaintiffs purport to be former executives of U.S. Surgical who traded their U.S. Surgical stock options for Tyco International, Ltd. stock options when Tyco acquired U.S. Surgical on October 1, 1998. Plaintiffs name as defendants Tyco International Ltd. and certain former Tyco directors and executives. The complaint asserts causes of action under Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, for common law fraud and negligence, and violation of New York General Business Law Section 349, which prohibits deceptive acts and practices in the conduct of any business. The complaint alleges that defendants made materially false and misleading statements and omissions concerning, among other things, Tyco's financial condition and accounting practices. The Judicial Panel on Multidistrict Litigation has transferred this action to the United States District Court for the District of New Hampshire and discovery in this action is ongoing.

As previously reported in our periodic filings, a complaint was filed on September 2, 2004 in the Court of Common Pleas for Dauphin County, Pennsylvania, Jasin v. Tyco International Ltd., et al. This pro se plaintiff named as additional defendants Tyco International (US) Inc., and certain of our former executives. Plaintiff's complaint asserts causes of action under Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, as well as Section 11 of the Securities Act of 1933. Claims against our former executives are also asserted under Section 14(a) of the Securities Exchange Act of 1934 and Rule 14a-9 promulgated thereunder and Section 20A of the Securities Exchange Act of 1934, as well as Sections 11, 12(a)(2) and 15 of the Securities Act of 1933. Plaintiff also asserts common law fraud, negligent misrepresentation, unfair trade practice, breach of contract, breach of the duty of good faith and fair dealing and violation of Section 1-402 of the Pennsylvania Securities Act of 1972. The Judicial Panel on Multidistrict Litigation has transferred this action to the United States District Court for the District of New Hampshire and discovery in this action is ongoing.

As previously reported in our periodic filings, the Judicial Panel on Multidistrict Litigation has transferred Hall v. Kozlowski, et al. an action relating to plaintiff's employment, 401(k) and pension plans and ownership of Tyco stock, to the United States District Court for the District of New Hampshire. Discovery in this action is ongoing.

As previously reported in our periodic filings, on October 16, 2007, Tyco filed a cross-motion to dismiss Davis v. Kozlowski et al., a class action originally filed on December 9, 2003 on behalf of holders of Tyco common shares that asserted claims based on alleged violations of state securities laws. In June 2007, the Judicial Panel on Multidistrict Litigation transferred the case to the United States District Court for the District of New Hampshire and on February 20, 2008, the Court granted a motion to dismiss that Tyco had filed in December 2007.

As previously reported in our periodic filings, Tyco and certain of our current and former employees, officers and directors, have been named as defendants in eight class actions brought under the Employee Retirement Income Security Act ("ERISA"). Two of the actions were filed in the United States District Court for the District of New Hampshire and the six remaining actions were transferred to that Court by the Judicial Panel on Multidistrict Litigation. All eight actions have been consolidated in the District Court in New Hampshire. The consolidated complaint purports to bring claims on behalf of our Retirement Savings and Investment Plans and the participants therein and alleges that the defendants breached their fiduciary duties under ERISA by negligently misrepresenting and negligently failing to disclose material information concerning, among other things, the following: related-party transactions and executive compensation; our mergers and acquisitions and the accounting therefore, as well as allegedly undisclosed acquisitions; and misstatements of our financial results. The complaint also asserts that the defendants breached their fiduciary duties by allowing the Plans to invest in our shares when it was not a prudent investment. The complaints seek recovery of alleged plan losses arising from alleged breaches of fiduciary duties. On August 15, 2006, the Court entered an order certifying a class "consisting of all Participants in the Plans for whose individual accounts the Plans purchased and/or

held shares of Tyco Stock Fund at any time from August 12, 1998 to July 25, 2002." On January 11, 2007, plaintiffs filed a motion, assented to by Tyco that proposed an agreed upon form of notice. On January 18, 2007, the Court granted that motion. On December 5, 2006, plaintiffs filed a motion seeking leave to file an amended complaint. Subsequently, on January 10, 2007, plaintiffs filed a motion to withdraw their motion to amend the complaint without prejudice. Discovery in this action is ongoing.

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.

