What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-09-27 compared with 2022-03-29 · 503 added, 761 removed, 284 unchanged (82% of the section changed)

4 unchanged sentences

(In thousands, except for par value amounts)

February 26, 2022

August 27, 2022

Current assets:

4 unchanged sentences

Prepaid expenses and other current assets

Total current assets

Property, plant & equipment, net

Finance lease right-of-use asset, net

Operating lease right-of-use asset, net

Total current

Property, plant &

equipment, net

Investments in unconsolidated entities

4 unchanged sentences

Accounts payable and accrued expenses

Current portion of finance lease obligation

Current portion of operating lease obligation

Total current liabilities

Long-term finance lease obligation

Long-term operating lease obligation

Dividends payable

Total current

Other noncurrent liabilities

11 unchanged sentences

Common stock in treasury at cost –

shares at February 26, 2022 and

shares at May 29, 2021

Total Cal-Maine Foods, Inc.

shares at August 27, 2022 and

at May 28, 2022

Total Cal-Maine Foods,

stockholders’ equity

Noncontrolling interest in consolidated entity

Total stockholders’ equity

Total Liabilities and Stockholders’ Equity

Total stockholders’

Total Liabilities and Stockholders’

See Notes to Condensed Consolidated Financial Statements.

1 unchanged sentence

and Subsidiaries

Condensed Consolidated Statements of Income

Condensed Consolidated Statements of Operations

(In thousands, except per share amounts)

Thirteen Weeks Ended

Thirty-nine Weeks Ended

February 26, 2022

February 27, 2021

February 26, 2022

February 27, 2021

Thirteen Weeks

August 27, 2022

August 28, 2021

Cost of sales

5 unchanged sentences

Royalty income

Patronage dividends

Equity income of unconsolidated entities

Total other income, net

Income before income taxes

Income (loss) before income taxes

Income tax expense (benefit)

Net income (loss)

Loss attributable to noncontrolling interest

Net income attributable to Cal-Maine Foods, Inc.

Net income per common share:

Weighted average shares outstanding:

Net income (loss) attributable to Cal-Maine Foods, Inc.

Net income (loss) per common share:

Weighted average

shares outstanding:

See Notes to Condensed Consolidated Financial Statements.

2 unchanged sentences

Condensed Consolidated Statements of

Comprehensive Income

Comprehensive Income (Loss)

(In thousands)

Thirteen Weeks Ended

Thirty-nine Weeks Ended

February 26, 2022

February 27, 2021

February 26, 2022

February 27, 2021

Thirteen Weeks

August 27, 2022

August 28, 2021

Net income (loss)

Other comprehensive income (loss), before tax:

Unrealized holding loss on available-for-sale

securities, net of reclassification adjustments

Income tax benefit related to items of other

comprehensive income

Unrealized holding loss on available-for-sale securities, net of reclassification

Income tax benefit related to items of other comprehensive income

Other comprehensive loss, net of tax

Comprehensive income

Comprehensive loss attributable to the

noncontrolling interest

Comprehensive income attributable to Cal-Maine

Comprehensive income (loss)

Comprehensive loss attributable to the noncontrolling interest

Comprehensive income (loss) attributable to Cal-Maine Foods, Inc.

See Notes to Condensed Consolidated Financial Statements.

3 unchanged sentences

(In thousands)

Thirty-nine Weeks Ended

February 26, 2022

February 27, 2021

Thirteen Weeks

August 27, 2022

August 28, 2021

Cash flows from operating activities:

Net income (loss)

Depreciation and amortization

1 unchanged sentence

Other adjustments, net

Net cash provided by operations

Net cash provided by (used in) operations

Cash flows from investing activities:

1 unchanged sentence

Sales and maturities of investment securities

Investment in unconsolidated entities

Distributions from unconsolidated entities

Acquisition of business, net of cash acquired

Purchases of property, plant and equipment

Net proceeds from disposal of property, plant and equipment

Purchases of property,

plant and equipment

Net proceeds from disposal of property,

plant and equipment

Net cash used in investing activities

Cash flows from financing activities:

Payments of dividends

Purchase of common stock by treasury

Principal payments on finance lease

Contributions

Net cash used in financing activities

2 unchanged sentences

Cash and cash equivalents at end of period

Supplemental Information:

Cash paid for operating leases

Interest paid

See Notes to Condensed Consolidated Financial Statements.

4 unchanged sentences

Basis of Presentation

Therefore, they do

not include all

of the information

and footnotes required

by generally accepted

accounting principles in

adjustments that are, in the opinion of management, necessary to a fair

statement of the results for the interim periods presented

periods are not necessarily indicative of operating results for the entire fiscal year.

