What changed in this filing

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Item 1A. Risk Factors

2022-08-30 compared with 2021-08-27 · 83 added, 73 removed, 206 unchanged (43% of the section changed)

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Such factors, among others, may have a material adverse effect on our business, financial condition, and results of operations and should be carefully considered.

Many of the risk factors could be exacerbated by the COVID-19 pandemic and any worsening of the global business and economic environment as a result.

Additional risks and uncertainties that we do not currently know about, we currently believe are immaterial, or we have not predicted may also affect our business, financial condition, or results of operations.

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Losses of key customers within specific industries or significant volume reductions from key customers are both risks.

If one of our current customers merges with or is acquired by a party that currently is aligned with a competitor, or the combination creates excess capacity, we could lose future revenues.

Our continuing success is dependent upon replacing expiring contract customers/programs with new customers/programs.

See “Customers” in Item 1 - Business for disclosure of the net sales as a percentage of consolidated net sales for each of our significant customers during fiscal years 2022, 2021, and 2020.

Regardless of whether our agreements with our customers, including our significant customers, have a definite term, our customers typically do not have an obligation to purchase a minimum quantity of products or services as individual purchase orders or other product or project specific documentation are typically entered into from time to time.

Regardless of whether our agreements with our customers, including our significant customers, have a definite term, our customers typically do not commit to firm production schedules for more than one quarter.

Our customers generally have the right to cancel a particular product, subject to contractual provisions governing the final product runs, excess or obsolete inventory, recovery of dedicated investments, and end-of-life pricing.

As such, our ability to continue the relationships with such customers is uncertain.

As many of our costs and operating expenses are relatively fixed, a reduction in customer demand, particularly a reduction in demand for a product that represents a significant amount of revenue, can harm our gross profit margins and results of operations.

Significant declines in the level of purchases by key customers or the loss of a significant number of customers could have a material adverse effect on our business.

In addition, the nature of the contract manufacturing industry is such that the start-up of new customers and new programs to replace expiring programs occurs frequently, and new customers and program start-ups generally cause margin dilution early in the life of a program.

We can provide no assurance that we will be able to fully replace any lost sales, which could have an adverse effect on our financial position, results of operations, or cash flows.

We may be unable to purchase a sufficient amount of materials, parts, and components for use in our products at competitive prices, in a timely manner, or at all.

New customer relationships also present risk because we do not have an extensive product or customer relationship history.

Consolidation among our customers exposes us to increased risks, including reduced revenue and dependence on a smaller number of customers.

Consolidation in industries that utilize our services may occur as companies combine to achieve further economies of scale and other synergies, which could result in an increase in excess manufacturing capacity as companies seek to divest manufacturing operations or eliminate duplicative product lines.

Excess manufacturing capacity may increase pricing and competitive pressures for our industry as a whole and for us in particular.

We can provide no assurance that we will be able to fully replace any lost sales from these risks, which could have an adverse effect on our financial position, results of operations, or cash flows.

Supply chain disruptions, including the COVID-19 pandemic, could prevent us from purchasing sufficient materials, parts, and components necessary to meet customer demand at competitive prices, in a timely manner, or at all.

We depend on suppliers globally to provide timely delivery of materials, parts, and components for use in our products.

The financial stability of suppliers is monitored by us when feasible as the loss of a significant supplier could have an adverse impact on our operations.

From time to time, we have experienced shortages of some of the materials, parts and components that we use, particularly with semiconductors.

These shortages can result from strong demand for those components or from problems experienced by suppliers, such as shortages of raw materials and shipping delays for such components with common carriers.

These unanticipated component shortages have and will continue to result in curtailed production or delays in production, which prevent us from making scheduled shipments to customers.

We have also experienced, and continue to experience, such shortages due to the effects of and responses to the COVID-19 pandemic, including the emergence of variants for which vaccines may not be effective, and may be impacted by other events outside our control, including macroeconomic events, trade restrictions, political crises, social unrest, terrorism, and conflicts (including the Russian invasion of and ongoing war in Ukraine).

We cannot reasonably predict the full extent to which these events may impact our supply chain, because any impacts will depend on future developments that are highly uncertain and continuously evolving, including, the duration and severity of the ongoing COVID-19 pandemic and new information that may emerge concerning COVID-19, further actions by governmental entities or others in response to the types of events described above, and how quickly and to what extent normal economic and operating conditions can resume.

