Maxeon Solar Technologies (MAXNQ) Risk Analysis

As a foreign private issuer, we are permitted to, and follow certain home country corporate governance requirements in lieu of certain NASDAQ requirements. Following our home country corporate governance requirements, as opposed to the requirements that would otherwise apply to a U.S. company listed on the NASDAQ, may provide less protection than is afforded to investors under the Nasdaq Listing Rules applicable to domestic issuers. In particular, we follow home country requirements instead of NASDAQ requirements otherwise applicable to U.S. companies regarding: - Nasdaq's requirement that a majority of the Maxeon Board be "independent" as defined by the Nasdaq Listing Rules. However, the Singapore Companies Act does not impose a similar requirement on a company. - Nasdaq's requirement that an issuer provide for a quorum as specified in its bylaws for any meeting of the holders of ordinary shares, which quorum may not be less than 33 1/3% of the outstanding shares of an issuer's voting ordinary shares. The requirement for a quorum under the Singapore Companies Act is two members of the company personally present so far as the constitution of a company does not make other provision in that behalf. Our Constitution similarly provides that two members of Maxeon present in person (and includes a person attending as a proxy or as representing a corporation which is a member) shall constitute a quorum for a general meeting. - Nasdaq's requirement that all members of our Compensation Committee be "independent" as defined in the Nasdaq Listing Rules. While the Maxeon Board has established a Compensation Committee, the Singapore Companies Act does not require us to maintain such a committee and does not require a majority of such committee to be independent directors. Similarly, Singapore law does not require that we disclose information regarding third-party compensation of our directors or director nominees. - Nasdaq's requirement the nominating committee of our Board (the "Nominating and Corporate Governance Committee") be "independent" as defined in the Nasdaq Listing Rules. The Singapore Companies Act does not require a nominating and corporate governance committee to be comprised entirely of independent directors, and nominations of persons for election to the Maxeon Board will be recommended by our Nominating and Corporate Governance Committee whose members are not all independent directors as defined by the Nasdaq Listing Rules. - NASDAQ's requirement that issuers obtain shareholder approval prior to the issuance of securities in connection with certain acquisitions, changes of controls or private placements of securities, or the establishment or amendment of certain stock option, purchase or other compensation plans. Under the Singapore Companies Act, new shares may be issued only with the prior approval of our shareholders in a general meeting. Approval, if granted, shall continue in force until the earlier of: - the conclusion of the next annual general meeting after the date on which the approval was given; and - the expiration of the period within which the next annual general meeting after that date is required by law to be held. Any such approval may be revoked or varied by the company in a general meeting.

As of December 31, 2023, TotalEnergies and its affiliates own approximately 14.8% of the voting power of outstanding Maxeon shares and TZE owns approximately 22.8% of the voting power of outstanding Maxeon shares. At their current shareholding, TotalEnergies and TZE possess significant influence and control over our affairs. On August 17, 2022, we issued our 2027 Notes, all of which were initially purchased by TZE. To the extent TZE converts the 2027 Notes held by it into Maxeon shares, then its voting power of the outstanding Maxeon shares, and its already significant influence over our affairs, in particular, will increase. TotalEnergies and/or TZE may have different interests than other Maxeon shareholders on matters which may affect our operational and financial decisions. As long as each of TotalEnergies and TZE own a significant percentage of our shares, the ability of our other shareholders to influence matters requiring shareholder approval will be limited. On May 19, 2023, TotalEnergies sold 1,870,000 of its ordinary shares as part of an underwritten public offering by the Company, following its November 1, 2022 Schedule 13D/A filing indicating that they classified the Maxeon shares as "held-for-sale" for financial reporting purposes based on, among other things, TotalEnergies' management's plan to sell such shares in one or more transactions within twelve months of the issuance of the financial statements of the TotalEnergies group (the "TotalEnergies' Future Share Divestment"). In the event that TotalEnergies elects to sell its remaining shares to a single purchaser, that purchaser would possess similarly significant influence and control over our affairs. Among other things, TotalEnergies and/or TZE's influence could delay, defer or prevent a sale of Maxeon that other shareholders support, or, conversely, this influence could result in the consummation of such a transaction that other shareholders do not support. This concentrated influence could discourage potential investors from seeking to acquire Maxeon shares and, as a result, might harm the market price of Maxeon shares.