The Company's

the three-month

year-to-date periods

ended on February 26, 2022 and February 27, 2021 included 13 weeks and 39 weeks, respectively

“we,” “us,” “our”)

have been prepared

in accordance with

the instructions

and Article 10

of Regulation S-X

with generally

principles in

reporting and should

be read in conjunction

with our Annual Report

for the fiscal year

ended May 28,

statement of the results for

the interim periods presented

and, in the opinion of

management, consist of adjustments

recurring nature.

Operating results for

the interim periods

are not necessarily

indicative of operating

results for the

entire fiscal

The Company's fiscal

the Saturday closest

Each of the three-month

periods ended on

August 27, 2022

and August 28, 2021 included

Use of Estimates

The preparation of the consolidated financial statements in conformity with GAAP requires management to make

estimates and

assumptions that

amounts reported

consolidated financial

statements and

accompanying notes.

Actual results

The preparation of the

consolidated financial statements in

conformity with GAAP requires management

to make estimates and

the consolidated

financial statements

and accompanying

could differ from those estimates.

The severity, magnitude and duration, as well as the economic consequences of the COVID-19 pandemic, are uncertain, rapidly

periods in response to COVID-19.

Investment Securities

1 unchanged sentence

securities are

accounted for

in accordance

accordance with

“Investments -

Securities” (“ASC

Equity Securities”

available-for-sale.

current, because the amounts invested are available for

current operations.

current, because the

amounts invested are available

for current operations.

Available-for-sale

securities are carried at fair value,

securities are carried at

with unrealized

losses reported

separate component

of stockholders’

regularly evaluates

changes to the

rating of its

debt securities by credit

agencies and economic conditions

to assess and

record any expected credit

losses through the

allowance for credit

losses, limited to

the amount that

fair value was

less than the

amortized cost basis.

the rating of

its debt securities

agencies and economic

conditions to assess

any expected credit

losses through

the allowance

losses, limited

to the amount

that fair value

was less than

the amortized

available-for-sale

identification

Gains and losses are recognized in other income (expenses) as Other, net in the Company's Condensed Consolidated Statements

Investments in

are classified

long-term assets”

Condensed Consolidated

Balance Sheets.

Gains and losses are recognized in other income

(expenses) as Other, net in the Company's

Condensed Consolidated Statements

Consolidated Balance Sheets.

Trade Receivables

receivables are

Trade receivables

are stated at

their carrying

values, which

credit losses.

include a reserve

for credit losses.

respectively.

customers based on an

evaluation of each customer's financial

condition and credit history.

Collateral is generally not required.

historical loss information adjusted as needed for economic and other forward-looking factors.

Business Combinations

Company applies

accounting guidance

non-financial assets

liabilities associated

with business

acquisitions.

liabilities are

purchase price

non-financial assets acquired is determined internally.

Our internal valuation methodology for non-financial assets considers the

remaining estimated life of the assets acquired and what management believes is the market value for those assets.

Change in Accounting Principle

instruments held by financial institutions and other organizations.

The guidance replaces the prior “incurred loss” approach with

loss” model and

requires measurement of

all expected credit

financial assets held

reporting date

retrospective basis

cumulative effect

adjustment to

retained earnings

the beginning

the period of

The Company evaluated

its current methodology of

estimating allowance for doubtful

accounts and the

guidance and recorded a $

thousand cumulative increase to retained earnings at May 31, 2020.

customers based on

an evaluation of

each customer's financial

condition and credit

Collateral is generally

not required.

historical loss information adjusted as needed for economic and

other forward-looking factors.

Immaterial Error Correction

River”), including

certain liabilities.

third quarter

2022, management

corresponding other

wholly-owned subsidiaries

Condensed Consolidated

Statements of Income.

The errors resulted in

an overstatement of Net Sales and Cost

of Sales of $

million in the first quarter

income (loss) or Net income (loss) per share.

the Company’s

corresponding

-owned subsidiaries

second quarter

2022 Condensed

overstatement

quarter of fiscal 2022

million in the second

quarter of fiscal 2022.

impact to Operating

loss, Net income

(loss) or Net income (loss) per share.

quantitatively

qualitatively

99 Materiality, and

99 Materiality,

108 Considering

3 unchanged sentences

was not material

condensed consolidated

financial statements

second quarters

that correcting

the cumulative

ended February

Accordingly, we have reflected the correction of the immaterial errors as a reduction of Net Sales and

Cost of Sales in the accompanying Condensed Consolidated Statements of Income for the thirty-nine weeks ended February 26,

Note 2 – Acquisition

LLC (“Red River”),

including certain liabilities.