Suppliers adjust their capacity as demand fluctuates, and component shortages and/or component allocations could occur in addition to longer lead times.

Certain components purchased by us are primarily manufactured in select regions of the world and issues in those regions could cause manufacturing delays.

Certain components we purchased are primarily manufactured in select regions of the world and

issues in those regions could cause manufacturing delays.

Maintaining strong relationships with key suppliers of components critical to the manufacturing process is essential.

Price increases of commodity components, including increased tariffs, could have an adverse impact on our profitability if we cannot offset such increases with other cost reductions or by price increases to customers.

Materials utilized in our manufacturing process are generally available, but future availability is unknown and could impact our ability to meet customer order requirements.

The EMS industry is currently experiencing component shortages, component allocations, and shipping delays, particularly with semiconductors, driven by the strong demand in consumer electronics and the beginning of a global recovery, and complicated by the continued impact of COVID-19.

Component shortages or allocations could increase component costs and potentially interrupt our operations and negatively impact our ability to meet commitments to customers.

Component shortages may also increase our cost of goods sold because we may be required to pay higher prices for components in short supply and redesign or reconfigure products to accommodate substitute components.

These and other price increases, including increased tariffs, could have an adverse impact on our profitability if we cannot offset such increases with other cost reductions or by price increases to customers.

If suppliers fail to meet commitments to us in terms of price, delivery, or quality, or if the supply chain is unable to react timely to increases in demand, it could interrupt our operations and negatively impact our ability to meet commitments to customers.

We are subject to manufacturing inefficiencies or underutilization due to start-up or expansion of facilities, programs, transfers of production, personnel turnover and shortages, and other related factors.

The substantial investments required to start up and expand facilities and new customer programs may adversely affect our margins and profitability.

We are currently expanding our global operations by increasing our product and service offerings and scaling our infrastructure at certain facilities to support our business.

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We may not be able to manage these expansions effectively, which could damage our reputation, limit our growth, and negatively affect our operating results.

The start-up of new programs requires the coordination of the design and manufacturing processes.

Start-ups of new customer programs require the coordination of the design and manufacturing processes, as well as substantial investments in resources and equipment.

The design and engineering required for certain new programs can take an extended period of time, and further time may be required to achieve customer acceptance.

Accordingly, the launch of any particular program may be delayed, less successful than we originally anticipated, or not successful at all.

Additionally, most of our customers do not commit to long-term production schedules, and we are unable to forecast the level of customer orders with certainty over a given period of time.

As a result, at times it can be difficult for us to schedule production and maximize utilization of our manufacturing capacity.

Fluctuations and deferrals of customer orders may have a material adverse effect on our ability to utilize our fixed capacity.

Additionally, even after acceptance, most of our customers do not commit to long-term production schedules, and we are unable to forecast the level of customer orders with certainty over a given period of time.

If our customers do not purchase anticipated levels of products, we may not recover our up-front investments, may not realize profits, and may not effectively utilize expanded fixed manufacturing capacities.

All of these types of manufacturing inefficiencies could have an adverse impact on our financial position, operating margins, results of operations, or cash flows.

The high demand for manufacturing labor in certain geographic areas in which we operate makes recruiting new production employees and retaining experienced production employees difficult.

Shortages of production workers could adversely impact our ability to complete our customers’ orders on a timely basis, which could adversely affect our relations with customers, potentially resulting in reduction in orders from customers or loss of customers.

Turnover in personnel could result in additional training and inefficiencies that could adversely impact our operating results.

Our international operations make us vulnerable to financial and operational risks associated with doing business in foreign countries.

We have operations outside the United States, primarily in China, India, Mexico, Poland, Romania, Thailand, and Vietnam.

We derive a substantial majority of our revenues from our operations outside the United States, primarily in China, India, Mexico, Poland, Romania, Thailand, and Vietnam.

Our international operations are subject to a number of risks, which may include the following:

• economic and political instability, including the uncertainties caused by the United Kingdom’s exit from the European Union;

• foreign governments’ measures taken in response to the COVID-19 pandemic;

• warfare, riots, terrorism, and other forms of violence or geopolitical disruption;

• compliance with laws, such as the Foreign Corrupt Practices Act, applicable to U.S.

companies doing business outside the United States;

• global, regional, or local economic and political instability;

• widespread health emergencies, such as COVID-19, and foreign governments’ measures taken in response to them;

• foreign currency fluctuations including currency controls and inflation, which may adversely affect our ability to do business in certain markets and reduce the U.S.

dollar value of revenues, profits, or cash flows we generate in non-U.S.

