Who is the new Chief Financial Officer and when does his appointment become effective?

Kevin S. Krumm has been appointed as the new Chief Financial Officer (CFO) of Flex Ltd. His appointment is effective January 6, 2025. He will replace Jaime Martinez, who will cease serving as Interim CFO on that date.

What is the compensation package for the new CFO?

Mr. Krumm's compensation package includes an annual base salary of $832,000, an annual incentive bonus with a target of 115% of base salary (maximum 200%), and a long-term equity award with a target value of $2,900,000 (comprising 50% PSUs and 50% RSUs). He will also receive a one-time funding payment of $416,000 under the Deferred Compensation Plan and is eligible for annual company contributions.

Are there any special payments or equity grants associated with Mr. Krumm's hiring?

Yes, to compensate for forfeited incentives from his previous employer, Mr. Krumm will receive a one-time sign-on cash bonus of $3,500,000 and a one-time make-whole grant of RSUs valued at $5,800,000. The cash bonus is subject to repayment if he voluntarily resigns without Good Reason or is terminated for Cause within 24 months of employment.

What are the severance benefits if Mr. Krumm's employment is terminated?

Mr. Krumm is eligible for Flex Ltd.'s Executive Severance Plan. In the event of termination without Cause or resignation for Good Reason, he would receive salary and benefits continuation during a transition period, a pro-rated bonus, and continued vesting of certain equity and deferred compensation awards during that period. Further accelerated vesting of some awards may occur post-transition period, subject to compliance with post-termination covenants.

FLEX 8-K: Leadership Changes & Regulation FD

Summary

Flex Ltd. (FLEX) announced a significant leadership change with the appointment of Kevin S. Krumm as its new Chief Financial Officer, effective January 6, 2025. Mr. Krumm brings extensive financial experience from his previous roles at APi Group Corporation and Ecolab Inc., where he held senior positions including CFO and Corporate Treasurer. His background includes a strong foundation in public accounting with major firms, M&A, and corporate finance. This appointment comes with a comprehensive compensation package designed to attract and retain Mr. Krumm. His remuneration includes a base salary of $832,000, eligibility for annual incentive bonuses, and substantial long-term equity awards. Notably, the package includes significant sign-on bonuses and make-whole equity grants to compensate for forfeited compensation from his prior employer, totaling $5.8 million in RSUs and $3.5 million in cash, with clawback provisions on the cash bonus. Investors should note the terms of his potential severance benefits under the Company's Executive Severance Plan, which include continued salary and benefits, pro-rated bonus, and accelerated vesting of equity awards under specific termination scenarios.

Key Highlights

1Kevin S. Krumm appointed as the new Chief Financial Officer (CFO), effective January 6, 2025.
2Mr. Krumm's prior experience includes CFO at APi Group Corporation and Corporate Treasurer/SVP at Ecolab Inc.
3Annual base salary for Mr. Krumm set at $832,000.
4Annual incentive bonus target of 115% of base salary, with a maximum opportunity of 200% of target.
5Long-term incentive award with a target value of $2,900,000, comprised of performance-based (PSUs) and service-based (RSUs) restricted share units.
6Significant one-time sign-on bonus of $3,500,000 and make-whole RSU grant of $5,800,000 to compensate for forfeited prior employment incentives.
7Mr. Krumm will be eligible for the Company's Executive Severance Plan, outlining benefits upon termination without Cause or for Good Reason.

FLEX LTD. 8-K Report, Executive Changes (Nov 22, 2024)

Summary

Key Highlights

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