Exhibit 99.1

 

Dear Flex Ltd. Shareholder,

We are pleased to announce a significant strategic initiative for Flex Ltd. (“Flex”). As part of our ongoing commitment to creating value and sharpening our focus on core business priorities, Flex intends to separate its current offerings across power, cooling, and cloud into an independent, publicly traded company, Axiom Solutions International, Inc. (“Axiom”).

The completion of this spin-off is subject to the approval of Flex’s Board of Directors, our shareholders, and the High Court of the Republic of Singapore (“High Court Approval”). Upon receiving these approvals and completing the transaction, Flex will continue to advance its leadership as a diversified technology, manufacturing, and supply chain partner, while Axiom will emerge as a leading provider of critical infrastructure technologies built around power delivery, advanced cooling, and rack-scale integration for high-density computing and industrial applications.

The spin-off will be effected through a distribution of between approximately 88.0% to 94.0% of all issued and outstanding shares of Axiom common stock, by way of a distribution in specie to Flex shareholders of record on a pro rata basis as of the record date of the Distribution (the “Distribution Record Date”). For every      ordinary shares in the capital of Flex (“Flex ordinary shares”) held as of the Distribution Record Date, each Flex shareholder will receive      shares of Axiom common stock. Axiom shares will be issued in book-entry form only; no physical share certificates will be distributed. The Distribution will be effected by way of a court-approved capital reduction (the “Capital Reduction”) under the Companies Act 1967 of Singapore (the “Singapore Companies Act”).

Following the separation, Flex’s ordinary shares will continue to trade on Nasdaq under the symbol “FLEX” and, subject to requisite approvals, Axiom common stock is expected to be listed on the Nasdaq Stock Market LLC (“Nasdaq”) under the symbol “AXM.” You do not need to take any action or pay any consideration to receive your Axiom shares, nor will you need to surrender or exchange your Flex shares.

We expect the Distribution of Axiom common stock to be tax-free to Flex shareholders for U.S. federal income tax purposes, except for any cash received in lieu of fractional shares. We recommend that you consult your tax advisor regarding the specific tax consequences of the Distribution, including any state, local, or non-U.S. tax implications.

We encourage you to review the enclosed information statement, which provides important information about the spin-off, Axiom’s business, financial condition, and operations, as well as the Distribution process.

Flex’s Board of Directors believes this separation will maximize value for all Flex shareholders by creating two focused companies—Flex, which can concentrate more fully on the high-complexity markets where its capabilities and scale create the greatest advantage, and Axiom, dedicated to supporting the growing demand for power-dense infrastructure across data center, utility, industrial, and edge applications. We thank you for your continued commitment to Flex and look forward to your support of both Flex and Axiom in the future.

Sincerely,

The Board of Directors of Flex Ltd.

Dear Future Axiom Shareholder,

I am pleased to introduce Axiom Solutions International, Inc. (“Axiom”), a new independent company formed from Flex Ltd.’s power, cooling, and cloud businesses. Axiom, a leader in critical digital and electrical infrastructure, develops and manufactures end-to-end infrastructure technologies built around power delivery, advanced cooling, and rack-scale integration for high-density computing and industrial applications.

Demand for digital infrastructure is increasing power density, compressing deployment timelines, and raising system complexity. These trends are driving the need for coordinated power, cooling, and integration delivered as factory-built, scalable infrastructure. Axiom is designed to address these requirements through capabilities spanning utility and facility power infrastructure, embedded power systems, advanced liquid cooling, and rack-scale integration.

As an independent company, Axiom brings deep expertise across power, thermal management, and infrastructure integration with an integrated portfolio that enables faster time-to-capacity, improved reliability, and improved performance at scale. In this new chapter, Axiom will focus on expanding these capabilities, deepening customer relationships, and scaling our global engineering and manufacturing footprint. We believe this focus positions Axiom to support the growing demand for power-dense infrastructure across data center, utility, industrial, and edge applications.

Thank you for your interest and support.

Sincerely,

Revathi Advaithi

Chief Executive Officer

Axiom Solutions International, Inc.

 

believe that the information in this information statement is accurate as of the date set forth on the cover. Changes to the information contained in this information statement may occur after that date, and none of us, Flex, the Spinco Board of Directors (as defined herein) or the Flex Board of Directors (as defined herein) undertake any obligation to update such information, except in the normal course of our and Flex’s public disclosure obligations and practices and as required by applicable federal securities laws.

At the time our registration statement, of which this information statement is a part, is declared effective by the United States Securities and Exchange Commission (the “SEC”), Spinco will become subject to the information and reporting requirements of the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (the “Exchange Act”), and, in accordance with the Exchange Act, we will file periodic reports (including Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K), proxy statements, and other information with the SEC. The SEC maintains a website, www.sec.gov, that contains periodic reports, proxy statements and information statements and other information regarding issuers, like us, that file electronically with the SEC. We encourage you to review our periodic reports, proxy statements and information statements and any other information we file with the SEC when they are made available, as they will contain important information about Spinco, in particular for periods after the date of this information statement.

In reviewing the information statement, you should carefully consider the matters described under the caption “Risk Factors” beginning on page 34.

Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this information statement is truthful or complete. Any representation to the contrary is a criminal offense.

This information statement does not constitute an offer to sell or the solicitation of an offer to buy any securities.

This information statement is first being made available to Flex shareholders on or about     , 2026, and a Notice of Internet Availability of Information Statement Materials containing instructions describing how to access this information statement was first mailed to Flex shareholders on or about     , 2026. This information statement will be mailed to Flex shareholders who previously elected to receive a paper copy of Flex’s materials.

 

 

The date of this information statement is     , 2026.

TABLE OF CONTENTS

 

SUMMARY OF HISTORICAL AND UNAUDITED PRO FORMA COMBINED FINANCIAL DATA			19
QUESTIONS AND ANSWERS ABOUT THE SEPARATION AND DISTRIBUTION			23
RISK FACTORS			34
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS			69
THE SEPARATION AND DISTRIBUTION			70
UNITED STATES FEDERAL INCOME TAX CONSEQUENCES OF THE DISTRIBUTION			82
DIVIDEND POLICY			86
CAPITALIZATION			87
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION			88
NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION			93
BUSINESS			104
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS			114
MANAGEMENT			138
COMPENSATION DISCUSSION AND ANALYSIS			147
DIRECTOR COMPENSATION			193
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS			194
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT			203
DESCRIPTION OF MATERIAL INDEBTEDNESS			205
DESCRIPTION OF CAPITAL STOCK			206
WHERE YOU CAN FIND MORE INFORMATION			236
INDEX TO COMBINED FINANCIAL STATEMENTS			F-1

 

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PRESENTATION OF INFORMATION

Unless otherwise indicated or the context otherwise requires, references in this information statement to:

 

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“we,” “us,” “our,” “Axiom,” “Spinco,” and the “Company” refer to Axiom Solutions International, Inc., a Texas corporation and its subsidiaries.

 

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“Bonus Issuance” refers to issuance of Bonus Shares in the proportion to be determined by the Flex Board of Directors in their sole discretion of such number of Bonus Share(s) for every existing Flex ordinary share(s) held by each Flex shareholder of record as of the Record Date, on a pari passu basis, fractions of a Bonus Share to be disregarded.

 

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“Bonus Shares” refers to the new ordinary shares in the capital of Flex to be allotted and issued pursuant to the Bonus Issuance, and each, a “Bonus Share.”

 

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“Capital Reduction” refers to the court-approved capital reduction to be carried out by Flex pursuant to Section 78G of the Singapore Companies Act in order to effect the Distribution.

 

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“Cloud & Power Infrastructure business” refers to Flex’s cloud and power infrastructure business.

 

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“Distribution” refers to the distribution of between approximately 88.0% to 94.0% of all of the then issued and outstanding shares of Spinco common stock to be carried out by Flex by way of a distribution in specie to Flex shareholders on a pro rata basis based on the number of Flex ordinary shares held by each such Flex shareholder of record as of the Distribution Record Date.

 

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“Distribution Date” refers to the date of the Distribution, which is expected to be on or about     , 2027.

 

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“Effective Time” refers to 12:01 a.m., New York City Time, on the Distribution Date.

 

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“Flex” or “RemainCo” refers to Flex Ltd., a Singapore-incorporated public company limited by shares (company registration no. 199002645H), or, as the case may be, Flex Ltd. and its subsidiaries.

 

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“Flex Board of Directors” refers to the board of directors of Flex.

 

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“Flex business” refers to the business, activities, and operations of Flex other than the Cloud & Power Infrastructure business, in each case as conducted prior to the Distribution Date by Flex or Spinco (or any of their respective predecessors).

 

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“Flex ordinary shares” refers to the ordinary shares in the capital of Flex.

 

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“Flex shareholders” refers to holders of record of Flex ordinary shares in their capacity as such.

 

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“Flex Shareholder Approvals” refers to the affirmative vote by the holders of (i) a simple majority of the Flex ordinary shares present and voting (in person or by proxy) at the extraordinary general meeting of Flex in favor of the Bonus Issuance and (ii) at least three-fourths of the Flex ordinary shares present and voting (in person or by proxy) at the extraordinary general meeting of Flex in favor of the Capital Reduction and Distribution.

 

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“Internal Reorganization” refers to the allocation, transfer, or conveyance by Flex of the entities, assets, and liabilities in advance of the Distribution so that Spinco and its subsidiaries are allocated, transferred, or conveyed the entities, assets, and liabilities of the Cloud & Power Infrastructure business, while the remaining entities, assets, and liabilities will remain with Flex.

 

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“High Court Approval” refers to the approval of the High Court of the Republic of Singapore of the Capital Reduction.

 

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“Person” refers to any natural person, firm, individual, corporation, business trust, joint venture, association, bank, land trust, trust company, company, limited liability company, partnership or other organization or entity, whether incorporated or unincorporated, or any governmental entity.

 

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“Record Date” or “Distribution Record Date” refers to the date to be set by the Flex Board of Directors or an officer authorized to make such determination by the Board to determine the Flex shareholders eligible to receive the Bonus Shares or, as the case may be, the distribution of Spinco common stock.

 

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“RemainCo Group” refers to (i) RemainCo, (ii) each Person (other than any member of the Spinco Group) that is a direct or indirect subsidiary of RemainCo immediately prior to the Distribution (but after giving effect to the Internal Reorganization) and (iii) each Person that becomes a subsidiary of RemainCo following the Distribution; provided that the RemainCo Group shall not include the Persons on Schedule 1.1(179) of the Separation Agreement (as defined below).

 

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“RemainCo Protected Customer” refers to any customer of the RemainCo Restricted Business as conducted immediately prior to the Effective Time.

 

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“RemainCo Restricted Business” refers to contract manufacturing services generally, but shall exclude (i) integration of modular power equipment and associated enclosures and (ii) contract manufacturing services in the Cloud & Compute business. For the avoidance of doubt the RemainCo Restricted Business includes contract manufacturing services for the Power, Cooling, and Networking product businesses, in any jurisdiction worldwide.

 

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“Restricted Period” refers to the three-year period following the Distribution.

 

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“Singapore Companies Act” refers to the Companies Act 1967 of Singapore, as amended or modified.

 

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“Spinco Board of Directors” refers to the board of directors of the Company.

 

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“Spinco Cash Distribution” shall mean the cash distribution in an amount equal to the outstanding Indebtedness incurred by Flex in connection with its acquisition of EPC Power Corp. to be made, or caused to be made by Spinco to RemainCo.

 

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“Spinco common stock” refers to the shares of common stock, par value $0.0001 per share, of Spinco.

 

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“Spinco Financing Arrangements” refers to the bridge loan, term loan or other indebtedness for borrowed money to be incurred by Spinco immediately prior to or substantially concurrently with the effective time of the Distribution on terms and conditions reasonably acceptable to Flex.

 

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“Spinco Group” refers to (a) Spinco, (b) each Person (other than any member of the RemainCo Group) that is a direct or indirect subsidiary of Spinco immediately prior to the Distribution (but after giving effect to the Internal Reorganization) and (c) each Person that becomes a subsidiary of Spinco following the Distribution, including those Persons listed on Schedule 1.1(179) under the caption “Subsidiaries” of the Separation Agreement.

 

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“Spinco Protected Customers” refers to any customer of the Spinco Restricted Business as conducted immediately prior to the Effective Time.

 

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“Spinco Restricted Business” refers to (i) the Power business, excluding contract manufacturing services; (ii) the Cooling business, excluding contract manufacturing services; and (iii) the Cloud & Compute business, including contract manufacturing services generally and, for the avoidance of doubt, including contract manufacturing services related to CPU and AI-accelerated servers, compute trays, fabrication of associated racks and enclosures, and integration into those racks, but shall exclude contract manufacturing services for Networking products, in any jurisdiction worldwide.

 

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“Spin-Off” refers to the separation of the Cloud & Power Infrastructure business from Flex’s other businesses following the Internal Reorganization, the Distribution and the creation, as a result of the separation and distribution, of an independent, publicly traded company, Axiom Solutions International, Inc., holding the entities, assets and liabilities associated with the Cloud & Power Infrastructure business.

 

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Spinco’s historical assets, liabilities, products, businesses, or activities generally refer to the historical assets, liabilities, products, businesses, or activities of the Cloud & Power Infrastructure business as conducted by Flex prior to the completion of the Spin-Off.

 

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Unless the context otherwise requires, the information included in this information statement about Spinco assumes the completion of all of the transactions referred to in this information statement in connection with the Spin-Off. This information statement describes the business to be transferred to Spinco by Flex in the separation as if the transferred business was our business for all historical periods described. References in this information statement to our historical assets, liabilities, products, businesses, or activities of our business are generally intended to refer to the historical assets, liabilities, products, businesses, or activities of the transferred business as the business was conducted as part of Flex and its subsidiaries prior to the completion of all the transactions referred to in this information statement in connection with the Spin-Off.

This information statement is being furnished solely to provide information to Flex shareholders who will receive shares of Spinco common stock in the Distribution. It is not and is not to be construed as an inducement or encouragement to buy or sell any of Spinco’s securities or any securities of Flex. This information statement describes Spinco’s business, Spinco’s relationship with Flex, and how the Spin-Off affects Flex and its shareholders and provides other information to assist you in evaluating the benefits and risks of holding or disposing of Spinco common stock that you will receive in the Distribution. You should be aware of certain risks relating to the Spin-Off, Spinco’s business and ownership of Spinco common stock, which are described under the section of this information statement entitled “Risk Factors.”

FINANCIAL STATEMENT INFORMATION

This information statement includes certain historical combined financial and other data for Spinco (referred to as the Cloud & Power Infrastructure business of Flex Ltd. or the Business in the historical combined financial statements and related notes thereto). In connection with the Spin-Off, Spinco will become the holder of the assets and liabilities of all of Flex’s Cloud & Power Infrastructure business (as defined herein). Spinco is the registrant under the registration statement of which this information statement forms a part and will be the financial reporting entity following the completion of the Spin-Off. Flex is presently, and will continue to be, a financial reporting entity following the Spin-Off. This information statement also includes summary unaudited pro forma condensed combined balance sheet data as of June 26, 2026, and summary unaudited pro forma condensed combined statement of operations data for the three months ended June 26, 2026 and the fiscal year ended March 31, 2026, which present our combined financial position and results of operations after giving effect to the separation and distribution, and the other transactions described under “Unaudited Pro Forma Condensed Combined Financial Information.” The unaudited pro forma condensed combined financial information is presented for illustrative purposes only and is not necessarily indicative of the operating results or financial position that would have occurred if the relevant transactions had been consummated on the date indicated, nor is it indicative of future operating results. You should read the sections of this information statement entitled “Unaudited Pro Forma Condensed Combined Financial Information” and “Notes to Unaudited Pro Forma Condensed Combined Financial Information,” which are qualified in their entirety by reference to our combined financial statements and related notes thereto, the consolidated financial statements of Flex and related notes thereto and the financial and other information, including in the sections of this information statement entitled “Risk Factors,” “Capitalization” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

NON-GAAP FINANCIAL INFORMATION

This information statement also contains certain financial measures, including adjusted operating income, adjusted net income (loss) and free cash flow, that are not required by, or prepared in accordance with, accounting principles generally accepted in the United States (“GAAP”). We refer to these measures as “non-GAAP” financial measures. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Financial Measures” for our definitions of these non-GAAP measures, information about how and why we use these non-GAAP measures, and a reconciliation of each of these non-GAAP measures to its most directly comparable financial measure calculated in accordance with GAAP.

 

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MARKET, INDUSTRY AND OTHER DATA

Unless otherwise indicated, information contained in this information statement concerning our industry and the markets in which we operate, including our general expectations and market position, market opportunity, and market share, is based on information from third-party sources, our own analysis of data received from these third-party sources, our own internal data, market research that we commission, and management estimates. Our management estimates are derived from publicly available information, our knowledge of our industry and assumptions based on such information and knowledge, which we believe to be reasonable. Assumptions and estimates of our and our industry’s future performance are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described under the section of this information statement entitled “Risk Factors.” These and other factors could cause future performance to differ materially from our assumptions and estimates. For additional information, see the sections of this information statement entitled “Risk Factors” and “Cautionary Statement Concerning Forward-Looking Statements.”

TRADEMARKS AND TRADE NAMES

This information statement may contain trade names, trademarks, or service marks belonging to other companies. Such trade names, trademarks, or service marks are the property of their respective owners, and we do not intend any use or display of other parties’ trademarks, trade names, or service marks to imply a relationship with, or endorsement or sponsorship of us by, these other parties.

 

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RISK FACTORS

The risks and uncertainties described below could materially and adversely impact our business, financial condition, and results of operations, could cause actual results to differ materially from our expectations and projections, and could cause the market value of our stock to decline. You should consider these risk factors when evaluating us and our common stock and when reading the rest of this information statement, including the sections entitled “Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our financial statements and related notes included elsewhere in this document. These risk factors may not include all of the important factors that could affect our business or our industry or that could cause our future financial results to differ materially from historic or expected results or cause the market price of our common stock to fluctuate or decline. Additional risks and uncertainties not currently known to us or that we currently believe are immaterial also may impair our business, results of operations, liquidity, and financial condition.

Risks Related to Our Business and Operations

Customer and Revenue Risks

Our revenue is concentrated among a limited number of customers, which subjects us to significant revenue variability, margin pressure, and counterparty risk.

A relatively small number of customers have historically accounted for, and are expected to continue to account for, a majority of our revenue. The loss of one or more of our largest customers, or a significant reduction in sales to any of these customers, could materially and adversely affect our business, financial condition, and results of operations. For the fiscal year ended March 31, 2026, our top two customers represented 34% and 30% of our revenue, respectively. Collectively, our top two customers accounted for 64% and our top 10 customers accounted for 87% of our revenue.

Our customer base is concentrated in part due to the structure of the digital infrastructure industry, in which a limited number of hyperscale cloud providers, colocation companies, and large enterprises represent a substantial portion of market demand. This industry structure may make it difficult or impractical for us to materially diversify our customer base, and we expect that customer concentration will continue for the foreseeable future.

Our dependence on a concentrated customer base subjects us to significant risks. These customers typically have substantial purchasing power and negotiating leverage, which they may use to obtain favorable pricing, extended payment terms, or other concessions that could reduce our margins or adversely affect our cash flows. As our customers grow larger through consolidation or organic growth, their bargaining power may increase further. In addition, decisions by one or more significant customers to shift their purchases to our competitors, to vertically integrate and manufacture products internally, to develop their own infrastructure that may compete with us, or to reduce the volume of products or services they purchase from us could have a material adverse effect on our business. Our customers may have pre-existing or concurrent relationships with, or may themselves be, current or potential competitors, which may affect such customers’ decisions to purchase our products and services or the terms on which they are willing to do so. Certain hyperscale customers have developed, or may develop, internal capabilities that compete with our offerings, and these customers may choose to reduce their reliance on third-party providers like us over time.

Certain of our customer contracts contain change of control, assignment, or consent provisions that may be triggered by the separation or the Distribution. If we are unable to obtain required consents from customers, or if customers exercise termination or other contractual rights in connection with the separation, our business, financial condition, and results of operations could be materially and adversely affected. Our contracts with our top two customers require consents in connection with the separation. We have engaged with these customers regarding the separation and, based on discussions to date, expect to obtain the required consents prior to the completion of the Distribution. However, we cannot provide any assurance that such consents will be obtained,

 

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or that they will be obtained on terms acceptable to us. In addition, even if consents are not technically required, customers may use the separation as an opportunity to renegotiate pricing, reduce order volumes, or otherwise modify their relationships with us. See “Risks Related to the Spin-Off” for additional information regarding third-party consent requirements.

We may not be able to replace lost revenue from a key customer with revenue from new customers or increased sales to existing customers on a timely basis or at all. This could materially and adversely affect our business, financial condition, and results of operations.

Customer commitments are limited and demand is cyclical, which may create inventory exposure, capacity utilization challenges, and significant period-to-period variability in our results.

Our customers generally do not commit to long-term production schedules or provide binding forecasts of their product needs, and our contracts with customers typically do not require them to purchase any minimum quantities. Customer purchase orders are often subject to cancellation, modification, or rescheduling, in some cases with limited or no penalties. Many agreements provide for non-cancellable/non-returnable (NCNR) terms or other inventory liability coverage, and some agreements include contractual price reductions or other pricing mechanisms over the term, which can adversely affect revenue and margins. Our customers may terminate their relationships with us or significantly reduce or delay orders at any time, including as a result of changes in their own business conditions, product demand, technology strategy, or for convenience. Our inability to accurately forecast customer demand or manage order volatility can result in excess or obsolete inventory, non-cancellable outstanding firm purchase orders which are no longer required requiring cancellation at a cost, manufacturing inefficiencies, and increased costs.

In addition, our contracts with customers are often for finite terms and are subject to renewal or renegotiation upon expiration. We cannot assure you that our customers will renew their contracts with us or, if they do, that the terms of any renewal will be as favorable as our current contract terms. Customers may use contract renewal cycles as an opportunity to demand price concessions, impose additional requirements, or reduce order volumes. Our failure to renew contracts with key customers, or to renew them on terms that are favorable to us, could materially and adversely affect our business, financial condition, and results of operations.

Because our customers operate in highly competitive, rapidly evolving end markets, their demand can be cyclical, project-driven, and influenced by capital spending cycles, regulatory developments, and technology transitions. These dynamics can cause significant period-to-period variability in orders, forecasts, and backlog conversion. We generally do not obtain firm, long-term purchase commitments from our customers, and we often experience reduced lead times in customer orders that may be shorter than the lead time we require to procure necessary components and materials.

When demand is reduced, delayed, or cancelled, we may face excess and obsolete inventory, underutilized assets, margin pressure, adverse working capital effects, and increased cash needs. Forecast error, combined with rapid technology transitions, can lead to excess and obsolete inventory, expedite fees, higher logistics costs, suboptimal factory loading, and variability in revenue and gross margin from period to period. Many factors outside of our control impact our customers and their ordering behavior, including recession in end markets, changing technology and industry standards, commercial acceptance for products, product obsolescence, and loss of business. This could materially and adversely affect our business, financial condition, and results of operations.

Our concentration of accounts receivable and deposits with a small number of customers increases counterparty and collection risk.

A significant portion of our accounts receivable is concentrated among a small number of customers. This concentration of credit risk increases our exposure to nonpayment, late payment, or financial distress affecting any one of these customers. If one or more of our key customers experiences financial difficulties, delays

 

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payments, disputes amounts owed, or becomes subject to bankruptcy or insolvency proceedings, we could experience material losses or be required to write off a substantial portion of our accounts receivable. In addition, the failure of a key customer to pay amounts owed to us when due could adversely affect our liquidity and our ability to meet our own financial obligations. We periodically review the creditworthiness of our customers; however, such reviews may not be effective in identifying potential credit risks or in preventing nonpayment. Extended payment terms or credit support structures may not fully mitigate this risk. If customers experience financial difficulty or insolvency, we may be unable to collect amounts owed on a timely basis, if at all.

Our customer contracts may permit termination for convenience or on short notice.