Tyco International Ltd. v. L. Dennis Kozlowski. As previously reported in our periodic filings, we filed a civil complaint against our former Chairman and Chief Executive Officer for breach of fiduciary duty and other wrongful conduct, which was subsequently amended. The amended complaint alleges that the defendant misappropriated millions of dollars from our Key Employee Loan Program and relocation program; awarded millions of dollars in unauthorized bonuses to himself and certain other Tyco employees; engaged in improper self-dealing real estate transactions involving our assets; and conspired with certain other former Tyco employees in committing these acts. The amended complaint alleges causes of action for breach of fiduciary duty, fraud, unjust enrichment, breach of contract, conversion, constructive trust, and other wrongful conduct. The amended complaint seeks recovery for all of the losses suffered by us as a result of the former Chairman and Chief Executive Officer's conduct, and of all remuneration, including restricted and unrestricted shares and options, obtained by Mr. Kozlowski during the course of this conduct. The Judicial Panel on Multidistrict Litigation has transferred this action to the United States District Court for the District of New Hampshire. Discovery in this and the other affirmative cases is proceeding.

Mr. Kozlowski was tried on criminal charges in New York County. The first criminal trial resulted in a mistrial declared on April 2, 2004. The retrial of Mr. Kozlowski began on January 18, 2005 and concluded on June 17, 2005, when the jury returned verdicts. Of the thirty-one counts submitted to it, which were similar to certain of the claims alleged in the Company's affirmative action described above, twenty-two were against Mr. Kozlowski. The jury found Mr. Kozlowski guilty on all charges of grand larceny, conspiracy and securities fraud, and all but one count of falsification of business records. On September 19, 2005, Mr. Kozlowski was sentenced to a term of imprisonment of eight and one-third years to twenty-five years, and ordered to pay an individual fine of $70 million and restitution, jointly

and severally with Mr. Swartz, to Tyco of $134 million within one year. On September 19, 2005, Mr. Kozlowski filed a notice of appeal from his conviction. On January 2, 2007, by order of the Supreme Court of the State of New York, the New York County District Attorney's office released to Tyco, on behalf of Mr. Kozlowski, $98 million in restitution. The payment by Mr. Kozlowski was made pending the outcome of his appeal, which was denied on November 15, 2007. However, on February 29, 2008, the New York State Court of Appeals agreed to review Mr. Kozlowksi's case. A hearing date has not yet been scheduled.

Tyco International Ltd. v. Mark H. Swartz. As previously reported in our periodic filings, we filed an arbitration claim against Mark H. Swartz, our former Chief Financial Officer and director, on October 7, 2002. As a consequence of Mr. Swartz's refusal to submit to the jurisdiction of the American Arbitration Association, we filed a civil complaint against him on April 1, 2003, for breach of fiduciary duty and other wrongful conduct. The action alleges that the defendant misappropriated millions of dollars from our Key Employees Loan Program and relocation program; approved and implemented awards of millions of dollars of unauthorized bonuses to himself and certain other Tyco employees; awarded millions of dollars in unauthorized payments to himself; engaged in improper self dealing real estate transactions involving our assets; and conspired with certain other former Tyco employees in committing these acts. The complaint alleges causes of action for breach of fiduciary duty, fraud, unjust enrichment, conversion, and constructive trust, and other wrongful conduct. The action seeks recovery for all of the losses suffered by us as a result of the former Chief Financial Officer and director's conduct, and all remuneration, including restricted and unrestricted shares and options, obtained by Mr. Swartz during the course of this conduct. The Judicial Panel on Multidistrict Litigation transferred this action to the United States District Court for the District of New Hampshire. Discovery in this and the other affirmative cases is proceeding.

Mr. Swartz was tried on criminal charges in New York County. The first criminal trial resulted in a mistrial declared on April 2, 2004. The retrial of Mr. Swartz began on January 18, 2005 and concluded on June 17, 2005, when the jury returned verdicts. Of the thirty-one counts submitted to it, which were similar to certain of the claims alleged in the Company's affirmative action described above, twenty-three were against Mr. Swartz. The jury found Mr. Swartz guilty on all charges of grand larceny, conspiracy and securities fraud, and all but one count of falsification of business records. On September 19, 2005, Mr. Swartz was sentenced to a term of imprisonment of eight and one-third years to twenty-five years, and ordered to pay an individual fine of $35 million and restitution, jointly and severally with Mr. Kozlowski, to Tyco of $134 million within one year and Mr. Swartz was ordered individually to pay damages to Tyco in the amount of $1 million. On September 19, 2005, Mr. Swartz filed a notice of appeal from his conviction. On October 27, 2006, Mr. Swartz paid restitution to the Company in the amount of $38 million. The payment by Mr. Swartz was made pending the outcome of his appeal, which was denied on November 15, 2007. However, on February 29, 2008, the New York State Court of Appeals agreed to review Mr. Swartz's case. A hearing date has not yet been scheduled.