As a result of the

acquisition, Red River became a wholly owned

subsidiary of

Red River owns and operates

a specialty shell egg production

complex with approximately

million cage-free

located on approximately

acres near Bogata, Texas.

consideration

assumed recognized at the acquisition date:

Cash consideration paid

Fair value of the Company's equity interest in Red River held before the business combination

Recognized amounts of identifiable assets acquired and liabilities assumed

Accounts receivable, net

Property, plant and equipment

Liabilities assumed

Deferred income taxes

Total identifiable net assets

accounts receivable

acquired along

with liabilities

their carrying

fair value due to the short maturity of these instruments.

Inventory consisted primarily

of flock, feed

ingredients, packaging, and

egg inventory.

Flock inventory was

valued at carrying

value as management believes that their carrying value

best approximates their fair value.

Feed ingredients, packaging and egg

inventory were all valued based on market prices as of May 30, 2021.

equipment were valued

utilizing the

cost approach which

replacement or reproduction

the assets and subtracting any depreciation resulting from physical deterioration and/or functional or economic obsolescence.

of remeasuring

held before the business combination.

The gain was recorded in other income and expense under the heading “Other, net” in the

Condensed Consolidated

Statements of

acquisition of

million, which

million decrease

expense related

outside-basis of

corresponding

non-recurring,

remeasurement

The recognition

of deferred tax

liabilities resulted in

the recognition of

the goodwill recognized is

expected to be deductible for income tax purposes.

2022 as a reduction of Net Sales and Cost of Sales in the accompanying Condensed

Consolidated Statements of Operations.

New Accounting Pronouncements and Policies

No new accounting pronouncement issued or effective

during the fiscal year had or is expected to have a material

impact on our

Consolidated Financial Statements.

Note 2 - Investment

The following represents the Company’s investment securities as of February 26, 2022 and May 29, 2021 (in thousands):

February 26, 2022

The following represents the Company’s

investment securities as of August 27, 2022 and May 28, 2022 (in

August 27, 2022

Municipal bonds

2 unchanged sentences

Certificates of deposits

US government and agency obligations

Asset backed securities

Total current investment securities

Total noncurrent investment securities

Treasury bills

Total current

investment securities

Total noncurrent

investment securities

Municipal bonds

2 unchanged sentences

Certificates of deposits

US government and agency obligations

Asset backed securities

Total current investment securities

Total noncurrent investment securities

Total current

investment securities

Total noncurrent

investment securities

Available-for-sale

1 unchanged sentence

maturities of

investment securities available-for-sale

investment securities

available-for-sale

million during

thirty-nine weeks ended February

February 27, 2021,

respectively.

Gross realized gains

for the thirty-nine

ended February 26, 2022 and February 27, 2021 were $

thousand and $

thousand, respectively.

Gross realized losses for

the thirty-nine weeks ended February 26, 2022 and February 27, 2021 were $

August 27, 2022

and August 28,

thousand and $

thousand, respectively.

allowances for credit losses at February 26, 2022 and May 29, 2021.

Actual maturities may differ

from contractual maturities as

some borrowers have

Gross realized

losses for the thirteen

respectively.

for credit losses at August 27, 2022 and May 28, 2022.

Actual maturities

from contractual

maturities as some

borrowers have

call or prepay

obligations with or

obligations with

without penalties.

Contractual maturities of current investments at February 26, 2022 are as follows (in thousands):

Contractual maturities of current investments at August

27, 2022 are as follows (in thousands):

Estimated Fair Value

Within one year

ended February

securities during the thirty-nine weeks ended February 27, 2021.

Note 4 - Fair Value Measurements

sales of noncurrent

investment securities during

the thirteen weeks

ended August 27,

Proceeds from

and maturities of noncurrent

investment securities were $

thousand during the thirteen

weeks ended August 28, 2021.

realized gains for

the thirteen weeks

ended August 28, 2021

realized losses for

weeks ended August 28, 2021.

Note 3 - Fair Value

to categorize

4 unchanged sentences

transaction between

knowledgeable, and willing parties able to engage in the

A liability’s fair value

is defined as the amount that would

the liability

transaction between

such parties,

knowledgeable, and willing

parties able to engage in

the transaction.

A liability’s

fair value is defined

as the amount that would

settle the liability with the creditor.

- Quoted prices in active markets for identical assets or liabilities

quoted prices

observable for

or liability,

directly or indirectly, including:

prices included

are observable

directly or indirectly,

Quoted prices for similar assets or liabilities in active markets

1 unchanged sentence

Inputs other than quoted prices that are observable for the asset or liability

Inputs derived principally from or corroborated by other observable market data

- Unobservable inputs for the asset or liability that are supported by little or no market activity and that are

Inputs derived principally from or corroborated by other observable market

- Unobservable inputs for the asset or liability that are

supported by little or no market activity and that

significant to the fair value of the assets or liabilities

The disclosures of fair value of certain financial assets and liabilities that are recorded at cost are as follows:

Cash and cash equivalents, accounts receivable, and accounts payable:

The disclosures of fair value of certain financial assets and liabilities that are recorded

at cost are as follows:

Cash and cash equivalents, accounts receivable,

and accounts payable:

The carrying amount approximates fair value due to the

1 unchanged sentence

Lease obligations:

The carrying value of the Company’s lease obligations is at its present value which approximates fair value.

