CVS Caremark
Corporation CVS confirmed today that it has reached an agreement in
principle with the staff of the Boston Regional Office of the Securities and
Exchange Commission (SEC) to resolve an investigation by the SEC of certain
events that occurred in 2009. This investigation, which CVS Caremark
previously disclosed after it began in 2011, has focused on events that
occurred in the third and fourth quarters of 2009, including certain public
disclosures made by the Company, transactions in the Company's securities by
certain current and former employees and certain aspects of the purchase
accounting adjustment related to the October 2008 Longs Drug Stores
acquisition. The agreement in principle was reached following extensive
discussions with the SEC over the last several months. The settlement remains
subject to completion of final documentation and approval by the Commission
and federal court.
The settlement will be entered into by the Company on a "no admit or deny"
basis and will resolve a number of alleged violations of the Securities Act of
1933 and the Securities Exchange Act of 1934, including certain anti-fraud
provisions of those statutes. Under the terms of the agreement in principle,
CVS Caremark will pay a $20 million civil penalty, which has been fully
reserved in CVS Caremark's financial statements. The settlement will not
require CVS Caremark to restate its earnings for any reporting period.
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