Certain of our customer contracts contain provisions that permit the customer to terminate the agreement for convenience upon prior written notice, which notice periods may be relatively short. If a key customer were to exercise its termination rights, we may not be entitled to receive payment for work in process, stranded inventory, or other costs incurred in anticipation of future orders. We may not have adequate contractual protections, such as termination fees or wind-down payments, to offset the financial impact of an early termination by a significant customer. The termination or non-renewal of a contract with any of our largest customers, or a significant reduction in orders under such a contract, could materially and adversely affect our business, financial condition, and results of operations.

We may incur significant losses if customer-specific capital equipment becomes impaired or obsolete.

We make investments in capital equipment that is designed for or dedicated to specific customers, products, or programs. These investments are often based on forecasts of customer demand and anticipated long-term relationships. In certain cases, such equipment has limited alternative use and may not be readily redeployable to other customers or applications without significant modification or additional cost. If a customer reduces, delays, or terminates its orders, exits a product line, experiences financial distress, or otherwise ceases to do business with us, we may be unable to recover the carrying value of the related equipment. In such circumstances, we may be required to recognize impairment charges or write-offs for these assets, which could be material to our financial condition and results of operations.

In addition, the timing and magnitude of customer demand may differ from our expectations, leading to underutilization of such equipment and reduced returns on our investments. While we may seek contractual protections, including customer commitments or reimbursement provisions, such protections may be insufficient or may not be enforceable in all cases. Any significant impairment, write-off, or accelerated depreciation of customer-specific capital equipment could adversely affect our results of operating, cash flows, and financial position.

Our relationships with key customers may require us to improve our products, services, and capabilities, which may involve significant technological and design challenges.

Our customers may place considerable pressure on us to meet tight development schedules, capacity availability timelines, and evolving technical specifications. Accordingly, we may be required to devote a substantial amount of our resources, including engineering, research and development, and capital expenditures, to satisfying the demands of our largest customers, which could divert resources from other strategic initiatives or delay our completion of other important development projects. Failure to meet customer-imposed development requirements or timelines could impair our relationships with these customers, negatively impact forecasted sales, and could materially and adversely affect our business, financial condition, and results of operations.

 

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Supply Chain, Technology, and Operational Risks

Constrained supply and dependence on single- or limited-source components may elongate lead times, increase costs, and create misalignment with customer obligations.

A delay or interruption in supply from a supplier, especially for critical components such as custom or customer-specified semiconductors, power modules, and high-speed interconnect components, which in some cases are sourced from a single or limited number of suppliers, could significantly impact our operations and our customers if we are unable to deliver finished products in a timely manner. Quality or reliability issues at any of our suppliers, or financial difficulties that affect their production and ability to supply us with components, could halt or delay production of a customer’s product or result in claims against us for failure to meet required customer specifications. Replacing a single- or limited-source supplier could delay production because replacement suppliers, if available, may be subject to capacity constraints or other output limitations. If we cannot secure timely and cost-effective supply aligned with customer schedules, we may incur expedite premiums, carry higher inventory, miss delivery windows, or face penalties and reputational harm.

Our production has in the past been, and may in the future be, adversely affected by delays and increased costs resulting from issues our suppliers face, including geopolitical conflicts and increased energy prices. Our inability to make scheduled shipments may cause us to experience a reduction in sales, increase in inventory levels and costs, and could adversely affect relationships with existing and prospective customers.

Customer-directed suppliers and components may increase our supply chain risk.

Certain of our customers direct or require us to purchase components, materials, or subsystems from specified suppliers. In some cases, these customer-directed suppliers may be sole sources for the required components or may be geographically concentrated. We may have limited ability to qualify alternative suppliers or pass through cost increases for customer-specified components. If a customer-directed supplier experiences supply disruptions, quality issues, financial distress, or other problems, we could be unable to meet our customer’s requirements and could be exposed to warranty claims, contract penalties, or liability, even if the underlying issue was attributable to the customer-directed supplier. Our customers may not agree to share responsibility for these supply chain risks, and we may bear a disproportionate share of the exposure.

Our dependence on customer and third-party power and water availability and permitting may delay projects or impair economics.

Our ability to deliver and expand certain solutions and services depends on our customers and third-party data center operators securing sufficient and reliable electrical power and water at acceptable costs and within required timelines. Limitations on power generation, transmission, and distribution capacity, utility interconnection lead times, curtailments, outages, and volatility in energy markets may delay energization, restrict available capacity, increase operating costs, and materially affect project economics and contractual performance. Public utility planned outages, broader grid reliability events, and inflationary or geopolitical pressures on energy prices may further increase volatility for our customers and partners, affecting our schedules and costs. Similarly, water scarcity, drought conditions, competing demands for water resources, and regulatory restrictions on water use may constrain data center cooling capacity, limit site selection, increase operating costs, or delay project timelines.

In several markets, regulators and local authorities have imposed or considered data center development moratoria, stricter energy efficiency standards, caps on usage, or other conditions to approvals. These measures may delay or prevent site development or expansion and increase compliance costs. If customers or third-party operators are unable to secure timely and cost-effective power, or if approval processes are delayed or restricted, we could experience project delays, missed milestones, service-level exposure under our contracts, reduced margins, and lost or deferred revenue.

 

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Third-party facility control, retrofit requirements, and capacity utilization variability may introduce delays, performance risks, and contractual exposure.

As rack power densities increase and liquid or hybrid cooling becomes more prevalent, many existing data center facilities require retrofits to power distribution, structural supports, fluid handling, and interconnect infrastructure. In cases where customers or third-party operators manage these retrofits, we have limited control over their timing, execution, and quality. In certain circumstances, our contractual performance obligations may still be evaluated against end-to-end service-level agreements (“SLAs”). If required retrofits or interconnect upgrades are delayed, deficient, or incompatible with our integrated solutions, we may experience schedule slippage, rework, increased warranty or service obligations, or other adverse commercial consequences, even though these constraints are outside our direct control. These risks may become more pronounced as customers accelerate adoption of high-density racks and liquid cooling systems requiring complex facility modifications. Misalignment between contracted program volumes and actual customer usage, whether from program push-outs, changes in deployment plans, or infrastructure delays, can also result in underutilized capacity, excess capacity costs, and inventory exposures. If infrastructure readiness issues prevent timely integration or energization, we could face SLA penalties, margin compression, increased working capital needs, and significant period-to-period variability in our results.

Physical climate and geopolitical risks could disrupt our facilities, supply chains, and customer programs.

Our facilities and those of our customers and suppliers are exposed to acute and chronic physical risks, including extreme weather, drought, wildfire, flooding, and seismic events, which may increase in frequency and severity due to climate change. Such events can cause outages, delay production or deployments, impair logistics, increase insurance and energy costs, and reduce available water or power at customer or third-party sites.

Geopolitical tensions-including those affecting the China-Taiwan corridor and other critical regions for semiconductor manufacturing and component sourcing, as well as the conflicts in Ukraine and the Middle East, including the recent conflict involving Iran, can exacerbate supply disruptions, extend lead times, and increase costs. Our global operations are subject to inherent risks including changes in local tax rates and incentives, labor unrest, political instability, armed conflict, social unrest, terrorism, and natural disasters. Any of these events could disrupt operations at one or more of our sites or those of our customers, suppliers, and logistics partners, with the impact potentially magnified in areas where we or they have multiple facilities in close proximity.

Rapid technology shifts require continuous capability upgrades and may render existing solutions less competitive or obsolete.

Our industry is characterized by frequent platform transitions, increasing rack power densities, adoption of liquid and hybrid cooling, evolving power delivery architecture and interconnect standards, and changing security and manageability requirements. To remain competitive, we must continually invest in engineering, validation, supply chain enablement, specialized integration capabilities, capital equipment, and technical support. If we fail to anticipate or timely align with evolving specifications, standards, or density requirements, or if competitors adopt innovations more quickly, our win rates, pricing, and margins may suffer, and we may incur inventory write-downs and rework charges.

Many of our competitors are well-capitalized and may develop superior products, adapt more quickly to technological changes, industry changes, or customer requirements. The emergence of new technologies, industry standards, or customer requirements may render our power delivery systems, cooling solutions, integration capabilities, inventory, or processes less competitive or obsolete. Our acquisition and implementation of new technologies and equipment, and the expansion of our offerings, may require significant expense or capital investment, which could reduce our operating margins or adversely affect our business, financial condition and results of operations. If we fail to keep pace with technological change or evolving market needs, or to develop and introduce competitive products or solutions on a timely manner, we may lose customers and experience decreased or delayed market acceptance and sales of our products and solutions.

 

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Financial and Working Capital Risks

Working capital intensity and access to financing may constrain growth and increase earnings volatility.

Delivering our products, solutions and services can require significant upfront commitments for customer-specific materials, tooling, integration capacity, specialized test equipment, and inventory. Our ability to fund growth depends on internally generated cash and access to debt and other financing on acceptable terms. Market disruptions, interest rate volatility, bank sector instability, or adverse credit conditions could increase borrowing costs, limit available capital, or delay funding, constraining project delivery and capacity expansion.

High fixed and semi-fixed costs in our manufacturing operations, and elevated inventory levels for customer programs, can magnify the impact of utilization variability and project delays, adversely impacting our earnings and cash flows. Our operations are working capital intensive, and inventories, accounts receivable, and accounts payable are significant components of our net asset base. Numerous factors impact our working capital and cash flow, including fluctuations in revenues, fluctuations in collections of receivables and timing of payables, timing and size of capital expenditures, and our ability to manage materials purchasing and payment policies and to optimize our terms and conditions with suppliers. If we fail to manage our working capital effectively, our business, financial condition, results of operations, and liquidity could be materially and adversely affected.

We may not be able to obtain financing arrangements on acceptable terms or in amounts sufficient to meet our needs in the future, which could harm our ability to grow our business. Failure to obtain required capital when needed could reduce our ability to pursue program pipelines and meet customer commitments.

Capital markets and interest rate volatility may constrain our customers’ and partners’ ability to fund sites and power, indirectly affecting program ramps and growth visibility.

The development and expansion of data center capacity and utility and power infrastructure, including site acquisition, power procurement, and infrastructure buildouts, are capital intensive and often depend on access to debt and equity markets. Higher interest rates, tighter credit conditions, or reduced investor appetite for digital infrastructure or utility capital investment may lead customers to delay or scale back projects, renegotiate commercial terms, or reprioritize spend, which can reduce our order flow and slow ramps. Broader concerns regarding global economic conditions, financial market volatility, geopolitical developments, energy costs, inflation, and the availability or cost of credit have contributed to increased uncertainty. All of the foregoing factors are outside of our control and may adversely affect our results of operations.

Operational and Strategic Risks

We may encounter difficulties with acquisitions, including the EPC Power Acquisition, and divestitures, which could harm our business.

As part of our growth strategy, we intend to selectively pursue acquisitions, joint ventures, and strategic alliances. On September 3, 2026, Flex announced that it entered into a definitive agreement to purchase EPC Power, a leading provider of intelligent power conversion solutions for data center and grid applications, for $4.4 billion. EPC Power is expected to become part of the Cloud and Power Infrastructure business, which Flex plans to separate into Spinco in the Spin-Off. Whether we realize the anticipated benefits from such activities depends, in part, upon the successful integration of the acquired businesses, the performance and development of the underlying products, capabilities, or technologies, our correct assessment of assumed liabilities, and the management of the operations. The integration of acquired businesses may not be successful and could result in disruption to other parts of our business. In addition, acquisitions involve numerous risks and challenges, including: diversion of management’s attention from the normal operation of our business; potential loss of key employees and customers of the acquired companies; difficulties managing and integrating operations in geographically dispersed locations; the potential for deficiencies in internal controls at acquired companies; increases in our expenses and working capital requirements, which reduce our return on invested capital; lack of experience operating in the geographic market or industry sector of the acquired business; the need to implement

 

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financial and other systems and add management resources; failure to realize anticipated benefits, such as cost savings and revenue enhancements; and exposure to unanticipated liabilities of acquired companies. The EPC Power Acquisition and any future acquisitions may require additional equity financing, which could be dilutive to our existing shareholders, or additional debt financing, which could increase our leverage and potentially affect our credit ratings. In addition, divestitures involve significant risks, including difficulty finding financially sufficient buyers or selling on acceptable terms in a timely manner. Divestitures could adversely affect our profitability and, under certain circumstances, require us to record impairment charges or a loss as a result of the transaction. These and other factors could harm our ability to achieve anticipated levels of profitability or realize other anticipated benefits of an acquisition or divestiture, and could adversely affect our business and results of operations.

We may not achieve some or all of the expected benefits of our restructuring activities, and our restructuring activities could adversely affect our ability to execute our business strategy.

Following the Spin-Off, we expect to evaluate our operations as a standalone company and may undertake restructuring actions to optimize our cost structure, establish independent functions, or align our operations with our strategic priorities. We will also incur costs associated with creating capabilities previously provided by Flex. Restructuring activities may be costly and disruptive, require significant management attention, and may not achieve the anticipated benefits on the expected timeline or at all. Any failure to achieve expected benefits could have a material adverse effect on our competitive position and results of operations.

We may encounter difficulties expanding or consolidating our operations or introducing new competencies or offerings, which could adversely affect our results of operations.

As we expand our business, open new sites, enter new markets, products, and technologies, invest in research, design and development, transfer business within our network, consolidate certain operations, or introduce new business models or programs, we may encounter difficulties that result in higher than expected costs associated with such activities. Potential difficulties include our ability to manage growth effectively; to maintain existing business relationships during periods of transition; to anticipate disruptions in our operations that may impact our ability to deliver to customers on time, produce quality products, and ensure overall customer satisfaction; and to respond rapidly to changes in customer demand or volumes.

We may also encounter difficulties in ramping and executing new programs. Ramping new programs can range from several months to over a year before production starts, and often requires significant up-front investments and increased working capital. These programs may generate lower margins or losses during and following the ramp period, or may not achieve the expected financial performance, due to production ramp inefficiencies, lower than expected volume, or delays in ramping to volume. Our customers may significantly change these programs, or even cancel them altogether, due to decreases in their end-market demand or in the actual or anticipated success of their products in the marketplace.

We depend on our ability to attract, retain, and develop highly skilled personnel, and our failure to do so could seriously harm our business.

To successfully operate as an independent public company and implement our business plans, we must identify, attract, develop, motivate, train, and retain key employees, including qualified executives, management, engineering, sales, marketing, IT support, and service personnel. The market for such individuals is highly competitive. We may not be successful in attracting, integrating, or retaining qualified personnel to meet our current growth plans or future needs. Attracting and retaining key employees in a competitive marketplace requires us to provide a competitive compensation package. If our total compensation package is not viewed as competitive, our ability to attract, motivate, and retain key employees could be weakened, and failure to successfully hire or retain key employees and executives could adversely impact us.

Changes in our executive management team may also cause disruptions in, and harm to, our business. Failure to have an effective succession plan in place for our key executive officers could significantly delay or prevent us from achieving our business or development objectives and could materially harm our business.

 

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Cybersecurity and Data Risks

Cybersecurity, data privacy, and operational-technology risks could disrupt our operations, damage our reputation, and expose us to liability.

We rely on our information systems, some of which are managed by third parties, to process, transmit, and store electronic information (including sensitive data such as confidential business information and personally identifiable information relating to employees, customers, vendors, and other business partners), and to manage or support critical business processes and activities, including manufacturing, design and engineering services, financial reporting, inventory management, procurement, invoicing, and electronic communications. Our ability to effectively manage our business depends on the security, reliability, and adequacy of these information systems. We may be adversely affected if these information systems break down, fail, or are no longer supported.

Like many other corporations in our industry, we and third parties upon which we rely have faced, and may continue to face, attempts to gain unauthorized access to our systems, networks, and cloud resources, or those of our customers, vendors, and third-party service providers. Threat actors continue to evolve in sophistication and use techniques that change frequently, may be difficult to detect, and may remain dormant for extended periods. Artificial intelligence (“AI”) techniques may also be utilized to increase the number and technical sophistication of such attempted breaches. Due to increasing geopolitical tensions and conflicts, we and the third parties upon which we rely may be vulnerable to a heightened risk of cyberattacks that could materially disrupt our systems, operations, supply chain, and ability to serve our customers, any of which could reduce revenues and harm our operational performance.

Our ability to monitor third parties’ information security practices is limited, supply chain attacks have increased in frequency and severity, and we cannot guarantee that third parties, including cloud or hosted solutions providers, have not been compromised or that their systems are free from exploitable defects. A material incident could result in unauthorized access to, or loss of, confidential information and trade secrets, unfavorable publicity, loss of competitive advantage, governmental inquiry and oversight, difficulty in marketing and selling our products and services, significant costs related to rebuilding internal systems, higher insurance premiums, allegations by our customers that we have not performed our contractual obligations, litigation by affected parties, and financial penalties, fines, or obligations for damages related to the theft or misuse of our information or other assets.

We may be required to invest significant additional resources to comply with evolving cybersecurity regulations, including those addressing artificial intelligence, and to modify and enhance our information systems, security and controls, and to investigate and remediate any security vulnerabilities.

We are subject to laws and regulations in the U.S. and other countries relating to privacy and the collection, use, transfer, storage, and security of personal data, including the European Union General Data Protection Regulation, as well as controls or rules imposed by customer or other contracts relating to the same. Data protection laws continue to develop and may have conflicting requirements across jurisdictions; compliance can be costly, and any failure to comply with these laws or other data protection standards could subject us to legal and reputational risks, government inquiries, and significant penalties and fines. Our liability insurance may not be sufficient in type or amount to cover us against claims related to security breaches, cybersecurity attacks, and other related incidents.

Reputational and Stakeholder Risks

Exposure to financially troubled customers or suppliers could adversely affect our business, financial condition, and results of operations.

Our customers may experience financial distress, consolidation, and cyclical demand. If a customer experiences financial difficulty or insolvency, we may be unable to collect amounts owed to us on a timely basis, if at all, and demand for our products and services may decline. These events could require us to increase our allowance for credit losses, write down inventory, reduce revenue, and increase our working capital requirements due to higher inventory levels and longer collection periods.

 

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If a supplier experiences financial difficulty, we may face supply interruptions, reduced allocations, less favorable terms, or the need to qualify alternative sources, which could increase costs, delay production, and affect our ability to meet delivery schedules. Any of these developments could adversely affect our business, financial condition, results of operations, and cash flows.

Our business could be impacted as a result of actions by activist shareholders or others.

We may be subject, from time to time, to legal and business challenges in the operation of our company due to actions instituted by activist shareholders or others. Responding to such actions could be costly and time-consuming, may not align with our business strategies, and could divert the attention of our Board of Directors and senior management from the pursuit of our business strategies. Perceived uncertainties as to our future direction as a result of shareholder activism may lead to the perception of a change in the direction of the business or other instability and may make it more difficult to attract and retain qualified personnel and business partners and may affect our relationships with customers, vendors, and other third parties.

Negative publicity, regardless of accuracy, could harm our reputation and adversely affect our business, financial condition, and results of operations.

Media coverage concerning our industry, company, brand, personnel, or operations can spread rapidly through digital platforms and social media, making it difficult to remediate. Our ability to maintain and enhance our brand depends on adapting to this evolving media environment. Negative commentary may reduce customer trust and demand for our products and services, which could negatively impact our performance.

Risks Related to Our Industry

Our business depends on continued capital investment in digital infrastructure, and any reduction in such spending could materially harm our results of operations.

We primarily serve customers in the digital infrastructure market, including hyperscale/cloud, colocation, and enterprise data center operators. A majority of our revenue is derived from products and services that support high-density computing infrastructure for cloud, AI, and machine learning (“ML”) workloads, as well as other high-performance and data-intensive applications. As a result, our business, financial condition, and results of operations are significantly dependent on the level and timing of capital expenditures by our customers, particularly hyperscalers.

The digital infrastructure industry is subject to rapid technological change, intense competition, and evolving customer priorities. Capital expenditure cycles among hyperscalers and other data center operators can be volatile and may be influenced by factors outside our control, including macroeconomic conditions, changes in credit availability, shifts in customer investment priorities, technological developments or alternative deployment architectures (such as orbital or undersea data centers) that reduce demand for our products or render certain solutions less competitive, and regulatory developments or public policy changes affecting AI development or deployment. Because we are focused on the data center market and lack significant diversification across other industries, a sustained decline in AI-related or other accelerated compute and data-center capital spending could adversely affect our business, financial condition, results of operations, and prospects.

Overall market trends of increased demand for compute capacity, power infrastructure, and advanced cooling driven by AI and cloud applications have supported recent growth, but there can be no assurance that such trends will continue. Advances in model architectures, training and inference techniques, algorithmic efficiency, and semiconductor design may materially reduce the compute, power, and cooling resources required per unit of AI workload, which could reduce the volume of infrastructure Spinco’s customers require even if AI adoption continues to grow. Consolidation among our customers, reduction in spending on digital infrastructure, or shifts in market size toward larger customers may result in lower sales volumes and, pricing pressure. Any sustained reduction in customer spending could adversely affect our business, financial condition, and results of operations.

 

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In addition, the substantial data center capacity currently under construction may come online faster than demand develops, which could result in excess capacity, declining utilization, falling prices for compute and colocation services, deferred or cancelled projects, and financial distress among Spinco’s customers. Because Spinco’s revenue is concentrated in the data center market, any such developments could result in a rapid and pronounced decline in demand, order cancellations, inventory and capital equipment impairments, and adverse effects on Spinco’s business, financial condition, and results of operations.

Our industry is highly competitive, and competitive pressures could reduce our market share, revenues, and profitability.

We operate in a highly competitive industry. Some of our competitors have greater scale and offer a broader range of services, and may have greater name recognition, geographic market presence, manufacturing, and research and development capabilities. They may be better able to take advantage of acquisition opportunities, may be willing or able to make sales or provide services at lower margins than we do, or may adapt more quickly than we do to new technologies, evolving industry trends, and changing customer requirements.

We also face indirect competition from current and prospective customers who decide to manufacture products internally, or insource previously outsourced business. Competition may cause pricing pressures, reduced profits, or a loss of market share, any of which could materially and adversely affect our business, financial condition, results of operations, and cash flows.

Increases in prices for energy and other commodities may adversely affect our results of operations.

We rely on various energy sources in our production and transportation activities. Increases in prices for energy and other commodities have resulted in, and may result in further, increased raw material and component costs and transportation costs. Any increase in our costs that we are unable to recover in our pricing to our customers would negatively impact our margins and results of operations. To the extent we cannot compensate for cost increases through productivity improvements or price increases to our customers, our margins may decline, materially affecting our business, financial condition, results of operations, and cash flows. Geopolitical instability and volatility in energy markets may further exacerbate these risks.

Evolving regulations relating to energy, utilities, and data center development could adversely affect our business.

Government authorities in the U.S. and other jurisdictions have enacted, proposed, or are considering laws and regulations relating to data center development and permitting, energy and water consumption, grid reliability, and environmental and community impacts, which may result in new requirements, delays, or restrictions on the development, expansion, or operation of data centers or related infrastructure. Regulatory developments, such as moratoria or pauses on data center development, enhanced permitting or review processes, requirements to fund or share in the cost of grid or other utility upgrades, or operational restrictions relating to energy use, water consumption, noise mitigation, or other community-impact measures, could increase our customers’ costs, delay or reduce their planned investments, limit the scale or location of data center deployments, or otherwise constrain their ability to deploy or expand AI/ML infrastructure, which could adversely impact demand for our products and solutions. In addition, political and popular opposition to the construction, expansion or operation of data centers, which has increased and become more organized in some areas, could lead to additional measures restricting or limiting data center development, expansion and operation and heighten these risks.

Risks Related to the International Nature of our Business

We conduct operations globally and are subject to the risks inherent in international operations, which could adversely affect our business, financial condition, and results of operations.