Assets and Liabilities Measured at Fair Value

The carrying value of the Company’s lease obligations

is at its present value which approximates fair value.

Assets and Liabilities Measured at Fair

on a Recurring Basis

accordance with

hierarchy described

financial assets

liabilities measured at fair value on a recurring basis as of February 26, 2022 and May 29, 2021 (in thousands):

February 26, 2022

liabilities measured at fair value on a recurring basis as of August 27, 2022 and May 28,

2022 (in thousands):

August 27, 2022

Municipal bonds

2 unchanged sentences

Certificates of deposits

US government and agency obligations

Asset backed securities

Total assets measured at fair value

Treasury bills

Total assets measured at fair

Municipal bonds

2 unchanged sentences

Certificates of deposits

US government and agency obligations

Asset backed securities

Total assets measured at fair value

Investment securities

Total assets measured at fair

available-for-sale

classified as

securities with

maturities of

with maturities

when purchased.

classified these securities as current because amounts invested are readily available

classified these securities as

current because amounts

invested are readily available

for current operations.

1 unchanged sentence

Note 4 - Inventories

Inventories consisted of the following as of February 26, 2022 and May 29, 2021 (in thousands):

February 26, 2022

Inventories consisted of the following as of August 27, 2022 and May 28,

2022 (in thousands):

August 27, 2022

Flocks, net of amortization

1 unchanged sentence

Feed and supplies

breeders (male and female chickens used to produce fertile eggs to

hatch for egg production flocks).

Our total flock at February

26, 2022 consisted of approximately

million pullets and breeders and

million layers.

Note 6 - Accrued Dividends Payable and Dividends per Common Share

accrue dividends at the

end of each quarter

according to the Company’s

dividend policy adopted by its

Board of Directors.

The Company pays

a dividend to

shareholders of its

Common Stock and Class

A Common Stock

on a quarterly

basis for each

Company reports net

income attributable

breeders (male

chickens used

production flocks).

27, 2022 and May

28, 2022 consisted of

approximately

million pullets and breeders

million layers, respectively.

Note 5 - Accrued Dividends Payable and Dividends per Common

accrue dividends at

each quarter according

to the Company’s

dividend policy adopted

of Directors.

pays a dividend

to shareholders

of its Common

Class A Common

a quarterly basis

Company reports

attributable to

Cal-Maine Foods,

in accordance

equal to one-third

quarterly income.

shareholders of record

as of the 60th

following the

of such quarter,

the fourth fiscal

the fourth quarter,

pays dividends

to shareholders of record on the 65th day after the

Dividends are payable on the 15th day following

the record date.

Following a quarter for which the Company does not report net income

attributable to Cal-Maine Foods, Inc., the Company will

not pay a dividend

for a subsequent profitable

quarter until the Company

is profitable on a cumulative

basis computed from the

date of the most recent quarter for which a dividend was paid.

For the first

quarter of fiscal 2023, we will pay a cash dividend of

approximately $

per share to holders of our Common Stock and Class A Common Stock.

Condensed Consolidated

Statements of

Operations, we

determine dividends

accordance with

in an amount equal

to one-third (

) of such quarterly

Dividends are paid

to shareholders of record as

of the 60th day

following the last

such quarter,

except for the

fourth fiscal quarter.

For the fourth

Company pays dividends

to shareholders of record on the 65th day after the quarter end.

Dividends are payable on the 15th day following the record date.

Following a quarter for which the Company does not report net income attributable to Cal-Maine Foods, Inc., the Company will

not pay a dividend for a subsequent

profitable quarter until the Company is profitable on

a cumulative basis computed from the

date of the most

recent quarter for which

a dividend was paid.

For the third quarter

of fiscal 2022, we

cash dividend

of approximately $

per share to holders

of our Common Stock

and Class A Common

The amount of

the accrual is

recorded in Accounts payable and accrued expenses in the Company’s Condensed Consolidated Balance Sheets.

computation in the following table (in thousands, except per share data):

Thirteen Weeks Ended

Thirty-nine Weeks Ended

February 26, 2022

February 27, 2021

February 26, 2022

February 27, 2021

Net income attributable to Cal-Maine Foods,

Cumulative losses to be recovered prior to

payment of divided at beginning of period

Thirteen Weeks

August 27, 2022

August 28, 2021

Net income (loss) attributable to Cal-Maine Foods, Inc.