Each of TotalEnergies and TZE have the ability to sell a substantial number of Maxeon shares. We filed a registration statement on Form F-3 (File No. 333-268309), which was declared effective on November 23, 2022, pursuant to which each of TotalEnergies and TZE may offer and re-sell the Maxeon shares which they own and the Maxeon shares which may be issued on conversion of the 2027 Notes including ordinary shares issuable upon conversion of any PIK Notes (as defined herein) or, subject to certain conditions, by directly issuing ordinary shares in lieu of cash payment of interest ("Interest Payment Ordinary Shares"), assuming payment of all amounts due with respect to the remaining 4.0% of interest payable as payable-in-kind interest or as Interest Payment Ordinary Shares. If our existing significant shareholders sell substantial amounts of Maxeon shares in the market, including pursuant to the TotalEnergies' Future Share Divestment, the market price of Maxeon shares could decrease significantly. The disclosure of the TotalEnergies' Future Share Divestment and any perception in the market that our other existing significant shareholders might sell shares could also depress our share price. A decline in the price of Maxeon shares may impede our ability to raise capital through the issuance of additional shares or other equity securities.

In the future, we may issue additional shares in connection with capital markets transactions, acquisitions or otherwise. For instance, the board of directors of Maxeon (the "Board of Directors," "Maxeon Board" or the "Board") approved recently an increase in the number of shares issuable under the 2020 Omnibus Incentive Plan (the"2020 Plan"), and, in May 2023, we sold 5,620,000 ordinary shares at $28.00 per share in an underwritten public offering and pursuant to the 2023 TZE Private Placement (as defined under "Item 4.A. History and Development of the Company"), we sold to TZE 1,500,000 ordinary shares at $28.00 per share. See "Note 1. Background and Basis of Presentation - Background." The conversion of some or all of the Notes will dilute the ownership interests of existing shareholders. In particular, to the extent that Zhonghuan Singapore Investment and Development Pte. Ltd. ("TZE SG"), a subsidiary of TZE, continues to hold all or a portion of the 2027 Notes, upon the conversion of such notes, TZE SG may receive additional Maxeon shares pursuant to the terms of 2027 Notes thereby increasing its ownership interests and voting power, which will consequently dilute the ownership interests of other, existing shareholders. See "-TotalEnergies's and TZE's significant ownership of our shares may adversely affect the liquidity and value of our shares." Additionally, in connection with the Green Convertible Notes, Maxeon granted to TZE SG an option to purchase an amount of Maxeon shares that would allow TZE SG to maintain its percentage ownership of outstanding Maxeon shares following any conversion of the Green Convertible Notes as compared to its percentage ownership existing immediately prior to any such conversion. See "Item 7.B. Related Party Transactions-Dilution Protection Agreement." Any sales in the public market of the shares issuable upon conversion of the Notes could adversely affect prevailing market prices of our shares. In addition, the existence of the Notes may encourage short selling by market participants because the conversion of the Green Convertible Notes and/ or the 2027 Notes could depress the price of our shares. Furthermore, the Compensation Committee of the Maxeon Board (the "Compensation Committee") has and it is anticipated that it will continue to grant equity awards to our employees and directors, from time to time, under our employee benefits plans. These additional awards have and will continue to have a dilutive effect on our earnings per share, which could adversely affect the market price of our shares.

We may issue additional equity, equity-linked or debt securities for a number of reasons, including to finance our operations and business strategy (including in connection with expansion of our manufacturing capacity, acquisitions, strategic collaborations or other transactions), to satisfy our obligations for the repayment of existing indebtedness, to adjust our ratio of debt to equity, or for other reasons. Any future issuances of equity securities or equity-linked securities could substantially dilute the interests of our existing shareholders and may materially and adversely affect the price of Maxeon shares. We cannot predict the timing or size of any future issuances or sales of equity, equity-linked or debt securities, or the effect, if any, that such issuances or sales, may have on the market price of Maxeon shares. Market conditions could require us to accept less favorable terms for the issuance of our securities in the future.