Tyco International Ltd. v. L. Dennis Kozlowski and Mark H. Swartz. As previously reported in our periodic filings, we filed a civil complaint against our former Chairman and Chief Executive Officer and former Chief Financial Officer and Director pursuant to Section 16(b) of the Securities and Exchange Act of 1934 for disgorgement of short-swing profits from prohibited transactions in our common shares believed to exceed $40 million. The action seeks disgorgement of profits, interest, attorney's fees and costs. The Judicial Panel on Multidistrict Litigation has transferred this action to the United States District Court for the District of New Hampshire. Discovery in this and the other affirmative cases is proceeding.

Tyco International Ltd. v. Frank E. Walsh, Jr. As previously reported in our periodic filings, we filed a civil complaint against Frank E. Walsh, Jr., a former director, for breach of fiduciary duty and related wrongful conduct involving receipt by Mr. Walsh of a $20 million payment in connection with

our 2001 acquisition of the CIT Group, Inc. The action alleges causes of action for restitution, breach of fiduciary duty and inducing breach of fiduciary duty, conversion, unjust enrichment, and a constructive trust, and seeks recovery for all of the losses suffered by us as a result of the defendant director's conduct. On December 17, 2002, Mr. Walsh paid $20 million in restitution to Tyco, which was deposited by the Company in January 2003, as a result of a plea bargain agreement with the New York County District Attorney. Our claims against Mr. Walsh are still pending. The Judicial Panel on Multidistrict Litigation has transferred this action to the United States District Court for the District of New Hampshire. Discovery in this and the other affirmative cases is proceeding.

As previously reported in our periodic filings, we and others have received various subpoenas and requests from the SEC, the U.S. Department of Labor, state departments of labor, the General Service Administration and others seeking the production of voluminous documents in connection with various investigations into our governance, management, operations, accounting and related controls. We are cooperating with these investigations and are complying with these requests.

Certain of our current and former employees received subpoenas from the SEC's Division of Enforcement seeking testimony related to past accounting practices for the ADT dealer connect fees. The investigation, which began in June 2002, related to accounting practices employed by our former management. As previously reported in our periodic filings, these practices have been discontinued.

As previously reported in our periodic filings, in November 2004, we received an order from the SEC to report facts and circumstances involving our participation, if any, in the United Nations Oil for Food Program governing sales of Iraqi oil. On January 10, 2005 and November 8, 2005, we responded to the order and provided information concerning transactions under the United Nations Oil for Food Program. On January 31, 2006, we received a subpoena from the SEC to produce additional documents and information related to the participation of three of our businesses in the United Nations Oil for Food Program. The SEC notified us on June 7, 2006 that it was not recommending any enforcement action against Tyco in connection with its investigation of the United Nations Oil for Food Program. Subsequently, we discovered additional product sales that may be responsive to the SEC's order and notified the SEC staff that we intend to investigate these transactions. While it is not possible at this time to predict the final outcome of this matter, we do not believe this discovery will have a material adverse effect on the Company's financial position, results of operations or cash flows.

The U.S. Department of Labor served document subpoenas on Tyco and Fidelity Management Trust Company for documents concerning the administration of our Retirement Savings and Investment Plans. The current focus of the Department's inquiry concerns the losses allegedly experienced by the plans due to investments in our stock. The Department of Labor has authority to bring suit on behalf of the plans and their participants against those acting as fiduciaries to the plans for recovery of losses and additional penalties, although it has not informed us of any intention to do so. The Company is continuing to cooperate with the Department's investigation.

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 March 28, 2008, Tyco concluded that it was probable that it would incur remedial costs in the range of approximately $36 million to $63 million. As of March 28, 2008, Tyco concluded that the best estimate within this range is approximately $39 million, of which $7 million is included in accrued and other current liabilities and $32 million is included in other liabilities on Tyco's Consolidated Balance Sheets. In view of the Company's financial

position and reserves for environmental matters, the Company believes that any potential payment of such estimated amounts will not have a material adverse effect on its financial position, results of operations or cash flows.

As previously reported in its periodic filings, Tyco and some of its subsidiaries and certain subsidiaries of Covidien are named as defendants in personal injury lawsuits based on alleged exposure to asbestos-containing materials. Pursuant to the Separation and Distribution Agreement, Covidien has assumed all liabilities for pending cases filed against Covidien's subsidiaries. Each case typically names between dozens to hundreds of corporate defendants. The complaints generally seek monetary damages for personal injury or bodily injury resulting from alleged exposure to products containing asbestos. The Company will continue to vigorously defend the lawsuits that have been filed against it and its subsidiaries, but cannot predict whether it will be successful in those cases that proceed to trial. When appropriate, the Company settles claims. Although in the past the total amount paid in any year to settle and defend all asbestos claims has been immaterial, Tyco has recently experienced an increase in the number of lawsuits that have proceeded to trial. Of the lawsuits that have proceeded to trial in 2008, Tyco has won or settled all but one case, with that one case returning an adverse jury verdict for approximately $7.7 million, which included both compensatory and punitive damages. Tyco intends to appeal this verdict and believes that the jury verdict will be overturned. As of March 28, 2008 there were approximately 5,800 asbestos liability cases pending against the Company and its subsidiaries.