Cumulative loss to be recovered prior to payment of divided at beginning of period

Net income available for dividend

1/3 of net income attributable to Cal-Maine

1/3 of net income attributable to Cal-Maine Foods, Inc.

available for dividend

1 unchanged sentence

Class A common stock outstanding (shares)

Total common stock outstanding (shares)

Total common stock

outstanding (shares)

Dividends per common share*

outstanding (shares).

Note 7 – Credit Facility

Restated Credit

Agreement (the

“Credit Agreement”)

“Administrative

Credit Facility in

the aggregate up

adding one or

more incremental senior

secured term loans

or increasing

one or more times

the revolving commitments under

the Revolver.

As of February 26,

amounts were borrowed under

the Credit Facility and $

million in standby letters of credit were issued under the Credit Facility.

Eurodollar Rate

the Applicable

The “Eurodollar

reserve adjusted rate

at which Eurodollar

deposits in the

London interbank market

for an interest

a fluctuating

Administrative

Agent, and (c) the Eurodollar Rate for an interest period of

% per annum, subject to certain interest rate floors.

Capitalization Ratio

quarterly pricing date.

The Company will

pay a commitment

unused portion of

the Credit Facility

payable quarterly

Capitalization

quarterly pricing date.

The Credit Agreement contains customary provisions regarding replacement of the Eurodollar Rate.

Credit Facility

guaranteed by

future wholly-owned

indirect domestic

subsidiaries of

Company (the “Guarantors”),

and is secured

by a first-priority

perfected security interest

in substantially all

of the Company’s

(including farm products) and deposit accounts maintained with the Administrative Agent.

Agreement for

Facility contains

customary covenants,

including restrictions

incurrence of

incurrence of additional

debt, sales of

assets and other

fundamental corporate changes

and investments.

Credit Agreement

requires maintenance of

two financial covenants:

(i) a maximum

Funded Debt to

Capitalization Ratio tested

no greater than

and (ii) a requirement to maintain Minimum Tangible

at all times of $

Additionally, the

Credit Agreement requires that Fred

spouse, natural children, sons-in-law or grandchildren,

any trust, guardianship,

conservatorship or custodianship for

the primary benefit of

foregoing, or any

family limited

partnership, similar limited liability company or other entity

% of the voting control of such

entity is held by any of the

foregoing, shall maintain at least

% of the Company's voting

Failure to satisfy any

of these covenants will constitute

default under the terms of the Credit Agreement.

Further, under

the terms of the Credit Agreement, payment of dividends under

payment of other dividends or

repurchases by the Company of

its capital stock is allowed,

as long as after giving

effect to such

dividend payments

or repurchases

continuing and

equivalents of

Company and its subsidiaries plus availability under the Credit Facility equals at least $

Agreement also

includes customary

customary remedies

occurrence of

default, including acceleration of the amounts

due under the Credit Facility and

foreclosure of the collateral securing the

At February 26, 2022, we were in compliance with the covenant requirements of the Credit Facility.

Note 6 - Equity

The following reflects equity activity for the

thirteen and thirty-nine weeks ended February 26,

2022 and February 27, 2021 (in

Thirteen Weeks Ended February 26, 2022

Cal-Maine Foods, Inc.

Noncontrolling

Balance at November

Other comprehensive

loss, net of tax

Stock compensation

plan transactions

Net income (loss)

Balance at February

Thirteen Weeks Ended February 27, 2021

Cal-Maine Foods, Inc.

Income (Loss)

Balance at November 28, 2020

Other comprehensive loss, net of tax

Stock compensation plan transactions

Balance at February 27, 2021

Thirty-nine Weeks Ended February 26, 2022

The following reflects equity activity for the thirteen weeks ended

August 27, 2022 and August 28, 2021 (in thousands):

Thirteen Weeks

Ended August 27, 2022

Cal-Maine Foods, Inc.

5 unchanged sentences

plan transactions

Contributions

Net income (loss)

Balance at February

Thirty-nine Weeks Ended February 27, 2021

Balance at August

Thirteen Weeks

Ended August 28, 2021

Cal-Maine Foods, Inc.

Income (Loss)

Balance at May 29, 2021

Impact of ASC 326

Balance at May 31 2020

Other comprehensive loss, net of tax

Stock compensation plan transactions

Contributions

Balance at February 27, 2021

Note 9 - Net Income per Common Share

Basic net income per

share is based on

the weighted average Common Stock

and Class A Common

Stock outstanding.

Balance at August 28, 2021

Note 7 - Net Income (Loss) per Common Share

income (loss)

weighted average

dilutive effect of share-based awards.

Stock outstanding.

Diluted net income

weighted-average common

shares outstanding

relevant period adjusted

of share-based

quarter of fiscal 2022.

These shares were not included in the diluted net

loss per share calculation.

reconciliation

income per common share (amounts in thousands, except per share data):

Thirteen Weeks Ended

Thirty-nine Weeks Ended

February 26, 2022

February 27, 2021

February 26, 2022

February 27, 2021

Loss attributable to noncontrolling

Net income attributable to Cal-Maine

Weighted-average common shares

outstanding, basic

income (loss) per common share (amounts in thousands, except per share data):

Thirteen Weeks

August 27, 2022

August 28, 2021

Net income (loss)

Loss attributable to noncontrolling interest

Net income (loss) attributable to Cal-Maine Foods, Inc.

Weighted-average

common shares outstanding, basic

Effect of dilutive restricted shares

Weighted-average common shares

outstanding, diluted

Net income per common share attributable to

Cal-Maine Foods, Inc.

Note 10 - Revenue Recognition

Weighted-average

common shares outstanding, diluted

Net income (loss) per common share attributable to Cal-Maine Foods,

Note 8 – Revenue from Contracts with Customers

Satisfaction of Performance Obligation

Most of the Company’s

revenue is derived from

contracts with customers based on

the customer placing an

order for products.

determined when

customer agree

specific order,

which establishes

the contract for that order.

The vast majority of the Company’s

revenue is derived from agreements with customers based on the customer

placing an order

for products.

for the most part

is determined when

the Company and

the customer agree

upon the specific

establishes the contract for that order.

recognized in

1 unchanged sentence

consideration we

independently quoted

wholesale market

prices, negotiated

formulas related

of production.

The Company’s

sales predominantly

single performance

recognize revenue

upon satisfaction of the

performance obligation with the

customer, which typically

occurs within days of

the Company and the

independently

predominantly

customer agreeing upon the order.

Returns and Refunds

Some of our contracts include a guaranteed

sale clause, pursuant to which we

credit the customer’s account for product that

customer is unable to

sell before expiration.

The Company records

an estimate of returns and

refunds by using historical

current period

Some of our contracts

include a guaranteed sale

clause, pursuant to which

we credit the customer’s

account for product

accounts receivable.

corresponding reduction in trade accounts receivable.

The allowance

with a corresponding reduction in trade accounts receivable.

Sales Incentives Provided to Customers

discount offers (e.g.,

percentage discounts off

current purchases), inducement offers

(e.g., offers for

discount offers

(e.g., percentage

discounts off

current purchases), inducement

offers (e.g.,

future discounts subject

2 unchanged sentences

Current discount

customers, are

transaction, while

inducement offers,

when accepted

by customers,

historical experience

inducement offers.

while inducement

by customers,

estimated future

redemption rates.

estimated using

the Company’s

Current discount

and inducement

are presented

‘‘Net sales.’’

Disaggregation of Revenue

The following table provides revenue disaggregated by product category (in thousands):

Thirteen Weeks Ended

Thirty-nine Weeks Ended

February 26, 2022

February 27, 2021

February 26, 2022

February 27, 2021

The following table provides revenue disaggregated by product category

(in thousands):

Thirteen Weeks

August 27, 2022

August 28, 2021

Conventional shell egg sales

1 unchanged sentence

Contract Costs

The Company can incur costs to obtain or fulfill a contract with a customer.

If the amortization period of these costs is less than

The Company can incur costs to

obtain or fulfill a contract with a

amortization period of these costs is less

the amortization

and is amortized

over the contract

reduction in net

February 26, 2022

and February 27,

2021, the balance

for contract assets is immaterial.

contract life

contract assets is immaterial.

Contract Balances

receives payment

from customers

specified terms

generally less

There are rarely contract assets or liabilities related to performance under the contract.

Note 11 - Leases

Expenses related to

operating leases, amortization

of finance leases,

right-of-use assets, and

finance lease interest

in Cost of sales, Selling general and administrative expense, and Interest income, net in the Condensed Consolidated Statements

The Company’s lease cost consists of the following (in thousands):

Thirteen Weeks Ended

Thirty-nine Weeks Ended

February 26, 2022

Operating lease cost

Finance lease cost

Amortization of right-of-use asset

Interest on lease obligations

Short term lease cost

Future minimum lease payments under non-cancelable leases are as follows (in thousands):

As of February 26, 2022

Operating Leases

Finance Leases

Remainder fiscal 2022

Less imputed interest

weighted-average

Balance Sheet are as follows:

As of February 26, 2022

Operating Leases

Finance Leases

Weighted-average remaining lease term (years)

Weighted-average discount rate

The Company receives payment from customers based on specified terms that are

generally less than 30 days from delivery.

There are rarely contract assets or liabilities related to performance under the

Note 9 - Stock Based Compensation

stock-based compensation expense

million and $

million for the

thirty-nine weeks ended

February 26, 2022

and February 27, 2021, respectively.

