CAL-MAINE FOODS INC
For the period ended May 30, 2026. Filed Jul 22, 2026.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2026 · Filed Jul 22, 2026
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Item 8. Financial Statements and Supplementary Data
Report of
Independent
Registered
Public
Accounting Firm
Board
of Directors and
Stockholders
Cal
Opinion on the
We
have audited
the accompanying
balance
sheets of
Cal
as of
May 30,
and May
31,
2025, the
related
of income,
comprehensive
income, stockholders’
equity,
flows
of the three
years in
the period
ended May
and the related
notes and schedule
listed in the
Index
at Items 15(a)(1)
and 15(a)(2) (collectively referred to as the “consolidated financial
statements”).
In our opinion, the consolidated
financial statements
present fairly,
in all material
respects,
the financial
position of Cal
Subsidiaries as of
May 30,
May 31, 2025,
and the results
and their cash
flows for
each of
the three years
in the period
ended
May
with accounting
principles generally accepted
in the United States
of America.
We
also
have
audited,
in
of
the
Public Company
Accounting
Oversight
Board
(United
States)
(“PCAOB”),
the Cal
Subsidiaries’ internal
as of
May 30,
2026, based
on
the criteria
in
2013 Internal
Control
– Integrated
issued by
the Committee
of Sponsoring
of the
and
our report dated
July 22, 2026
expressed
an
unqualified
opinion.
Basis for
Opinion
These
are the
responsibility
of the
entities’
management.
Our responsibility
is to
express
an
opinion
on
these
based
on our
audits.
We
are
a
public
firm
registered
with
the
PCAOB and
are required
to be independent
to Cal
with the U.S.
federal
securities laws
and
the applicable
rules and
regulations of
the Securities and
and
the PCAOB.
We
our audits in accordance
with the standards
of the PCAOB.
Those standards
require that we plan and perform
the
audit
to
obtain
about
whether
the
are
free
of
misstatement,
whether
due
to
error
or
fraud.
Our
audits
to assess
the risks
of material
misstatement
of the
whether due
to
error
or fraud,
and
performing procedures
that
respond
to
those
risks.
Such
examining,
on
a test
basis,
evidence
and
in
the
Our audits
also included
the accounting
used and
made
by management,
as well as evaluating
the overall presentation
of the consolidated
financial statements.
We believe our audits provide
a reasonable
our opinion.
Critical Audit
Matters
The
audit
matters
communicated
below are
matters
arising
from
the
current
period
audit
of the
that were communicated
or required
to be communicated
to the
Audit Committee
and
that:
(1) relate to accounts
or
that are
to the
and (2) involved
our especially
challenging,
subjective,
or
complex
judgments.
The communication
of the critical
audit matters
does not
alter in
any way
our
financial statements,
taken
as a
whole, and
we are not,
by communicating
the critical
audit
matters
below,
providing
a separate
the critical
audit
matters
or on the
or disclosures to which they
relate.
– Litigation
and Claims
– Refer to Note
16 in the Consolidated
Critical Audit Matter Description
Cal
-Maine
Foods,
Inc.
and
record
for
legal
and
claims
in
those
instances
where
they
can
of the loss
and when
the liability is probable.
Where the reasonable
of the probable
loss
is a range, Cal
Subsidiaries record
the most likely
of the loss, or the
low end of the range
if there
is no one
best estimate.
Cal
either disclose
of a possible loss
or range
of
loss in
excess of established accruals
if estimable, or states that
such an estimate cannot be made.
Cal
-Maine Foods, Inc. and Subsidiaries
disclose significant legal proceedings
and claims even where liability is not probable
or the amount of the liability
is not estimable,
or both, if Cal
Subsidiaries believe
there is at
least a
possibility that
a loss may
be incurred.
We
identified litigation
and claims as
a critical audit
matter
because
of the challenges auditing
judgments
applied
in determining
the likelihood
of loss related
to the resolution
of such claims.
Specifically,
auditing management’s
determin
at
ion
of whether
any contingent
loss arising
related
litigation and
claims is
probable, reasonably
possible, or remote,
and
the
related
is subjective
and
requires significant judgment
due to
the sensitivity of
the issue.
