Item 9A. Controls and Procedures
ITEM 9A.
CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
Our disclosure controls and procedures are designed to provide reasonable assurance that information
required to be disclosed by
us in
the reports
we file
or submit
under the
Securities Exchange
Act of
1934, as
amended (the
“Exchange Act”)
is recorded,
processed, summarized
and reported,
within the time
periods specified in
the Securities and
Exchange Commission’s
rules and
forms. Disclosure
controls
and
procedures
include,
without
limitation,
controls
and
procedures
designed
to
ensure
that
information
required
to
be
disclosed
by
us
in
the
reports
that
we
file
or
submit
under
the
Exchange
Act
is
accumulated
and
communicated to management,
including our principal
executive and principal
financial officers, or
persons performing similar
functions, as appropriate
to allow
timely decisions regarding
required disclosure. Based
on an
evaluation of
our disclosure controls
and procedures conducted by our
Chief Executive Officer and Chief
Financial Officer, together with other financial officers, such
officers concluded that our disclosure controls and procedures
were effective as of June 3, 2023
at the reasonable assurance level.
Internal Control Over Financial Reporting
(a)
Management’s Report
on Internal Control Over Financial Reporting
The following
sets forth,
in accordance
with Section
404(a) of
the Sarbanes-Oxley
Act of
2002 and
Item 308
of the
Securities
and Exchange Commission’s Regulation
S-K, the report of management on our internal control over financial reporting.
1.
Our management is responsible for establishing and maintaining adequate internal control over financial
reporting.
“Internal control over financial reporting”
is a process designed
by, or under the supervision of, our
Chief Executive
Officer and Chief
Financial Officer,
together with other financial
officers, and effected
by our Board of
Directors,
management
and other
personnel, to
provide reasonable
assurance
regarding the
reliability of
financial reporting
and the preparation of financial statements for external purposes in accordance
with generally accepted accounting
principles and includes those policies and procedures that:
●
Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions
and dispositions of our assets;
●
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial
statements
in
accordance
with
generally
accepted
accounting
principles,
and
that
our
receipts
and
expenditures are being made only in accordance with
authorizations of our management and directors; and
●
Provide reasonable assurance regarding prevention or timely detection
of unauthorized acquisition, use or
disposition of our assets that could have a material effect on the financial
statements.
2.
Our
management,
in
accordance
with
Rule
13a-15(c)
under the
Exchange
Act
and
with the
participation
of
our
Chief
Executive
Officer
and
Chief
Financial
Officer,
together
with
other
financial
officers,
evaluated
the
effectiveness
of
our
internal
control
over
financial
reporting
as
of
June
3,
2023. The
framework
on
which
management’s
evaluation
of
our
internal
control
over
financial
reporting
is
based
is
the
“Internal
Control
–
Integrated
Framework”
published
in
2013
by
the
Committee
of
Sponsoring
Organizations
(“COSO”)
of
the
Treadway Commission.
3.
Management has
determined that
our internal
control over
financial reporting
as of June
3, 2023
is effective.
It is
noted
that
internal
control
over
financial
reporting
cannot
provide
absolute
assurance
of
achieving
financial
reporting objectives, but rather reasonable assurance of achieving
such objectives.
4.
The attestation report of FROST,
PLLC on our internal control over financial reporting,
which includes that firm’s
opinion on the effectiveness of our internal control over financial
reporting, is set forth below.
(b)
Attestation Report of the Registrant’s
Public Accounting Firm
62
Report of Independent Registered Public Accounting Firm
on Internal Control Over Financial Reporting
Board of Directors and Stockholders
Cal-Maine Foods, Inc. and Subsidiaries
Ridgeland, Mississippi
Opinion on Internal Control Over Financial Reporting
We
have audited
Cal-Maine Foods,
Inc. and
Subsidiaries’ internal
control over
financial reporting
as of June
3, 2023,
based
on
criteria
established
in
2013
Internal
Control
–
Integrated
Framework
issued
by
the
Committee
of
Sponsoring
Organizations of
the Treadway
Commission (“COSO”).
In our
opinion, Cal-Maine
Foods, Inc. and
Subsidiaries maintained,
in
all material
respects,
effective
internal
control
over
financial
reporting
as June
3, 2023,
based
on
criteria
established
in
2013
Internal Control – Integrated Framework issued by the COSO.
We
also have
audited, in
accordance with
the standards
of the
Public Company
Accounting Oversight
Board (United
States) (“PCAOB”), the consolidated
balance sheets and the
related consolidated statements of
income, comprehensive income,
stockholders’ equity,
and cash flows of Cal-Maine Foods,
Inc. and Subsidiaries and our
report dated July 25, 2023 expressed
an
unqualified opinion.