We maintain operations, supply chain relationships, and customer relationships across numerous countries. Our global operations subject us to a variety of risks that could materially harm our business, including: longer payment cycles; ineffective legal protection of our intellectual property rights in certain countries; labor unrest,

 

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including labor strikes, difficulties in staffing, and geographic labor shortages; environmental protection laws and regulations, including those related to climate change; expropriation of private enterprises; natural disasters and exposure to infectious disease, epidemics, and pandemics on our business operations in geographic locations impacted by outbreaks; political or social unrest; cultural differences and differences in local business customs; and a potential reversal of current favorable policies encouraging foreign investment or foreign trade by our host countries.

The geographic distances between our global operations create logistical and communications challenges that could adversely affect our business.

The geographic distances between the Americas, Asia, and Europe create a number of logistical and communications challenges for us. These challenges include managing operations across multiple time zones, directing the manufacture and delivery of products across long distances, coordinating procurement of components and raw materials and their delivery to multiple locations, and coordinating the activities and decisions of our management team, which may be based in a number of different countries. Facilities in several different locations may be involved at different stages of the production process of a single product, leading to additional logistical difficulties.

Global economic conditions, including inflationary pressures, currency volatility, trade conflicts, geopolitical uncertainty, and instability in financial markets, may adversely affect our business, financial condition, results of operations, and access to capital.

Our operations and the execution of our business plans and strategies are subject to the effects of global economic trends, geopolitical risks, and demand or supply shocks from events that could include political crises and conflict, war, terrorist attacks, natural disasters, or actual or threatened public health emergencies. Our business is also affected by local and regional economic environments, supply chain constraints, and policies in the U.S. and other markets that we serve, including interest rates, monetary policy, inflation, commodity prices, currency volatility, currency controls or other limitations on the ability to expatriate cash, sovereign debt levels, and actual or anticipated defaults on sovereign debt. Changes in local economic conditions or outlooks, such as lower rates of investment or economic growth in China, Europe, or other key markets, may affect the demand for or profitability of our products and services.

We operate in emerging markets where economic, political, and legal risks are heightened. Political changes and trends such as protectionism, economic nationalism, and restrictions on multinational companies can interfere with our global operating model, supply chain, production costs, customer relationships, customer demand, and competitive position. Such measures can be imposed suddenly and unpredictably. Changes in policies by the U.S. or other governments could negatively affect our results of operations due to changes in duties, tariffs, or taxes, or limitations on currency or fund transfers, as well as government-imposed restrictions on producing certain products in, or shipping them to, specific countries.

We are subject to complex and evolving trade policies, tariffs, and export controls, and failure to comply or adapt to changes could restrict our business or result in penalties.

Due to the global nature of our business, we are subject to a complex system of import- and export-related laws and regulations in the United States and other countries, including economic sanctions administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control and similar laws in other jurisdictions. Our products, services, and technology are regulated by these trade control and customs regimes, and in some cases require licenses or other authorizations. Our ability to obtain and maintain such licenses and authorizations on a timely basis, or at all, is subject to risks and uncertainties, including changing laws, regulations, foreign policies, and geopolitical factors.

Non-compliance with these laws and regulations by us, our customers, or our suppliers can result in a wide range of penalties, including denial of import or export privileges, fines, criminal penalties, administrative sanctions, seizure of inventory, import detention, and loss of business. Delays or denials of licenses can prevent or defer sales, and if we are not successful in obtaining or maintaining necessary licenses or authorizations in a timely

 

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manner, previously recognized revenue and profit may need to be reversed. Moreover, we could be subject to reputational harm if any of our customers, former customers, or vendors were subject to U.S. sanctions or did business with sanctioned countries.

Any expansion of export, sanctions, or import restrictions, including the imposition of new tariffs or trade restrictions, tariff increases, anti-dumping or countervailing duties, trade embargoes, or retaliatory measures by affected countries, could adversely affect our competitive position, financial condition, results of operations, or liquidity.

Tariffs, trade restrictions, changes in trade policy, including heightened trade volatility, and uncertainty regarding trade agreements may adversely affect our business.

Political developments such as protectionism and economic nationalism have resulted in, and may continue to result in, tariffs, trade restrictions, and other barriers that may interfere with our operations, supply chain, and competitive position. Throughout 2025 and into 2026, the U.S. administration imposed varying levels of tariffs on goods imported from China and other countries. Further escalation of trade tensions could materially increase our product input costs, contract customer demand, or otherwise adversely affect our business. We generally seek to pass tariff costs through to our customers, which can affect reported net sales, operating income margins, and the timing of operating cash flows. To the extent we are unable to recover tariff costs, our results of operations could be adversely affected. The United States-Mexico-Canada Agreement is subject to a joint review process in 2026, and there can be no assurance that the agreement will not be amended, suspended, or terminated. In addition, on February 20, 2026, the U.S. Supreme Court struck down certain tariffs imposed under the International Emergency Economic Powers Act (“IEEPA”), following which the U.S. administration announced a new 10% global tariff under Section 122 of the Trade Act of 1974. These developments have created uncertainty regarding the future rate, scope, and enforceability of tariffs, the availability of refunds for invalidated tariffs, and the potential for alternative legislative or executive actions. Any material changes to trade agreements or ongoing uncertainty regarding U.S. trade policies could adversely affect our business, financial condition, and results of operations.

We have operations in China that are subject to evolving laws, regulations, policies, and geopolitical risks that could adversely affect our business.

We have operations located in China that could be adversely affected by evolving laws, regulations, and policies, including with regard to import and export tariffs and restrictions, and information security and privacy, as well as changes in the political and geopolitical environment involving China. U.S.-China bilateral trade relations remain uncertain. U.S. trade actions, including imposing tariffs on certain goods imported from China or deemed to be of Chinese origin, as well as the potential for new tariffs, trade embargoes, or sanctions by the U.S. and countermeasures imposed by China in response, could adversely affect our business, including in the form of increased cost of goods sold, decreased margins, increased pricing for customers, and reduced sales. U.S. technology export controls with respect to China, which are intended in part to restrict China’s ability to obtain advanced computing chips, develop and maintain supercomputers, and manufacture advanced semiconductors, have adversely impacted certain of our customers and end markets and may continue to do so.

Additionally, increased tensions between mainland China and Taiwan could disrupt the operations of companies in Taiwan that are critical to the global supply of semiconductors and other electronic components on which many of our customers depend. Any such disruption could have significant adverse effects on our supply chain and ability to serve our customers.

Geopolitical uncertainty, including as a result of armed conflicts, may adversely affect our business, financial condition, and results of operations.

We may have facilities in regions subject to geopolitical tensions. If these facilities were to be damaged, destroyed, or otherwise unable to operate, whether due to war, acts of hostility, or terrorist acts, such an event

 

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could jeopardize our ability to develop, manufacture, and deliver certain products and adversely affect our operations and results of operations. Our operations have been, and could continue to be, disrupted by the absence of employees called to active duty to perform military service.

The Russia-Ukraine conflict, the Israel-Hamas war, the recent military actions in Iran by the U.S. and Israel and other conflicts in the Middle East, and other hostilities or armed conflicts, or the interruption or curtailment of trade or transport between the countries where our facilities are located and their respective trading partners, have in the past and could in the future adversely affect our operations and results of operations. Political, economic, and military instability in these or other regions could lead to an increase in cyberattacks and disruptions and instability in global markets (including increases in inflation rates, increases in energy prices, and adverse effects on currency exchange rates and financial markets), supply chains, and industries that could negatively impact our business, financial condition, and results of operations.

Increased international political volatility, including changes to previously accepted trade or other government policies or legislation in the U.S. and Europe, instability in parts of Europe and the Middle East, as well as strained international relations, anti-immigrant activities, social unrest, fears of terrorism, enhanced national security measures, and armed conflicts, may materially hinder our ability to conduct business, or may reduce demand for our products or services.

Operations in foreign countries present risks associated with inflation, infrastructure, and labor conditions that could adversely affect our business.

Inflation may impact our profits and cash flows. In many jurisdictions in which we operate, governmental authorities exercise significant influence over many aspects of the economy, and their actions could have a significant effect on our business. We could be harmed by inadequate infrastructure, including lack of adequate power supply, transportation, raw materials, or components in certain locations. In addition, we may encounter labor disruptions, including labor strikes or claims, and rising labor costs (including minimum wage increases that are government-mandated from time to time), in particular within the lower-cost regions in which we operate due to, among other things, demographic changes and economic development in those regions. Any increase in labor costs that we are unable to recover in our pricing to our customers could adversely impact our margins and results of operations.

Financial Risks

We may not be able to access the capital and credit markets on terms that are favorable to us, or at all, including in connection with the EPC Power Acquisition.

Our business relies on the availability of financing. In connection with the EPC Power Acquisition, Flex intends to replace the Bridge Facility with a combination of debt and equity financing at Spinco. The capital and credit markets have in the past experienced and may continue to experience extreme volatility or disruptions that may lead to uncertainty and liquidity issues for both borrowers and investors. Certain customers and suppliers, as well as our business, may need access to credit and trade finance lines and other financing instruments for certain transactions. Additionally, we may need to access the capital markets to supplement our existing funds and cash generated from operations to satisfy our needs for working capital or capital expenditure requirements.

A variety of factors beyond our control could impact the availability or cost of capital, such as domestic or international economic conditions, including as a result of: tariffs or the imposition of new tariffs, trade wars, barriers, or restrictions or threats of such actions; increases in key benchmark interest rates and/or credit spreads; the adoption of new or amended banking or capital market laws or regulations; and the repricing of market risks and volatility in capital and financial markets.

In the event of adverse capital and credit market conditions, we may be unable to obtain capital market or other financing on favorable terms, or at all, and changes in credit ratings issued by nationally recognized credit-rating agencies could adversely affect our ability to obtain capital market or other financing and the cost of such financing. Such factors may impact our ability, or the ability of our customers or suppliers, to obtain debt financing, guarantees, or hedging from financial institutions, which could limit our growth and materially and adversely affect our business, financial condition, results of operations, and cash flows.

 

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We are subject to the risk of increasing income and other taxes, tax audits, and changes in tax laws, any of which may adversely affect our financial performance.

We conduct business operations in a number of countries and are subject to income and other taxes in the United States and numerous foreign jurisdictions. Our future effective tax rates could be affected by changes in the mix of earnings in countries with differing statutory tax rates; changes in tax laws, regulations and judicial rulings (or changes in the interpretation thereof); changes in generally accepted accounting principles; changes in the valuation of deferred tax assets and liabilities; changes in the amount of earnings permanently reinvested offshore; and changes related to tax holidays or incentives. From time to time we may benefit from tax incentives or similar programs, and changes to or the expiration of such programs could affect our income tax expense.

The international tax environment continues to change as a result of both coordinated efforts by governments and unilateral measures designed to address perceived international tax avoidance. The Organization for Economic Co-operation and Development (the “OECD”) and participating countries continue to work toward implementation of a global minimum tax rate of 15% as part of its Base Erosion and Profit Shifting project, and many countries in which we operate have enacted or are enacting laws based on these proposals. These rules could increase tax complexity and uncertainty, adversely impact our effective tax rate and cash tax liability, and reduce the benefits achieved from tax incentives. However, in January 2026, the OECD released a “side-by-side” package introducing new safe harbors and providing an exemption for U.S.-based multinational companies from parts of the global minimum tax framework. We continue to evaluate the impact of proposed and enacted legislative changes to our effective tax rate and cash flows as new guidance becomes available in each country.

We and our subsidiaries are regularly subject to tax return audits and examinations by various taxing jurisdictions. We develop our tax filing positions based upon the anticipated nature and structure of our business and the tax laws, administrative practices, and judicial decisions currently in effect, all of which are subject to change or differing interpretations, possibly with retroactive effect. Should additional taxes be assessed as a result of a current or future examination, or should tax laws change in a manner adverse to us, there could be a material adverse effect on our tax provision, financial condition, results of operations, and cash flows.

Fluctuations in foreign currency exchange rates could increase our operating costs and adversely affect our results of operations.

We have operations located in various parts of the world, and a portion of our purchase and sale transactions are denominated in currencies other than the U.S. dollar. A significant portion of our operational costs, including payroll, site costs, locally sourced supplies and inventory, and income taxes, are denominated in various non-U.S. dollar currencies. Currency exchange rates fluctuate daily as a result of changes in political and economic conditions, and a significant increase in the value of certain local currencies relative to the U.S. dollar could adversely affect our financial results and cash flows by increasing both our costs and the costs of our local supply base.

We may use financial instruments such as forward exchange contracts, swap contracts, and options to hedge our foreign currency exposure. However, our hedging strategy may not fully mitigate the longer-term impacts of changes to foreign exchange rates, and if our hedging activities are not successful or if counterparties default on their obligations, we may experience significant unexpected expenses or fluctuations in our results of operations.

Changes in accounting standards and subjective assumptions, estimates, and judgments by management related to complex accounting matters, could significantly affect our financial results or financial condition.

Generally accepted accounting principles and related accounting pronouncements, implementation guidelines, and interpretations regarding a wide range of matters relevant to our business, such as revenue recognition, asset impairment and fair value determinations, inventories, business combinations and intangible asset valuations, leases, and litigation, are highly complex and involve many subjective assumptions, estimates, and judgments. Changes in these rules or their interpretation or changes in underlying assumptions, estimates, or judgments could have a material adverse effect on our business, results of operations, and financial position.

 

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Legal and Regulatory Risks

Litigation, investigations, or enforcement actions could result in significant liabilities, operational restrictions, and reputational harm.

We are, from time to time, subject to claims, lawsuits, investigations, and regulatory or administrative proceedings across the jurisdictions where we operate. These matters may involve commercial disputes; regulatory compliance; intellectual property; product liability; employment and labor; privacy and data protection; securities and governance; and tax. Adverse outcomes, whether by judgment, settlement, consent decree, or otherwise, could require monetary payments, penalties, injunctive relief, operational changes, monitorships, remedial measures, or enhanced compliance controls.

Even if we prevail, we may incur substantial costs, increased insurance premiums, and management distraction that disrupts operations and harms our reputation with customers, suppliers, employees, and regulators. Outcomes are unpredictable, and accruals and insurance coverage may be insufficient or unavailable. Securities class actions or derivative litigation may also follow volatility in our securities or disclosures. Any of these could materially affect our business, financial condition, results of operations, and cash flows.

Our compliance program may not prevent violations of anti-corruption and related laws, which could result in severe penalties, business restrictions, and reputational harm.

We conduct business in numerous jurisdictions with stringent anti-corruption, anti-bribery, and related compliance requirements, including the U.S. Foreign Corrupt Practices Act, the UK Bribery Act, and similar laws elsewhere. We maintain policies, procedures, training, and internal controls designed to promote compliance and prohibit offering, promising, authorizing, or providing anything of value to government officials or other counterparties to obtain or retain business. However, we cannot assure that our employees, agents, consultants, or other third parties acting on our behalf will comply with these requirements at all times. Our risk may be heightened in jurisdictions where corruption is perceived to be more prevalent.

Actual or alleged violations could result in investigations, significant civil and criminal fines and penalties, disgorgement, monitorships, and reputational damage. Any of these events could adversely affect our business, financial condition, results of operations, and could require substantial management time and resources to address.

Inadequate protection of our intellectual property and exposure to third-party intellectual property claims could adversely affect our business and results of operations.

We develop and own, and in some cases license, intellectual property used in our engineering, design, and manufacturing services and in our products. Although we use a range of measures to protect our intellectual property, including contractual and security controls and seeking patent and trademark protection where appropriate, these measures may not prevent infringement, misappropriation or other unauthorized disclosure or use of our intellectual property or innovations. Moreover, protecting against the unauthorized use of proprietary technology is difficult and expensive and we may need to litigate with third parties to enforce or defend patents issued to us and our other intellectual property rights or to determine the enforceability and validity of our proprietary rights or those of others. If we cannot adequately protect or enforce our intellectual property rights, we could lose the competitive advantages of our proprietary technology.

Our activities may expose us, our suppliers, and our customers to claims that our services, products, processes, designs, or components infringe, misappropriate, or otherwise violate third-party intellectual property rights, or that we have breached license or other contractual provisions. We also sometimes enter into patent, software, or other licenses that condition our use of third-party technology and restrict the scope of permitted activities. While licensing is not a significant component of our business, disputes may still arise over coverage or compliance,

 

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our licensors may fail to maintain, enforce, or protect the licensed intellectual property, and we may decide not to take certain licenses, any of which could increase the likelihood of third-party assertions and require us to modify or limit certain activities, products, or services.

Because we provide design and engineering services in addition to manufacturing, customers often seek to allocate intellectual property risk to us to a greater extent than in traditional manufacturing engagements, including requiring broad intellectual property indemnities. Assertions against our customers may trigger indemnification obligations, require us to participate in defense, or result in disputes over responsibility between us and our customers. Moreover, we could become subject to large indemnity payments or damages claims from contractual breach, which could harm our business results, cash flows, financial condition, or prospects.

If infringement, misappropriation, or other similar claims are brought against us or our customers, whether or not they have merit, we could be required to expend significant resources on defense, and we or our customers could be required to develop non-infringing alternatives, obtain licenses, or cease, delay, or modify the affected services, products, or features. Suitable alternatives may be unavailable or costly, licenses may not be available on commercially reasonable terms or at all, and any litigation or dispute resolution could be lengthy, disruptive, and expensive and may not be resolved in our or our customers’ favor.

We also face heightened risks to our intellectual property in certain foreign jurisdictions, including risks of theft, reverse engineering, or misuse; limitations in the availability, scope, or enforceability of intellectual property rights; and challenges in obtaining effective remedies. In some countries in which we operate, intellectual property laws and enforcement mechanisms may be weaker than in the United States, and legal or administrative requirements may require us to compromise protections or yield certain rights to technology, data, or other intellectual property to conduct business in such countries or access certain markets. Any inability to obtain, maintain, or enforce our intellectual property rights in jurisdictions where we operate could result in the loss of competitive advantage, reduced revenue, and other adverse consequences that could affect our business, financial condition, and results of operations.

In addition, our corporate name, trade names, and related brand identity may be subject to challenge. Competitors or other third parties may use trade names, trademarks, or service marks similar to ours, which could impede our ability to build brand identity and lead to third party claims. If we are required to rebrand or change our trade names as a result of third-party claims or other circumstances, we could incur substantial costs related to marketing, packaging, legal compliance, and customer communications, and we may experience operational disruptions and a period of reduced brand recognition that adversely affects demand for our products and services. The collective impact of these risks could be material to our business, financial condition, and results of operations.

Defects or failures in our products or solutions could lead to liability and warranty claims, contractual penalties, and reputational harm.

If our products, manufacturing processes, or design and engineering services contain defects or deficiencies, demand for our offerings may decline, our reputation may be harmed, and we may be exposed to product liability and warranty claims and other customer claims. We also may be required to undertake service-based remediation, such as onsite field service actions, retrofits, or component replacements, and may incur SLA or other contractual penalties, any of which can be costly, disruptive, and exceed remediation costs. Even when customers, suppliers, or third parties are responsible, indemnification may be unavailable, delayed, or inadequate, and insurance may be inadequate, unavailable, or uneconomic.

Because we frequently build to customer specifications, including for hyperscaler and cloud customers, and integrate third-party components, defects may arise or be alleged due to customer design choices, supplier quality issues, component failures, or quality and process variances, including materials, testing, or other supply-chain issues. These issues can halt integration or delay shipments and deployments, require additional service actions

 

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or other corrective measures, increase costs, trigger claims for failure to meet specifications, and damage customer relationships.

As we expand higher-value design, engineering, and solutions offerings, our early-stage execution risks and warranty exposure may increase, and pricing may not fully cover associated warranty and service-remediation costs. Quality or execution issues during ramps can amplify costs and contribute to variability in our results. Integration of control software and firmware in our infrastructure solutions also introduces reliability, interoperability, and cybersecurity risks, including vulnerabilities in third-party or customer-specified software components.

Failure to comply with employment and related laws and regulations could adversely affect our business and financial performance.

We are subject to U.S. and foreign employment, labor, benefits, immigration, and related laws governing, among other things, wage-and-hour, worker classification, workplace safety, anti-discrimination and retaliation, leave and accommodations, collective bargaining and works councils, termination benefits, work authorization, and handling of employee data. These requirements vary by jurisdiction and change frequently, and regulatory actions or changes in labor legislation could facilitate union organizing or impose additional employer obligations. Portions of our workforce are, or may become, represented by labor unions, including as a result of acquisitions or organizing campaigns, and we have experienced organizing activity at certain facilities. Work stoppages, strikes, or other labor disruptions could adversely affect our operations and customer relationships. Government agencies and private plaintiffs, including through class or collective actions, regularly pursue audits, investigations, and enforcement. Adverse outcomes may include monetary penalties, back pay, damages, tax assessments, injunctive or equitable relief requiring changes to our practices, restrictions on staffing models, and immigration-related sanctions. Compliance efforts, disputes, and remediation can be costly and disruptive, and insurance coverage may be limited. Any of the foregoing could materially and adversely affect our business, financial condition, results of operations, and reputation.

We are subject to extensive environmental, health and safety, and producer responsibility laws; violations or alleged violations may result in fines, production suspensions, costly remediation, product recalls, and limitations on facility expansion.

Our operations are regulated by federal, state, local, and international environmental, health and safety, and product stewardship requirements governing worker health and safety; the generation, use, storage, transportation, discharge, and disposal of materials, including hazardous substances; product content and recyclability; and end-of-life producer responsibility. Applicable regimes include the EU Waste Electrical and Electronic Equipment Directive, China’s regulation on electronic information products, and the EU carbon border adjustment mechanism, among others.

We may also face liability to customers regarding materials used in procured components. Non-compliance, or allegations thereof, could lead customers to refuse purchases and could trigger fines, penalties, production suspension, product sales prohibitions, product recalls, and costly changes to operations, procurement, and inventory management. We are responsible for cleanup at certain current and former facilities and at certain third-party sites, and some environmental laws impose strict liability without fault for investigation and remediation of releases. More stringent standards, or new findings of contamination, could increase our liabilities and costs. Additional environmental matters may arise at sites where no issue is currently known or at sites we may acquire.

Evolving sustainability expectations and related disclosure regimes may increase costs, create legal exposure, and adversely impact our operations, talent attraction, and access to capital.

Governments, investors, customers, employees, and other stakeholders continue to focus on sustainability matters, including climate change and greenhouse gas emissions, environmental stewardship, responsible

 

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sourcing, human capital, and related matters. These expectations have led to multiple and evolving reporting regimes, including the EU Corporate Sustainability Reporting Directive (“CSRD”) and California’s climate statutes, and many customers and investors impose sustainability requirements through policies or procurement terms or investment standards. Meeting these expectations and reporting obligations involves operational, financial, legal, regulatory, and reputational risks, may require additional resources and controls, and may be affected by evolving and inconsistent standards for identifying, measuring, and reporting sustainability metrics. At the same time, “anti-ESG/DEI” legislation and policies in certain jurisdictions may impose additional, and potentially conflicting, compliance obligations and litigation risks. Failure or perceived failure to meet goals that we may announce, adhere to public statements, or comply with reporting requirements on announced timelines could adversely affect our reputation, customer relationships, talent recruitment and retention, and investment attractiveness, and could result in enforcement actions or private litigation.

Climate change regulation could disrupt our operations and supply chain and increase our costs.

Several jurisdictions have enacted or are considering climate-related disclosure and due diligence laws, such as the EU CSRD, EU Taxonomy, the EU Corporate Sustainability Due Diligence Directive, and California’s climate statutes, that may directly or indirectly affect our operations and those of our suppliers. Compliance and adaptation may require increased energy, production, transportation, and raw material costs, higher capital expenditures, and higher insurance costs, and inconsistent requirements across jurisdictions may further increase compliance burden. The impact of future climate regulation and policy remains uncertain, and increased public scrutiny regarding climate matters can also affect our reputation. Any of these developments could have a material adverse effect on our business, financial condition, and results of operations.

Risks Related to the Spin-Off

We may not achieve some or all of the expected benefits of the Spin-Off, and the Spin-Off may adversely impact our business.