• warfare, riots, terrorism, general strikes, or other forms of violence and/or geopolitical disruption;

• compliance with laws and regulations, including the U.S.

Foreign Corrupt Practices Act, applicable to operations outside of the U.S.;

• changes in U.S.

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These risks could have an adverse effect on our financial position, results of operations, or cash flows.

In addition, fluctuations in exchange rates could impact our operating results.

Our risk management strategy includes the use of derivative financial instruments to hedge certain foreign currency exposures.

Any hedging techniques we implement contain risks and may not be entirely effective.

Exchange rate fluctuations could also make our products more expensive than competitors’ products not subject to these fluctuations, which could adversely affect our revenues and profitability in international markets.

Certain foreign jurisdictions restrict the amount of cash that can be transferred to the United States or impose taxes and penalties on such transfers of cash.

To the extent we have excess cash in foreign locations that could be used in, or is needed by, our operations in the United States, we may incur significant penalties and/or taxes to repatriate these funds.

For example, the Russian invasion of Ukraine and the ongoing war there has impacted the global economy as the United States, the UK, the EU, and other countries have imposed broad export controls and financial and economic sanctions against Russia (a large exporter of commodities), Belarus, and specific areas of Ukraine, and may continue to impose additional sanctions or other measures.

Russia may impose its own counteractive measures.

Companies worldwide have interrupted or stopped production in Ukraine, Russia, and neighboring countries.

We do not procure materials directly from Ukraine or Russia or have facilities there, but impacts like these, wherever they may occur, can further exacerbate the ongoing supply chain disruptions that are occurring across the globe, particularly in the automotive industry.

Our European operations are located in Poland and

Romania, and both of these countries are part of NATO, which is actively taking, and could take in the future, certain measures in response to Russia’s invasion of Ukraine.

The extent of the war’s effect on the global economy and the duration, scope, and impacts of the conflict are unknown and highly unpredictable, and the consequences from future actions such as increased sanctions and retaliatory measures taken by the United States, NATO, or other countries cannot be predicted but could have an adverse impact on our business operations, particularly our European operations.

We operate in a highly competitive industry and may not be able to compete successfully.

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Any problems caused by these third parties, including those resulting from disruption in communications services, cyber attacks, or security breaches, have the potential to hinder our ability to conduct business.

In addition, data privacy laws and regulations, such as the European Union General Data Protection Regulation and similar legislation in jurisdictions in which we operate, pose increasingly complex compliance challenges and potentially elevate costs, and any failure to comply with these laws and regulations could result in significant penalties.

The cost of providing employee healthcare benefits could increase and reduce our profitability.

We are self-insured up to certain limits for certain domestic employee health benefits.

For these self-insured health plans, we incur the cost of claims, which may include catastrophic claims, with the employees bearing a limited portion of the cost through insurance premiums and deductibles.

Accordingly, increases in employee healthcare benefit costs, including as a result of the high costs associated with treatments and prescriptions for rare diseases could have an adverse effect on our profitability.

In addition, data privacy laws and regulations, such as the European Union General Data Protection Regulation (“GDPR”), the UK GDPR, ePrivacy Directive, the California Privacy Rights Act (“CPRA”), and similar legislation in jurisdictions in which we operate, pose increasingly complex compliance challenges and potentially elevate costs, and any failure to comply with these laws and regulations could result in significant penalties.

We depend on attracting and retaining executive officers, key employees, skilled personnel, and sufficient labor to efficiently operate our business.

Our success depends to a large extent on our ability to attract and retain highly qualified and diverse executive officers, key employees, and skilled personnel, and to continue to implement our succession plans for managers and other key employees.

These employees are not generally bound by employment or non-competition agreements, and we cannot assure you that we will retain them.

The labor market for these employees is intensely competitive, and compensation and benefit costs continue to increase significantly in the current economic environment.

In particular, the high demand for manufacturing labor in certain geographic areas in which we operate makes recruiting new production employees and retaining experienced production employees difficult.

Our success also depends on keeping pace with technological advancements, including Industry 4.0, and adapting services to provide manufacturing capabilities which meet customers’ changing needs.

Therefore, we must retain our qualified engineering and technical personnel and successfully anticipate and respond to technological changes in a cost effective and timely manner.

Shortages of workers could adversely impact our ability to operate our business effectively and timely serve our customers’ needs, which could adversely affect our relations with customers, result in reductions in orders from customers, or cause us to lose customers.