During the second quarter of 2008, the IRS issued additional RARs asserting a withholding tax liability of approximately $106 million associated with the prior proposed tax adjustments related to Tyco, Covidien and Tyco Electronics. The amount related to Tyco is immaterial. The Company as Auditing Managing Party as specified in the Tax Sharing Agreement, intends to vigorously defend its prior filed tax return positions and determined that no adjustment is required to the Company's guarantees and indemnifications liability recorded in conjunction with the Tax Sharing Agreement as discussed in Guarantees within Management's Discussion and Analysis of Financial Condition and Results of Operations.

The IRS proposed civil fraud penalties against a prior subsidiary that was distributed to Tyco Electronics arising from alleged actions of former executives in connection with certain intercompany

transfers of stock of Simplex Technologies in 1998 and 1999. Based on statutory guidelines, we estimate the proposed penalties could range between $30 million and $50 million. The Company, as Audit Managing Party, will vigorously oppose the assertion of any such penalties against Tyco Electronics, in part, because beginning in 2003 the Company discovered, investigated and reported the conduct at issue to the IRS and fully cooperated in the criminal prosecution of the Company's former Chief Tax Officer on a charge of willful filing of a false tax return.

As previously reported in our periodic filings, we have received and responded to various allegations and other information that certain improper payments were made by our subsidiaries in recent years. As previously reported, we have been informed that two subsidiaries in our Flow Control business in Italy have been named in a request for criminal charges filed by the Milan public prosecutor's office. We have reported to the U.S. Department of Justice ("DOJ") and the SEC the investigative steps and remedial measures that we have taken in response to the allegations. We also informed the DOJ and the SEC that we retained outside counsel to perform a company-wide baseline review of our policies, controls and practices with respect to compliance with the Foreign Corrupt Practices Act ("FCPA"), that we would continue to make periodic progress reports to these agencies, and that we would present our factual findings upon conclusion of the baseline review. We have 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 payments identified by us in the course of our ongoing compliance activities. Covidien and Tyco Electronics agreed, in connection with the Separation, to cooperate with the Company in its response to these allegations. To date, the baseline review has revealed that some business practices may not comply with Tyco and FCPA requirements. At this time, we cannot predict the outcome of these matters and other allegations reported to regulatory and law enforcement authorities and therefore cannot estimate the range of potential loss or extent of risk, if any, that may result from an adverse resolution of these matters. However, it is possible that we may be required to pay material fines, consent to injunctions on future conduct, or suffer other penalties or adverse impacts, each of which could have a material adverse effect on our financial position, results of operations or cash flows.

The German Federal Cartel Office ("FCO") charged in early 2007 that certain German subsidiaries in Tyco's Flow Control business had engaged in anti-competitive practices, in particular with regard to its hydrant, valve, street box and fittings business. Tyco investigated this matter and determined that the conduct may have violated German anti-trust law. Tyco is cooperating with the FCO in its investigation of this violation. Tyco 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 our financial position, results of operations or cash flows.

indebtedness (the "Notes") were issued, commenced an action against Tyco International Group S.A. ("TIGSA") and Tyco in the United States District Court for the Southern District of New York captioned The Bank of New York v. Tyco International Group S.A. BONY served an amended complaint on October 18, 2007, which added Tyco International Finance S.A. ("TIFSA") as an additional defendant. As amended, the complaint alleges that the Separation of the Electronics and Healthcare businesses and related assets and liabilities of Tyco and its subsidiaries and the distribution of such Electronics and Healthcare businesses and related assets and liabilities to Tyco's shareholders, breached the Indentures and seeks damages in excess of $4.1 billion on behalf of noteholders. The amended complaint also seeks a judgment declaring that BONY was not required to sign supplemental indentures proposed by TIGSA, TIFSA and Tyco in connection with the Separation that added TIFSA as a co-obligor on the Notes issued under the Indentures and transferred TIGSA's obligations under the Indentures to Tyco. BONY also seeks a declaratory judgment that TIGSA is obligated to pay BONY reasonable compensation and to reimburse BONY for all reasonable expenses, including attorneys' fees incurred in connection with the Separation and in resolving the proper interpretation of the Indentures. Tyco and TIFSA filed counterclaims against BONY, alleging that its refusal to sign the supplemental indentures in connection with the Separation and the filing of the amended complaint constituted a breach of the Indentures and a breach of the duty of good faith and fair dealing implied in the Indentures. Tyco and TIFSA seek unspecified damages on these claims. Tyco and TIFSA also seek a declaratory judgment that no default has occurred and that BONY is required to sign the supplemental indentures proposed by TIGSA, TIFSA and Tyco.