Basis for Opinion
Cal-Maine
Foods,
Inc.
and
Subsidiaries’
management
is
responsible
for
maintaining
effective
internal
control
over
financial
reporting,
and
for
their
assessment
of
the
effectiveness
of
internal
control
over
financial
reporting,
included
in
the
accompanying Management’s
Report on Internal
Control Over Financial
Reporting in Item 9A.
Our responsibility is
to express
an opinion on the entities’ internal control over financial reporting based
on our audit. We are a public accounting firm registered
with the PCAOB and
are required to be
independent with respect to
Cal-Maine Foods, Inc.
and Subsidiaries in accordance
with
the
U.S.
federal
securities
laws and
the
applicable
rules
and
regulations
of the
Securities and
Exchange
Commission
and
the
PCAOB.
We
conducted
our
audit in
accordance
with
the
standards
of
the
PCOAB. Those
standards
require
that
we
plan
and
perform the audit to obtain reasonable assurance about whether effective internal control over financial
reporting was maintained
in
all material
respects.
Our audit
of internal
control over
financial
reporting
included
obtaining
an understanding
of internal
control
over
financial
reporting,
assessing the
risk
that
a
material
weakness
exists,
and
testing
and
evaluating
the design
and
operating effectiveness
of internal control based
on the assessed risk.
Our audit also included
performing such other procedures
as we considered necessary in the circumstances. We
believe our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
An entities’ internal control over financial reporting is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of
consolidated financial statements for external purposes in accordance with
accounting principles
generally accepted
in the
United States
of America.
An entities’
internal control
over financial
reporting
includes those
policies and
procedures that
(1) pertain
to the
maintenance
of records
that, in
reasonable detail,
accurately and
fairly reflect the
transactions and dispositions of
the assets of the
entities; (2) provide reasonable
assurance that transactions are
recorded
as
necessary
to
permit
preparation
of
consolidated
financial
statements
in
accordance
with
accounting
principles
generally
accepted
in the
United States
of America,
and
that receipts
and
expenditures
of the
entities are
being
made only
in
accordance
with
authorizations
of
management
and
directors
of
the
entities;
and
(3)
provide
reasonable
assurance
regarding
prevention or
timely detection
of unauthorized
acquisition, use,
or disposition
of the
entities’ assets
that could
have a
material
effect on the consolidated financial statements.
Because of
its inherent
limitations, internal
control over
financial reporting
may not
prevent or
detect misstatements.
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become
inadequate
because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.
/s/
Frost, PLLC
Little Rock, Arkansas
July 25, 2023
63
(c)
Changes in Internal Control Over Financial Reporting
In
connection
with
its
evaluation
of
the
effectiveness,
as
of
June
3,
2023,
of
our
internal
control
over
financial
reporting,
management determined that there was no change
in our internal control over financial reporting that
occurred during the fourth
quarter
ended June
3, 2023,
that has
materially
affected,
or is
reasonably
likely to
materially
affect,
our
internal
control over
financial reporting.
ITEM 9B.
OTHER INFORMATION
Not applicable.
ITEM 9C.
DISCLOSURE REGARDING FOREIGN JURISDICTIONS
THAT PREVENT INSPECTIONS
Not applicable.
PART
III.
ITEM 10.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE
GOVERNANCE
Except as set forth below, the information concerning directors, executive officers and corporate governance required by Item 10
is
incorporated
by
reference
from
our
definitive
proxy
statement
which
is
to
be
filed
pursuant
to
Regulation
14A
under
the
Securities Exchange Act of 1934 in connection with our 2023 Annual
Meeting of Shareholders.
We have adopted a Code of Ethics and
Business Conduct that applies to
our directors, officers and employees, including the chief
executive
officer
and principal
financial and
accounting
officers of
the Company.
We
will provide
a copy
of the
code free
of
charge to any person that requests a copy by writing to:
Cal-Maine Foods, Inc.
P.O.
Box 2960
Jackson, Mississippi 39207
Attn.:
Investor Relations
Requests can be made by phone at (601) 948-6813.
A copy is also
available at our
website www.calmainefoods.com
under the heading
“Investors – Corporate
Governance – Code
of Ethics.” We
intend to disclose
any amendments
to, or waivers
from, the
Code of Conduct
and Ethics for
Directors, Officers
and
Employees
on our
website promptly
following
the date
of any
such amendment
or waiver.