Turnover in personnel could result in additional training and inefficiencies that could adversely impact our operating results.

Our culture and guiding principles focus on continuous training, motivating, and development of employees, and we strive to attract, motivate, and retain qualified personnel.

To aid in managing our growth and strengthening our pool of qualified personnel, we will need to internally develop, recruit, and retain diverse, qualified personnel.

If we are not able to do so, our business and our ability to continue to grow could be harmed.

Regulatory and Litigation Risks

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Anti-takeover provisions in our organizational documents and Indiana law could delay or prevent a change in control.

We have adopted Amended and Restated Articles of Incorporation and Amended and Restated Bylaws.

Certain provisions of the Amended and Restated Articles of Incorporation and the Amended and Restated Bylaws may delay or prevent a merger or acquisition that a Share Owner may consider favorable.

For example, the Amended and Restated Articles of Incorporation authorizes our Board of Directors to issue one or more series of preferred stock, prevents Share Owners from acting by written consent without unanimous consent, and requires a supermajority Share Owner approval for certain business combinations with related persons.

Certain provisions of our Amended and Restated Articles of Incorporation and the Amended and Restated Bylaws may delay or prevent a merger or acquisition that a Share Owner may consider favorable.

combinations with related persons.

These provisions may discourage acquisition proposals or delay or prevent a change in control, which could harm our stock price.

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Failure or noncompliance could have an adverse effect on our reputation in addition to an adverse impact on our financial position, results of operations, or cash flows.

We are subject to extensive environmental regulation and significant potential environmental liabilities.

Climate change, and the legal and regulatory initiatives related to climate change, could subject us to extensive environmental regulation and significant potential environmental liabilities.

There is increasing concern that a gradual increase in global average temperatures due to increased concentration of carbon dioxide and other greenhouse gases in the atmosphere will cause significant changes in weather patterns around the globe and an increase in the frequency and severity of natural disasters or extreme weather conditions, such as hurricanes, earthquakes, droughts, wildfires, cyclones, or floods.

Physical climate risks and the operation of facilities in areas subject to increased water stress could impair our production capabilities, disrupt the operations of our supply chain and infrastructure, and impact our customers and their demand for our services.

The past and present operation and ownership by Kimball Electronics of manufacturing plants and real property are subject to extensive and changing federal, state, local, and foreign environmental laws and regulations, including those relating to discharges in air, water, and land, the handling and disposal of solid and hazardous waste, the use of certain hazardous materials in the production of select products, and the remediation of contamination associated with releases of hazardous substances.

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In addition, we have committed to cut our greenhouse gas emissions, water usage, electrical usage, and air emissions significantly by 2025 as part of our long-term sustainability strategy, and we may take additional voluntary steps to mitigate our impact on the environment.

Environmental regulations or changes in the supply, demand, or available sources of energy or other resources may affect the availability or cost of goods and services, including natural resources, necessary to run our business.

The cost of energy is a critical component of freight expense and the cost of

operating manufacturing facilities.

Increases in the cost of energy could reduce our profitability.

Given the political significance and uncertainty around these issues, we cannot predict how legislation, regulation, and increased awareness of these issues will affect our operations and financial condition.

Environmental regulations or changes in the supply, demand, or available sources of energy, water, or other resources may affect the availability or cost of goods and services, including natural resources, necessary to run our business.

The cost of energy is a critical component of freight expense and the cost of operating manufacturing facilities.

Increases in the cost of energy in particular could reduce our profitability.

Given the political significance and uncertainty around these issues, we cannot predict how climate change, and the legal and regulatory initiatives related to climate change, will affect our operations and financial condition.

Compliance with government legislation and regulations may significantly increase our operating costs in the United States and abroad.

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In addition, such regulations could restrict our ability to expand our facilities or could require us to acquire costly equipment, or to incur other significant expenses, including expenses associated with the recall of any non-compliant product or with changes in our operational, procurement and inventory management activities.

In addition, there is an increasing governmental focus around the world on global warming and environmental impact issues, which may result in new environmental, health and safety regulations that may affect us, our suppliers and our customers.

In addition, there is an increasing governmental focus around the world on climate change and environmental impact issues, which may result in new environmental, health, and safety regulations that may affect us, our suppliers and our customers.

This could cause us to incur additional direct costs for compliance, as well as increased indirect costs resulting from our customers, suppliers or both incurring additional compliance costs that are passed on to us.