On April 11, 2008, Tyco reached a preliminary agreement with firms that claim to hold or advise the holders of approximately 80% of the Notes to settle this litigation. In exchange for dismissal of the lawsuit and waiver of any alleged default, the agreement calls for Tyco to make an aggregate cash payment of $250 million to the holders of the Notes. Tyco has also agreed to offer to exchange certain series of such indebtedness (Notes that are due in 2028 and 2029) for Notes with maturities in 2019 and 2021, respectively. As a result, Tyco has commenced a consent solicitation seeking a waiver from noteholders under the Indentures of any and all alleged defaults under the Indentures. The consent solicitation would also provide all noteholders with the right to require Tyco to repurchase the debt outstanding under the Indentures at a fixed price under certain circumstances in the event of a change

in control. In addition, Tyco has commenced the exchange offer described above only to qualified institutional buyers pursuant to Rule 144A. The new Notes issued in the exchange will have substantially the same terms as the existing Notes (as amended in accordance with the consent solicitation), with the exception of the shortened maturities described above.

London Transport's Blackwall Tunnel. FCL seeks damages for breach of contract in the amount of approximately $38 million. Tyco intends to defend this action vigorously. While it is not possible at this time to predict the final outcome of this dispute, Tyco does not believe this action will have a material adverse effect on its financial position, results of operations or cash flows. Trial is expected to begin in November 2008.

Tyco's significant business risks are described in Part I, Item IA in our 2007 Form 10-K, to which reference is made herein. Management believes that there have been no significant changes in the Company's risk factors since the Company filed the 2007 Form 10-K.

The transactions described in the table above primarily 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 September 2007. The average price paid per share is calculated by dividing the total cash paid for the shares by the total number of shares repurchased. Approximately $469 million remained outstanding under this share repurchase program at March 28, 2008. The Company, through an affiliate, also acquires shares from certain employees in order to satisfy employee tax withholding requirements in connection with the vesting of restricted shares. Approximately 44,900 shares were acquired in these vesting-related transactions outside of the share repurchase program during the quarter ended March 28, 2008.

The 2008 Annual General Meeting of Shareholders (the "Meeting") of the Company was held on March 13, 2008.

At the Meeting, a total of 409,652,321 common shares (83.4% of outstanding common shares as of the record date, January 2, 2008) were voted. The three Company proposals submitted at the Meeting were passed as described below.

The following is a brief description of each matter voted upon at the Meeting. Percentages indicated below reflect the percentage of the total number of common shares voted at the Meeting.

The following is a tabulation of the votes submitted in respect of Proposal 1 of the Proxy Statement. Proxies giving discretion to the chairman of the Meeting were voted in favor of each candidate. There were zero broker non-votes.

Proposal 2. A proposal to re-appoint Deloitte & Touche LLP as the independent auditors and to authorize the Audit Committee to set the auditors' remuneration:

A total of 403,590,602 shares (98.5%) were voted for and 1,623,681 shares (0.40%) were voted against this proposal. There were 4,438,038 abstentions and zero broker non-votes.

Proposal 3. A proposal to approve amendments to the Company's Amended & Restated Bye-Laws:

A total of 403,094,240 shares (98.4%) were voted for and 1,136,776 shares (0.28%) were voted against this proposal. There were 5,421,305 abstentions and zero broker non-votes.

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 March 28, 2008
or
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Bermuda (Jurisdiction of Incorporation)		98-0390500 (I.R.S. Employer Identification Number)
Second Floor, 90 Pitts Bay Road, Pembroke, HM 08, Bermuda (Address of Registrant's principal executive offices)
441-292-8674 (Registrant's telephone number)

			March 28, 2008		September 28, 2007
Assets
Current Assets:
	Cash and cash equivalents		$	1,074	$	1,894
	Accounts receivable, less allowance for doubtful accounts of $208 and $194, respectively			3,137		2,945
	Inventories			2,025		1,811
	Class action settlement escrow			—		2,992
	Prepaid expenses and other current assets			1,761		1,632
	Assets of discontinued operations			983		1,084

		Total current assets		8,980		12,358
Property, plant and equipment, net				3,613		3,543
Goodwill				11,922		11,636
Intangible assets, net				2,636		2,697
Other assets				2,723		2,581