How the Critical Audit Matter was addressed during the Audit
Addressing
the
matter
involved
and
audit
evidence
in
with
forming
our
overall
These procedures
included testing the
of the
controls relating
to
the Cal
Inc. and Subsidiaries’
of the
liability related to
legal proceedings and
claims, including controls
over
the
likelihood
of
a
loss
and
whether
the
amount
of loss
can
be
estimated,
as
well
as
stat
ement disclosures over
the legal proceedings
and claims.
These procedures
also included obtaining
and evaluating
the letters
of audit inquiry with
external legal counsel, evaluating
the reasonableness
of Cal
-Maine Foods, Inc. and Subsidiaries’
whether
an
unfavorable
outcome
is
or
probable,
and
estimable,
the
sufficiency
of Cal
-Maine
Foods,
Inc.
and
Subsidiaries’
related
to legal
and
claims and
the
completeness
and
accuracy
of Cal
Subsidiaries’ legal contingencies.
of
Echo
Lake
Foods,
LLC
–
for
Valuation
of
Acquired
Assets
– Refer
to
Note
2 in
the
Critical Audit Matter Description
Cal
-Maine
Foods,
Inc.
and
the acquisitions
of Echo
Lake
Foods,
LLC
and
certain
related
companies,
June
2,
for
a
total
net
of
$275
Cal
-Maine
Foods,
Inc.
and
for
the
of
Echo
Lake
Foods,
LLC
and
certain
related
as
a
combination,
and
accordingly,
allocated
the purchase
price to
and
assumed
based
on their
respective
fair
values
as of
the
date
of the
Identifiable
assets
relationships,
trade
names,
brand names,
and non-compete
agreements.
The excess of the purchase
over the fair value of identifiable
assumed
was recorded as goodwill.
The valuation
of acquired intangible assets
requires significant
due to
the
use
of
models that
incorporate
unobservable
inputs.
In
particular,
the
fair
value
are sensitive to assumptions
such as projected revenue,
growth rates, customer attrition, discount
rates, and contributory
asset
charges, which
require significant estimation.
We
the
of acquired
assets
as a
audit
matter
because
of the
auditor
to
evaluate
the reasonableness
and
the complexity
involved in
the
meth
odologies utilized.
How the Critical Audit Matter was addressed during the Audit
Our audit
related
to the
of acquired
intangible assets
included the
following, among others:
Testing
over
Cal
process,
over
the development
and
review of key assumptions
used in the
of intangible
assets
Evaluating
the
methodologies
used
by
and
its
specialists,
whether the
methods
were appropriate
and
guidance.
Assessing
key assumptions
used in the
models, including:
o
Projected
revenue
growth rates
o
attrition
rates
o
Discount
rates
o
Contributory
asset
charges,
by
comparing
them
to
performance,
market
data,
and
benchmarks
Involving
a
fair
value
specialist
to
assist
in
the
methodologies
and
used
in
the
models.
Evaluating
the mathematical
accuracy
of the
models and
recalculating
selected fair
values.
Assessing
the competence,
capabilities, and
objectivity
specialists.
/s/ Frost, PLLC
We
have
served as
auditor
since 2007.