The market price for Maxeon shares has been highly volatile and subject to wide fluctuations. During the period from August 26, 2020, the first day on which Maxeon shares were listed on NASDAQ, until December 31, 2023, the market price of Maxeon shares ranged from $3.91 to $57.97 per share. As of May 21, 2024, Maxeon shares closed at $2.71/share. The market price of Maxeon shares may continue to be volatile and subject to wide fluctuations in response to a wide variety of factors, including the factors discussed in this risk factors section and the following: - our ability to successfully execute on our financing plans to provide the necessary liquidity for us to operate as a going concern;- our ability to successfully implement our restructuring plans;- our ability to replace the revenue we would have generated under the 2022/ 2023 Supply Agreement and 2024/ 2025 Supply Agreement with SunPower, which agreements have been terminated;- announcements of new products by us or our competitors;- news regarding any gain or loss of customers by us;- news regarding recruitment or loss of key personnel by us or our competitors;- announcements of competitive developments, acquisitions or strategic alliances in our industry;- the operating and stock price performance of other companies, other industries and other events or factors beyond our control;- the impacts of the ongoing conflicts and geopolitical issues on us and the national and global economies;- regulatory developments in our target markets affecting us, our customers or our competitors;- announcements regarding patent litigation or the issuance of patents to us or our competitors;- announcements of studies and reports relating to the conversion efficiencies of our products or those of our competitors;- actual or anticipated fluctuations in our quarterly results of operations;- changes in financial projections or estimates about our financial or operational performance by securities research analysts;- changes in the economic performance or market valuations of other solar power technology companies;- market perception of our response to challenging economic and market environment;- sales or perceived sales of additional shares or Notes;- commencement of, or our involvement in, litigation;- speculative trading practices by certain market participants;- actual or purported "short squeeze" trading activity;- trading of our shares, which can have an outsized impact on our stock price given the limited public float;- fluctuations in the exchange rates;- persistent or rising inflation;- high or rising interest rates;- general market conditions or other developments affecting us or our industry; and - changes in the general condition of the global economy and credit markets. Any of these factors may result in large and sudden changes in the volume and price at which our shares will trade. On some occasions, our stock price may be, or may be purported to be, subject to "short squeeze" activity. A "short squeeze" is a technical market condition that occurs when the price of the stock increases substantially, forcing market participants who have taken a position that its price would fall (i.e. who had sold the stock "short"), to buy it, which in turn may create significant, short-term demand for the stock not for fundamental reasons, but rather due to the need for such market participants to acquire the stock in order to forestall the risk of even greater losses. A "short squeeze" condition in the market for a stock can lead to short-term conditions involving very high volatility and trading that may or may not track fundamental valuation models. Market disruptions such as the various U.S. key market-wide circuit breakers since March 9, 2020 triggered by concerns over economic slowdown led to historic drops for the U.S. capital markets. These market fluctuations may also have a material adverse effect on the market price of our shares. In the past, following periods of volatility in the market price of their stock, many companies have been the subject of securities class action litigation. If we become involved in similar securities class action litigation in the future, it could result in substantial costs and diversion of our management's attention and resources and could harm our stock price, business, prospects, financial condition and results of operations. In addition, the stock market in general, and NASDAQ and the securities of technology companies and solar companies in particular, have experienced severe price and volume fluctuations. These trading prices and valuations, including our own market valuation and those of companies in our industry generally, may not be sustainable. These broad market and industry factors may decrease the market price of our shares, regardless of our actual operating performance. Because the Notes are convertible into our shares (and/or cash equivalent to the value of our shares), volatility or depressed share prices could have a similar effect on the trading price of the Notes.

The trading market can be influenced to some extent by the research and reports that industry or financial analysts publish about us and our business. We do not control these analysts. As a foreign private issuer, the analysts who publish information about Maxeon shares may have had relatively little experience with us or our industry, which could affect their ability to accurately forecast our results and could make it more likely that we fail to meet their estimates. If any of the analysts who cover us provide inaccurate or unfavorable research or issue an adverse opinion regarding our stock price, our stock price could decline. If one or more of these analysts cease coverage of us or fail to publish reports covering us regularly, we could lose visibility in the market, which in turn could cause our stock price or trading volume to decline and result in the loss of all or a part of your investment in us.