		Total Assets	$	29,874	$	32,815

Liabilities and Shareholders' Equity
Current Liabilities:
	Loans payable and current maturities of long-term debt		$	525	$	380
	Accounts payable			1,516		1,665
	Class action settlement liability			—		2,992
	Accrued and other current liabilities			3,316		3,470
	Liabilities of discontinued operations			526		598

		Total current liabilities		5,883		9,105
Long-term debt				3,977		4,082
Other liabilities				3,985		3,937

		Total Liabilities		13,845		17,124

Commitments and Contingencies (Note 9)
Minority interest				55		67
Shareholders' Equity:
	Common shares, $0.80 par value, 1,000,000,000 shares authorized; 485,183,892 and 496,301,846 shares outstanding, net of 13,333,248 and 1,277,449 shares owned by subsidiaries, respectively			388		397
	Capital in excess:
		Share premium		9,209		9,189
		Contributed surplus		5,029		5,439
	Accumulated earnings			433		34
	Accumulated other comprehensive income			915		565

		Total Shareholders' Equity		15,974		15,624

		Total Liabilities and Shareholders' Equity	$	29,874	$	32,815

				For the Six Months Ended
				March 28, 2008			March 30, 2007
Cash Flows From Operating Activities:
Net income				$	643		$	1,628
	Income from discontinued operations, net of income taxes				(10	)		(1,306	)

Income from continuing operations					633			322
Adjustments to reconcile net cash provided by operating activities:
	Depreciation and amortization				566			592
	Non-cash compensation expense				57			81
	Deferred income taxes				(105	)		(93	)
	Provision for losses on accounts receivable and inventory				61			44
	Other non-cash items				43			18
	Changes in assets and liabilities, net of the effects of acquisitions and divestitures:
		Accounts receivable, net			(107	)		(67	)
		Inventories			(149	)		(280	)
		Other current assets			(24	)		164
		Accounts payable			(206	)		(51	)
		Accrued and other liabilities			(325	)		(50	)
		Class action settlement liability			(3,020	)		—
		Other			(45	)		32

			Net cash (used in) provided by operating activities		(2,621	)		712

			Net cash provided by discontinued operating activities		4			1,696

Cash Flows From Investing Activities:
Capital expenditures					(356	)		(299	)
Proceeds from disposal of assets					10			10
Acquisition of businesses, net of cash acquired					(27	)		(16	)
Accounts purchased from ADT dealer network					(187	)		(176	)
Liquidation of rabbi trust investments					—			271
Class action settlement escrow					2,960			—
Other					(9	)		43

			Net cash provided by (used in) investing activities		2,391			(167	)

			Net cash provided by (used in) discontinued investing activities		14			(505	)

Cash Flows From Financing Activities:
Proceeds from issuance of short-term debt					—			195
Repayment of short-term debt					(371	)		—
Proceeds from issuance of long-term debt					667			—
Repayment of long-term debt, including debt tenders					(256	)		(2	)
Proceeds from exercise of share options					21			212
Dividends paid					(148	)		(395	)
Repurchase of common shares by subsidiary					(477	)		(668	)
Transfer from discontinued operations					19			1,083
Other					(69	)		13

			Net cash (used in) provided by financing activities		(614	)		438

			Net cash used in discontinued financing activities		(18	)		(1,077	)

Effect of currency translation on cash					24			21
Effect of currency translation on cash related to discontinued operations					—			19

Net (decrease) increase in cash and cash equivalents					(820	)		1,137
Less: net increase in cash related to discontinued operations					—			(133	)
Cash and cash equivalents at beginning of period					1,894			2,193

Cash and cash equivalents at end of period				$	1,074		$	3,197

		Number of Common Shares		Common Shares $0.80 Par Value			Share Premium		Contributed Surplus			Accumulated Earnings			Accumulated Other Comprehensive Income		Total
Balance at September 29, 2006		498		$	398		$	8,787	$	14,493		$	10,692		$	1,017	$	35,387
Comprehensive income:
	Net income												1,628					1,628
	Currency translation															476		476
	Unrealized gain on marketable securities, net of income taxes of $1 million															2		2
	Minimum pension liability, net of income taxes of $23 million															35		35

	Total comprehensive income																	2,141
Dividends declared													(395	)				(395	)
Share options exercised, including tax benefit of $25 million		2			2			210		25								237
Repurchase of common shares by subsidiary		(5	)		(4	)				(664	)							(668	)
Compensation expense										159								159

Balance at March 30, 2007		495		$	396		$	8,997	$	14,013		$	11,925		$	1,530	$	36,861