Unrecognized compensation

of non-vested

restricted stock

outstanding under

average period of

Refer to Part II

Item 8, Notes to Consolidated

Financial Statements and Supplementary Data, Note

Stock Compensation Plans in our 2021 Annual Report for further information on our stock compensation plans.

The Company’s restricted share activity for the thirty-nine weeks ended February 26, 2022 follows:

Total stock-based

compensation expense was $

million for the thirteen weeks ended August 27, 2022 and August 28, 2021.

stock outstanding

Restated 2012 Omnibus Long-Term

Incentive Plan at August 27, 2022 of $

million will be recorded over a weighted average

Supplementary

Stock Compensation Plans in our 2022 Annual Report for further information

on our stock compensation plans.

The Company’s restricted share activity

for the thirteen weeks ended August 27, 2022 follows:

Average Grant

1 unchanged sentence

Outstanding, May 28, 2022

Outstanding, February 26, 2022

Outstanding, August 27, 2022

Note 10 – Income Taxes

million which reflects

%, respectively.

Excluding the impact

Egg Farm, LLC acquisition, the adjusted effective

tax rate for the first quarter of fiscal 2022 is

Our effective tax

rate differs from

the federal statutory income

tax rate due to

state income taxes, certain

federal tax credits and

nondeductible

noncontrolling interest.

Note 11 - Commitments and Contingencies

Financial Instruments

recorded as a liability on the consolidated balance sheets.

The Company maintained

standby letters of credit

(“LOCs”) totaling $

million at August 27,

2022, which were issued

the Company's Credit Facility.

The outstanding LOCs are for the

benefit of certain insurance companies

and are not recorded as

a liability on the consolidated balance sheets.

LEGAL PROCEEDINGS

State of Texas v.

State of Texas

Cal-Maine Foods, Inc.

1 unchanged sentence

and Wharton County Foods, LLC

2020, the Company

and its subsidiary

Wharton County Foods,

LLC (“WCF”) were

named as defendants

Cal-Maine Foods,

Wharton County

Foods, LLC (“WCF”)

as defendants in

Harris County,

3 unchanged sentences

Practices—Consumer

On August 13, 2020, the court granted the defendants’ motion to dismiss the State’s original petition with

On September 11,

On August 13, 2020, the court granted the defendants’ motion to dismiss the State’s

original petition with

the State filed a

notice of appeal, which was

assigned to the Texas

Court of Appeals for the

First District.

State filed its

opening brief on

December 7, 2020.

The Company and

WCF filed their

response on February

notice of appeal,

which was assigned

Court of Appeals

believes the risk of material loss related to this matter to be remote.

Cal-Maine Foods et al.

defendants in

Cal-Maine Foods

producers, and farms.

Plaintiffs assert that defendants violated the DTPA

by allegedly demanding exorbitant or excessive prices

COVID-19 state

of emergency.

request certification

Plaintiffs assert that defendants

violated the DTPA

by allegedly demanding exorbitant or

excessive prices

certification

all consumers

who purchased

Plaintiffs seek to enjoin the Company and

other defendants from selling eggs at a price more

than 10% greater than the price of

declaration of

Plaintiffs seek to enjoin

the Company and other

defendants from selling eggs

at a price more than

10% greater than the price

per violation,

1 unchanged sentence

impacting anyone

other defendants

plaintiffs’ amended

plaintiffs subsequently

related proceedings were

States magistrate

recommendation

dismissed without prejudice

subject matter jurisdiction.

On September 20,

court adopted the

recommendation

final judgment

certain other

defendants dismissing

case without prejudice.

On October 18,

2021, plaintiffs

filed a motion

amend the final

judgement and allow

defendants filed

subsequently filed

related proceedings

were referred

United States

magistrate judge.

the magistrate

recommendation

dismissed without prejudice for lack of subject matter jurisdiction.

On September 20, 2021, the court dismissed the case without

On March 15, 2022,

filed a second suit

against the Company and

several defendants in

Cal-Maine Foods

1:22-cv-246, in

Austin Division

same assertions

plaintiffs’ filed

their opposition

defendants filed

their reply on

September 13,

court has not

issued a ruling.

Management believes

of material loss related to both matters to be remote.

Kraft Foods Global, Inc.

2 unchanged sentences

September 25,

several defendants

cases involving

egg industry.

cases, except

plaintiffs who sought substantial damages allegedly arising from the purchase of egg products

(as opposed to shell eggs).

plaintiffs who sought substantial

damages allegedly arising from

the purchase of egg products (as

opposed to shell eggs).

remaining plaintiffs

are Kraft Food

Global, Inc., General

Mills, Inc., and

Nestle USA, Inc.