These costs may adversely impact our operations and financial condition.

Social and environmental responsibility policies and guidelines may increase our costs and impose difficult and expensive compliance requirements.

ESG issues, including those related to climate change and sustainability, may increase our costs and impose difficult and expensive compliance requirements.

Customers, consumers, investors, and other stakeholders, particularly in the EMS industry, are increasingly focusing on environmental issues, including climate change, water use, deforestation, waste, and other sustainability concerns.

Along with our stakeholders and our broader industry, we have increased our focus on sustainability and measurement of our progress against Environmental, Social, and Governance (“ESG”) criteria.

Our customers have adopted, and may continue to adopt, procurement policies that require us to comply with social, and environmental responsibility provisions.

In addition, an increasing number of investors have adopted, and may continue to adopt, ESG policies for their portfolio companies, and various voluntarily sustainability initiatives and organizations have promulgated different social and environmental responsibility and sustainability guidelines.

These practices, policies, provisions, and initiatives are under active development, subject to change, can be unpredictable and conflicting, and may prove difficult and expensive for us to comply with.

These costs may adversely impact our operations and financial condition.

We have established sustainability and ESG programs aligned with sound environmental, social and governance principles.

These programs reflect our current initiatives and we cannot guarantee that we will be able to achieve the planned results.

Our ability to successfully execute these initiatives and accurately report our progress presents numerous operational, financial, legal, reputational and other risks, many of which are outside our control, and all of which could have a material negative impact on our business.

Additionally, the implementation of these initiatives imposes additional costs on us.

If our ESG initiatives fail to satisfy investors, current or potential customers, consumers, and our other stakeholders, our reputation, our ability to sell products and services to customers, our ability to attract or retain employees, and our attractiveness as an investment or business partner could be negatively impacted.

Similarly, our failure or perceived failure to pursue or fulfill our goals, targets, and objectives, or to satisfy various reporting standards within the timelines we announce, or at all, could also have similar negative impacts and expose us to government enforcement actions and private litigation.

In addition, our customers have adopted, and may continue to adopt, procurement policies that require us to comply with social, and environmental responsibility provisions.

An increasing number of investors have adopted, and may continue to adopt, ESG policies for their portfolio companies, and various voluntarily sustainability initiatives and organizations have promulgated different social and environmental responsibility and sustainability guidelines.

Financial Risks

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Such impairment could have an adverse impact on our financial position and results of operations.

For example, in fiscal year 2020, we recorded a $7.9 million impairment charge associated with the goodwill of our GES reporting unit.

See Note 6 - Goodwill and Other Intangible Assets of Notes to Consolidated Financial Statements for further discussion of the charge.

Fluctuations in our effective tax rate could have a significant impact on our financial position, results of operations, or cash flows.

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Certain of our subsidiaries provide financing, products, and services to, and may undertake certain significant transactions with, other subsidiaries in different jurisdictions.

Moreover, several jurisdictions in which we operate have tax laws with detailed transfer pricing rules which require that all transactions with non-resident related parties be priced using arm’s length pricing

principles and that contemporaneous documentation must exist to support such pricing.

Due to inconsistencies among jurisdictions in the application of the arm’s length standard, our transfer pricing methods may be challenged and, if not upheld, could increase our income tax expense.

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Given the scope of our international operations and the fluid and uncertain nature of how the BEPS project might ultimately lead to future legislation, it is difficult to assess how any changes in tax laws would impact our income tax expense.

We are exposed to foreign currency risk.

Fluctuations in exchange rates could impact our operating results.

Our risk management strategy includes the use of derivative financial instruments to hedge certain foreign currency exposures.

Any hedging techniques we implement contain risks and may not be entirely effective.

A failure to comply with the financial covenants under our credit facilities could adversely impact us.

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We believe the most significant covenants under our credit facilities are the ratio of consolidated total indebtedness minus unencumbered U.S.

cash on hand in the United States in excess of $15 million to adjusted consolidated EBITDA, as defined in our primary credit facility, and the fixed charge coverage ratio.

cash on hand in the United States in excess of $15 million to adjusted consolidated EBITDA, as defined in our primary credit facility, and the interest coverage ratio.

More detail on these financial covenants is discussed in Item 7 - Management’s Discussion and Analysis of Financial Condition and Results of Operations .

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We have exposure to interest rate risk on our borrowings under our credit facilities.