We may not realize any strategic, financial, operational, or other benefits from the Spin-Off. We cannot predict with certainty if or when anticipated benefits will occur or the extent to which they will be achieved. Following the completion of the Spin-Off, our operational and financial profile will change and we will face new risks. Following the completion of the Spin-Off, we will be a smaller and less-diversified company compared to Flex prior to the Spin-Off, and may be more vulnerable to changing market conditions. As part of Flex, we have been able to enjoy certain benefits from Flex’s operating diversity, size, and purchasing power, as well as opportunities to pursue integrated initiatives with Flex’s other businesses. As an independent, publicly traded company, we will not have the same benefits. While we believe that the Spin-Off will position each company to better unlock its full standalone long-term potential, we cannot assure you that following the Spin-Off we will be successful. Further, there can be no assurance that the combined value of the shares of the two resulting companies will be equal to or greater than what the value of Flex ordinary shares would have been had the Spin-Off not occurred. After the Spin-Off, Flex or we may offer products or engage in businesses that compete with the other company’s products or businesses, subject to the reciprocal restrictions described below.

The non-competition and customer non-solicitation restrictions in the Separation Agreement may limit our ability to compete and pursue certain business opportunities.

The Separation Agreement will impose reciprocal non-competition and customer non-solicitation restrictions applicable worldwide on Spinco and Flex and their respective subsidiaries during the Restricted Period, which will be the three years following the Distribution. Spinco generally would be restricted from engaging in the RemainCo Restricted Business, meaning contract manufacturing services generally but excluding (i) integration of modular power equipment and associated enclosures and (ii) contract manufacturing services in the Cloud & Compute business. For the avoidance of double, the RemainCo Restricted Business includes contract manufacturing services for the Power, Cooling, and Networking product businesses, in any jurisdiction

 

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worldwide. Spinco also generally would be restricted from soliciting any RemainCo Protected Customer. Flex generally would be restricted from engaging in the Spinco Restricted Business, meaning (i) the Power business, excluding contract manufacturing services; (ii) the Cooling business, excluding contract manufacturing services; and (iii) the Cloud & Compute business, including contract manufacturing services generally and for the avoidance of doubt, including contract manufacturing services related to CPU and AI-accelerated servers, compute trays, fabrication of associated racks and enclosures, and integration into those racks, but excluding contract manufacturing services for Networking products, and from soliciting any Spinco Protected Customer. Among other exceptions, (a) Spinco would be permitted to continue contract manufacturing in the Power, Cooling and Networking product businesses only for customers for which Spinco or any member of the Spinco Group has such business as of immediately prior to the Effective Time, including associated future programs with such customers and (b) RemainCo would be permitted to continue the Compute business for certain customers. These restrictions may limit Spinco’s ability to compete in certain markets, pursue certain customers, or complete acquisitions or other strategic transactions during the Restricted Period, which could materially and adversely affect our business, financial condition and results of operations. See “Certain Relationships and Related Transactions—Agreements with Flex—The Separation Agreement—Non-Competition and Customer Non-Solicitation.”

We may incur material costs and expenses as a result of the Spin-Off.

We may incur costs and expenses greater than those we currently expect to incur as a result of the Spin-Off. These increased costs and expenses may arise from various factors, including financial reporting and costs associated with complying with federal securities laws (including compliance with Sarbanes-Oxley Act of 2002, as amended (the “Sarbanes-Oxley Act”)). We will also incur ongoing costs and dis-synergies in connection with, or as a result of, the separation and related restructuring transactions, including costs of operating as independent, publicly traded companies that the two businesses will no longer be able to share. We cannot assure you that these costs will not be material to our business.

We may not be able to prevent or detect all errors or fraud, and as a newly standalone public company, we will need to establish our own internal control environment.

As a newly standalone public company following the Spin-Off, we will need to establish and maintain our own financial, accounting, and reporting systems and internal control over financial reporting. Certain functions for our business have historically been performed or supported by Flex, and following the separation, we must implement these functions independently. We may face challenges in designing and implementing controls that were previously provided by Flex or that must be modified to reflect our standalone operations, and there can be no assurance that we will successfully establish and maintain adequate internal controls.

Due to the inherent limitations of internal control systems, misstatements due to error or fraud may occur and may not be detected in a timely manner or at all. Over time, certain aspects of a control system may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. In connection with our ongoing assessment of the effectiveness of our internal control over financial reporting, we may discover “material weaknesses” in our internal controls that could result in material misstatements not being prevented or detected on a timely basis.

The existence of any material weakness may require significant management time and remediation expense, may result in errors requiring corrective adjustments or restatements, may cause us to fail to meet reporting obligations, and may cause shareholders to lose confidence in our reported financial information, any of which could materially and adversely affect the market price of our securities and our ability to maintain compliance with securities laws and stock exchange listing requirements.

 

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If we fail to maintain proper and effective internal controls, our ability to produce accurate and timely financial statements could be impaired, our stock price and our ability to access the capital markets could be adversely impacted, and investors’ views of us could be harmed.

The Sarbanes-Oxley Act requires, among other things, that we maintain effective internal control over financial reporting and disclosure controls and procedures. In particular, we must perform system and process evaluation and testing of our internal control over financial reporting to allow management and our independent registered public accounting firm to report on the effectiveness of our internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act, with auditor attestation of the effectiveness of our internal controls, beginning as early as our second required annual report on Form 10-K based on current SEC rules. To comply with these requirements, we may need to upgrade our systems, implement additional financial and management controls, reporting systems and procedures and hire additional accounting and finance staff. We expect to incur additional annual expenses for the purpose of addressing these and other public-company reporting requirements. If we are unable to upgrade our financial and management controls, reporting systems, IT systems and procedures in a timely and effective fashion, our ability to comply with financial reporting requirements and other rules that apply to reporting companies under the Exchange Act, could be impaired. If we are not able to comply with the requirements of Section 404 in a timely manner or if we or our independent registered public accounting firm identifies deficiencies in our internal control over financial reporting that are deemed to be material weaknesses, the market price of shares of common stock could decline and we could be subject to sanctions or investigations by the SEC or other regulatory authorities, which would require additional financial and management resources.

Our ability to comply with Section 404 requires us to be able to prepare timely and accurate financial statements. Any delay in the implementation of, or disruption in the transition to, new or enhanced systems, procedures or controls may cause our operations to suffer, and we may be unable to conclude that our internal control over financial reporting is effective and to obtain an unqualified report on internal controls from our auditors as required under Section 404 of the Sarbanes-Oxley Act. Moreover, we cannot be certain that these measures would ensure that we implement and maintain adequate controls over our financial processes and reporting in the future. Even if we were to conclude, and our auditors were to concur, that our internal control over financial reporting provided reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP, because of its inherent limitations, internal control over financial reporting might not prevent or detect fraud or misstatements. This, in turn, could have an adverse impact on trading prices for our shares of common stock and could adversely affect our ability to access the capital markets. See “—Risks Related to the Spin-Off—As we build our IT infrastructure and transition our data to our own systems, we could incur substantial additional costs and experience temporary business interruptions, including cybersecurity incidents.”

We are being spun-off from our parent company, Flex, and our historical and pro forma financial information is not necessarily representative of the results that we would have achieved as a separate, publicly traded company and, therefore may not be a reliable indicator of our future results.

We are being spun-off from our parent company, Flex, and have no operating history as an independent, publicly traded company. The historical information about us in this information statement refers to our business as part of pre-Spin-Off Flex. Our historical and pro forma financial information included in this information statement is derived from the combined financial statements and accounting records of Flex. Accordingly, the historical and pro forma financial information included in this information statement does not necessarily reflect the financial condition, results of operations, or cash flows that we would have achieved as a separate, publicly traded company during the periods presented or those that we will achieve in the future primarily as a result of the factors described below:

 

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we may need to make significant investments to replicate or outsource certain systems, infrastructure, and functional expertise after the Spin-Off. These initiatives to develop our independent ability to operate will be costly to implement. We may not be able to operate our business as efficiently or at comparable costs, and our profitability may decline;

 

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•

how we finance our working capital or other cash requirements may differ from how we financed those requirements as part of pre-Spin-Off Flex. After the Spin-Off, our access to and cost of debt financing will be different from the historical access to and cost of debt financing under pre-Spin-Off Flex. Differences in access to and cost of debt financing are likely to result in differences in interest rates charged to us on financings, the amounts of indebtedness, types of financing structures and debt markets that may be available to us, which may have an adverse effect on our business, financial condition, results of operations, and cash flows; and

 

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in preparing our financial statements, pre-Spin-Off Flex made allocations of costs and corporate expenses deemed to be attributable to our business. However, these costs and expenses reflect the costs and expenses attributable to our business operated as part of a larger organization and do not necessarily reflect costs and expenses that would be incurred by us had we been operating independently. As a result, our historical financial information may not be a reliable indicator of future results.

For additional information about the past financial performance of our business and the basis of presentation of the historical combined financial statements and the unaudited pro forma combined financial statements of our business, see the sections of this information statement entitled “Unaudited Pro Forma Condensed Combined Financial Information,” “Notes to Unaudited Pro Forma Condensed Combined Financial Information,” “Summary of Historical and Unaudited Pro Forma Combined Financial Data” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” as well as the combined financial statements and accompanying notes, included elsewhere in this information statement.

Flex may fail to perform under various transaction agreements that will be executed as part of the Spin-Off, or we may fail to have necessary systems and services in place when Flex is no longer obligated to provide services under the various agreements.

We and Flex will enter into certain agreements, such as the Separation Agreement, a Transition Services Agreement, a Tax Matters Agreement, an Employee Matters Agreement, an Intellectual Property Matters Agreement, a Stockholder’s and Registration Rights Agreement, Cross-Supply Agreements, and a Site Services Agreement, as discussed in greater detail in the section of this information statement entitled “Certain Relationships and Related Transactions—Agreements with Flex,” which may provide for the performance by each company for the benefit of the other for a period of time after the Spin-Off. If Flex is unable to satisfy its obligations under these agreements, including its indemnification obligations in favor of us, we could incur operational difficulties or losses.

If we do not have in place our own systems and services, and do not have agreements with other providers of these services when the transitional or other agreements terminate, or if we do not implement the new systems or replace Flex’s services successfully, we may not be able to operate our business effectively, which could disrupt our business and have a material adverse effect on our business, financial condition, and results of operations. These systems and services may also be more expensive to install, implement, and operate, or less efficient than the systems and services Flex is expected to provide during the transition period.

In connection with the Spin-Off, Flex will indemnify us for certain liabilities. However, there can be no assurance that the indemnity will be sufficient to protect us against the full amount of such liabilities, or that Flex’s ability to satisfy its indemnification obligations will not be impaired in the future.

Flex will agree to indemnify us for certain liabilities as discussed further in the section of this information statement entitled “Certain Relationships and Related Transactions.” However, third parties could also seek to hold us responsible for liabilities that Flex has agreed to retain, and there can be no assurance that the indemnity from Flex will be sufficient to protect us against the full amount of such liabilities, or that Flex will be able to fully satisfy its indemnification obligations. In addition, Flex’s insurers may attempt to deny coverage to us for liabilities associated with certain occurrences of indemnified liabilities prior to the Spin-Off.

 

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In connection with our separation, we will assume and indemnify Flex for certain liabilities. If we are required to make payments pursuant to these indemnities to Flex, we would need to meet those obligations and our financial results could be adversely impacted.

We will agree to assume and indemnify Flex for, certain liabilities as discussed further in the section of this information statement entitled “Certain Relationships and Related Transactions.” Payments pursuant to these indemnities may be significant and could adversely impact our business, financial condition, results of operations, and cash flows, particularly indemnities relating to our actions that could impact the tax-free nature of the Distribution.

If the Distribution, together with certain related transactions, does not qualify for the Intended Tax Treatment, you and Flex could be subject to significant U.S. federal income tax liability and, in certain circumstances, we could be required to indemnify Flex for material taxes pursuant to indemnification obligations under the anticipated Tax Matters Agreement.

It is a condition to the completion of the Distribution that Flex receives the Tax Opinion, substantially to the effect that, among other things, the Distribution, together with certain related transactions, will qualify for the Intended Tax Treatment and that holders of Flex ordinary shares that are United States persons (as defined in Section 7701(a)(30) of the Code) should not be required to recognize gain pursuant to the Distribution by reason of the application of certain Treasury Regulations promulgated under Section 367(b) of the Code. However, this condition may be waived by Flex in its sole discretion. The Tax Opinion will rely on certain facts, assumptions, representations, and undertakings from Flex and us, including those regarding the past and future conduct of the companies’ respective businesses and other matters. Nevertheless, an opinion of counsel, such as the Tax Opinion, neither binds the IRS nor precludes the IRS or the courts from adopting a contrary position. Moreover, Flex does not intend to request a ruling from the IRS on issues related to the U.S. federal income tax consequences of the Distribution and certain related transactions. Therefore, notwithstanding the Tax Opinion, the IRS could determine that the Distribution or any such related transaction is taxable if it determines that any of these facts, assumptions, representations, or undertakings are not correct or have been violated, or that the Distribution should be taxable for other reasons, including if the IRS were to disagree with the conclusions in the Tax Opinion. For more information regarding the Tax Opinion, see the section of this information statement entitled “United States Federal Income Tax Consequences of the Distribution.”

If the Distribution or any of the above referenced related transactions is determined to be taxable for U.S. federal income tax purposes, a shareholder of Flex that has received shares of our stock in the Distribution and Flex could each incur significant U.S. federal income tax liabilities. In addition, Flex and we could incur significant U.S. federal income tax obligations, whether under applicable law or under the Tax Matters Agreement that we intend to enter into with Flex. For a discussion of the tax consequences of the Distribution, together with certain related transactions, please refer to the section entitled “United States Federal Income Tax Consequences of the Distribution.”

To preserve the tax-free treatment to Flex and its shareholders of the Distribution and certain related transactions, under the Tax Matters Agreement that we anticipate entering into with Flex, we will be restricted from taking certain actions after the Distribution that could adversely impact the Intended Tax Treatment of the Distribution and such related transactions.

To preserve the tax-free treatment to Flex and its shareholders of the Distribution and certain related transactions, under the Tax Matters Agreement that we anticipate entering into with Flex, we may be restricted from taking certain actions after the Distribution that could adversely impact the Intended Tax Treatment of the Distribution, together with certain related transactions. Failure to adhere to any such restrictions, including in certain circumstances that may be outside of our control, could result in tax being imposed on Flex for which we could bear responsibility and for which we could be obligated to indemnify Flex. In addition, even if we are not responsible for tax liabilities of Flex under the anticipated Tax Matters Agreement, we nonetheless could potentially be liable under applicable tax law for certain of such liabilities if such taxes were not paid.

 

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The terms of the anticipated Tax Matters Agreement may, furthermore, restrict us from taking certain actions, particularly for the two years following the Spin-Off, including (among other things) the ability to freely issue stock, to merge or agree to merge with a third party, to be acquired or agree to be acquired by certain parties and to raise additional equity capital. Any such restrictions could impair our ability to implement strategic initiatives. Also, any indemnity obligation to Flex might discourage, delay or prevent a change of control that we or our shareholders may otherwise consider favorable. These restrictions may limit our ability to enter into certain strategic transactions or other transactions that we may believe to be in the best interests of our shareholders or that might increase the value of our business. In addition, under the anticipated Tax Matters Agreement, we may be required to indemnify Flex against certain tax liabilities as a result of the acquisition of our stock or assets, even if we did not participate in or otherwise facilitate the acquisition. For a discussion of the Tax Matters Agreement, see the section of this information statement entitled “Certain Relationships and Related Transactions—Agreements with Flex—Tax Matters Agreement.”

There is uncertainty regarding the potential application of Section 367(b) of the Code to the Distribution, which could result in material U.S. federal income tax liability to U.S. Holders.

The U.S. federal income tax treatment of the Distribution to U.S. Holders (as defined in the section entitled “United States Federal Income Tax Consequences of the Distribution”) depends in part on the interpretation and application of Section 367(b) of the Code and certain Treasury Regulations promulgated thereunder, including Treasury Regulations Section 1.367(b)-3(c). Flex understands that it is not possible for its tax counsel, Skadden, to reach a more definitive conclusion regarding whether holders of Flex ordinary shares that are United States persons (as defined in Section 7701(a)(30) of the Code) are required to recognize gain pursuant to the Distribution by reason of the application of certain Treasury Regulations promulgated under Section 367(b) of the Code, as the U.S. federal income tax treatment of the Distribution to such holders depends in part on the interpretation and application of Section 367(b) of the Code and Treasury Regulations promulgated thereunder, including Treasury Regulations Section 1.367(b)-3(c). These rules are complex, and there is significant uncertainty as to whether such Treasury Regulations should be interpreted as applying to the Distribution because Flex is a non-U.S. corporation that is not a controlled foreign corporation for U.S. federal income tax purposes, and the Distribution is structured as a pro rata distribution of Spinco common stock to holders of Flex ordinary shares. Thus, the applicability of these Treasury Regulations is unclear.

Accordingly, certain conclusions in the Tax Opinion will relate to matters for which there is no legal authority directly on point, and such conclusions will therefore necessarily be based upon analysis and interpretation of certain authorities. Based upon such analysis and authorities, the Tax Opinion will provide that holders of Flex ordinary shares that are United States persons (as defined in Section 7701(a)(30) of the Code) should not be required to recognize gain pursuant to the Distribution by reason of the application of certain Treasury Regulations promulgated under Section 367(b) of the Code.

Flex does not intend to request a ruling from the IRS on issues related to the U.S. federal income tax consequences of the Distribution and certain related transactions. Moreover, the Tax Opinion will not be binding upon the IRS or any court. As such, there is a risk that the IRS could assert, contrary to the conclusions reached in the Tax Opinion, that Treasury Regulations Section 1.367(b)-3(c) does apply to the Distribution.

If the IRS were to successfully assert that such Treasury Regulations apply to the Distribution, the receipt of Spinco common stock pursuant to the Distribution would be taxable to a U.S. Holder whose Flex ordinary shares have a fair market value of $50,000 or more on the Distribution Date, and such U.S. Holder would be required to recognize gain (but not loss) upon the Distribution, but there is no clear guidance regarding how such gain should be computed. Such amounts may be significant, potentially resulting in material U.S. federal income tax liabilities. However, if the fair market value of a U.S. Holder’s Flex ordinary shares is less than $50,000 on the Distribution Date, these rules would not apply, and the Distribution would not be taxable to such holder pursuant to such rules. U.S. Holders are urged to consult their tax advisor as to the applicability of these Treasury Regulations and how to determine the amount of any gain that would be required to be recognized. See the section entitled “United States Federal Income Tax Consequences of the Distribution” for more information.

 

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The Spin-Off and related internal restructuring transactions may expose us to potential liabilities arising out of state and federal fraudulent conveyance laws and legal dividend requirements.

Although the Flex Board of Directors expects to receive a solvency opinion, the Spin-Off could be challenged under various state and federal fraudulent conveyance laws. Fraudulent conveyances or transfers are generally defined to include (a) transfers made or obligations incurred with the actual intent to hinder, delay or defraud current or future creditors or (b) transfers made or obligations incurred for less than reasonably equivalent value when the debtor was insolvent, or that rendered the debtor insolvent, inadequately capitalized or unable to pay its debts as they become due. A creditor or an entity acting on behalf of a creditor (including, without limitation, a trustee or debtor-in-possession in a bankruptcy by us or Flex or any of our or its respective subsidiaries) may bring a lawsuit alleging that the Spin-Off or any of the related transactions constituted a fraudulent conveyance. If a court accepts these allegations, it could impose a number of remedies, including, without limitation, voiding the Distribution and returning our assets or shares and subjecting Flex and/or us to liability.

We may have received better terms from unaffiliated third parties than the terms we will receive in our agreements with Flex.

The agreements we will enter into with Flex in connection with the Spin-Off, including the ancillary agreements, were prepared while we were still a wholly owned subsidiary of Flex. Accordingly, during the period in which the terms of those agreements were prepared, we did not have a board of directors or management team that was independent of Flex. While the parties believe the terms reflect arm’s-length terms, there can be no assurance that we would not have received better terms from unaffiliated third parties than the terms we will receive in our agreements with Flex. For more information, see the section of this information statement entitled “Certain Relationships and Related Transactions—Agreements with Flex.”

Some contracts and other assets which will need to be transferred or assigned from Flex or its affiliates to us in connection with the Spin-Off may require the consent of a third party. If such consent is not given, we may not be entitled to the benefit of such contracts and other assets in the future, which could adversely impact our financial condition and future results of operations.

In connection with the Spin-Off, a number of contracts and licenses with third-parties and other assets are to be transferred or assigned from (x) Flex or its affiliates to us or our anticipated subsidiaries or (y) us or our affiliates to Flex or its subsidiaries. However, the transfer or assignment of certain of these contracts, licenses, or assets may require the consent of a third party to such a transfer or assignment. Similarly, in some circumstances, we and another business unit of Flex are joint beneficiaries of contracts, and we or Flex will need to (x) enter into a new agreement with the third-party to replicate the existing contract, (y) be assigned and delegated the portion of the existing contract related to the applicable business or (z) use commercially reasonable efforts to provide for an alternative arrangement to obtain the same or reasonably similar benefits and burdens of the applicable portion of the existing contract. It is possible that some parties may use the requirement of a consent or the fact that the Spin-Off is occurring to seek more favorable contractual terms from us, to terminate the contract or license or to otherwise request additional accommodations, commitments, or other agreements from us. If we are unable to obtain such consents on commercially reasonable and satisfactory terms or if the contracts are terminated, we may be unable to obtain the benefits, assets, and contractual commitments which are intended to be allocated to us as part of the Spin-Off. The failure to timely complete the assignment of existing contracts, licenses, or assets, or the negotiation of new arrangements, or a termination of any of those arrangements, could have a material adverse impact on our financial condition and future results of operations. To the extent we require a specific arrangement and agree to less favorable terms in connection with obtaining any consent to retain that arrangement, the basis for that arrangement may be less favorable than currently held by us and could adversely impact our financial conditions and future results of operations. In addition, where we do not intend to obtain consent from third-party counterparties based on our belief that no consent is required, the third-party counterparties may challenge a transfer of assets on the basis that the terms of the applicable commercial arrangements require the third-party counterparties’ consent. We may incur substantial litigation and other costs in connection with any such claims and, if we do not prevail, our ability to use these assets could be materially and adversely impacted.

 

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In connection with the Spin-Off, we expect to incur debt obligations that could materially and adversely affect our business, results of operations, cash flows, and financial condition.

In connection with the completion of the Spin-Off, we expect to incur indebtedness of up to $4.4 billion pursuant to the Spinco Financing Arrangements and to complete the Spinco Cash Distribution to Flex. The terms of such indebtedness are subject to change and will be finalized prior to the closing of the Spin-Off.

Our ability to make payments on and to refinance our indebtedness, including the debt incurred in connection with the Spin-Off, as well as any future debt that we may incur, will depend on our ability to generate cash in the future from operations, financings or asset sales. Our ability to generate cash is subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control, as well as the risk factors set forth herein.

If our cash flow from operations is less than we anticipate, or if our cash requirements are more than we expect, we may require additional access to capital and may need to incur additional debt or raise additional funds.

If our cash flow from operations is less than we anticipate, or if our cash requirements are more than we expect, we may require additional access to capital and may need to incur additional debt or raise additional funds. However, debt or equity financing may not be available to us on terms acceptable or favorable to us, if at all, and will depend on a number of factors, many of which are beyond our control, such as the state of the credit and financial markets and other economic, financial, and geopolitical factors. If we incur additional debt or raise capital through the issuance of preferred stock, the terms of the debt or preferred stock issued may give the holders thereof rights, preferences, and privileges senior to those of holders of our common stock, particularly in the event of liquidation. The terms of such debt may also impose additional and more stringent restrictions on our operations than we are currently subject to. If we raise funds through the issuance of additional equity, your percentage ownership in us would be diluted. If we are unable to raise additional capital when needed, it could affect our financial condition, which could adversely impact your investment in us.