Little Rock,
Arkansas
Balance
Sheets
(in thousands,
except
for par value
amounts)
May
May
Assets
Current assets:
Cash
and
cash
$
107,217
$
499,392
816,840
892,708
Receivables:
Trade
receivables, net
136,249
244,079
Income
tax
107,867
13,057
Other
20,315
15,225
Total
receivables, net
264,431
272,361
Inventories,
net
375,265
295,670
and
assets
17,789
7,979
Total
current assets
1,581,542
1,968,110
plant
& equipment,
net
1,318,335
1,026,684
97,059
46,776
assets, net
73,130
15,157
Other assets
37,504
27,892
Total
assets
$
3,107,570
$
3,084,619
Liabilities and
equity
Current liabilities:
Trade
payable
$
96,106
$
101,033
Dividends payable
—
114,163
Accrued
wages and
48,371
60,263
Accrued
and
61,039
32,912
Total
current liabilities
205,516
308,371
Other liabilities
39,650
55,582
income
taxes
221,872
154,651
Total
467,038
518,604
Commitments
and
contingencies
- see
Note 16
—
—
Stockholders’
equity:
Common
stock ($
0.01
par value):
Common
stock
– authorized
120,000
shares, issued
75,061
shares in 2026
and
Paid-in capital
86,106
80,845
Retained
2,765,108
2,565,928
other comprehensive
loss, net of tax
(1,466)
(1,007)
Common
stock in treasury,
at
cost –
28,080
and
26,567
shares in 2026
and
2025,
(217,767)
(85,893)
Total
Cal
Inc. stockholders’
equity
2,632,732
2,560,624
Noncontrolling
interest in consolidated
equity
7,800
5,391
Total
equity
2,640,532
2,566,015
Total
liabilities and
equity
$
3,107,570
$
3,084,619
(in thousands,
except
amounts)
Fiscal years
ended
May
May
$
$
$
Cost of
sales
2,239,583
2,411,000
1,784,872
Gross profit
672,049
1,850,885
541,571
and
329,291
314,449
252,625
(Gain) loss
on involuntary
(8,819)
(23,532)
(Gain) loss
on disposal
assets
1,391
(259)
income
350,186
312,452
Other income
(expense):
46,175
48,059
31,726
Patronage
11,670
11,197
11,331
Other,
net
2,973
7,347
4,462
Total
other income
60,818
66,603
47,519
Income
before
income
taxes
411,004
1,603,142
359,971
Income
tax
expense
92,892
384,910
83,689
318,112
276,282
Less:
Income
1,430
(1,816)
(1,606)
to Cal
Inc.
$
316,682
$
$
277,888
to Cal
Inc.:
Basic
$
6.65
$
25.04
$
5.70
Diluted
$
6.63
$
24.95
$
5.69
average
shares outstanding:
Basic
47,650
48,719
48,717
Diluted
47,781
48,891
48,873
of
Comprehensive Income
Fiscal years
ended
May
May
$
318,112
$
$
276,282
income
(loss), before tax:
holding gain
(loss) available
-for-sale securities,
net of
reclassification
(693)
1,271
Decrease in
post-retirement
obligation, net
of
reclassification
income
(loss), before tax
(623)
1,438
Income
tax
expense
(benefit) related
to items of
other comprehensive
income
(loss)
(164)
income
(loss), net of
tax
(459)
1,113
income
317,653
1,218,998
277,395
Less: comprehensive
income
to the
noncontrolling interest
1,430
(1,816)
(1,606)
income
to Cal
Inc.
$
316,223
$
1,220,814
$
279,001
of Stockholders’
Equity
Accum.
Other
Common
Stock
Comp.