The interest rates of these borrowings are based on a spread plus applicable base rate, including the London interbank offered rate (“LIBOR”), the prime rate of a reference bank, or the federal funds rate.

The interest rates of these borrowings are based on a spread plus applicable base rate, including the Secured Overnight Financing Rate (“SOFR”), the Euro Interbank Offered Rate (“EURIBOR”), the prime rate of a reference bank, or the federal funds rate.

An adverse change in the base rates upon which our interest rates are determined could have a material adverse effect on our financial position, results of operations, or cash flows.

In addition, the United Kingdom’s Financial Conduct Authority has announced that after 2021 it would no longer persuade or compel panel banks to submit the rates required to calculate LIBOR.

In March 2021, the administrator of LIBOR, the ICE Benchmark Administration, publicly announced that it will cease publication of LIBOR settings, either on December 31, 2021 or June 30, 2023, subject to the LIBOR settings.

As LIBOR is discontinued and we transition to a new rate, interest rates on our current or future indebtedness may be adversely affected.

General Risk Factors

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See Note 1 - Business Description and Summary of Significant Accounting Policies of Notes to Consolidated Financial Statements for more information on the adoption of the new accounting guidance.

Our failure to retain the existing management team, maintain our engineering, technical, and manufacturing process expertise, or continue to attract qualified personnel could adversely affect our business.

We depend significantly on our executive officers and other key personnel.

The unexpected loss of the services of any one of these executive officers or other key personnel may have an adverse effect on us.

Our success also depends on keeping pace with technological advancements, including Industry 4.0, and adapting services to provide manufacturing capabilities which meet customers’ changing needs.

Therefore, we must retain our qualified engineering and technical personnel and successfully anticipate and respond to technological changes in a cost effective and timely manner.

Our culture and guiding principles focus on continuous training, motivating, and development of employees, and we strive to attract, motivate, and retain qualified personnel.

Failure to retain and attract qualified personnel could adversely affect our business.

A change in our sales mix among various products could have a negative impact on our gross profit margin.

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Natural disasters or other catastrophic events such as the COVID-19 pandemic may impact our production schedules and, in turn, negatively impact profitability.

Natural disasters or other catastrophic events, including severe weather, terrorist attacks, power interruptions, fires, and pandemics, could disrupt operations and likewise our ability to produce or deliver products.

Natural disasters or other catastrophic events, including severe weather (including cyclones, hurricanes, and floods) as well as terrorist attacks, power interruptions, fires, and pandemics, could disrupt operations and likewise our ability to produce or deliver products.

Our manufacturing operations require significant amounts of energy, including natural gas and oil, and governmental regulations may control the allocation of such fuels to Kimball Electronics.

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and world economies, and could result in reduced demand for our customers’ products and delayed or lost revenue for our services.

Further, any continuing disruption in our computer systems could adversely affect the ability to receive and process customer orders, manufacture products, and ship products on a timely basis, and could adversely affect relations with customers, potentially resulting in reduction in orders from customers or loss of customers.

We maintain insurance to help protect us from costs relating to some of these matters, but such may not be sufficient or paid in a timely manner to us in the event of such an interruption.

Further, any disruption in our IT systems could adversely affect the ability to receive and process customer orders, manufacture products, and ship products on a timely basis, and could adversely affect relations with customers, potentially resulting in reduction in orders from customers or loss of customers.

We maintain insurance to help protect us from costs relating to some of these matters, but it may not be sufficient or paid in a timely manner to us in the event of such an interruption.

For example, the COVID-19 pandemic poses the risk that we or our employees, suppliers, customers, and others may be restricted or prevented from conducting business activities as normal for indefinite or intermittent periods of time, which has impacted and will continue to impact our global operations.

Several of our facilities have experienced temporary suspensions of operations due to the COVID-19 outbreak.

While all facilities have since resumed normal operations, further temporary suspensions could occur.

impacts on the availability of critical components, our supply chain, capacity utilization at our facilities, and the ability of certain employees to return to work.

All of our operations have been, and will continue to be, impacted to varying degrees by government measures worldwide to contain or mitigate the spread of the virus, including travel restrictions, restrictions on operation of businesses, shelter in place orders, and mandatory closures of schools and child-care facilities, which in turn can have adverse impacts on the availability of critical components, our supply chain, capacity utilization at our facilities, and the ability of certain employees to return to work.

We have modified our business practices for the continued health and safety of our employees and may take further actions, or be required to take further actions, that are in the best interests of our employees.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors