What changed in this filing

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Item 1A. Risk Factors

2022-02-17 compared with 2021-02-18 · 40 added, 33 removed, 206 unchanged (26% of the section changed)

37 unchanged sentences

The Company will need to develop and introduce new products and product enhancements on a timely basis that keep pace with technological developments and emerging industry standards and address increasingly sophisticated requirements of its customers.

The Company invests heavily in research and development without knowing tif it will recover these costs.

The Company invests heavily in research and development without knowing if it will recover these costs.

The Company’s competitors may develop products or technologies that will render its products non-competitive or obsolete.

5 unchanged sentences

Failure to attract and retain qualified personnel could affect the Company’s business results.

The Company’s success, both generally and in connection with mergers and acquisitions, depends on the Company’s ability to attract, retain, and motivate a highly-skilled and diverse management team and workforce.

The Company’s success in its existing and acquired businesses, depends on the Company’s ability to attract, retain, and motivate a highly-skilled and diverse management team and workforce.

Failure to ensure that the Company has the depth and breadth of personnel with the necessary skill set and experience could impede its ability to deliver growth objectives and execute the Company’s strategy.

4 unchanged sentences

The Company develops and acquires new intellectual property on an ongoing basis and considers all of its intellectual property to be valuable.

The Company's policy is to file applications and obtain patents for the great majority of its novel and innovative

new products including product modifications and improvements.

The Company's policy is to file applications and obtain patents for the great majority of its novel and innovative new products including product modifications and improvements.

Based on the broad scope of its product lines, the Company believes that the loss or expiration of any single intellectual property right would not have a material adverse effect upon its consolidated results of operations, financial position and cash flows;

1 unchanged sentence

2) Regulatory Risks:

Climate change, and the regulatory and legislative developments related to climate change, may have a material adverse impact on our business and results of operations.

The potential physical impacts of climate change on our business operations are highly uncertain and differ in each geographic region where we operate.

These impacts may include changes in weather patterns and increased weather intensity, water shortages, changing sea levels and changing temperatures.

The impacts of climate change may materially and adversely impact the cost of production, insurance availability, and financial performance of our operations.

Further, any impacts to our business and financial condition as a result of climate change are likely to occur over a sustained period of time and are therefore difficult to quantify with any degree of specificity.

For example, extreme weather events may result in adverse physical effects on portions of our or others infrastructure, which could disrupt our supply chain and our customers and ultimately our business operations.

In addition, disruption of transportation and distribution systems could result in reduced operational efficiency and customer service interruption.

Climate-related events have the potential to disrupt our business, including the business of our suppliers and customers, and may cause us to experience higher attrition, and additional costs to resume operations.

Increased government or governmental bodies contemplating legislative and regulatory changes in response to the potential impact of climate change could impose significant costs on us and our suppliers and customers, including increased cost of materials and natural resources, sources and supply of energy, capital equipment, environmental monitoring and reporting, or other costs to comply with such regulations.

Potential regulations or standards could mandate more restrictive manufacturing requirements, such as stricter limits on greenhouse gas emissions and material used in production.

Any future climate change regulations could also adversely impact our ability to compete with companies not subject to such regulations.

Changes in U.S.

and other countries trade policy, including the imposition of tariffs and the resulting consequences, may have a material adverse impact on our business and results of operations.

In the past few years, the U.S.

In the past several years, the U.S.

government adopted a new approach to trade policy and in some cases to renegotiate, or potentially terminate, certain existing bilateral or multi-lateral trade agreements.

It also imposed tariffs on certain foreign goods and products.

These measures may materially increase costs for goods imported into the United States.

These measures may materially increase costs for goods imported into the U.S.

This in turn could require us to materially increase prices to our customers which may reduce demand, or, if we do not or are unable to increase prices, could result in lower margins on products sold.

25 unchanged sentences

• terrorist activities;

• public health concerns, including the outbreak of the coronavirus;

• public health concerns, including the outbreak of the coronavirus or other pandemics;

• difficulties in staffing and managing multi-national operations;

5 unchanged sentences

Several public health organizations have recommended, and some local governments have implemented, certain measures to slow and limit the transmission of the virus, including travel restrictions, shelter-in-place requirements and social distancing requirements.

availability, potential increased vulnerability to cybersecurity incidents, including breaches of information systems security due to widespread remote working arrangements, potential border closures, disruptions to the businesses of our original equipment manufacturers ("OEMs") and channel partners, and others.

Our suppliers and customers may also face these and other challenges, which could lead to a disruption in our supply chain as well as decreased demand for our products.

Such preventive measures, or others we may voluntarily put in place, may have a material adverse effect on our business for an indefinite period of time, such as the potential shut down of certain locations, decreased employee availability, potential increased vulnerability to cybersecurity incidents, including breaches of information systems security due to widespread remote working arrangements, potential border closures.

Our suppliers and customers, including OEMs and distribution partners, may also face similar disruptions to their operations, which could lead to a disruption in our supply chain as well as decreased demand for our products.

These issues may also materially affect our future access to our sources of liquidity, particularly our cash flows from operations, financial condition, capitalization, and capital investments.

24 unchanged sentences

In the future, the Company may take additional restructuring actions including the consolidating, closing or selling of additional facilities.

These actions could result in impairment charges and various charges for such items as idle capacity, disposition costs and severance costs, in addition to normal or attendant risks and uncertainties.

These actions could result in

impairment charges and various charges for such items as idle capacity, disposition costs and severance costs, in addition to normal or attendant risks and uncertainties.

The Company may be unsuccessful in any of its current or future efforts to restructure or consolidate its business.

4 unchanged sentences

The Company has multiple sources of supply for the majority of its commodity requirements.

