We recently announced the proposed separation of Urology, Acute Care and OEM businesses. We may encounter challenges to executing the proposed separation of our Urology, Acute Care and OEM businesses on the terms and within the timeframe we announced, or at all. The separation will be subject to the satisfaction of a number of customary conditions, including, but not limited to, the final approval from the Company’s Board of Directors, the filing and effectiveness of a registration statement on Form 10, the receipt of a favorable Internal Revenue Service ruling and tax opinion the Company’s tax advisor with respect to the tax-free nature of the separation, the satisfactory completion of financing arrangements and the receipt of any necessary regulatory approvals. The failure to satisfy any of the required conditions could delay the completion of the proposed separation for a significant period of time or prevent it from occurring at all. Additionally, it is complex in nature, and unanticipated developments or changes, including disruptions in general market conditions, changes in law or challenges in executing the separation of the two businesses, may affect our ability to complete the separation on the terms or on the timeline we announced, or at all. The terms and conditions of the required regulatory authorizations and consents that are granted, if any, may also impose requirements, limitations or costs, or place restrictions on the conduct of the independent companies or impact our ability to complete the separation on the terms or timeline we announced, or at all.
Although we intend for the proposed separation to be tax-free to the Company’s stockholders for U.S. federal income tax purposes, there can be no assurance that the proposed separation will qualify for such treatment. The IRS ruling and opinion described above will be each based upon various factual representations and assumptions, as well as certain undertakings made by the Company and the new independent company. If any of these factual representations or assumptions are, or become, untrue or incomplete in any material respect, an undertaking is not complied with, or the facts upon which the ruling and opinion are based are materially different from the actual facts relating to the separation, reliance on the ruling and opinion may be jeopardized. If the separation was ultimately determined to be taxable for U.S. federal income tax purposes, we would incur a significant tax liability, while the distribution of shares of the new independent company to the Company’s stockholders would become taxable to them for U.S. federal income tax purposes and the new independent company could incur income tax liabilities as well. In addition, even if the separation is tax-free for U.S. federal income tax purposes, the Company and the new independent company may incur state, local, non-U.S. and/or non-income taxes in connection with the separation, including as a result of the incorporation of the OECD’s Pillar Two global minimum tax framework into local country tax laws, which taxes may be significant.