Inc., General

Products Plaintiffs”)

5 unchanged sentences

Pennsylvania,

2002, to the United States District Court for

the Northern District of Illinois, Kraft Foods Global, Inc.

the United States District Court

for the Northern District

of Illinois, Kraft Foods Global,

1:11-cv-8808,

illegally to raise the prices that plaintiffs paid for processed egg products.

In particular, the Egg Products Plaintiffs are

certain features of the United

Egg Producers animal-welfare guidelines and program

used by the Company and many

Products Plaintiffs

Company and other

defendants from engaging

in antitrust violations

parties filed

status report

preparing a final pretrial order.

August 25, 2021, the parties filed a joint status report, and on

August 26, 2021, the court, by

docket entry, informed the parties that the need to discuss issues was no longer necessary and that a scheduled August 30, 2021,

status hearing was stricken.

No trial schedule has yet been entered by the court.

illegally to raise the prices that plaintiffs

paid for processed egg products.

In particular,

the Egg Products Plaintiffs are

certain features of

the United Egg

Producers animal-welfare guidelines

and program used by

the Company and

many other egg

Plaintiffs seek

defendants from

antitrust violations

and seek treble money damages.

On May 2, 2022,

the court set trial for October

24, 2022, but on September

20, 2022, the court

cancelled the

COVID-19 protocols

and converted

reschedule the

We anticipate the

trial being rescheduled for the first or second calendar quarter of 2023.

a confidential

2 unchanged sentences

condition or results of operations.

November 11, 2019, a

stipulation for dismissal was filed with

the court, but the court

not yet entered a judgment on the filing.

The Company intends to continue to defend the remaining case with the Egg Products Plaintiffs

On November 11,

2019, a stipulation for dismissal was filed with the court,

and on March 28,

2022, the court dismissed the Company with prejudice.

The Company intends to

continue to defend the remaining

case with the Egg Products Plaintiffs

as vigorously as possible based

5 unchanged sentences

Products Plaintiffs,

at the present

not possible to

estimate the amount

of monetary exposure,

to the Company

due to a range of factors, including the following, among

the matter is in the early stages of preparing for

trial following

factual issues

damages other

than compensatory

damages (i.e.,

injunction and

money damages).

State of Oklahoma Watershed Pollution Litigation

State of Oklahoma

in the United

present time,

monetary exposure,

substantially

legal arguments

and/or damages;

prior related

are significant

other than compensatory damages (i.e., injunction and treble money damages).

State of Oklahoma Watershed Pollution

Oklahoma filed

States District

the Northern District

against Cal-Maine Foods, Inc.

and Tyson Foods, Inc.

and affiliates,

Cobb-Vantress,

and affiliates, Cobb-Vantress,

Inc., Cargill, Inc.

and its affiliate, George’s,

affiliate, Peterson Farms,

affiliate, George’s,

its affiliate,

Peterson Farms, Inc.

and Simmons Foods,

Oklahoma claims that through

State of Oklahoma

claims that through

the disposal of

chicken litter

the defendants

have polluted

River Watershed.

defendants have

Illinois River

This watershed

provides water

eastern Oklahoma.

The complaint

2 unchanged sentences

monetary damages

litigation began, Cal-Maine

membership interests of

Benton County

the litigation

began, Cal-Maine

membership interests

commercial shell

3 unchanged sentences

LLC is not a defendant in the litigation.

The trial in the case began in September 2009 and concluded in February 2010.

The case was tried without a jury,

The trial in the case

began in September 2009 and

concluded in February 2010.

case was tried without a jury,

and the court

has not yet issued its ruling.

Management believes the risk of material loss related to this matter to be remote.

Management believes the risk of material loss related

to this matter to be remote.

Other Matters

In addition to the above,

the Company is involved in

various other claims and litigation

incidental to its business.

In addition to

the above, the Company

is involved in

various other claims

and litigation incidental

to its business.

these matters

cannot be determined

with certainty,

management, upon the

advice of counsel,

the opinion that

the final outcome should not have a material effect on the Company’s consolidated results of operations or financial position.

Note 14 - Related Party Transaction

beneficiaries

Stockholders”),

secondary public

Common Stock held by them, pursuant to a previously disclosed Agreement Regarding Common Stock (the “Agreement”) filed

as an exhibit to our 2021 Annual Report.

Adams and the Daughters’ Trust advised the Company that they were conducting

including the Prospectus contained therein dated October

9, 2018, and a related

Prospectus Supplement dated August 19, 2020,

each of which

with the Securities and

Exchange Commission.

offering involved only

the offering.

(not including

the underwriting

Stockholders,

Stockholders)

Pursuant to the Agreement, the Selling Stockholders reimbursed the Company $

determined with

management, upon

the final outcome should not have a material effect on the Company’s

consolidated results of operations or financial position.

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-Q

Item 1. Financial Statements