We became a foreign private issuer as of the date of the Spin-off and therefore we are not required to comply with all of the periodic disclosure and current reporting requirements of the Exchange Act applicable to U.S. domestic issuers. In order to maintain our status as a foreign private issuer, either (a) a majority of our shares must be directly or indirectly owned of record by non-residents of the United States or (b)(i) a majority of our executive officers or directors may not be U.S. citizens or residents, (ii) more than 50% of our assets cannot be located in the United States and (iii) our business must be administered principally outside the United States. If pursuant to the TotalEnergies Future Share Divestment or sales of our shares by any of our other existing significant shareholders, the majority of our shares are no longer directly or indirectly owned of record by non-residents of the United States,and we are unable to meet any of the other requirements to qualify as a foreign private issuer, then we will lose our foreign private issuer status. If we were to lose our foreign private issuer status, we would be required to comply with the Exchange Act reporting and other requirements applicable to U.S. domestic issuers, which are more detailed and extensive than the requirements for foreign private issuers. For instance, we would be required to make changes in our corporate governance practices in accordance with various SEC and NASDAQ rules. The regulatory and compliance costs to us under U.S. securities laws when we would be required to comply with the reporting requirements applicable to a U.S. domestic issuer could be significantly higher than the costs we will incur as a foreign private issuer. As a result, a loss of foreign private issuer status could increase our legal and financial compliance costs and could make some activities highly time-consuming and costly. If we were required to comply with the rules and regulations applicable to U.S. domestic issuers, it could make it more difficult and expensive for us to obtain director and officer liability insurance, and we could be required to accept reduced coverage or incur substantially higher costs to obtain coverage. These rules and regulations could also make it more difficult for us to attract and retain qualified members of the Maxeon Board.

Our corporate affairs are governed by our Constitution and by the laws governing companies incorporated in Singapore. The rights of our shareholders and the responsibilities of the members of the Maxeon Board under Singapore law are different from those applicable to a corporation incorporated in the United States. Therefore, our public shareholders may have more difficulty in protecting their interest in connection with actions taken by our management or members of the Maxeon Board than they would as shareholders of a corporation incorporated in the United States.

The Singapore Code on Take-overs and Mergers (the "Singapore Take-overs Code") and Sections 138, 139 and 140 of the Securities and Futures Act 2001 of Singapore contain certain provisions that may delay, deter or prevent a future takeover or change in control of our company for so long as we remain a public company with more than 50 shareholders and net tangible assets of S$5.0 million or more. Any person acquiring shares, whether by a series of transactions over a period of time or not, either on his own or together with parties acting in concert (as defined in the Singapore Take-over Code) with such person, in 30% or more of the voting rights of our company, or, if such person holds, either on his own or together with parties acting in concert with such person, not less than 30% but not more than 50% (both inclusive) of the voting rights of our company, and such person (or parties acting in concert with such person) acquires additional shares carrying more than 1% of the voting rights of our company in any six-month period, must, except with the consent of the Securities Industry Council of Singapore, extend a mandatory take-over offer for all the remaining voting shares in accordance with the provisions of the Singapore Take-overs Code. On January 30, 2020, the Securities Industry Council of Singapore waived the application of the Singapore Take-overs Code to us, subject to certain conditions. Pursuant to the waiver, for as long as we are not listed on a securities exchange in Singapore, and except in the case of a tender offer (within the meaning of U.S. securities laws) where the Tier 1 Exemption set forth in Rule 14d-1(c) under the Exchange Act (the "Tier 1 Exemption") is available and the offeror relies on the Tier 1 Exemption to avoid full compliance with the tender offer regulations promulgated under the Exchange Act, the Singapore Take-overs Code shall not apply to us. In connection with receipt of the waiver, the SunPower board of directors submitted to the Securities Industry Council of Singapore a written confirmation to the effect that it is in the interests of SunPower shareholders who will become holders of Maxeon shares as a result of the Spin-off that a waiver of the provisions of the Singapore Take-overs Code is obtained. However, if the conditions for the waiver are no longer applicable, the Singapore Take-overs Code will be applicable to us. While the primary objective of the Singapore Take-overs Code is fair and equal treatment of all shareholders in a take-over or merger situation, its provisions may discourage or prevent certain types of transactions involving an actual or threatened change of control of our company. These legal requirements may impede or delay a take-over of our company by a third party, and thereby have a material adverse effect on the value of our shares. In addition, as the Notes are convertible into our ordinary shares, under the Singapore Take-overs Code (where the Singapore Take-overs Code may be applicable), if a take-over offer is made for the Maxeon shares, an appropriate offer or proposal has to be made to the holders of the Notes (so long as the Notes are outstanding) in accordance with the provisions of the Singapore Take-overs Code.