		Number of Common Shares		Common Shares $0.80 Par Value			Share Premium		Contributed Surplus			Accumulated Earnings			Accumulated Other Comprehensive Income		Total
Balance at September 28, 2007		496		$	397		$	9,189	$	5,439		$	34		$	565	$	15,624
Comprehensive income:
	Net income												643					643
	Currency translation															339		339
	Unrealized gain on marketable securities and derivative instruments, net of income taxes of $2 million															4		4
	Change in net actuarial loss and prior service credit, net of income taxes of $3 million															7		7

	Total comprehensive income																	993
Dividends declared													(147	)				(147	)
Share options exercised, including tax benefit of $3 million		1			1			20		3								24
Repurchase of common shares by subsidiary		(12	)		(10	)				(467	)							(477	)
Compensation expense										53								53
Exchange of convertible debt										1								1
Adoption of FIN No. 48 (see Note 4)													(79	)				(79	)
Other													(18	)				(18	)

Balance at March 28, 2008		485		$	388		$	9,209	$	5,029		$	433		$	915	$	15,974

	ADT Worldwide		Flow Control		Fire Protection Services			Electrical and Metal Products		Safety Products			Corporate and Other		Total
Balance at September 28, 2007	$	5,025	$	1,975	$	1,495		$	1,054	$	2,082		$	5	$	11,636
Acquisitions		2		11		—			—		6			—		19
Divestitures		—		—		(17	)		—		(5	)		—		(22	)
Currency translation		125		125		26			2		11			—		289

Balance at March 28, 2008	$	5,152	$	2,111	$	1,504		$	1,056	$	2,094		$	5	$	11,922

		March 28, 2008					September 28, 2007
		Gross Carrying Amount		Accumulated Amortization		Weighted Average Amortization Period	Gross Carrying Amount		Accumulated Amortization		Weighted Average Amortization Period
Amortizable:
	Contracts and related customer relationships	$	6,024	$	3,820	14 years	$	5,808	$	3,565	14 years
	Intellectual property		550		382	15 years		542		354	15 years
	Other		21		16	15 years		20		14	11 years

	Total	$	6,595	$	4,218	14 years	$	6,370	$	3,933	14 years

Non-Amortizable:
	Intellectual property	$	254				$	255
	Other		5					5

	Total	$	259				$	260

		Tyco International Ltd.			Tyco International Finance S.A.			Other Subsidiaries			Consolidating Adjustments			Total
Net revenue		$	—		$	—		$	4,866		$	—		$	4,866
Cost of product sales			—			—			2,196			—			2,196
Cost of services			—			—			990			—			990
Selling, general and administrative expenses			29			—			1,176			—			1,205
Separation costs			5			—			(10	)		—			(5	)
Restructuring and asset impairment charges, net			—			—			37			—			37

	Operating (loss) income		(34	)		—			477			—			443
Interest income			14			—			11			—			25
Interest expense			(14	)		(95	)		(6	)		—			(115	)
Other (expense) income, net			(1	)		1			—			—			—
Equity in net income of subsidiaries			690			405			—			(1,095	)		—
Intercompany interest and fees			(382	)		45			337			—			—

	Income from continuing operations before income taxes and minority interest		273			356			819			(1,095	)		353
Income taxes			—			24			(103	)		—			(79	)
Minority interest			—			—			(1	)		—			(1	)

	Income from continuing operations		273			380			715			(1,095	)		273
Income from discontinued operations, net of income taxes			7			5			7			(12	)		7

	Net income	$	280		$	385		$	722		$	(1,107	)	$	280

		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	$	(3,571	)	$	243		$	707		$	—		$	(2,621	)
	Net cash provided by discontinued operating activities		—			—			4			—			4
Cash Flows From Investing Activities:
Capital expenditures			—			—			(356	)		—			(356	)
Proceeds from disposal of assets			—			—			10			—			10
Acquisition of businesses, net of cash acquired			—			—			(27	)		—			(27	)
Accounts purchased from ADT dealer network			—			—			(187	)		—			(187	)
Class action settlement escrow			2,960			—			—			—			2,960
Intercompany dividend from subsidiary			—			62			—			(62	)		—
Increase in intercompany loans			—			(279	)		—			279			—
Other			—			—			(9	)		—			(9	)

	Net cash provided by (used in) investing activities		2,960			(217	)		(569	)		217			2,391
	Net cash provided by discontinued investing activities		—			—			14			—			14
Cash Flows From Financing Activities:
Net borrowings (repayments) of debt			—			50			(10	)		—			40
Proceeds from exercise of share options			20			—			1			—			21
Dividends paid			(148	)		—			—			—			(148	)
Intercompany dividend to parent			—			—			(62	)		62			—
Repurchase of common shares by subsidiary			—			—			(477	)		—			(477	)
Net intercompany loan borrowings (repayments)			724			—			(445	)		(279	)		—
Transfer from discontinued operations			—			—			19			—			19
Other			—			(76	)		7			—			(69	)