Information
contained
on our
website is not a part of this report.
ITEM 11.
EXECUTIVE COMPENSATION
The information concerning executive
compensation required by Item 11
is incorporated by reference from our
definitive proxy
statement which is to
be filed pursuant to Regulation
14A under the Securities
Exchange Act of 1934 in
connection with our 2023
Annual Meeting of Shareholders.
ITEM
12.
SECURITY
OWNERSHIP
OF
CERTAIN
BENEFICIAL
OWNERS
AND MANAGEMENT
AND
RELATED STOCKHOLDER
MATTERS
The information
concerning security
ownership of
certain beneficial
owners and
management and
related stockholder
matters
required by Item 12 is incorporated
by reference from our definitive proxy
statement which is to be filed pursuant
to Regulation
14A under the Securities Exchange Act of 1934 in connection with our 2023
Annual Meeting of Shareholders.
ITEM 13.
CERTAIN
RELATIONSHIPS
AND RELATED TRANSACTI
ONS, AND DIRECTOR INDEPENDENCE
The
information
concerning
certain
relationships
and
related
transactions,
and
director
independence
required
by
Item
13
is
incorporated by reference from
our definitive proxy
statement which is
to be filed
pursuant to Regulation
14A under the
Securities
Exchange Act of 1934 in connection with our 2023 Annual Meeting of Shareholders.
64
ITEM 14.
PRINCIPAL ACCOUNTING
FEES AND SERVICES
The information
concerning principal
accounting fees
and services
required by
Item 14
is incorporated
by reference
from our
definitive
proxy
statement
which
is
to
be
filed
pursuant
to
Regulation
14A
under
the
Securities
Exchange
Act
of
1934
in
connection with our 2023 Annual Meeting of Shareholders.
PART
IV.
ITEM 15. EXHIBIT AND FINANCIAL STATEMENT
SCHEDULES
(a)(1)
Financial Statements
The following consolidated financial statements and notes thereto of Cal-Maine Foods, Inc. and subsidiaries are included in Item
8 and are filed herewith:
Report of Independent Registered Public Accounting Firm
(PCAOB
5348
)
35
Consolidated Balance Sheets – June 3, 2023 and May 28, 2022
37
Consolidated Statements of Income – Fiscal Years Ended June 3, 2023, May 28, 2022, and May 29, 2021
38
Consolidated Statements of Comprehensive Income – Fiscal Years Ended June 3, 2023, May 28, 2022, and
May 29, 2021
39
Consolidated Statements of Changes in Stockholders' Equity for the Fiscal Years Ended June 3, 2023, May 28,
2022, and May 29, 2021
40
Consolidated Statements of Cash Flows for the Fiscal Years Ended June 3, 2023, May 28, 2022, and May 29,
2021
41
Notes to Consolidated Financial Statements
42
(a)(2)
Financial Statement Schedule
Schedule II – Valuation and Qualifying Accounts
60
All other schedules are omitted either because they
are not applicable or required, or
because the required information is included
in the financial statements or notes thereto.
(a)(3)
Exhibits Required by Item 601 of Regulation S-K
See Part (b) of this Item 15.
65
(b)
Exhibits Required by Item 601 of Regulation S-K
The following exhibits are filed herewith or incorporated by reference:
Exhibit
Number
Exhibit
3.1
Second Amended and Restated Certificate of Incorporation of the Registrant (incorporated by reference to
Exhibit 3.1 in the Registrant’s Form 8-K, filed July 20, 2018)
3.2
Composite Bylaws of the Registrant (incorporated by reference to Exhibit 3.2 in the Registrant’s Form 10-Q
for the quarter ended March 2, 2013, filed April 5, 2013)
4.1**
Description of Registrant's Securities Registered Under Section 12 of the Exchange Act
10.1
Underwriting Agreement, dated August 19, 2020, among the Company, the Selling Stockholders and BofA
Securities Inc., as representative of the several underwriters named therein (incorporated by reference to
Exhibit 1.1 in the Registrant’s Form 8-K, filed August 24, 2020)
10.2
Agreement Regarding Common Stock, including Registration Rights Exhibit (attached) (incorporated by
reference to Exhibit 10.1 to the Registrant’s Form 8-K, filed June 5, 2018)
10.3*
Deferred Compensation Plan, dated November 15, 2021 (incorporated by reference to Exhibit 10.2 in the
Registrant's Form 8-K, filed November 19, 2021)
