Item 9A. Controls and Procedures
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of our disclosure controls and procedures as defined under Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 as amended ("Exchange Act") Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of December 25, 2022, our disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed in our reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.
Management’s Report on Internal Control Over Financial Reporting
This Annual Report does not include a report of management’s assessment regarding internal control over financial reporting or an attestation report of our registered public accounting firm due to a transition period established by rules of the SEC for newly public companies.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting that occurred during the quarter ended December 25, 2022 that materially affected or are reasonably likely to materially affect our internal control over financial reporting.
Item 9B. Other Information
None.
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Not applicable.
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PART III
Item 10. Directors, Executive Officers and Corporate Governance
The information required by this item is incorporated by reference from the applicable information set forth in our definitive Proxy Statement for our 2023 Annual Meeting of Shareholders to be filed with the SEC.
CODE OF ETHICS
Information regarding the Company’s code of conduct is available on the Company’s website at https://www.masterbrand.com. To access this information, first click on “Investors”, then click on “Governance” and then click on "Governance Documents" on the Company’s website. Then, select the “Code of Business Conduct and Ethics” and “Code of Ethics for Senior Financial Officers” links.
Item 11. Executive Compensation
The information required by this item is incorporated by reference from the applicable information set forth in our definitive Proxy Statement for our 2023 Annual Meeting of Shareholders to be filed with the SEC.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The information required by this item is incorporated by reference from the applicable information set forth in our definitive Proxy Statement for our 2023 Annual Meeting of Shareholders to be filed with the SEC.
Item 13. Certain Relationships and Related Transactions, and Director Independence
The information required by this item is incorporated by reference from the applicable information set forth in our definitive Proxy Statement for our 2023 Annual Meeting of Shareholders to be filed with the SEC.
Item 14. Principal Accounting Fees and Services
The information required by this item is incorporated by reference from the applicable information set forth in our definitive Proxy Statement for our 2023 Annual Meeting of Shareholders to be filed with the SEC.
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PART IV
Item 15. Exhibits, Financial Statement Schedules
(a) The following documents are filed as part of this report:
1. Consolidated Financial Statements
Page
Reference
Consolidated Statements of Income for the years ended December 25, 2022, December 26, 2021, & December 27, 2020 41
Consolidated Statements of Comprehensive Income for the years ended December 25, 2022, December 26, 2021, & December 27, 2020 42
Consolidated Balance Sheets at December 25, 2022, December 26, 2021, & December 27, 2020 43
Consolidated Statements of Cash Flows for the years ended December 25, 2022, December 26, 2021, & December 27, 2020 44
Consolidated Statements of Equity for the years ended December 25, 2022, December 26, 2021, & December 27, 2020 45
Notes to Consolidated Financial Statements 46
Report of Independent Registered Public Accounting Firm (PCAOB ID Number: 238) 77
2. Financial Statement Schedule
Valuation and qualifying accounts – Allowance for cash discounts and sales allowances, customer program allowance and tax valuation allowance 84
All other schedules have been omitted since the required information is not present or not present in amounts sufficient to require submission of the schedules, or because the information required is included in the Consolidated Financial Statements or the notes thereto.
3. Exhibits
The exhibits listed on the accompanying exhibit index are filed as part of this Annual Report on Form 10-K.
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EXHIBIT INDEX
Incorporated by reference herein
Exhibit
Number Description Form Date
2.1
Separation and Distribution Agreement, dated December 14, 2022, between Fortune Brands Home & Security, Inc. and MasterBrand, Inc.
Current Report on Form 8-K
(File No. 001-41545) December 15, 2022
3.1
Amended and Restated Certificate of Incorporation of MasterBrand, Inc., effective December 14, 2022
Current Report on Form 8-K
(File No. 001-41545) December 15, 2022
3.2
Amended and Restated Bylaws of MasterBrand, Inc., effective December 14, 2022
Current Report on Form 8-K
(File No. 001-41545) December 15, 2022
4.1
Description of Securities (x)
10.1
Transition Services Agreement, dated December 14, 2022, between Fortune Brands Home & Security, Inc. and MasterBrand, Inc.
Current Report on Form 8-K
(File No. 001-41545) December 15, 2022
10.2
Tax Allocation Agreement, dated December 14, 2022, between Fortune Brands Home & Security, Inc. and MasterBrand, Inc.