	Net cash provided by (used in) financing activities		596			(26	)		(967	)		(217	)		(614	)
	Net cash used in discontinued financing activities		—			—			(18	)		—			(18	)
Effect of currency translation on cash			—			—			24			—			24

Net decrease in cash and cash equivalents			(15	)		—			(805	)		—			(820	)
Cash and cash equivalents at beginning of period			16			—			1,878			—			1,894

Cash and cash equivalents at end of period		$	1		$	—		$	1,073		$	—		$	1,074

		Tyco International Ltd.			Tyco International Group S.A.			Other Subsidiaries			Consolidating Adjustments			Total
Cash Flows From Operating Activities:
	Net cash (used in) provided by operating activities	$	(652	)	$	1,084		$	280		$	—		$	712
	Net cash provided by discontinued operating activities		—			78			1,618			—			1,696
Cash Flows From Investing Activities:
Capital expenditures			—			—			(299	)		—			(299	)
Proceeds from disposal of assets			—			—			10			—			10
Acquisition of businesses, net of cash acquired			—			—			(16	)		—			(16	)
Accounts purchased from ADT dealer network			—			—			(176	)		—			(176	)
Liquidation of rabbi trust investments			—			—			271			—			271
Increase in intercompany loans			—			(541	)		—			541			—
Other			—			(2	)		45			—			43

	Net cash used in investing activities		—			(543	)		(165	)		541			(167	)
	Net cash used in discontinued investing activities		—			(78	)		(505	)		78			(505	)
Cash Flows From Financing Activities:
Net borrowings (repayments) of debt			—			195			(2	)		—			193
Proceeds from exercise of share options			190			—			22			—			212
Dividends paid			(395	)		—			—			—			(395	)
Repurchase of common shares by subsidiary			—			—			(668	)		—			(668	)
Net intercompany loan borrowings (repayments)			859			—			(318	)		(541	)		—
Transfer from discontinued operations			—			—			1,083			—			1,083
Other			—			—			13			—			13

	Net cash provided by financing activities		654			195			130			(541	)		438
	Net cash used in discontinued financing activities		—			—			(999	)		(78	)		(1,077	)
Effect of currency translation on cash			—			—			21			—			21
Effect of currency translation on cash related to discontinued operations			—			—			19			—			19

Net increase in cash and cash equivalents			2			736			399			—			1,137
Less: net increase in cash related to discontinued operations			—			—			(133	)		—			(133	)
Cash and cash equivalents at beginning of period			2			1,158			1,033			—			2,193

Cash and cash equivalents at end of period		$	4		$	1,894		$	1,299		$	—		$	3,197

Period	Total Number of Shares Purchased	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced or Programs Plans or Programs	Maximum Number of Shares That May Yet Be Purchased Under Publicly Announced Plans or Programs
12/29/07-1/25/08	6,567,132	$	37.37	6,565,419	—
1/26/08-2/29/08	4,983	$	40.03	—	—
3/1/08-3/28/08	38,230	$	41.20	—	—

	NUMBER OF VOTES FOR	% OF QUORUM		NUMBER OF VOTES WITHHELD
Dennis C. Blair	403,099,500	98.4	%	6,552,821
Edward D. Breen	402,316,594	98.2	%	7,335,727
Timothy M. Donahue	402,919,638	98.4	%	6,732,683
Brian Duperreault	403,330,110	98.5	%	6,322,211
Bruce S. Gordon	401,880,743	98.1	%	7,771,578
Rajiv L. Gupta	403,059,229	98.4	%	6,593,092
John A. Krol	403,385,019	98.5	%	6,267,302
Brendan R. O'Neill	401,794,726	98.1	%	7,857,595
William S. Stavropoulos	401,812,253	98.1	%	7,840,068
Sandra S. Wijnberg	403,369,095	98.5	%	6,283,226
Jerome B. York	386,401,697	94.3	%	23,250,624

Exhibit Number		Exhibit
2.1		Purchase Agreement, dated as of February 11, 2008, among AECOM Technology Corporation, Tyco International Finance S.A. and certain other seller parties thereto (Incorporated by reference to Exhibit 2.1 to the Registrant's Current Report on Form 8-K filed on February 13, 2008)
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).

		TYCO INTERNATIONAL LTD.
		By:	/s/ CHRISTOPHER J. COUGHLIN Christopher J. Coughlin Executive Vice President and Chief Financial Officer (Principal Financial Officer)