Following the Spin-Off, the value of your ordinary shares of Flex and common stock of Spinco may collectively trade at an aggregate price less than what Flex ordinary shares might have traded at had the Spin-Off not occurred.

The ordinary shares of Flex and common stock of Spinco that you may hold following the Spin-Off may collectively trade (taking into account the Distribution Ratio) at a value less than the price at which Flex ordinary shares might have traded had the Spin-Off not occurred or as it was trading prior to the Spin-Off. Reasons for this potential difference include the future performance of either Flex or Spinco as separate, independent companies, and the future shareholder base and market for Flex ordinary shares and Spinco’s common stock and the prices at which such shares individually trade.

Until the Distribution occurs, Flex has the sole discretion to change the terms of the Spin-Off in ways which may be unfavorable to us.

Completion of the Distribution will be contingent upon the satisfaction or waiver of customary conditions, including, among other things, the effectiveness of appropriate filings with the SEC. For a more detailed description of these conditions, see the section of this information statement entitled “The Separation and Distribution—General—Conditions to the Distribution.” Until the Distribution occurs, Flex will have the sole and absolute discretion to determine and change the terms of the Spin-Off, including the allocation of assets and liabilities, the establishment of the Distribution Record Date and distribution date, the conditions to the Distribution, and all other terms. These changes could be unfavorable to us. In addition, until the Spin-Off has occurred, Flex has the right not to complete the Spin-Off, even if all the conditions have been satisfied, if, at any time prior to the Distribution, the Flex Board of Directors determines, in its sole discretion, that the Spin-Off is not in the best interests of Flex, that a sale or other alternative is in the best interests of Flex, or that market conditions or other circumstances are such that it is not advisable at that time to separate our business from Flex. We cannot provide any assurances that the Distribution will be completed.

 

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Certain entities or assets that are part of our separation from Flex may not be transferred to us at or prior to the Distribution or at all.

Certain entities and assets that are part of our separation from Flex may not be transferred at or prior to the Distribution because the entities or assets, as applicable, are subject to governmental or third-party approvals that we may not receive prior to the Distribution. It is currently anticipated that all material transfers will occur without material delays beyond the Distribution, but we cannot offer any assurance that such transfers will ultimately occur or not be delayed for an extended period of time. To the extent such transfers do not occur at or prior to the Distribution, under the separation and distribution agreement, the benefits and burdens of owning such assets and/or entities will, to the extent reasonably possible and permitted by applicable law, be provided to the applicable party.

In the event such transfers do not occur or are significantly delayed because we do not receive the required approvals, we may not realize all of the anticipated benefits of our separation from Flex and we may be dependent on Flex for transition services for a longer period of time than would otherwise be the case.

The separation could give rise to disputes or other unfavorable effects, which could materially and adversely affect our business, financial condition, and results of operations.

The separation may lead to increased operating and other expenses, of both a nonrecurring and a recurring nature, and to changes to certain operations, which expenses or changes could arise pursuant to arrangements made between Flex and us or could trigger contractual rights of, and obligations to, third parties. Disputes with third parties could also arise out of these transactions, and we could experience unfavorable reactions to the separation from employees, lenders, ratings agencies, regulators, or other interested parties. These increased expenses, changes to operations, disputes with third parties, or other effects could materially and adversely affect our business, financial condition, and results of operations. In addition, following the separation, disputes with Flex could arise in connection with one or more of the ancillary agreements or certain other agreements.

Ms. Advaithi will serve as our Chief Executive Officer and as one of our directors as well as the non-executive chair of the Flex Board of Directors, and certain of our directors and executive officers will continue to own shares or equity awards of Flex, which overlap may give rise to conflicts of interest.

Following the Distribution, Ms. Advaithi will serve as our Chief Executive Officer and as one of our directors. Ms. Advaithi is also expected to fill a transitional role as the non-executive chair of the Flex Board of Directors. Ms. Advaithi may have actual or apparent conflicts of interest with respect to matters involving or affecting each of Flex or Spinco. For example, there will be the potential for a conflict of interest when we on the one hand, and Flex and its respective subsidiaries and successors on the other hand, are party to commercial transactions concerning the same or adjacent investments. In addition, after the Distribution, even though our board of directors will consist of a majority of directors who are independent, and any of our expected executive officers who are currently employees of Flex will cease to be employees of Flex, certain of our directors and executive officers will continue to have financial interests in Flex ordinary shares. However, no director or executive officer of Spinco is expected to beneficially own 1% or more of Flex ordinary shares following the Distribution. These financial interests could create actual, apparent, or potential conflicts of interest if we and Flex pursue the same corporate opportunities or when these individuals are faced with decisions that could have different implications for our company and Flex. See “Certain Relationships and Related Transactions—Procedures for Approval of Related Person Transactions” for a discussion of certain procedures we will institute to help ameliorate such potential conflicts that may arise.

The separation may result in disruptions to relationships with customers, suppliers, and other business partners.

While we intend to manage our operations to minimize any disruptions to our customers, suppliers, and business partners, uncertainty related to the separation may nevertheless lead to disruption in those relationships. These disruptions, if not managed by us, could have an adverse effect on our business, financial condition, results of operations, and prospects.

 

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After the separation, we may be unable to make, on a timely or cost-effective basis, the changes necessary to operate as an independent company, and we may experience a loss of institutional knowledge as a result of employee transitions.

At the completion of the separation, we may not have the infrastructure, systems, or personnel necessary to operate effectively as an independent company, including with respect to the functionality and reliability of our information technology systems, without relying on Flex to provide certain transitional services. We may need additional personnel or third-party service providers to successfully operate our business. Upon the completion of the separation, we will enter into a transition services agreement with Flex pursuant to which we will provide certain services to Flex, and Flex will provide certain services to us, to allow us to continue to operate in substantially the same manner following the separation and to benefit from the continuation of certain services for a certain amount of time post-separation and certain cost efficiencies in sharing certain resources and personnel. We cannot assure you that we will be able to successfully implement the infrastructure or retain or hire the personnel necessary to operate as a separate company or that we will not incur costs in excess of anticipated costs to establish such infrastructure and retain or hire such personnel.

In addition, in connection with the Spin-Off, certain employees who have historically supported our business may remain with Flex, retire, or otherwise depart. These employees may possess significant institutional knowledge regarding our operations, customer relationships, supply chain, technology systems, and business processes that have been accumulated over many years. The loss of such institutional knowledge could result in operational inefficiencies, delays in decision-making, disruptions to customer and supplier relationships, and increased costs as we train new personnel or hire replacements. The departure of key personnel with specialized expertise could also impair our ability to maintain continuity in our operations and strategic initiatives. Even where employees transfer to us from Flex, changes in organizational structure, reporting relationships, or corporate culture following the Spin-Off could result in the departure of valuable employees who might otherwise have remained. We may not be able to fully replicate or retain the institutional knowledge held by departing employees, which could have a material adverse effect on our business, financial condition, and results of operations.

The physical separation and reorganization of manufacturing operations in connection with the Spin-Off may disrupt our business and result in increased costs.

In connection with the Spin-Off, we will be required to physically separate and reorganize certain manufacturing operations. This process may involve the relocation of manufacturing equipment and production lines, the division or reconfiguration of shared manufacturing facilities, the establishment of new manufacturing capabilities, and the reconfiguration of supply chain and logistics networks. These activities are complex and may result in significant costs, production downtime, unabsorbed labor and overhead, or delays in fulfilling customer orders. During the transition period, we may experience disruptions to manufacturing continuity, including interruptions in production schedules, reduced manufacturing capacity, quality control issues, or inefficiencies as we establish standalone operations. The transfer of manufacturing know-how, processes, and institutional knowledge from Flex may not occur smoothly or completely, which could adversely affect our ability to maintain product quality and operational efficiency. In addition, the allocation of manufacturing capacity, equipment, and facilities between Spinco and Flex may not be optimal for our business needs, and we may need to incur significant capital expenditures to build or acquire additional manufacturing capacity.

The transfer of certain employees from Flex to us contemplated by the separation will not be complete at the time of the Distribution.

In connection with the separation, Flex has agreed to transfer to us, through asset transfers, dividends, contributions and similar transactions, the entities, assets, liabilities and obligations that we will hold following the separation of our business from Flex’s other businesses. As set forth more fully in “The Separation and Distribution” and “Certain Relationships and Related Transactions,” we expect to enter into the Separation Agreement and a number of other agreements with Flex prior to the Distribution.

 

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Certain of these transactions will not be complete at the time of the Distribution. In particular, at the completion of the Distribution, we expect that a substantial portion of the employees that support our business in certain jurisdictions will remain employed by legal entities that are owned by Flex and not by us. While we have entered into the Employee Matters Agreement and the Transition Services Agreement with Flex that, together, provide for the eventual transfer of such employees to us following the completion of the Distribution (as well as certain other terms, including the allocation of employee-related liabilities and how such employees’ efforts must be directed), future developments such as unanticipated delays in setting up business operations or fulfilling applicable legal or regulatory requirements necessary to employ such employees in the countries in which we operate are difficult to predict, and could prevent or further delay the transfer of certain employees to legal entities owned by us, which could deprive us of key personnel and adversely impact our business and results of operations.

Risks Related to Our Common Stock

We cannot be certain that an active trading market for our common stock will develop or be sustained after the Spin-Off and, following the Spin-Off, our stock price may fluctuate significantly.

A public market for our common stock does not currently exist. We expect that shortly before the Distribution Date, trading of shares of our common stock will begin on a “when-issued” basis on     and will continue through the Distribution Date. However, we cannot guarantee that an active trading market will develop or be sustained for our common stock after the Spin-Off. If an active trading market does not develop, our shareholders may have difficulty selling their shares of our common stock at an attractive price, or at all. Nor can we predict the prices at which shares of our common stock may trade after the Spin-Off.

Similarly, we cannot predict the effect of the Spin-Off on the trading prices of our common stock. Subject to the completion of the Spin-Off, we expect our common stock to be listed and traded on Nasdaq under the symbol “AXM.” The combined trading prices of Flex ordinary shares and our common stock after the separation, as adjusted for any changes in the combined capitalization of these companies, may not be equal to or greater than the trading price of Flex ordinary shares prior to the Spin-Off. Until the market has fully evaluated the business of Flex without our business, or fully evaluated us, the price at which Flex ordinary shares or our common stock trades may fluctuate significantly.

Our common stock may not be listed on Nasdaq, which could negatively impact the price of our common stock and your ability to sell our common stock.

Approval of our listing application by Nasdaq is a condition to the Distribution, and we intend to apply to have our common stock listed on Nasdaq under the symbol “AXM.” However, there can be no assurance that we will be able to meet Nasdaq’s initial listing requirements. If we fail to satisfy the initial listing requirements or Nasdaq exercises its discretion to deny our listing application, the Distribution may not occur, or, if the condition is waived and the Distribution occurs, our common stock would not be listed on a national securities exchange. In such case, our stock could be quoted on an over-the-counter market. These quotation services are generally considered to be a less efficient and less visible market than a national securities exchange. Trading on an over-the-counter market could reduce the liquidity and market price of our common stock and may make it more difficult for investors to buy or sell shares of our common stock.

The market price of our common stock may fluctuate significantly due to a number of factors, some of which may be beyond our control, including:

 

•

our business profile, market capitalization, or capital allocation policies may not fit the investment objectives of Flex’s current shareholders, causing a shift in our investor base and our common stock may not be included in some indices in which Flex ordinary shares are included, causing certain holders to sell their shares of our common stock;

 

•

our quarterly or annual earnings, or those of other companies in our industry;

 

•

the failure of securities analysts to cover our common stock after the Spin-Off;

 

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•

actual or anticipated fluctuations in our results of operations;

 

•

changes in earnings estimates by securities analysts or our ability to meet those estimates;

 

•

our ability to meet our forward looking guidance;

 

•

the operating and stock price performance of other comparable companies;

 

•

overall market fluctuations and domestic and worldwide economic conditions; and

 

•

other factors described in this “Risk Factors” section and elsewhere in this information statement.

Stock markets in general have experienced volatility that has often been unrelated to the operating performance of a particular company. Broad market and industry factors may materially harm the market price of our common stock, regardless of our operating performance. In the past, following periods of volatility in the market price of a company’s securities, shareholder derivative lawsuits, and/or securities class action litigation has often been instituted against such company. Such litigation, if instituted against us, could result in substantial costs and a diversion of management’s attention and resources.

In addition, investors may have difficulty accurately valuing our common stock. Investors often value companies based on the stock prices and results of operations of other comparable companies. Investors may find it difficult to find comparable companies and to accurately value our common stock, which may cause the trading price of our common stock to fluctuate.

Any sales of substantial amounts of shares of our common stock in the public market, or the perception that such sales might occur, in connection with the Distribution or otherwise, may cause the market price of our common stock to decline.

Upon completion of the Distribution, we expect that we will have an aggregate of approximately     shares of our common stock issued and outstanding based upon approximately     Flex ordinary shares issued and outstanding as of      , 2026. The shares of our common stock will be freely tradeable without restriction or further registration under the Securities Act of 1933, as amended (the “Securities Act”), unless the shares are owned by one of our “affiliates,” as that term is defined in Rule 405 under the Securities Act.

We are unable to predict whether large amounts of our common stock will be sold in the open market following the Spin-Off. We are also unable to predict whether a sufficient number of buyers would be in the market at that time. Flex investors who have an investment strategy of tracking an index fund may sell the shares of Spinco common stock that they receive in the Distribution if Spinco is not listed on the same index. As a result, the price of Spinco common stock may decline or experience volatility as Spinco’s shareholder base changes. Whether related to the foregoing or otherwise, sales of substantial amounts of shares of our common stock in the public market following the Spin-Off, or the perception that such sales might occur, may cause the market price of our common stock to decline.

In addition, Flex is retaining between approximately 6.0% to 12.0% of our common stock. Flex intends to dispose of such shares of Spinco common stock that it owns after the Distribution through one or more subsequent exchanges of Spinco common stock for Flex debt held by Flex creditors and/or through distributions of Spinco common stock to Flex shareholders as dividends or as non-cash consideration in exchange for issued and outstanding Flex ordinary shares pursuant to an off-market purchase on equal access scheme as prescribed by the Singapore Companies Act, in each case during the 24-month period following the Distribution. Any disposition by Flex, or any significant shareholder, of Spinco common stock, or the perception that such dispositions could occur, could adversely affect prevailing market prices for Spinco common stock.

We do not intend to pay cash dividends for the foreseeable future.

The timing, declaration, amount, and payment of future dividends to shareholders falls within the discretion of our board of directors and will depend on many factors, including our financial condition, earnings, capital requirements of our business, and covenants associated with debt obligations, as well as legal requirements,

 

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regulatory constraints, industry practice, and other factors that our board of directors deems relevant. We do not intend to, and there can be no assurance that we will, pay any dividend in the future.

Your percentage of ownership in us may be diluted in the future.

Your percentage ownership in us may be diluted because of equity issuances of our common stock for acquisitions, capital market transactions or otherwise, including, without limitation, equity awards that we may grant to our directors, officers, and employees. Such issuances may have a dilutive effect on our earnings per share, which could adversely affect the market price of our common stock.

In addition, our amended and restated certificate of formation will authorize us to issue, without the approval of our shareholders, one or more classes or series of preferred stock having such designation, powers, preferences, and relative, participating, optional, and other special rights, including preferences over our common stock respecting dividends and distributions, as our board of directors generally may determine. The terms of one or more classes or series of preferred stock could dilute the voting power or reduce the value of our common stock. For example, we could grant the holders of preferred stock the right to elect some number of our directors in all events or on the happening of specified events or to veto specified transactions. Similarly, the repurchase or redemption rights or liquidation preferences we could assign to holders of preferred stock could affect the residual value of our common stock. See the section entitled “Description of Capital Stock.”

The Warrant issued to Amazon may result in additional dilution of our common stock in connection with the Distribution.

On August 15, 2025, Flex issued a warrant (the “Warrant”) to Amazon.com NV Investment Holdings LLC (the “Warrantholder”), a wholly-owned subsidiary of Amazon.com, Inc. (“Amazon”), to purchase up to an aggregate of 3,859,851 ordinary shares of Flex (the “Warrant Shares”) at an exercise price of $51.29 per share, which expires on August 15, 2030. The Warrant Shares are subject to vesting based on qualifying payments (as defined in the Warrant) for the purchase of all products and services by or on behalf of Amazon and its affiliates over the term of the Warrant. The Warrant also provides that, upon certain distributions (which would include the Distribution), the exercise price will be adjusted, concurrent with the Distribution Record Date, by reducing the exercise price by the per share fair market value (as defined in the Warrant) of the Distribution. The Warrant further provides that the exercise price may not be reduced below $0.01 per share and that if the exercise price becomes $0.01, then the Warrantholder will be entitled to participate in the Distribution as if the Warrantholder had previously exercised and would be the holder of all Warrant Shares, whether vested or not, subject to the Warrant before the Distribution Record Date. Flex, Spinco and the Warrantholder are negotiating and expect to execute an amendment to the Warrant which will provide that, instead of Spinco shares, the Warrantholder would receive a fully vested warrant to purchase up to a specified number of Spinco shares at an exercise price of $0.01 per share (the “Spinco Warrant”). As a result, we expect that the exercise price of the Flex Warrant will be reduced to $0.01 per share and that, upon the consummation of the Distribution, the Warrantholder will receive the Spinco Warrant.

Provisions of Texas law, our amended and restated certificate of formation and our amended and restated bylaws, may prevent or delay an acquisition of our company, which could decrease the market price of Spinco common stock.

Texas law contains, and our amended and restated certificate of formation and amended and restated bylaws will contain, provisions that are intended to deter coercive takeover practices and inadequate takeover bids by making such practices or bids unacceptably expensive to the bidder and to encourage prospective acquirers to negotiate with our board of directors rather than to attempt a hostile takeover. These provisions include, among others:

 

•

provisions regarding the election of directors, classes of directors, the term of office of directors, and the filling of director vacancies;

 

•

limit on the ability of shareholders to call a special meeting to those shareholders or groups of shareholders owning at least [20]% of our shares entitled to vote at such meeting;

 

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•

removal of directors only for cause, by the affirmative vote of the holders of a majority of the voting power of all of the then-issued and outstanding shares of stock entitled to vote generally at an election of directors, voting together as a single class;

 

•

our board of directors has the authority to determine designations and the powers, preferences, and relative, participating, optional, or other special rights, and qualifications, limitations, or restrictions thereof, including, without limitation, the dividend rate, conversion rights, redemption price, and liquidation preference, of any series of shares of preferred stock, and to fix the number of shares constituting any such series, and to increase or decrease the number of shares of any such series (but not below the number of shares thereof then outstanding);

 

•

advance notice requirements applicable to shareholders for director nominations and other business to be brought before meetings of shareholders;

 

•

requirements that, for so long as we are a “nationally listed corporation” within the meaning of Section 21.373 of the Texas Business Organizations Code (the “TBOC”), a shareholder or group of shareholders seeking to submit a proposal for approval at a meeting of shareholders must satisfy specific share ownership, holding period, and solicitation requirements;

 

•

a requirement that specified internal corporate claims, including derivative actions, claims alleging breaches of fiduciary duty, claims arising under the TBOC or our organizational documents, claims governed by the internal affairs doctrine, and “internal entity claims” (as defined in the TBOC) be brought exclusively in the Texas Business Court in the Third Business Court Division of the State of Texas, subject to the alternative forums specified in our amended and restated certificate of formation;

 

•

a waiver of the right to trial by jury for any “internal entity claim” as defined in Section 2.115 of the TBOC;

 

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a requirement that a shareholder or group of shareholders seeking to institute or maintain certain derivative proceedings against our directors or officers must beneficially own at least 3% of our outstanding shares, which threshold will automatically increase to the maximum permitted threshold if the TBOC is amended to permit a higher threshold;

 

•

our bylaws may be amended or repealed and new bylaws may be adopted, by our board of directors, unless our amended and restated certificate of formation or Texas law reserves that power exclusively to our shareholders in whole or in part or our shareholders, in amending, repealing or adopting a particular bylaw expressly provide that our board of directors may not amend or repeal a particular bylaw. Unless our amended and restated certificate of formation or a bylaw adopted by our shareholders provides otherwise, our shareholders may also amend or repeal our bylaws or adopt new bylaws by the affirmative vote of the holders of a majority of the voting power of all of the then-issued and outstanding shares of stock entitled to vote thereon.

Public shareholders who might desire to participate in these types of transactions may not have an opportunity to do so, even if the transaction is considered favorable to shareholders. These anti-takeover provisions could substantially impede the ability of public shareholders to benefit from a change in control or a change in our management and board of directors and, as a result, may adversely affect the market price of Spinco common stock and your ability to realize any potential change of control premium.

In addition, following the Distribution, we expect to qualify as an “issuing public corporation” (as defined in the TBOC) subject to Title 2, Chapter 21, Subchapter M of the TBOC, which we refer to as the “Texas Business Combination Law.” Subject to certain exceptions, the Texas Business Combination Law prohibits an issuing public corporation from engaging in specified business combinations with an affiliated shareholder, or an

 

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affiliate or associate of an affiliated shareholder, for a period of three years after the date the shareholder became an affiliated shareholder, unless:

 

•

before the affiliated shareholder became an affiliated shareholder, our board of directors approved the business combination or the acquisition of shares that resulted in the shareholder becoming an affiliated shareholder; or

 

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the business combination is approved by the affirmative vote of the holders of at least two-thirds (2/3) of our outstanding voting shares not beneficially owned by the affiliated shareholder or an affiliate or associate of the affiliated shareholder, at the meeting of shareholders called for that purpose, not less than six months after the affiliated shareholder became an affiliated shareholder. This approval may not be obtained by written consent.

For purposes of Texas Business Combination Law, an “affiliated shareholder” (as defined in the TBOC) generally includes a person who beneficially owns, or owned during the preceding three-year period, 20% or more of the corporation’s outstanding shares. A “business combination” (as defined in the TBOC) includes specified mergers, share exchanges, conversions, asset dispositions, issuance or transfers of shares, liquidation or dissolution proposals, recapitalizations, and other transactions involving an affiliated shareholder or its affiliates or associates.

The Texas Business Combination Law also includes limited exceptions, including for certain inadvertent acquisitions of affiliated shareholder status, certain transfers by will or intestacy, and certain business combinations with a wholly owned Texas subsidiary. An issuing public corporation may also elect not to be governed by the Texas Business Combination Law in its original certificate of formation or bylaws or by a later amendment approved by at least two-thirds of the outstanding voting shares not held by affiliated shareholders, subject to an 18-month delayed effectiveness period and limitations for existing affiliated shareholders.

Neither the amended and restated certificate of formation nor the amended and restated bylaws contains any provisions expressly providing that we will not be subject to the Texas Business Combinations Law. As a result, the Texas Business Combination Law may have the effect of inhibiting a non-negotiated merger or other business combination involving us, even if such a merger or combination would be beneficial to our shareholders.

We believe these provisions will protect our shareholders from coercive or otherwise unfair takeover tactics by requiring potential acquirers to negotiate with our board of directors and by providing our board of directors with more time to assess any acquisition proposal. These provisions are not intended to make us immune from takeovers. However, these provisions will apply even if an acquisition proposal may be considered beneficial by some shareholders and could delay or prevent an acquisition that our board of directors determines is not in the best interests of us and our shareholders. These provisions may also prevent or discourage attempts to remove and replace incumbent directors.

Our amended and restated certificate of formation will contain an exclusive forum provision, and a waiver of the right to trial by jury for any “internal entity claim,” that could limit a shareholder’s ability to bring a claim in a judicial forum that the shareholder believes is favorable for such disputes and may discourage lawsuits against us and any of our directors, officers, or other employees.

