RISK FACTORS, continued
−Removed: DuPont, Historical Dow or DowDuPont executed a fraudulent conveyance in connection with divestitures and spin-offs of any one of their historical operations, including Chemours.
−Removed: If a court were to agree with such a plaintiff, then such court could void the Separation and Distribution as a fraudulent transfer or impose substantial liabilities on Corteva, which could materially adversely affect its financial condition and results of operations.
+Added: adversely affect its financial condition and results of operations.
Among other things, the court could return some of Corteva’s assets or shares of Corteva common stock to DuPont, provide DuPont with a claim for money damages against Corteva in an amount equal to the difference between the consideration received by DuPont and the fair market value of Corteva at the time of the Corteva Distribution, or require Corteva to fund liabilities of other companies involved in the Internal Reorganization and Business Realignment for the benefit of creditors.
21 unchanged sentences
Furthermore, under the terms of the Tax Matters Agreement, the company also generally will be responsible for any taxes imposed on DuPont or Dow that arise from the failure of the Corteva Distribution to qualify as tax-free for U.S.
−Removed: federal income tax purposes within the meaning of Section 355 of the Code or the
+Added: federal income tax purposes within the meaning of Section 355 of the Code or the failure of certain related transactions to qualify for tax-free treatment, to the extent such failure to qualify is attributable to actions, events or transactions relating to its, or its affiliates’, stock, assets or business, or any breach of its representations made in any representation letter provided to its counsel in connection with the tax opinion.
+Added: DuPont and Dow will be separately
RISK FACTORS, continued
−Removed: failure of certain related transactions to qualify for tax-free treatment, to the extent such failure to qualify is attributable to actions, events or transactions relating to its, or its affiliates’, stock, assets or business, or any breach of its representations made in any representation letter provided to its counsel in connection with the tax opinion.
−Removed: DuPont and Dow will be separately responsible for any taxes imposed on Corteva that arise from the failure of the Corteva Distribution to qualify as tax-free for U.S.
+Added: responsible for any taxes imposed on Corteva that arise from the failure of the Corteva Distribution to qualify as tax-free for U.S.
federal income tax purposes within the meaning of Section 355 of the Code or the failure of certain related transactions to qualify for tax-free treatment, to the extent such failure to qualify is attributable to actions, events or transactions relating to such company’s or its affiliates’ stock, assets or business, or any breach of such company’s representations made in connection with the IRS Ruling or in the representation letter provided to counsel in connection with the tax opinion.
2 unchanged sentences
To the extent that the company is responsible for any liability under the tax matters agreement, there could be a material adverse impact on Corteva’s business, financial condition, results of operations and cash flows in future reporting periods.
−Removed: The company agreed to numerous restrictions to preserve the tax-free treatment of the transactions separating it from DowDuPont in the United States, which may reduce Corteva’s strategic and operating flexibility.
−Removed: The company’s ability to engage in certain transactions is limited or restricted to preserve, for U.S.
−Removed: federal income tax purposes, the tax-free nature of the Distributions by DowDuPont, and certain aspects of the Internal Reorganization and Business Realignment.
−Removed: As a result of these limitations, under the Tax Matters Agreement that the company entered into with DuPont and Dow, for the two-year period following the Distribution, the company is prohibited, except in certain circumstances, from, among other things:
−Removed: • entering into any transaction resulting in acquisitions of a certain percentage of its assets, whether by merger or otherwise;
−Removed: • dissolving, merging, consolidating or liquidating;
−Removed: • undertaking or permitting any transaction relating to Corteva stock, including issuances, redemptions or repurchases other than certain, limited, permitted issuances and repurchases;
−Removed: • affecting the relative voting rights of Corteva stock, whether by amending Corteva’s certificate of incorporation or otherwise;
−Removed: • ceasing to actively conduct its business.
−Removed: These restrictions may significantly limit Corteva’s ability to pursue certain strategic transactions or other transactions that the company may believe to otherwise be in the best interests of its stockholders or that might increase the value of its business.
The IRS may assert that the Merger causes the Distributions and other related transactions to be taxable to DuPont, in which case the company could be subject to significant indemnification liability.
4 unchanged sentences
Notwithstanding the tax opinion and the IRS Ruling, the IRS could determine that the Distributions or a related transaction should nevertheless be treated as a taxable transaction to DuPont if it determines that any of the facts, assumptions, representations or undertakings of DowDuPont is not correct or that the Distributions should be taxable for other reasons, including if the IRS were to disagree with the conclusions in the tax opinion that are not covered by the private letter ruling.
−Removed: If DuPont is required to recognize corporate level tax on either of the Distributions and certain related transactions under Section 355(e) of the Code, then under the Tax Matters Agreement, the company may be required to indemnify DuPont and/or
−Removed: RISK FACTORS, continued
−Removed: Dow for all or a portion of such taxes, which could be a material amount, if such taxes were the result of either direct or indirect transfers of Corteva common stock or certain reasons relating to the overall structure of the Merger and the Distributions.
+Added: If DuPont is required to recognize corporate level tax on either of the Distributions and certain related transactions under Section 355(e) of the Code, then under the Tax Matters Agreement, the company may be required to indemnify DuPont and/or Dow for all or a portion of such taxes, which could be a material amount, if such taxes were the result of either direct or indirect transfers of Corteva common stock or certain reasons relating to the overall structure of the Merger and the Distributions.
The company is subject to continuing contingent tax-related liabilities of DowDuPont following the Distribution.
7 unchanged sentences
Other provisions of federal, state, local, or foreign law may establish similar liability for other matters, including laws governing tax-qualified pension plans, as well as other contingent liabilities.
−Removed: Corteva’s unaudited pro forma combined financial information is not necessarily representative of the results the company would have achieved as an independent, publicly traded company and may not be a reliable indicator of its future results.
−Removed: The unaudited pro forma financial information of Corteva included herein (refer to supplemental unaudited pro forma financial statements on page 51) may not reflect what Corteva’s financial condition, results of operations and cash flows would have been had the company been an independent, publicly traded company comprised solely of DowDuPont’s agriculture business during the periods presented.
−Removed: This is primarily because:
−Removed: • The historical financial information of Corteva does not reflect the changes that the company experienced in connection with the Separation, including the Distribution.
−Removed: • Prior to the Separation, Corteva’s business was operated under the corporate umbrella of DowDuPont.
−Removed: As part of the DowDuPont corporate organization, Corteva’s business was principally operated by Historical DuPont, with certain portions of its business being operated by Historical Dow as part of its internal corporate organization, rather than being operated as part of a consolidated agriculture business.
−Removed: • The historical financial information of Corteva reflects only corporate expenses of Historical DuPont and allocated corporate expenses from Historical Dow, and thus is not necessarily representative of the costs the company incurred for similar services as an independent company following the Separation.
−Removed: In addition, the unaudited pro forma financial information included in this annual report is based on a number of estimates and assumptions.
−Removed: These estimates and assumptions may prove to be inaccurate, and accordingly, Corteva’s unaudited pro forma financial information should not be assumed to be indicative of what the company’s financial condition or results of operations actually would have been as a standalone company during the time periods presented nor to be a reliable indicator of what its financial condition or results of operations actually may be in the future.
−Removed: For additional information about the unaudited pro forma financial statements, Historical DuPont’s past financial performance and the basis of presentation of Corteva’s financial statements, see Corteva’s consolidated financial statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations.
UNRESOLVED STAFF COMMENTS
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.