Current Report on Form 8-K
(File No. 001-41545) December 15, 2022
10.3
Employee Matters Agreement, dated December 14, 2022, between Fortune Brands Home & Security, Inc. and MasterBrand, Inc.
Current Report on Form 8-K
(File No. 001-41545) December 15, 2022
10.4
MasterBrand, Inc. 2022 Long-Term Incentive Plan *
Current Report on Form 8-K
(File No. 001-41545) December 15, 2022
10.5
MasterBrand, Inc. Annual Executive Incentive Compensation Plan *
Current Report on Form 8-K
(File No. 001-41545) December 15, 2022
10.6
Form of Severance and Change of Control Agreement *
Current Report on Form 8-K
(File No. 001-41545) December 15, 2022
10.7
MasterBrand, Inc. Deferred Compensation Plan *
Current Report on Form 8-K
(File No. 001-41545) December 15, 2022
21.1
Subsidiaries of the Company (x)
23.1
Consent of Independent Registered Public Accounting Firm (x)
24.1
Power of Attorney (included as part of the page titled “Signatures”)
31.1
Certification of principal executive officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002 (x)
31.2
Certification of principal financial officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002 (x)
32.1
Certification of principal executive officer, as required by Section 906 of the Sarbanes-Oxley Act of 2002 (x)
32.2
Certification of principal financial officer, as required by Section 906 of the Sarbanes-Oxley Act of 2002 (x)
* Management contract or compensatory plan or arrangement.
(x) Filed herewith.
Item 16. Form 10-K Summary
Not applicable .
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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.
Date: 3/10/2023
MasterBrand, Inc.
By: /s/ R. David Banyard, Jr.
Name: R. David Banyard, Jr.
Title: President & Chief Executive Officer
POWER OF ATTORNEY
KNOW BY ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints R. David Banyard, Jr. and Andrean Horton, jointly and severally, his or her attorney-in-fact, with the power of substitution, for him or her in any and all capacities, to sign any amendments to this Annual Report on Form 10-K and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that each of said attorneys-in-fact, or his or her substitute or substitutes, may do or cause to be done by virtue hereof.
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/ R. David Banyard, Jr. President, Chief Executive Officer, & a Director 3/10/2023
R. David Banyard, Jr. (Principal Executive Officer)
/s/ Andrea H. Simon Executive Vice President & Chief Financial Officer 3/10/2023
Andrea H. Simon (Principal Financial Officer)
/s/ Mark A. Young Vice President & Chief Accounting Officer 3/10/2023
Mark A. Young (Principal Accounting Officer)
/s/ David D. Petratis Non-Executive Chairman of the Board 3/10/2023
David D. Petratis*
/s/ Juliana L. Chugg Director 3/10/2023
Juliana L. Chugg*
/s/ Robert C. Crisci Director 3/10/2023
Robert C. Crisci*
/s/ Ann Fritz Hackett Director 3/10/2023
Ann Fritz Hackett*
/s/ Jeffery S. Perry Director 3/10/2023
Jeffery S. Perry*
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Schedule II Valuation and Qualifying Accounts
For the years ended December 25, 2022, December 26, 2021 and December 27, 2020
(In millions) Balance at
Beginning
of Period Charges (a)
Write-offs
and
Deductions (b)
Balance at
End of
Period
2022:
Allowance for cash discounts and sales allowances $ 5.6 $ 85.2 $ 85.2 $ 5.6
Customer program allowance 55.3 141.0 138.0 58.3
Allowance for deferred tax assets 1.2 — — 1.2
2021:
Allowance for cash discounts and sales allowances $ 5.9 $ 66.5 $ 66.8 $ 5.6
Customer program allowance 37.2 157.1 139.0 55.3
Allowance for deferred tax assets 1.3 (0.1) — 1.2
2020:
Allowance for cash discounts and sales allowances $ 4.8 $ 98.7 $ 97.6 $ 5.9
Allowance for credit losses 0.8 2.5 0.9 2.4
Customer program allowance 28.1 9.1 — 37.2
Allowance for deferred tax assets 0.2 1.1 — 1.3
(a) Charges related to the allowance for cash discounts and sales allowances and the customer program allowance are classified as a reduction in net sales. Charges related to the allowance for credit losses are classified as s elling, general and administrative expenses. Charges related to the allowance for deferred tax assets are classified as income tax expense.
(b) Net of recoveries of amounts written off in prior years and immaterial foreign currency impact.
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