Our amended and restated certificate of formation will provide that, unless we consent in writing to the selection of an alternative forum, the Texas Business Court in the Third Business Court Division of the State of Texas (the “Austin Business Court”) (or, if the Austin Business Court lacks jurisdiction or otherwise may not, or may decline to, hear the applicable cause of action, the Texas Business Court in the First Business Court Division of the State of Texas (the “Dallas Business Court”) or, if the Dallas Business Court lacks jurisdiction or otherwise may not hear, or may decline to hear the applicable cause of action the United States District Court for the Western District of Texas, Austin Division (the “Federal Court”) or if the Federal Court lacks jurisdiction or

 

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otherwise may not, or may decline to, hear the applicable cause of action, the state district court of Travis County, Texas) is the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by any directors, officers, or shareholders to us or our shareholders, (iii) any action asserting a claim against us or our current or former directors, officers, employees, or shareholders arising pursuant to any provision of the TBOC or our amended and restated certificate of formation or amended and restated bylaws, (iv) any action asserting a claim against us or any of our directors, officers, or shareholders governed by the internal affairs doctrine, (v) any action asserting an “internal entity claim,” as that term is defined in Section 2.115 of the TBOC, or (vi) any other action or proceeding in which the Business Court of the State of Texas has jurisdiction (the “Texas Exclusive Forum Provision”).

Our amended and restated certificate of formation includes a jury trial waiver consisting of the following language: TO THE FULLEST EXTENT PERMITTED BY THE TBOC, UNLESS THE CORPORATION CONSENTS IN WRITING TO A JURY TRIAL, THE CORPORATION AND EACH SHAREHOLDER, DIRECTOR, OFFICER AND EMPLOYEE OF THE CORPORATION HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY RIGHT THAT THE CORPORATION OR SUCH PERSON MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL ACTION, PROCEEDING, CAUSE OF ACTION, COUNTERCLAIM, CROSS-CLAIM OR THIRD-PARTY CLAIM ARISING OUT OF OR RELATING TO ANY “INTERNAL ENTITY CLAIM” AS THAT TERM IS DEFINED IN SECTION 2.115 OF THE TBOC, AND EACH SHAREHOLDER AGREES THAT SUCH SHAREHOLDER’S HOLDING OR ACQUISITION OF SHARES OF STOCK OF THE CORPORATION OR, TO THE EXTENT PERMITTED BY LAW, OPTIONS OR RIGHTS TO ACQUIRE SHARES OF STOCK OF THE CORPORATION FOLLOWING THE ADOPTION OF THIS AMENDED AND RESTATED CERTIFICATE OF FORMATION CONSTITUTES SUCH SHAREHOLDER’S INTENTIONAL AND KNOWING WAIVER OF ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO SUCH CLAIMS.

Our amended and restated certificate of formation will further provide that the Federal Court (or, if the Federal Court lacks jurisdiction or otherwise may not, or may decline to, hear the applicable cause of action, any other federal district court of the United States) will, to the fullest extent permitted by law, be the exclusive forum for resolving any complaint asserting a cause of action arising under the Securities Act (the “Federal Forum Provision”).

The Texas Exclusive Forum Provision is intended to apply to claims arising under Texas state law and would not apply to direct claims brought pursuant to the Securities Act or the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction. In addition, the Federal Forum Provision is intended to apply to claims arising under the Securities Act and would not apply to claims brought pursuant to the Exchange Act.

Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder. However, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce a duty or liability created by the Securities Act or the rules and regulations thereunder. Accordingly, there is uncertainty as to whether a court would enforce the Federal Forum Provision as written in connection with claims arising under the Securities Act. Any person purchasing or otherwise acquiring any interest in any of our securities will be deemed to have notice of, and to have consented to, these provisions.

The exclusive forum provisions we will include in our amended and restated certificate of formation will not relieve us of our duties to comply with the federal securities laws and the rules and regulations thereunder and, accordingly, actions by our shareholders to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder must be brought in federal courts. Our shareholders will not be deemed to have waived our compliance with these laws, rules, and regulations.

The exclusive forum provisions we will include in our amended and restated certificate of formation may limit a shareholder’s ability to bring a claim in a judicial forum of its choosing for disputes with the Company or its

 

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directors, officers, or other employees, which may discourage lawsuits against us and our directors, officers, and other employees. In addition, shareholders who bring a claim in the applicable Texas court pursuant to the Texas Exclusive Forum Provision could face additional litigation costs in pursuing any such claim, particularly if they do not reside in or near Texas. The court in the designated forum under our exclusive forum provisions may also reach different judgments or results than would other courts, including courts where a shareholder would otherwise choose to bring the action, and such judgments or results may be more favorable to us than to our shareholders. Further, the enforceability of similar exclusive forum provisions in other companies’ organizational documents has been challenged in legal proceedings, and it is possible that a court could find any of our exclusive forum provisions to be inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings. If a court were to find all or any part of our exclusive forum provisions to be inapplicable or unenforceable in an action, we might incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our business, operating results, and financial condition.

The price of Flex ordinary shares historically has been volatile, and the price of our common stock may be volatile as well. This volatility may affect the price at which you could sell your common stock, and the sale of substantial amounts of our common stock could adversely affect the price of our common stock.

The market price of Flex ordinary shares has been volatile, and the price of our common stock may also be volatile. This volatility may affect the price at which you could sell your common stock. Our stock price may be subject to significant price and volume fluctuations in response to market and other factors, including:

 

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actual or anticipated fluctuations in our results of operations, including those resulting from the seasonality and cyclicality of our business;

 

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perceptions about our business strategy, relationships with key customers, suppliers, and partners, and our ability to execute on strategic initiatives;

 

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announcements of technological innovations or new products and services by us or our competitors, which may impact demand for our existing products or increase the risk of inventory obsolescence;

 

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strategic actions by us or our competitors, such as acquisitions, divestitures, or restructurings;

 

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responses to the announcement of the separation;

 

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periods of severe pricing pressures due to oversupply or price erosion resulting from competitive pressures or industry consolidation;

 

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developments related to intellectual property, including patents or proprietary rights, and any litigation;

 

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proposed or adopted regulatory changes or developments or anticipated or pending investigations, proceedings, or litigation that involve or affect us or our competitors;

 

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conditions and trends in the data center infrastructure solutions, cloud computing, and broader technology industries;

 

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contraction in our operating results or growth rates that are lower than our previous high growth rate periods;

 

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failure to meet analysts’ revenue or earnings estimates, changes in financial estimates, or publication of research reports and recommendations by financial analysts relating specifically to us or our industry in general;

 

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announcements relating to debt or equity financings, dividends and share repurchases; and

 

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macroeconomic conditions that affect the market generally, including developments related to market conditions for our industry.

In addition, the sale of substantial amounts of shares of our common stock, or the perception that these sales may occur, could adversely affect the market price of our common stock. Further, the stock market is subject to

 

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fluctuations in the stock prices and trading volumes that affect the market prices of the stock of public companies, including us. These broad market fluctuations have adversely affected and may continue to adversely affect the market price of shares of our common stock. For example, expectations concerning general economic conditions may cause the stock market to experience extreme price and volume fluctuations from time to time that particularly affect the stock prices of many high technology companies. These fluctuations may be unrelated to the operating performance of the companies.

Securities class action lawsuits are often brought against companies after periods of volatility in the market price of their securities, and any such lawsuits filed against us could result in substantial costs and a diversion of resources and management’s attention.

The completion of the Spin-Off is subject to the Flex Shareholder Approvals and the High Court Approval, which may not be satisfied, and the Spin-Off may not occur.

Flex plans to complete the Spin-Off and effect the Distribution by way of the Capital Reduction. To effect the Capital Reduction, Flex will first need to capitalize its reserves through the Bonus Issuance. The Capital Reduction and the Distribution will be effected in compliance with Flex’s Constitution and Singapore law, which requires the High Court Approval following and in addition to the receipt of the Flex Shareholder Approvals. The Capital Reduction and the Distribution cannot be effected absent the Flex Shareholder Approvals and the High Court Approval. As a result, Spinco and Flex may not be able to complete the Spin-Off on the terms described in this information statement or on other acceptable terms or at all.

If securities or industry analysts do not publish research or reports about our business, or if they downgrade their recommendations regarding our common stock, our stock price and trading volume could decline.

The trading market for our common stock will be influenced by the research and reports that industry or securities analysts publish about us or our business. If any of the analysts who may cover us downgrade our common stock or publish inaccurate or unfavorable research about our business, our common stock price may decline. If analysts cease coverage of us or fail to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause our common stock price or trading volume to decline and our common stock to be less liquid.

 

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CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

This information statement and other materials that Flex and Spinco have filed or will file with the SEC contain, or will contain, forward-looking statements within the meaning of the federal securities laws. These forward-looking statements include, but are not limited to, statements regarding Spinco’s product and technology position, the anticipated benefits, timing and effects of the Spin-Off and all statements regarding Spinco’s expected future position, results of operations, cash flows, dividends, financing plans, business strategy, budgets, capital expenditures, competitive positions, growth opportunities, plans and objectives of management. Forward-looking statements also include statements containing forward-looking words, such as “will,” “may,” “designed to,” “believe,” “should,” “anticipate,” “plan,” “expect,” “intend,” “estimate,” “could,” “would,” “project,” “continue,” “potential,” “forecast,” “approximate,” “upside,” “target,” and similar expressions or the use of future tense. Statements concerning business outlook or future economic performance, anticipated profitability, revenues, expenses, dividends or other financial items, and products or services line growth of Spinco, together with other statements that are not historical facts, are forward-looking statements based on current expectations, estimates, assumptions and information available at the time they are made. Statements concerning current conditions may also be forward-looking if they imply trends or a continuation of such conditions.

Forward-looking statements are inherently uncertain, and shareholders and other potential investors must recognize that actual results may differ materially from Spinco’s expectations as a result of a variety of factors, including, without limitation, those discussed below. These forward-looking statements are based upon management’s current expectations and are subject to known and unknown risks, uncertainties and other factors, many of which Spinco is unable to predict or control, that may cause actual results, performance, or plans to differ materially from those expressed or implied by such forward-looking statements. These factors include, without limitation: volatility in global economic conditions; business conditions and growth in the digital infrastructure industry; pricing trends and fluctuations in average selling prices; the availability and cost of commodity materials and specialized components; actions by competitors; unexpected advances in competing technologies; and other risks and uncertainties described in the sections entitled “Summary of the Separation and Distribution,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Business,” and “The Separation and Distribution.” You should not place undue reliance on these forward-looking statements, which speak only as of the date they are made. Spinco undertakes no obligation to update any forward-looking statements to reflect new information or events.

Risks and uncertainties related to the Spin-Off include, but are not limited to: the future operating results of the stand-alone business; value creation associated with the separation and stand-alone business; the anticipated qualification of the Spin-Off as a tax-free transaction for U.S. federal income tax purposes; the expected relationship of the two businesses post-separation; whether the Spin-Off will be completed on the expected terms and on the anticipated timeline or at all, including the possibility that the conditions to the Spin-Off may not be satisfied, including that a governmental entity may prohibit, delay, or refuse to grant a necessary approval; the expected benefits and costs of the Spin-Off, including that the expected benefits will not be realized within the expected time frame, in full or at all; potential adverse reactions or changes to Spinco’s business relationships with their respective customers, suppliers, or other partners resulting from the announcement and completion of the Spin-Off; competitive responses to the announcement or completion of the Spin-Off; potential adverse effects on Spinco’s stock prices resulting from the announcement or completion of the Spin-Off; unexpected costs, liabilities, charges, or expenses resulting from the Spin-Off; litigation relating to the Spin-Off; the inability to retain key personnel of Spinco as a result of the Spin-Off; disruption of management time from ongoing business operations due to the Spin-Off; impacts of geopolitical conflicts; and any changes in general economic and/or industry-specific conditions. In addition to the factors set forth above, the Spin-Off is subject to other economic, competitive, legal, governmental, technological, regulatory, and other factors that may affect the Spin-Off and Spinco’s plans, results, or stock price and which are set forth under the sections entitled “Summary of the Separation and Distribution,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Business,” and “The Separation and Distribution.” Many of these factors are beyond Spinco’s control. Spinco cautions investors that forward-looking statements are not guarantees of future performance. Spinco does not intend, or undertake any obligation, to publish revised forward-looking statements to reflect events or circumstances after the date of this information statement or to reflect the occurrence of unanticipated events.

 

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THE SEPARATION AND DISTRIBUTION

General

On May 5, 2026, Flex announced its intention to separate into two standalone, publicly traded companies. Flex has determined to implement this separation through the Spin-Off of Flex’s Cloud & Power Infrastructure business to its shareholders. Flex intends to effect the Spin-Off pursuant to an internal reorganization followed by a distribution of between approximately 88.0% to 94.0% of the shares of our common stock, by way of a distribution in specie to Flex shareholders of record on a pro rata basis as of the Distribution Record Date, subject to certain conditions. The Distribution is expected to take place on or about    , 2027. On the Distribution Date, each holder of Flex ordinary shares will receive for each Flex ordinary share held as of     Central time on    , 2026, the Distribution Record Date,     share[s] of Spinco common stock (the “Distribution Ratio”). The Distribution will be effected by way of Capital Reduction under the Singapore Companies Act. Following the Distribution, Spinco will be a separate, publicly traded company. You will not be required to make any payment, surrender or exchange your Flex ordinary shares or take any other action to receive your shares of Spinco common stock to which you are entitled on the Distribution Date. The number of shares you own of Flex will not change as a result of the Spin-Off. On the Distribution Date, Flex will hold between approximately 6.0% to 12.0% of Spinco common stock. Following the Distribution, Flex intends to dispose of all of the Spinco common stock that it retains through one or more subsequent exchanges of Spinco common stock for Flex debt held by Flex creditors and/or through distributions of Spinco common stock to Flex shareholders as dividends or as non-cash consideration in exchange for issued and outstanding Flex ordinary shares pursuant to an off-market purchase on equal access scheme as prescribed by the Singapore Companies Act, in each case during the 24-month period following the Distribution.

The Distribution of our common stock as described in this information statement is subject to the satisfaction or waiver of certain conditions. Until the Spin-Off has occurred, Flex has the right not to complete the Spin-Off, even if all the conditions have been satisfied, if, at any time prior to the Distribution, the Flex Board of Directors determines, in its sole discretion, that the Spin-Off is not in the best interests of Flex, that a sale or other alternative is in the best interests of Flex, or that market conditions or other circumstances are such that it is not advisable at that time to separate the Cloud & Power Infrastructure business from Flex. We cannot provide any assurances that the Distribution will be completed. For a more detailed description of these conditions, see the section of this information statement entitled “The Separation and Distribution—General—Conditions to the Distribution.”

Reasons for the Spin-Off

In early 2025, the Flex Board of Directors authorized a comprehensive review of Flex’s business portfolio and capital allocation options. Throughout 2025 and into early 2026, the Flex Board of Directors met regularly to review and evaluate Flex’s businesses and available strategic opportunities with the assistance of financial and legal advisors. During this process, the Flex Board of Directors considered detailed analyses from Flex’s management and financial advisors regarding Flex’s portfolio composition, valuation considerations, capital structure alternatives, and potential strategic transactions. After an extensive evaluation process, the Flex Board of Directors concluded that Flex has significantly strengthened its businesses and optimized its portfolio over the last several years and that, as a continuation of that transformation, the separation of its Cloud & Power Infrastructure business as an independent, publicly-traded company at this time will accelerate the pace of its transformation and unlock future value potential. The Flex Board of Directors believes that the Spin-Off provides a tax-efficient opportunity for investors to more accurately assess the value of each company based on its individual merits, performance and future prospects, which the Flex Board of Directors believes may reduce the cost of capital and enhance the competitive positioning of both Flex and Spinco as standalone companies. In addition, the Flex Board of Directors believes that the separation will allow the management teams of each company to focus on their respective businesses and strategies, without competing internally for capital, research and development investment, or other corporate resources.

 

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The Spin-Off will create two strong, stand-alone businesses, each of which will have leading positions in the markets they serve and will be better positioned to deliver long-term growth and sustainable value creation for all shareholders:

 

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Flex will focus on its advanced manufacturing services business comprised of its Integrated Technology Solutions and the Regulated Manufacturing Solutions businesses; and

 

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Spinco will hold the Cloud & Power Infrastructure business.

In connection with its evaluation of available strategic opportunities, the Flex Board of Directors, with the assistance of its financial and legal advisors, considered a range of strategic alternatives, including maintaining the status quo; a complete spin-off of the Cloud & Power Infrastructure business with Flex not retaining any shares of Spinco common stock; a partial separation through an initial public offering of Spinco followed by a spin-off at a later date; and a spin-off of the Cloud & Power Infrastructure business with Flex retaining between approximately 6.0% to 12.0% of the shares of Spinco common stock followed by a tax-efficient monetization of the retained stake. In determining that a spin-off with a retained stake would be more favorable to Flex and its shareholders than other potential alternatives, the Flex Board of Directors considered a number of factors, including the potential reaction of investors, the timing and certainty of execution, the ability of each company to use its own equity currency to pursue its strategic objectives, and the strategic flexibility of Flex and Spinco after the Spin-Off. In determining to retain between approximately 6.0% to 12.0% of the shares of Spinco common stock, the Flex Board of Directors considered that a spin-off retaining such shares would enable Flex to reduce additional leverage at a later date in a tax-efficient manner using proceeds from the monetization of the retained equity stake. See “—Reasons for Flex’s Retention of Between Approximately 6.0% to 12.0% of Spinco Common Stock.”

After considering these and a variety of other factors in evaluating the Spin-Off, the Flex Board of Directors concluded that the other alternatives considered did not present the same advantages to Flex shareholders as the Spin-Off, and that the separation of the Cloud & Power Infrastructure business into an independent, publicly traded company, with Flex initially retaining between approximately 6.0% to 12.0% of the shares of Spinco common stock is the most attractive alternative for enhancing value for Flex and its shareholders.

The Flex Board of Directors believes that the separation of the Cloud & Power Infrastructure business is particularly compelling given accelerating demand for power-dense infrastructure and the increasing complexity of coordinated power delivery, cooling, and rack-scale integration requirements. Creating an independent company focused on integrated infrastructure platforms positions Spinco to meet the accelerating infrastructure and power demands with focus and agility.

The Flex Board of Directors believes that separating the Cloud & Power Infrastructure business from the remainder of Flex and distributing Spinco shares to Flex shareholders is in the best interests of Flex for a number of reasons, including:

 

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Simplified Investment Profile and Enhanced Ability to Allocate Capital on a Focused Basis. The business which will constitute Spinco differs significantly in several respects from the remaining businesses of Flex, including the nature of the business, growth profile, business cycles, and secular growth drivers. The Spin-Off will simplify how investors evaluate each business, streamline the investment profiles of both businesses, permit investors to better evaluate the individual merits, performance and future prospects of each company’s business, and provide investors the ability to invest in each company separately based on those distinct characteristics, all of which may enhance each company’s marketability. The Spin-Off will also enable investors to allocate capital on a more focused basis, with Spinco providing exposure to growth in power-dense infrastructure supporting data centers, AI workloads, and grid modernization sectors compared to Flex as a combined company today. The Spin-Off may also attract new investors that either chose not to invest in, or assess the merits of, pre-Spin-Off Flex given its complexity and its exposure to disparate markets and trends.

 

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Increased Management Focus on Core Business and Distinct Opportunities. The Spin-Off will result in dedicated, independent management for each of the businesses and enable the respective

 

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management teams to adopt strategies and pursue objectives specific to their respective businesses and better focus on strengthening their respective core businesses and operations. Enhancing the management focus with respect to each business is also expected to increase operating flexibility, and allow each company to pursue opportunities for growth distinct to their respective businesses. In addition, the Spin-Off will give each respective management team the opportunity to focus on the goals and expectations of such company’s respective investors. The separation of the experienced management teams and other key personnel operating the businesses will result in the ability for each company to better satisfy the needs of its respective shareholders.

 

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Improved Operational and Strategic Flexibility. The Spin-Off will permit each business to pursue its own business interests, operating priorities and strategies more effectively without having to consider the impact on the business of the other company or on the balance and composition of pre-Spin-Off Flex’s overall portfolio and will enhance operational flexibility for both businesses.

 

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Tailored Capital Allocation Strategies Align with Distinct Business Strategies and Industry Specific Dynamics. The Spin-Off will permit each company to implement a capital structure and flexible capital deployment policy that is optimized for its strategy and business needs, and that is aligned with each company’s target investor base. Flex believes that the Spin-Off will provide flexibility to better manage capital structure based on each company’s forecasted cash generation, planned investments, credit rating requirements, acquisition activity, and capital returns, among other factors, and accordingly will allow each company to invest capital (or return capital to its investors) at the time and in the manner most appropriate for its distinct strategic priorities and business needs. Each company will also have direct access to the debt and equity capital markets to fund its growth strategies, and the ability to concentrate its financial resources solely on its own operations.

 

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Facilitate Potential Mergers and Acquisitions and Resulting Synergies. As a result of the Spin-Off, each company is expected to be better situated to pursue future acquisitions, joint ventures, and other strategic opportunities as well as internal expansion that is more closely aligned with such company’s strategic goals and expected growth opportunities.

 

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Separate Acquisition Currency. The Spin-Off will provide each of Flex and Spinco with its own distinct equity currency that relates solely to its business to use in pursuing strategic opportunities. For example, each of Flex and Spinco will be able to pursue strategic acquisitions in which potential sellers would prefer equity or to raise cash by issuing equity to public or private investors. This benefit is particularly compelling for Spinco, where acquisition target valuations in the data center and AI infrastructure sectors remain elevated.

 

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Improved Talent Attraction, Retention, and Alignment of Management Incentives. The Spin-Off will enable each company to design and implement equity compensation programs that are directly tied to the performance and value of its respective business. The ability to offer equity incentives linked directly to the performance of each individual company is expected to improve each company’s ability to recruit, retain, and provide incentive compensation to employees through equity compensation plans that offer more direct correlation between employees’ compensation and the performance of the business for which such employees are responsible. This direct linkage between equity compensation and business performance is expected to enhance management focus and accountability.

The Flex Board of Directors also considered potentially negative factors in evaluating the Spin-Off, including:

 

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The potential for increased aggregate ongoing administrative costs for the two companies operating on a stand-alone basis post-Spin-Off, such as expenses associated with reporting and compliance as public companies and separate working capital requirements, overhead, insurance, financing, and other operating costs, as well the potentially higher cost of capital as separate companies.

 

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The inability to take advantage of pre-spin-off Flex’s size, purchasing power, borrowing leverage, and available capital for investments. After the Spin-Off, as standalone companies, Spinco and/or Flex may

 

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be unable to obtain goods and services at prices or on terms as favorable as those currently obtained by pre-Spin-Off Flex, and the degree to which Flex will be leveraged could adversely affect its business, financial condition, results of operations, and cash flows.

 

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One-time costs we expect to incur related to the Spin-Off and in connection with the transition to becoming a stand-alone public company including, among others, professional services costs, tax expense, recruiting, and other costs associated with hiring for two stand-alone corporate structures, and costs to separate IT systems and create two separate stand-alone IT structures.

 

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The potential for execution risks related to the Spin-Off, including disruption to the business as a result of the Spin-Off and the possibility that Spinco and/or Flex do not achieve the expected benefits of the Spin-Off for a variety of reasons.

 

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The Spin-Off may divert management’s time and attention, which could have a material adverse effect on the business, results of operations, financial condition, and cash flows of Spinco.

 

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Following the Spin-Off, Spinco and/or Flex may be more susceptible to market fluctuations and other events particular to one or more of their products than they currently are as pre-Spin-Off Flex.

 

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Spinco’s revenues are expected to be more concentrated among a limited number of customers, which may increase Spinco’s exposure to changes in the purchasing decisions, financial condition, or business strategies of these customers, and may affect Spinco’s ability to negotiate favorable terms or affect its credit ratings.

 

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The potential that reduced business diversification, with each post-Spin-Off company operating with a smaller product portfolio than pre-Spin-Off Flex, could increase the volatility of earnings and cash flow.

 

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Certain costs and liabilities that were otherwise less significant to pre-Spin-Off Flex could be more significant to Flex and/or Spinco after the Spin-Off as smaller, stand-alone companies.