However, significant shortages that disrupt the supply of raw materials or result in price increases could affect prices the Company charges its customers, its product costs, and the

competitive position of its products and services.

However, significant shortages that disrupt the supply of raw materials or result in price increases could affect prices the Company charges its customers, its product costs, and the competitive position of its products and services.

The Company monitors and manages these exposures as an integral part of its overall risk management program, which recognizes the unpredictability of markets and seeks to reduce the potentially adverse effects on its results.

13 unchanged sentences

jurisdictions.

Therefore, it is subject to changes in tax laws in each of these jurisdictions.

Tax legislative proposals have been mentioned by the new U.S.

administration that, if enacted, would raise the U.S.

corporate income tax rate and result in increases in the taxable income base of U.S.

multinational businesses.

Therefore, it is subject to changes in tax laws in each of these jurisdictions, including changes discussed in the paragraphs below.

The outcome of these and other legislative developments, including changes to interpretations of recently enacted legislation, could have a material adverse effect on the Company’s future effective tax rate and cash flows.

tax legislative proposals currently being considered in a bill referred to as “Build Back Better” could, among other things, increase the Company’s U.S.

taxes on non-U.S.

earnings, effective in 2023.

In addition, the Organization for Economic Cooperation and Development (“OECD”) is working with a group of more than 100 countries to significantly change the tax treatment of multinational businesses, subjecting them to tax in additional jurisdictions, modifying the methods by which they allocate profits among jurisdictions, and subjecting them to a minimum level of tax.

As part of this effort, during 2021, the OECD reached a near-unanimous agreement among the working group jurisdictions to apply a minimum income tax rate of 15%, on a country-by-country basis.

In December of 2021, the OECD published model rules to assist with implementation of the minimum tax regime, proposed to be effective in 2023, and the European Union published a directive that would incorporate the OECD-led minimum tax proposals into European Union law.

The Company’s income tax rate in certain non-U.S.

jurisdictions is lower than 15%.

Enactment of these minimum tax proposals, and the other proposals discussed above, could have a material adverse effect on the Company’s future effective tax rate and cash flows.

Certain European jurisdictions, including Germany and the Netherlands, have enacted or will enact tax legislation based upon directives from the European Union.

Such legislation could potentially deny tax deductions for certain expenses and/or subject to tax the income earned in certain low tax jurisdictions.

The Company’s income tax rate in certain other non-U.S.

jurisdictions, including the Philippines, is substantially lower than the U.S.

statutory tax rate.

Legislative proposals have been made from time to time to reduce the tax benefits in these jurisdictions, in some cases with the tax increase phased in over a multi-year transition period.

The Philippines is currently contemplating such legislation, including a relatively long-term transition period.

The Organization for Economic Co-operation and Development is working with a group of more than 100 countries to seek agreement to modify the international tax system during 2021 to address the influence of the digital economy.

This effort could result in a significant change to the tax treatment of multinational businesses, subjecting them to tax in additional jurisdictions, modifying the methods by which they allocate profits among jurisdictions, and subjecting them to a global or country by country minimum level of tax.

The outcome of this effort could have a material adverse effect on the Company’s effective tax rate and cash flows.

The Company has two subsidiaries in China which benefit from lower tax rates due to “tax holidays” which apply for three-year periods, subject to extension.

The tax holiday for one of these subsidiaries expired at the end of 2020, and it will seek an extension.

There can be no assurance that such extensions will be granted.

The Company has two subsidiaries in China which benefit from lower income tax rates due to “tax holidays” which apply for three-year periods.

The tax holiday for one of the subsidiaries expires at the end of 2022, and for the other subsidiary the tax holiday will expire at the end of 2023.

Future year tax benefits will depend upon the Company’s ability to obtain extensions, after the three-year periods expire.

There can be no assurance that future extensions will be granted.

The tax rates applicable in the jurisdictions within which the Company operates vary widely.

6 unchanged sentences

A decline in expected profitability of the Company or individual reporting units of the Company could result in the impairment of assets, including goodwill and other long-lived assets.

During 2020, the Company recorded a goodwill impairment charge of $33.8 million in the automotive sensors reporting unit within the Automotive segment and the Company continues to hold material amounts of goodwill and other long-lived assets on its balance sheet.

The Company continues to hold material amounts of goodwill and other long-lived assets on its balance sheet.

A decline in expected profitability, particularly if there is a decline in the global economy, could call into question the recoverability of the Company’s related goodwill and other long-lived tangible and intangible assets and require the write-down or write-off of these assets.

5 unchanged sentences

The Company’s most significant net long exposure is to the euro.

Company’s most significant net short exposures are to the Chinese renminbi, Mexican peso, and Philippine peso.

The Company’s most significant net short exposures are to the Chinese renminbi, Mexican peso, and Philippine peso.

Changes in foreign exchange rates could have an adverse effect on the Company's results of operations, financial position and cash flows.

26 unchanged sentences

The market price of the Company’s stock can fluctuate widely.

Between December 28, 2019 and December 26, 2020, the closing sale price of the Company’s common stock ranged between a low of $103.63 and a high of $253.70.

Between December 26, 2020 and January 1, 2022, the closing sale price of the Company’s common stock ranged between a low of $234.59 and a high of $334.84.

The volatility of the stock price may be related to any number of factors, such as volatility in the financial markets, general macroeconomic conditions, industry conditions, market expectations concerning the Company’s results of operations, or the volatility of its revenues as discussed above under “The Company’s Revenues May Vary Significantly from Period to Period.” The historic market price of the Company’s common stock may not be indicative of future market prices.

21 unchanged sentences

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