10.4
Credit Agreement, dated November 15, 2021, among Cal-Maine Foods, Inc., the Guarantors, BMO Harris
Bank N.A., as Administrative Agent, and the Lenders (incorporated by reference to Exhibit 10.1 in the
Registrant's Form 8-K, filed November 19, 2021)
10.5**
First Amendment to Credit Agreement, dated May 26, 2023, among Cal-Maine Foods, Inc., the Guarantors,
BMO Harris Bank N.A., as Administrative Agent, and the Lenders
10.6*
Cal-Maine Foods, Inc. KSOP, as amended and restated, effective April 1, 2012 (incorporated by reference to
Exhibit 4.4 in the Registrant’s Form S-8, filed March 30, 2012)
10.7*
Cal-Maine Foods, Inc. KSOP Trust, as amended and restated, effective April 1, 2012 (incorporated by
reference to Exhibit 4.5 in the Registrant’s Form S-8, filed March 30, 2012)
10.8*
Amended and Restated Cal-Maine Foods, Inc. 2012 Omnibus Long-Term Incentive Plan (incorporated by
reference to Exhibit 10.1 to the Company’s Form 8-K filed October 2, 2020)
10.9*
Form of Restricted Stock Agreement for Amended and Restated Cal-Maine Foods, Inc. 2012 Omnibus Long-
Term Incentive Plan (incorporated by reference to Exhibit 10.8 to the Company's Form 10K filed July 19,
2022)
10.10*
Supplemental Executive Retirement Plan, adopted March 24, 2023 (incorporated by reference to Exhibit 10.1
to the Company’s Form 8-K filed March 27, 2023)
10.11*
Split Dollar Life Insurance Plan, adopted March 24, 2023 (incorporated by reference to Exhibit 10.2 to the
Company’s Form 8-K filed March 27, 2023)
21**
Subsidiaries of the Registrant
23.1**
Consent of FROST, PLLC
31.1**
Rule 13a-14(a) Certification of Chief Executive Officer
31.2**
Rule 13a-14(a) Certification of Chief Financial Officer
32***
Section 1350 Certifications of the Chief Executive Officer and the Chief Financial Officer
101.SCH***+
Inline XBRL Taxonomy
Extension Schema Document
101.CAL***+
Inline XBRL Taxonomy
Extension Calculation Linkbase Document
101.DEF***+
Inline XBRL Taxonomy
Extension Definition Linkbase Document
101.LAB***+
Inline XBRL Taxonomy
Extension Label Linkbase Document
101.PRE***+
Inline XBRL Taxonomy
Extension Presentation Linkbase Document
104
Cover Page Interactive Data File (formatted as Inline XBRL and contained
in Exhibit 101)
*
Management contract or compensatory plan or arrangement
**
Filed herewith as an Exhibit
***
Furnished herewith as an Exhibit
†
Submitted electronically with this Annual Report on Form 10-K
(c)
Financial Statement Schedules Required by Regulation S-X
The financial statement schedule required by Regulation S-X is filed at page 60. All other schedules for which provision is made
in the
applicable accounting regulations
of the
Securities and
Exchange Commission are
not required
under the
related instructions
or are inapplicable and therefore have been omitted.
66
ITEM 16. FORM 10-K SUMMARY
Not applicable
67
SIGNATURES
Pursuant to
the requirements of
Section 13 or
15(d) of the
Securities Exchange
Act of 1934,
the registrant has
duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized,
in Ridgeland, Mississippi.
CAL-MAINE FOODS, INC.
/s/ Sherman L. Miller
Sherman L. Miller
President and Chief Executive Officer
Date:
July 25, 2023
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons
on behalf of the registrant and in the capacities and on the dates indicated:
Signature
Title
Date
/s/
Sherman L. Miller
President, Chief Executive Officer
July 25, 2023
Sherman L. Miller
and Director
(Principal Executive Officer)
/s/
Max P.
Bowman
Vice President, Treasurer,
Secretary,
July 25, 2023
Max P.
Bowman
Chief Financial Officer and Director
(Principal Financial Officer)
/s/ Matthew S. Glover
Vice President, Accounting
July 25, 2023
Matthew S. Glover
(Principal Accounting Officer)
/s/
Adolphus B. Baker
Chairman of the Board and Director
July 25, 2023
Adolphus B. Baker
/s/
Letitia C. Hughes
Director
July 25, 2023
Letitia C. Hughes
/s/
James E. Poole
Director
July 25, 2023
James E. Poole
/s/
Steve W. Sanders
Director
July 25, 2023
Steve W. Sanders
/s/
Camille S. Young
Director
July 25, 2023
Camille S. Young