 

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Flex’s ordinary shares and Spinco’s common stock could experience selling pressure after the Spin-Off as certain pre-Spin-Off shareholders may not be interested in holding an investment in one of the two post-Spin-Off companies.

 

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Flex and/or Spinco may be restricted in their ability to pursue certain opportunities that may have otherwise been available in order to preserve the tax-free nature of the Distribution and related transactions for U.S. federal income tax purposes.

 

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There may be, or there may be the appearance of, conflicts of interest or differences in strategy in Spinco’s relationship with Flex. Actual, potential, or perceived conflicts could give rise to investor dissatisfaction, settlements with shareholders, litigation or regulatory inquiries, or enforcement actions.

The Flex Board of Directors concluded that the potential benefits of the Spin-Off outweighed these factors and risks. The Flex Board of Directors also considered these potential benefits and potentially negative factors in light of the risk that the Spin-Off is abandoned or otherwise not completed, resulting in Flex not separating into two independent, publicly traded companies.

In view of the wide variety of factors considered in connection with the evaluation of the Spin-Off and the complexity of these matters, the Flex Board of Directors did not find it useful to, and did not attempt to, quantify, rank or otherwise assign relative weights to the factors considered.

The anticipated benefits of the Spin-Off are based on a number of assumptions, and there can be no assurance that such benefits will materialize to the extent anticipated, or at all. In the event the Spin-Off does not result in such benefits, the costs associated with the Spin-Off could have an adverse effect on each company individually and in the aggregate. For more information, see the section of this information statement entitled “Risk Factors.”

Aspects of the Spin-Off may increase the risks associated with ownership of shares of Spinco common stock. In connection with the Spin-Off, Spinco expects to incur indebtedness pursuant to the Spinco Financing Arrangements and to complete the Spinco Cash Distribution to Flex prior to or substantially concurrently with

 

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the consummation of the Spin-Off. The terms of such indebtedness are subject to change and will be finalized prior to the closing of the Spin-Off.

Reasons for Flex’s Retention of Between Approximately 6.0% to 12.0% of Spinco Common Stock

In considering the appropriate structure for the Spin-Off, the Flex Board of Directors determined that, immediately after the Distribution, Flex will retain between approximately 6.0% to 12.0% of the outstanding shares of our common stock. Flex’s plan to transfer less than all of the Spinco common stock to its shareholders in the Distribution is motivated by its desire to establish, in an efficient and non-taxable, cost-effective manner, an appropriate capital structure for each of Flex and Spinco, including by reducing, directly or indirectly, Flex’s indebtedness during the 24-month period following the Distribution. Flex’s retention of shares of our common stock is expected to increase its financial flexibility and support the establishment of optimal capital structures for each of Flex and Spinco by allowing Flex to reduce leverage in a tax-efficient manner. Flex intends to dispose of all of the Retained Shares after the Distribution through one or more subsequent exchanges of Spinco common stock for Flex debt held by Flex creditors and/or through distributions of Spinco common stock to Flex shareholders as dividends or as non-cash consideration in exchange for issued and outstanding Flex ordinary shares pursuant to an off-market purchase on equal access scheme as prescribed by the Singapore Companies Act, in each case during the 24-month period following the Distribution.

Formation of a Holding Company Prior to the Distribution and Internal Reorganization

As part of the Spin-Off, Flex formed Spinco as a corporation in Delaware on April 7, 2026, for the purpose of transferring to Spinco certain assets and liabilities, including certain entities holding assets and liabilities, associated with the Cloud & Power Infrastructure business in anticipation of the planned Spin-Off, and subsequently converted it into a Texas corporation pursuant to a plan of conversion. Spinco has engaged in no business activities to date, and it has no material assets or liabilities of any kind, other than those incident to its formation and those incurred in connection with the Spin-Off. Prior to the Distribution, Flex and its subsidiaries expect to complete the Internal Reorganization pursuant to which (i) Flex and its subsidiaries will transfer the assets and liabilities associated with the Cloud & Power Infrastructure business to Spinco or certain entities which will become its subsidiaries and transfer the equity interests of certain entities holding such assets and liabilities to Spinco and (ii) Spinco and its subsidiaries will transfer the assets and liabilities associated with the Flex business that are held by Spinco’s subsidiaries, if any, to Flex or its subsidiaries, in each case, as set forth in the Separation Agreement (as defined herein). The Internal Reorganization involves the formation of new subsidiaries in U.S. or non-U.S. jurisdictions to own and operate the Cloud & Power Infrastructure business in such jurisdictions, as applicable. Flex and its subsidiaries will also transfer all or a portion of certain other corporate and shared assets and liabilities to Spinco (or certain entities which will become its subsidiaries) and Spinco and its subsidiaries will also transfer all or a portion of certain other corporate and shared assets and liabilities to Flex or its subsidiaries, in each case, pursuant to the terms of the Separation Agreement. Following the Spin-Off, Flex will continue to hold the Flex business.

The Bonus Issuance, Capital Reduction and Distribution

Flex plans to complete the Spin-Off and effect the Distribution by way of the Capital Reduction. The Capital Reduction and the Distribution will be effected in compliance with Flex’s Constitution and Singapore law. To effect the Capital Reduction, Flex will first need to capitalize its reserves through the Bonus Issuance.

The Bonus Issuance requires the affirmative vote of a simple majority of the Flex ordinary shares present and voting (in person or by proxy) at the extraordinary general meeting of Flex. The Capital Reduction requires the affirmative vote of at least three-quarters of the Flex ordinary shares present and voting (in person or by proxy) at the extraordinary general meeting of Flex. The Bonus Issuance, Capital Reduction and the Distribution cannot be effected absent the Flex Shareholder Approvals and the High Court Approval.

Flex currently expects to complete the Bonus Issuance, the Capital Reduction and the Distribution as promptly as reasonably practicable after receipt of the High Court Approval and the satisfaction (or, to the extent permitted

 

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by applicable law, waiver by the parties entitled to the benefit thereof) of the conditions to the Distribution, other than those conditions that by definition cannot be completed prior to the Distribution.

Reasons for Furnishing this Information Statement; Changes in the Terms of the Spin-Off

This information statement is being furnished solely to provide information to Flex shareholders who are entitled to receive shares of our common stock in the Distribution. The information statement is not, and is not to be construed as, an inducement or encouragement to buy, hold, or sell any of our securities or securities of Flex. We believe that the information in this information statement is accurate as of the date set forth on the cover.

Changes may occur after that date and none of us, Flex, the Spinco Board of Directors or the Flex Board of Directors undertake any obligation to update such information, except as required by applicable federal securities laws.

Flex does not intend to notify its shareholders of any modifications to the terms of the Spin-Off, including the waiver of any conditions to the Distribution, that, in the judgment of the Flex Board of Directors, are not material. However, the Flex Board of Directors would likely consider material matters such as significant changes to the Distribution Ratio, or significant changes to the assets to be contributed or the liabilities to be assumed in the separation, as well as any waiver of the conditions that the Flex Board of Directors receives the Tax Opinion, obtains the Flex Shareholder Approvals, or obtains the High Court Approval with respect to the Spin-Off. To the extent that the Flex Board of Directors determines that any modification by Flex materially changes the material terms of the Spin-Off, including through the waiver of a condition to the Distribution, Flex will notify Flex shareholders in a manner reasonably calculated to inform them about the modification as may be required by law, by, for example, publishing a press release, filing a current report on Form 8-K, or making available a supplement to this information statement. As of the date hereof, the Flex Board of Directors does not intend to waive any of the conditions described herein.

Conditions to the Distribution

The Distribution is subject to the satisfaction or waiver of the following conditions, among others:

 

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The SEC will have declared effective the registration statement of which this information statement forms a part, with no stop order relating to the registration statement in effect, and no proceedings for such purpose will be pending before, or threatened by, the SEC.

 

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The distribution of this information statement (or a notice of internet availability thereof) to holders of Flex ordinary shares whose names appear on the Branch Register of Members maintained in the United States of America.

 

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The holders of a simple majority of the Flex ordinary shares present and voting at the extraordinary general meeting must affirmatively vote in favor of the Bonus Issuance.

 

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The holders of at least three-fourths of the Flex ordinary shares present and voting at the extraordinary general meeting must affirmatively vote in favor of the Capital Reduction and Distribution.

 

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The High Court Approval is obtained.

 

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Flex shall have issued the Bonus Shares and immediately cancelled the Bonus Shares issued in the Bonus Issuance.

 

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Nasdaq will have approved the listing of Spinco common stock, subject to official notice of issuance.

 

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Flex having lodged with the ACRA a copy of the Court order approving the Capital Reduction and the Distribution and a notice containing the reduction information within 90 days beginning with the date the order was made, or within such longer period as the ACRA may, on the application of Flex, allow, and the ACRA having recorded such information lodged in the appropriate register.

 

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Flex will have received the Tax Opinion. See the section of this information statement entitled “United States Federal Income Tax Consequences of the Distribution.”

 

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•

Flex will have received an opinion from a nationally recognized independent appraisal firm in form and substance satisfactory to Flex, confirming that after giving effect to the Distribution, Flex and Spinco will each be solvent and adequately capitalized.

 

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All actions and filings necessary or appropriate under applicable securities laws or “blue sky” laws and the rules and regulations thereunder will have been taken.

 

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No preliminary or permanent injunction or other order, decree, or ruling issued by a governmental authority, and no statute, rule, regulation, or executive order promulgated or enacted by any governmental authority will be in effect preventing the consummation of, or materially limiting the benefits of, the transactions contemplated by the separation and distribution agreement.

 

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Those reorganization transactions with respect to the Flex business and Cloud & Power Infrastructure business to be completed prior to the Distribution will have been effectuated in all material respects.

 

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The Flex Board of Directors will have declared the Distribution and approved all related transactions (and such declaration or approval will not have been withdrawn).

 

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No event or development will have occurred or failed to occur that, in the judgment of the Flex Board of Directors, in its sole discretion, prevents the consummation of, or makes it inadvisable to effect the separation, the Distribution, or the other related transactions.

 

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Any required governmental approvals or consents under any material contracts necessary to consummate the Distribution and the transactions contemplated by the separation and distribution agreement and the ancillary agreements will have been obtained and be in full force and effect.

 

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Prior to or substantially concurrently with the consummation of the Distribution, the financing for the Spinco Financing Arrangements will be available on terms acceptable to Flex and Spinco will have completed the Spinco Financing Arrangements and received the proceeds in respect thereof and Spinco will have completed the Spinco Cash Distribution.

 

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Each of the ancillary agreements will have been executed and delivered by each party thereto.

Flex and Spinco cannot assure you that any or all of these conditions will be met, and the Flex Board of Directors may also waive conditions to the Distribution in its sole discretion. If the Spin-Off is completed and the Flex Board of Directors waives any such condition, such waiver could have a material adverse effect on Flex’s and Spinco’s respective business, financial condition, or results of operations, including, without limitation, as a result of litigation relating to any preliminary or permanent injunctions that sought to prevent the consummation of the Spin-Off, or the failure of Flex and Spinco to obtain any required regulatory approvals. As of the date hereof, the Flex Board of Directors does not intend to waive any of the conditions described herein.

The fulfillment of the above conditions will not create any obligation on behalf of Flex to effect the Spin-Off, and Flex may at any time decline to go forward with the Spin-Off. Until the Spin-Off has occurred, Flex has the right not to complete the Spin-Off, even if all the conditions have been satisfied, if, at any time prior to the Distribution, the Flex Board of Directors determines, in its sole discretion, that the Spin-Off is not in the best interests of Flex, that a sale or other alternative is in the best interests of Flex, or that market conditions or other circumstances are such that it is not advisable at that time to separate the Cloud & Power Infrastructure business from Flex.

The Number of Shares You Will Receive

For each Flex ordinary share that you own as of     Central time on    , 2026, the Distribution Record Date, you will receive a number of shares of Spinco common stock equal to the Distribution Ratio on or about    , 2027, the Distribution Date. The actual number of shares of Spinco common stock to be distributed will be determined based on the total number of issued and outstanding Flex ordinary shares on the Distribution Record Date.

 

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Transferability of Shares You Receive

Shares of Spinco common stock distributed to holders in connection with the Distribution will be transferable without registration under the Securities Act, except for shares received by persons who may be deemed to be Spinco affiliates. Persons who may be deemed to be Spinco affiliates after the Distribution generally include individuals or entities that control, are controlled by or are under common control with Spinco, which may include certain of Spinco’s executive officers, directors or principal shareholders. Securities held by Spinco affiliates will be subject to resale restrictions under the Securities Act. Spinco affiliates will be permitted to sell shares of Spinco common stock only pursuant to an effective registration statement or an exemption from the registration requirements of the Securities Act, such as the exemption afforded by Rule 144 under the Securities Act.

When and How You Will Receive the Distributed Shares

Flex expects to distribute the shares of Spinco common stock on or about    , 2027, the Distribution Date. Computershare Trust Company, N.A. will serve as the transfer agent and registrar for our common stock and as distribution agent in connection with the Distribution.

If you own Flex ordinary shares as of     Central time on    , 2026, the Distribution Record Date, the shares of Spinco common stock that you will be entitled to receive in the Distribution will be issued electronically, as of the Distribution Date, to you in direct registration form or to your broker, bank, or other nominee on your behalf. If you are a registered holder, the distribution agent will then mail you a direct registration account statement that reflects your shares of Spinco common stock. Direct registration form refers to a method of recording share ownership when no physical share certificates are issued to shareholders, as is the case in this Distribution. If you sell your Flex ordinary shares in the “regular-way” market up to and including the Distribution Date, you will be selling your right to receive shares of Spinco common stock in the Distribution.

If you hold your Flex ordinary shares through a brokerage firm or bank, the brokerage firm or bank would be said to hold the Flex ordinary shares in “street name” and ownership would be recorded on the brokerage firm or bank’s books and your brokerage firm or bank will credit your account for the shares of Spinco common stock that you are entitled to receive in the Distribution. If you have any questions concerning the mechanics of having shares held in “street name,” we encourage you to contact your bank or brokerage firm.

Flex shareholders will not be required to make any payment or surrender or exchange their Flex ordinary shares or take any other action to receive their shares of our common stock.

Treatment of Equity Incentive Arrangements

We expect that Flex equity awards outstanding at the time of the Distribution will be adjusted with the intent to maintain the economic value of those awards before and after the Spin-Off, using a ratio that takes into account the average closing trading price of Flex ordinary shares over the ten trading days prior to the separation and the average of either the post-separation average closing trading price of Flex ordinary or the post-separation per share closing trading price of Spinco common stock, as applicable, over ten trading days following the separation. Flex equity awards held by Spinco employees and non-employee directors generally will be converted into Spinco equity awards, and Flex equity awards held by Flex employees and non-employee directors, as well as by Spinco employees transferring to Spinco some time after the separation (each such employee a “Delayed Transfer Spinco Employee”), will be adjusted and remain outstanding as awards denominated in shares of Flex ordinary shares (with Spinco using commercially reasonable efforts to replace any Flex equity awards forfeited by such Delayed Transfer Spinco Employee at the time such employee transfers to Spinco). For performance-based awards, the performance metrics for in-progress performance periods will be adjusted to reflect the Spin-Off. However, a one-time supplemental performance-based awards granted to the expected CEO of Spinco will convert to a Spinco award with no alterations to the performance measures.

 

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Additionally, the in-progress performance for a one-time supplemental performance-based award granted to the expected Chief Operating Officer of Spinco will be measured at the time of the Spin-Off, after which such award will remain subject to the same time-based vesting schedule. The treatment of each type of Flex equity award, is further discussed in “Compensation Discussion and Analysis—Treatment of Outstanding Equity Awards at the Time of the Spin-Off.”

 

Type of Award		Treatment
Flex RSUs		Outstanding Flex RSUs held by Spinco employees and non-employee directors will be converted into Spinco restricted stock units with substantially equivalent economic value. Outstanding Flex RSUs held by Flex employees and non-employee directors will be adjusted and remain outstanding as Flex RSUs. In each case, the adjusted awards will be subject to the same terms including the original vesting schedule.
EPS PSUs		The EPS PSUs will be adjusted or converted to Spinco PSUs in a manner similar to outstanding Flex RSUs generally, as described above. For performance periods that are at least 75% complete as of the Distribution Date will be determined based on actual results achieved through the Distribution Date. For all other performance periods, the EPS growth target goals will be adjusted to reflect the separation and allocated proportionately between Flex and Spinco. In each case, the final payout will be based on the average performance achieved across the three one-year performance measurement periods, and the original vesting schedule will remain unchanged.
rTSR PSUs		The rTSR PSUs held by Flex employees will be adjusted or converted to Spinco PSUs in a manner similar to outstanding Flex RSUs generally, as described above. With respect to the performance goals, the value of Spinco stock distributed to Flex shareholders on the Distribution Date will be treated as a special dividend and assumed as a reinvestment in Flex’s rTSR calculation for any performance period that remains in progress on the Distribution Date. Flex’s rTSR performance will be adjusted to reflect the Spin-Off, and the original vesting schedule will remain unchanged.   For the rTSR PSUs held by Spinco employees, performance for completed performance cycles will be banked as of the Distribution Date. For performance periods that remain in progress, performance will be based on actual performance as of the Distribution Date.
Non-CEO OP PSUs		The Supplemental PSUs granted to Hooi Tan in 2024 will be converted to Spinco RSUs in a manner similar to outstanding Flex RSUs generally, as described above. The outstanding performance period, which is expected to be at least 75% complete as of the Distribution Date, will be

 

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Type of Award		Treatment
		determined based on actual results achieved through the Distribution Date. The original vesting schedule will remain unchanged.
CEO Supplemental Equity Award		The CEO’s supplemental PSU award that vests based on achievement of OP targets of the Cloud & Power Infrastructure business that is outstanding at the Distribution Date will be converted into Spinco PSUS in a manner similar to outstanding Flex RSUs generally, as described above, with no changes to the original award terms, performance metrics and targets, or the performance period.

General Treatment of Fractional Shares of Common Stock

Flex will not distribute any fractional common stock shares to its shareholders. Instead, the transfer agent will aggregate fractional shares into whole shares, sell the whole shares in the open market at prevailing market prices, and distribute the aggregate cash proceeds (net of discounts and commissions) of the sales pro rata (based on the fractional shares such holder would otherwise be entitled to receive) to each holder who otherwise would have been entitled to receive a fractional share of common stock in the Distribution. The transfer agent, in its sole discretion, without any influence by Flex or us, will determine when, how, through which broker-dealer and at what price to sell the whole shares. Any broker-dealer used by the transfer agent will not be an affiliate of either Flex or us. Neither we nor Flex will be able to guarantee any minimum sale price in connection with the sale of these shares. Recipients of cash in lieu of fractional shares of common stock will not be entitled to any interest on the amounts of payment made in lieu of fractional shares.

The aggregate net cash proceeds of these sales will be taxable for U.S. federal income tax purposes. For an explanation of the material United States federal income tax consequences of the Distribution, see the section of this information statement entitled “United States Federal Income Tax Consequences of the Distribution.” If you are the registered holder of Flex ordinary shares, you will receive a check from the Distribution agent in an amount equal to your pro rata share of the aggregate net cash proceeds of the sale. The amount of this payment will depend on the prices at which the transfer agent sells the aggregated fractional shares of our common stock in the open market shortly after the Distribution date and will be reduced by any amount required to be withheld for tax purposes and any brokerage fees and other expenses incurred in connection with these sales of fractional shares. If you hold your Flex ordinary shares through a bank or brokerage firm, your bank or brokerage firm will receive, on your behalf, your pro rata share of the aggregate net cash proceeds of the sales and will electronically credit your account for your share of such proceeds.

Results of the Spin-Off

Immediately following the Spin-Off, Spinco will be a separate, publicly traded company, and we expect to have approximately     shares of our common stock outstanding as a result of the Distribution. The actual number of shares to be distributed will be determined after    , 2026, the Distribution Record Date. The Distribution will not affect the number of issued and outstanding Flex ordinary shares.

Market for Spinco Common Stock

There is currently no public market for our common stock. A condition to the Distribution is the listing of our common stock shares on Nasdaq. We intend to apply to list our common stock on Nasdaq under the symbol “AXM.” We have not and will not set the initial price of shares of our common stock. The initial price will be established by the public markets.

 

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We cannot predict the price at which shares of our common stock will trade after the Distribution. In fact, the combined trading prices, after the Spin-Off, of shares of our common stock that each Flex shareholder will receive in the Distribution and the ordinary shares of Flex held at the Distribution Record Date may not equal the “regular-way” trading price of a Flex ordinary share immediately prior to completion of the Spin-Off. The price at which shares of our common stock trade may fluctuate significantly, particularly until an orderly public market develops. Trading prices for our common stock will be determined in the public markets and may be influenced by many factors.

Trading Between the Record Date and the Distribution Date

Beginning on or shortly before the Distribution Record Date and continuing up to and including the Distribution date, Flex expects that there will be two markets in Flex ordinary shares: a “regular-way” market and an “ex-Distribution” market. Flex ordinary shares that trade on the “regular-way” market will trade with an entitlement to shares of Spinco common stock distributed pursuant to the Distribution. Flex ordinary shares that trade on the “ex-Distribution” market will trade without an entitlement to shares of Spinco common stock distributed pursuant to the Distribution. Each shareholder trading in Flex shares would make any decision as to whether to trade one or more of such shareholder’s shares in Flex in the “regular-way” market or the “ex-Distribution” market. If you sell Flex ordinary shares in the “regular-way” market up to and including through the Distribution Date, you will be selling your right to receive shares of Spinco common stock in the Distribution. If you own Flex ordinary shares as of     Central time on    , 2026, the Distribution Record Date, and sell those shares on the “ex-Distribution” market up to and including through the Distribution Date, you will receive the shares of Spinco common stock that you are entitled to receive pursuant to your ownership as of the Distribution Record Date.

Furthermore, beginning shortly before the Distribution Date and continuing up to and including the Distribution Date, we expect that there will be a “when-issued” market in our common stock. “When-issued” trading refers to a sale or purchase made conditionally because the security has been authorized but not yet issued. The “when-issued” trading market will be a market for our common stock that will be distributed to holders of Flex ordinary shares on or about    , 2027, the Distribution Date. If you own Flex ordinary shares as of     Central time on    , 2026, the Distribution Record Date, you will be entitled to a number of shares of Spinco common stock equal to the Distribution Ratio for each Flex ordinary share you hold. You may trade this entitlement to our shares, without the Flex shares you own, on the “when-issued” market. On the first trading day following the Distribution Date, “when-issued” trading with respect to our common stock will end, and “regular-way” trading will begin.

Transaction and Separation Costs

We expect to incur certain costs in connection with our establishment as a standalone public company. These one-time and non-recurring separation costs primarily relate to employee-related costs such as recruitment expenses, costs to establish certain standalone functions and information technology systems, professional services fees, and other separation-related costs during our transition to being a stand-alone public company. Except as otherwise set forth in the Separation Agreement, any such costs incurred prior to the completion of the Spin-Off will be borne by Flex, and any such costs incurred from and after the completion of the Spin-Off will be borne by the applicable party incurring such costs.

Incurrence/Treatment of Debt

Spinco intends to incur certain indebtedness pursuant to the Spinco Financing Arrangements in connection with the Spin-Off. If Spinco enters into arrangements for such indebtedness prior to the effectiveness of the Registration Statement on Form 10, of which this information statement forms a part, a description of such arrangements will be included in an amendment to this information statement.

 

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Regulatory Approval

Our registration statement on Form 10, of which this information statement forms a part, must become effective prior to the Distribution, and shares of Spinco common stock to be distributed must have been approved for listing on Nasdaq, subject to official notice of Distribution.

Further, under Singapore law, following and in addition to the Flex Shareholder Approvals, the Capital Reduction and the Distribution will be submitted to and must be approved by the High Court of the Republic of Singapore. Flex currently expects to complete the Capital Reduction and the Distribution as promptly as reasonably practicable after receipt of the High-Court Approval and the satisfaction (or, to the extent permitted by applicable law, waiver by the parties entitled to the benefit thereof) of the conditions to the Distribution, other than those conditions that by definition cannot be completed prior to the Distribution. For additional detail, see the section titled “The Bonus Issuance, Capital Reduction and Distribution” beginning on page 74.

