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The piston valve is attached to the shock shaft and mostly affects rebound although it has some effect on compression. In the shaft itself at its bottom is the needle valve. The shock shaft is hollow and has a rod going to the top that is attached to the needle valve on one end and the adjuster at the other. The needle valve controls oil flow past the piston. Screwing the needle valve in and out controls the amount of fluid bypassing the piston valves which primarily impacts rebound damping. This is how the externally adjustable damping works on the Tein Flex.
The seal retainer screws into the main outer tube and holds the whole works together. It also holds the seal and upper guide bearing.
The first step in the rebuilding process is to thoroughly clean everything in solvent.
The parts are then blown dry with compressed air.
The foot valve is placed in a vice and disassembled.
The valve body has metering holes and slots in it that mostly control high speed compression damping. The slotted washers are made of spring steel and are of varying thickness and stiffness. The sequence of the stack and the composition of the washers' thicknesses controls how they will flex as fluid pressure is applied to them uncovering orifices and passages at different fluid flows. The manner in which the stack is assembled has the greatest influence on low speed compression damping. 