Shareholder Vote

The Bonus Issuance by Flex requires the affirmative vote by the holders of a simple majority of the Flex ordinary shares present and voting (in person or by proxy) at the extraordinary general meeting.

The Capital Reduction and Distribution by Flex requires the affirmative vote by the holders of at least three-fourths of the Flex ordinary shares present and voting (in person or by proxy) at the extraordinary general meeting.

No Appraisal Rights

Flex shareholders do not have appraisal rights under the Singapore Companies Act or contractual appraisal rights under Flex’s Constitution in connection with the Distribution. As holders of shares of Spinco common stock following the Distribution, Flex shareholders will not have appraisal rights under applicable law or contractual appraisal rights under the amended and restated certificate of formation of Spinco.

 

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UNITED STATES FEDERAL INCOME TAX CONSEQUENCES OF THE DISTRIBUTION

The following discussion is a summary of the generally applicable U.S. federal income tax consequences that may be relevant to Flex and to the holders of Flex ordinary shares in connection with the Distribution. This discussion is based on the Code, the Treasury Regulations promulgated thereunder, judicial interpretations thereof, and administrative rulings and published positions of the IRS, all as in effect as of the date hereof and all of which are subject to change or differing interpretations, possibly with retroactive effect. Any such change could affect the accuracy of the statements and conclusions set forth herein. This summary assumes that the Distribution will be consummated in accordance with the separation and distribution agreement and as described in this information statement.

Except as specifically described below, this summary is limited to holders of Flex ordinary shares that are U.S. Holders, as defined immediately below. For purposes of this summary, a “U.S. Holder” is a beneficial owner of Flex ordinary shares that is, for U.S. federal income tax purposes:

 

•

an individual who is a citizen or a resident of the United States;

 

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a corporation, or other entity taxable as a corporation for U.S. federal income tax purposes, created or organized under the laws of the United States or any state thereof or the District of Columbia;

 

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an estate, the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source; or

 

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a trust, (a) the administration of which is subject to the primary supervision of a U.S. court and which has one or more U.S. persons who have the authority to control all substantial decisions of the trust or (b) that has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person.

This discussion is limited to U.S. Holders of Flex ordinary shares that hold their Flex ordinary shares as “capital assets” within the meaning of Section 1221 of the Code (generally, property held for investment). Further, this discussion is for general information only and does not purport to address all aspects of U.S. federal income taxation that may be relevant to a particular holder in light of their particular circumstances, nor does it address the consequences to holders subject to special treatment under the United States federal income tax laws, such as:

 

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dealers or traders in securities or currencies;

 

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traders that elect to use a mark-to-market method of accounting;

 

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tax-exempt entities;

 

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banks, financial institutions, or insurance companies;

 

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pension plans, cooperatives, real estate investment trusts, regulated investment companies, or grantor trusts;

 

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persons who acquired Flex ordinary shares pursuant to the exercise of any employee stock options or otherwise as compensation;

 

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persons who actually or constructively own 10% or more, by voting power or value, of Flex ordinary shares;

 

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persons owning Flex ordinary shares as part of a straddle, hedge, conversion, constructive sale, or other integrated transaction for U.S. federal income tax purposes;

 

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certain former citizens or long-term residents of the U.S.;

 

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persons whose functional currency is not the U.S. dollar;

 

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persons who are subject to special accounting rules under Section 451(b) of the Code;

 

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•

partnerships or other entities or arrangements subject to tax as partnerships for U.S. federal income tax purposes or persons holding Flex ordinary shares through such entities; or

 

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persons who hold Flex ordinary shares through an individual retirement account, tax-qualified retirement plan, or other tax-deferred account.

If a partnership (or any other entity or arrangement subject to tax as a partnership for U.S. federal income tax purposes) is a beneficial owner of Flex ordinary shares, the tax treatment of a partner in such partnership will generally depend on the status of the partner and the activities of the partnership. A partnership for U.S. federal income tax purposes that beneficially owns shares of Flex and its partners are urged to consult their tax advisor as to the tax consequences of the Distribution.

In addition, this discussion does not address any U.S. state or local or non-U.S. tax considerations or any U.S. federal estate, gift, or minimum tax considerations, or the Medicare tax on certain net investment income.

HOLDERS OF FLEX ORDINARY SHARES SHOULD CONSULT THEIR TAX ADVISORS REGARDING THE PARTICULAR TAX CONSIDERATIONS RELEVANT TO THEM REGARDING THE DISTRIBUTION, INCLUDING THE APPLICABILITY AND EFFECT OF U.S. FEDERAL, STATE, LOCAL, AND NON-U.S. TAX LAWS.

Tax Opinion

It is a condition to the completion of the Distribution that Flex receives the Tax Opinion from its tax counsel, Skadden, substantially to the effect that, among other things, for U.S. federal income tax purposes, (i) the Distribution, together with certain related transactions, will qualify as a reorganization within the meaning of sections 368(a)(1)(D), 361 and 355 of the Code, and (ii) holders of Flex ordinary shares that are United States persons (as defined in Section 7701(a)(30) of the Code) should not be required to recognize gain pursuant to the Distribution by reason of the application of certain Treasury Regulations promulgated under Section 367(b) of the Code. This condition may be waived by Flex in its sole discretion.

In rendering the Tax Opinion to be given as of the closing of the Distribution, Skadden will rely on (i) customary representations and covenants made by Flex and Spinco, including those contained in certificates of officers of Flex and Spinco and (ii) specified assumptions, including an assumption regarding the completion of the Distribution and certain related transactions in the manner contemplated by the transaction agreements. In addition, Skadden’s ability to provide the Tax Opinion will depend on the absence of changes in existing facts or law between the date of this information statement and the closing date of the Distribution. If any of the representations, covenants, or assumptions on which Skadden will rely are inaccurate, Skadden may not be able to provide the Tax Opinion, or the tax consequences of the Distribution could differ from those described below.

Furthermore, Flex understands that it is not possible for its tax counsel, Skadden, to reach a more definitive conclusion regarding whether holders of Flex ordinary shares that are United States persons (as defined in Section 7701(a)(30) of the Code) are required to recognize gain pursuant to the Distribution by reason of the application of certain Treasury Regulations promulgated under Section 367(b) of the Code, as the U.S. federal income tax treatment of the Distribution to such holders depends in part on the interpretation and application of Section 367(b) of the Code and Treasury Regulations promulgated thereunder, including Treasury Regulations Section 1.367(b)-3(c). These rules are complex, and there is significant uncertainty as to whether such Treasury Regulations would apply to the Distribution because Flex is a non-U.S. corporation that is not a controlled foreign corporation for U.S. federal income tax purposes, and the Distribution is structured as a pro rata distribution of Spinco common stock to holders of Flex ordinary shares. Thus, the applicability of these Treasury Regulations is unclear.

Accordingly, certain conclusions in the Tax Opinion will relate to matters for which there is no legal authority directly on point, and such conclusions will therefore necessarily be based upon analysis and interpretation of

 

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certain authorities. Based upon such analysis and authorities, the Tax Opinion will provide that holders of Flex ordinary shares that are United States persons (as defined in Section 7701(a)(30) of the Code) should not be required to recognize gain pursuant to the Distribution by reason of the application of certain Treasury Regulations promulgated under Section 367(b) of the Code.

However, an opinion of counsel, such as the Tax Opinion, will not be binding upon the IRS or any court, and Flex does not intend to request a ruling from the IRS on issues related to the U.S. federal income tax consequences of the Distribution and certain related transactions. In light of the uncertainties noted above, we cannot assure you that the IRS will agree with the conclusions expected to be set forth in the Tax Opinion, and it is possible that the IRS or another tax authority could adopt a position contrary to one or all of those conclusions and that a court could sustain that contrary position. Moreover, if any of the facts, representations, assumptions, or undertakings described or made in connection with the Tax Opinion are not correct, are incomplete or have been violated, Flex’s ability to rely on the Tax Opinion, including with respect to the Intended Tax Treatment, could be jeopardized. As of the date of this information statement, we are not aware of any facts or circumstances, however, that would cause these facts, representations, or assumptions to be untrue or incomplete or that would cause any of these undertakings to fail to be complied with, in any material respect.

Treatment of the Distribution

Assuming the Distribution, together with certain related transactions, qualifies as a reorganization within the meaning of sections 368(a)(1)(D), 361 and 355 of the Code, for U.S. federal income tax purposes:

 

•

no gain or loss should be recognized by, or be includible in the income of, a U.S. Holder solely as a result of the receipt of our common stock in the Distribution, except with respect to any cash received in lieu of fractional shares;

 

•

the aggregate tax basis of the Flex ordinary shares and shares of Spinco common stock (including any fractional shares deemed received, as discussed below) in the hands of each U.S. Holder immediately after the Distribution will be the same as the aggregate tax basis of the Flex ordinary shares held by such holder immediately prior to the Distribution, allocated between the Flex ordinary shares and shares of Spinco common stock in proportion to their relative fair market value immediately following the Spin-Off; and

 

•

the holding period with respect to shares of Spinco common stock received by a U.S. Holder (including any fractional shares deemed received, as discussed below) will include the holding period of the Flex ordinary shares with respect to which such Spinco common stock was received.

A U.S. Holder that has acquired different blocks of Flex ordinary shares at different times or at different prices should consult its tax advisors regarding the allocation of its aggregate adjusted basis among, and its holding period of, our shares distributed with respect to blocks of Flex ordinary shares.

If, notwithstanding the conclusions that we expect to be included in the Tax Opinion, it is ultimately determined that the Distribution does not qualify as tax-free under Sections 368(a)(1)(D), 361 and 355 of the Code for U.S. federal income tax purposes, then Flex may recognize gain. In addition, each U.S. Holder that receives shares of Spinco common stock in the Distribution would be treated as receiving a distribution in an amount equal to the fair market value of Spinco common stock that was distributed to such holder, which would generally be taxed as a dividend.

Even if the Distribution otherwise qualifies for tax-free treatment under Sections 368(a)(1)(D), 361 and 355 of the Code, the Distribution may result in corporate level taxable gain under Section 355(e) of the Code if either Flex or Spinco undergoes a 50% or greater ownership change as part of a plan or series of related transactions that includes the Distribution, potentially including transactions occurring after the Distribution. If an acquisition or issuance of stock triggers the application of Section 355(e) of the Code, Flex would recognize such taxable gain, but the Distribution would be tax-free to each Flex shareholder (except with respect to any tax on any cash received in lieu of fractional shares).

 

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Furthermore, if the IRS were to successfully assert that Treasury Regulations Section 1.367(b)-3(c) applies to the Distribution, the receipt of Spinco common stock pursuant to the Distribution would be taxable to a U.S. Holder whose Flex ordinary shares have a fair market value of $50,000 or more on the Distribution Date, and such U.S. Holder would be required to recognize gain (but not loss) upon the Distribution, but there is no clear guidance regarding how such gain should be computed. Such amounts may be significant, potentially resulting in material U.S. federal income tax liabilities. However, if the fair market value of a U.S. Holder’s Flex ordinary shares is less than $50,000 on the Distribution Date, these rules would not apply, and the Distribution would not be taxable to such holder pursuant to such rules. U.S. Holders are urged to consult their tax advisor as to the applicability of these Treasury Regulations and how to determine the amount of any gain that would be required to be recognized.

A U.S. Holder that receives cash instead of fractional shares of Spinco common stock should be treated as though such U.S. Holder first received a distribution of a fractional share of Spinco common stock and then sold it for the amount of cash received. Such U.S. Holder should recognize capital gain or loss, measured by the difference between the cash received for such fractional share and the U.S. Holder’s tax basis in the fractional share, as determined above. Such capital gain or loss should generally be a long-term capital gain or loss if the U.S. Holder’s holding period for such U.S. Holder’s Flex ordinary shares exceeds one year on the Distribution Date.

U.S. Treasury Regulations require certain holders of Flex ordinary shares who receive Spinco common stock in the Distribution to attach a detailed statement setting forth certain information relating to the Distribution to their respective U.S. federal income tax returns for the year in which the Distribution occurs. Within a reasonable period after the Distribution, Flex will provide holders who receive our common stock in the Distribution with access to an IRS Form 8937 setting forth information relating to the Distribution. In addition, all holders are required to retain permanent records relating to the amount, basis, and fair market value of Spinco common stock received in the Distribution and to make those records available to the IRS upon request of the IRS.

 

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DIVIDEND POLICY

We do not currently intend to pay any cash dividends in the foreseeable future. We currently intend to retain all available funds and future earnings, if any, for the operation of our business and to strengthen our financial position and flexibility. The payment of cash dividends in the future will be dependent upon our revenue and earnings, capital requirements and general financial condition, and results of operations, as well as applicable law, regulatory constraints, industry practice, and other business considerations determined by our board of directors to be relevant. The payment of any cash dividends will be within the discretion of the Spinco Board of Directors. In addition, the terms governing our current or future debt may also limit or prohibit dividend payments. Accordingly, we cannot guarantee that we will ever pay dividends in the future or that we would continue to pay any dividends that we may commence in the future.

In addition, under the TBOC, Spinco may not make a distribution (as such term is defined under TBOC Section 21.002) that (a) violates our certificate of formation, (b) would render Spinco insolvent (as such term is defined under TBOC Section 1.002) or (c) exceeds our surplus (which is defined as the amount by which our net assets exceed our stated capital, as such terms are defined under TBOC Section 21.002). A dividend payable in our own shares is subject to further limitations under the TBOC, including, but not limited to, that we may not pay a share dividend in authorized but unissued shares of any class if our surplus is less than the amount required to be transferred to our stated capital at the time such share dividend is made. The Spinco Board of Directors may base determinations of whether Spinco is or would be insolvent and the amount or value of our net assets, stated capital, or surplus on our financial statements prepared in accordance with generally accepted accounting principles, a fair valuation or information from any other method that is reasonable under the circumstances, or as otherwise permitted by the TBOC.

 

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CAPITALIZATION

The following table sets forth our cash and cash equivalents and capitalization as of June 26, 2026, on a historical basis and on a pro forma basis to give effect to the Spin-Off and related transactions as if they had occurred on June 26, 2026. You should review the following table in conjunction with the sections of this information statement entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Unaudited Pro Forma Condensed Combined Financial Information,” our unaudited condensed combined financial statements and the accompanying notes thereto included elsewhere in this information statement.

 

		As of June 26, 2026
($ in millions)		Historical				Pro Forma
Cash
Cash and cash equivalents		$	20			$	1,100
Indebtedness
Short-term debt			—				4,374
Long-term debt			—				34
Total debt			—				4,408
Equity
Common stock, par value $0.0001			—				—
Additional paid-in capital			—				4,933
Net parent investment			3,515				—
Accumulated other comprehensive income			11				11
Total equity			3,526				4,944
Total capitalization		$	3,526			$	9,352

We have not yet finalized our post-Distribution capitalization. Adjusted financial data reflecting our post-Distribution capitalization will be included in an amendment to the registration statement of which this information statement forms a part.

 

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UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION

The following unaudited pro forma combined financial statements consist of an unaudited pro forma combined balance sheet as of June 26, 2026 and unaudited pro forma combined statement of operations for the three months ended June 26, 2026 and the year ended March 31, 2026. This unaudited pro forma financial information has been derived from the historical audited combined financial statements for the year ended March 31, 2026 and our unaudited condensed combined financial statements as of and for the three months ended June 26, 2026 included elsewhere in this information statement. All significant pro forma adjustments and their underlying assumptions are described more fully in the notes to unaudited pro forma combined financial statements, which you should read in conjunction with such unaudited pro forma combined financial statements.

The unaudited pro forma combined statement of operations gives effect to the Pro Forma Transactions (as defined below) as if they had occurred on April 1, 2025, the first day of Spinco’s fiscal year 2026. The unaudited pro forma combined balance sheet gives effect to the pro forma transactions as if they had occurred on June 26, 2026, Flex’s latest balance sheet date.

The unaudited pro forma combined financial statements include certain transaction accounting adjustments that reflect the accounting for transactions in accordance with GAAP and autonomous entity adjustments that reflect certain incremental expenses or other charges necessary, if any, to present fairly our unaudited pro forma combined statement of operations and unaudited pro forma combined balance sheet as of and for the periods indicated as if Spinco was a separate standalone entity. The following unaudited pro forma combined financial statements illustrates the effects of the following transactions (collectively, the “Pro Forma Transactions”):

 

•

the transfer and/or contractual allocation to Spinco pursuant to the Separation Agreement, Tax Matters Agreement and Employee Matters Agreement of certain residual corporate and other shared assets and liabilities that were not included in the historical combined financial statements;

 

•

the purchase price accounting adjustments and related financing for the contemplated acquisition of EPC Power Corp. (“EPC Power”), which we refer to as EPC Power PPA and Related Financing

 

•

the impact of the Transition Services Agreement and other transaction-related agreements between Spinco and Flex and the provisions contained therein (see “Certain Relationships and Related Transactions”);

 

•

the effect of our anticipated post-Distribution capital structure, including the issuance of approximately 786 million shares of Spinco common stock;

 

•

transaction and incremental income and costs expected to be incurred as an autonomous entity and specifically related to the Spin-Off; and

 

•

other adjustments described in the notes to the unaudited pro forma combined financial statements.

EPC Power Acquisition

On September 3, 2026, Flex entered into a definitive agreement to acquire EPC Power (the “EPC Power Acquisition”) for aggregate consideration of approximately $4.4 billion, subject to customary adjustments. The EPC Power Acquisition will be funded with a combination of debt and equity, including potential equity-linked securities. EPC Power adds power conversion capabilities, including differentiated grid-forming technology, for data center and utility applications. Based on the expected timing of closing of the EPC Power Acquisition during 2026, the EPC Power business will be transferred by Flex to Spinco in conjunction with the Spin-Off. The Company concluded that the criteria in Article 11 of Regulation S-X, including that the EPC Power Acquisition is probable, were met; thus, these pro forma financial statements reflect the impact of the EPC Power Acquisition method of accounting in accordance with the Accounting Standards Codification 805, Business Combinations (“ASC 805”).

 

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The unaudited pro forma condensed combined balance sheet gives effect to the EPC Power Acquisition as if it had occurred on June 26, 2026. The unaudited pro forma condensed combined statements of operations give effect to the EPC Power Acquisition for the three months ended June 26, 2026 and the year ended March 31, 2026 as if the acquisition had occurred on April 1, 2025. The historical financial information of EPC Power has been derived from the annual financial statements for the year ended December 31, 2025 and the unaudited interim financial statements for the six months ended June 30, 2026, included elsewhere in this information statement.

The pro forma adjustments reflect management’s preliminary estimates and assumptions based on information currently available and are subject to change as additional information becomes available and analyses are finalized, including the completion of the purchase accounting assessment and valuation procedures. Accordingly, actual adjustments may differ materially from those presented herein.

The Spin-Off

The unaudited pro forma combined financial statements have been prepared to include transaction accounting (including the impact of changes to Flex’s legal entity structure in anticipation of the Spin-Off) and autonomous entity adjustments to reflect the financial condition and results of operations as if Spinco were a standalone entity. Transaction adjustments have been presented to show the impact and associated cost as a direct result of the legal separation from Flex, including the establishment of Spinco’s expected capital structure and funding at the time of Spin-Off, and the Tax Matters Agreement. Autonomous entity adjustments have been presented to show the impact of items such as the Transition Services Agreement, lease arrangements with third parties and Flex and certain incremental costs expected to be incurred as an autonomous entity. Actual future costs incurred may differ from these estimates.

The unaudited pro forma combined financial statements were prepared in accordance with Article 11 of Regulation S-X, as amended. The unaudited pro forma combined financial statements are subject to the assumptions and adjustments described in the accompanying notes. The Pro Forma Transactions are based on available information and assumptions we believe are reasonable; however, such adjustments are subject to change. A final determination regarding our capital structure has not yet been made, and the Separation agreement, Tax Matters Agreement, Transition Services Agreement, Employee Matters Agreement,

and other transaction-related agreements have not been finalized. As such, the unaudited pro forma combined financial statements may be revised in future amendments to reflect the impact on our capital structure and the final form of those agreements, to the extent any such revisions would be deemed material.

The unaudited pro forma combined financial statements have been presented for informational purposes only. The unaudited pro forma information is not necessarily indicative of our results of operations or financial condition had the Spin-Off and the related transactions been completed on the dates assumed and should not be relied upon as a representation of our future performance or financial position as a separate public company. The historical combined financial statements have been derived from Flex’s historical accounting records and include certain corporate overhead and other shared costs which have been allocated to Spinco. The allocations have been determined on a reasonable basis; however, the amounts are not necessarily representative of the amounts that would have been reflected in the financial statements had the Company been an entity that operated independently of Flex during the periods or at the dates presented. See Note 1, “Organization of the Company” and Note 12, “Related Party Transactions” to the combined financial statements included elsewhere in this information statement for further information on the allocation of corporate and other shared costs. The following unaudited pro forma combined financial statements should be read in conjunction with our historical audited combined financial statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in this information statement.

 

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UNAUDITED PRO FORMA COMBINED BALANCE SHEET

 

						Transaction Accounting Adjustments
As of June 26, 2026 (in millions)1		Spinco Historical				EPC Power Historical Adjusted (Note 1)				EPC Power PPA and related financing (Note 2)						Other Transaction Accounting Adjustments (Note 3)						Autonomous Entity Adjustments (Note 4)						Pro Forma
ASSETS
Current assets:
Cash and cash equivalents		$	20			$	141			$	—					$	939			3(a)		$	—					$	1,100
Accounts receivable, net of allowance for credit losses			1,810				127				—						—						—						1,937
Contract assets			488				—				—						—						—						488
Inventories			1,813				171				4			2(d)			—						—						1,988
Customer-controlled inventory			1,161				—				—						—						—						1,161
Other current assets			272				96				—						—						—						368
Total current assets			5,564				535				4						939						—						7,042
Property and emquipment, net			766				19				—						73			3(d)			—						858
Operating lease right-of-use assets, net			205				15				—						11			3(d)			24			4(e)			255
Goodwill			971				110				3,450			2(b)			—						—						4,531
Intangible assets, net			716				41				939			2(c)			—						—						1,696
Other non-current assets			47				5				(211	)		2(f)			420			3(g), 3(h)			(6	)		4(d)			255
Total assets		$	8,269			$	725			$	4,182					$	1,443					$	18					$	14,637
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable		$	3,688			$	98			$	—					$	—					$	—					$	3,786
Accrued payroll and benefits			104				—				—						6			3(c)			1			4(g)			111
Deferred revenue and customer working capital advances			361				285				—						—						—						646
Other current liabilities			323				62				4,410			2(a), 2(e)			1			3(d)			3			4(e)			4,799
Total current liabilities			4,476				445				4,410						7						4						9,342
Operating lease liabilities, non-current			182				15				—						1			3(d)			21			4(e)			219
Long-term debt			—				34				—						—						—						34
Other non-current liabilities			85				13				—						—						—						98
Total liabilities		$	4,743			$	507			$	4,410					$	8					$	25					$	9,693
Equity
Common stock, par value $0.0001		$	—			$	—			$	—					$	—			3(b)		$	—					$	—
Additional paid-in capital																	4,940			3(b). 3(e)			(7	)		4(d)			4,933
Net Parent Investment			3,515				218				(228	)					(3,505	)		3(b)			—						—
Accumulated other comprehensive income (loss)			11				—				—						—						—						11
Total equity			3,526				218				(228	)					1,435						(7	)					4,944
Total liabilities and equity		$	8,269			$	725			$	4,182					$	1,443					$	18					$	14,637

1 - For purposes of the unaudited pro forma condensed combined balance sheet, EPC Power Corp.’s historical balance sheet as of June 30, 2026 has been combined with Spinco’s historical balance sheet as of June 26, 2026. The difference between the respective reporting dates is not expected to have a material impact on the pro forma financial information presented.

 

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