Shares
Amount
Class A
Shares
Class A
Amount
Shares
Amount
Paid In
Capital
Retained
Earnings
Income
(loss)
Noncontrolling
Total
Balance
at
June 3, 2023
70,261
$
4,800
$
26,077
$
(30,008)
$
72,112
$
1,571,112
$
(2,886)
$
(1,498)
$
1,609,583
—
—
—
—
(55)
(1,589)
4,259
—
—
—
2,670
1.889
Common
—
—
—
—
—
—
—
(83,565)
—
—
(83,565)
Class A common
—
—
—
—
—
—
—
(9,040)
—
—
(9,040)
(loss)
—
—
—
—
—
—
—
277,888
—
(1,606)
276,282
of tax
—
—
—
—
—
—
—
—
1,113
—
1,113
Balance
at
70,261
4,800
—
26,022
(31,597)
76,371
1,756,395
(1,773)
(3,104)
1,797,043
—
—
—
—
(7)
(3,900)
4,474
—
—
—
Conversion
of Class
A Shares
4,800
(4,800)
(48)
—
—
—
—
—
—
—
—
—
—
—
(50,396)
—
—
—
—
(50,396)
Contributions
to Crepini Foods
LLC
—
—
—
—
—
—
—
—
—
6,485
6,485
of noncontrolling
in
Foods LLC
—
—
—
—
—
—
—
(3,826)
—
3,826
—
8.319
Common
—
—
—
—
—
—
—
(378,062)
—
—
(378,062)
Class A common
—
—
—
—
—
—
—
(28,627)
—
—
(28,627)
(loss)
—
—
—
—
—
—
—
—
(1,816)
of tax
—
—
—
—
—
—
—
—
—
Balance
at
May
75,061
—
—
26,567
(85,893)
80,845
2,565,928
(1,007)
5,391
2,566,015
—
—
—
—
(59)
(1,354)
5,261
—
—
—
3,907
—
—
—
—
1,572
(130,520)
—
—
—
—
(130,520)
2.458
Common
—
—
—
—
—
—
—
(117,502)
—
—
(117,502)
Contributions
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
316,682
—
1,430
318,112
loss, net of tax
—
—
—
—
—
—
—
—
(459)
—
(459)
Balance
at
May
75,061
$
—
$
—
28,080
$
(217,767)
$
86,106
$
2,765,108
$
(1,466)
$
7,800
$
2,640,532
See Notes to
Financial Statements.
of Cash Flows
ended
May
May
from
operating activities:
$
318,112
$
$
276,282
Adjustments
to reconcile net
income
to net
cash
by operating
and
124,342
94,021
80,241
income
taxes
67,363
11,570
(9,672)
expense
5,757
4,527
4,358
Loss on
change
in fair value
—
15,000
5,500
Other operating
activities, net
(4,425)
(15,426)
(6,908)
Change
in operating assets
and
liabilities, net of effects
from
acquisitions:
(Increase)
in trade
139,753
(104,997)
(27,570)
(Increase)
in inventories
(34,978)
(12,224)
28,800
in accounts
payable
and
current accrued
(8,338)
65,311
9,353
Net change
in income taxes
and
payable
(94,810)
(45,946)
91,567
Net changes
in other operating
assets
and
(33,023)
(5,334)
(553)
by operating
479,753
1,224,734
451,398
from
used in investing
of investments
(648,915)
(1,213,593)
(573,565)
Sales of investments
745,240
907,640
358,932
of businesses,
net of
cash
(427,794)
(116,193)
(53,746)
of Van's
(24,776)
—
—
in unconsolidated
—
—
(363)
Distributions
from
3,253
4,050
3,000
of property,
plant
and
(151,220)
(161,255)
(147,116)
Net proceeds
from
property,
plant
and
3,882
used in investing activities
(503,884)
(575,469)
(412,586)
used
in financing
Principal payments
on long-term
debt
—
(2,481)
—
Principal payments
on finance
lease
—
—
(214)
Purchase
of common
stock by
(131,124)
(53,953)
(1,688)
of dividends
(231,622)
(330,290)
(91,856)
used in financing
(362,746)
(386,724)
(93,758)
in cash, cash
and
(386,877)
262,541
(54,946)
Cash,
cash
and
at
beginning of year
500,419
237,878
292,824
Cash,
cash
and
at
end of
year
$
113,542
$
500,419
$
237,878
Notes to
Note 1 -
Summary of
Accounting Policies
Nature of Operations
Cal
Inc. (“we,”
“us,”
“our,”
or the
“Company”)
is the
largest
egg
company
States
(“U.S.”)
and a
leading
player
in
the
food
The
shell
egg
spans
the
full
egg
value
ladder
—from
to
brown,
pasture
-raised, and
eggs—
serving both retail and foodservice
customers nationwide. Cal
-Maine Foods also participates
in
the growing prepared foods
sector,
with offerings
such as pre-cooked
scrambled egg
hard
-cooked eggs, pancakes,
and specialty
wraps.
Our branded
Best®, Land
O’Lakes®,
Eggs®, 4Grain®,
Van’s®,
and Crepini®.
We
sell most of
our products
much of
and aim
efficient, state
located close to our
customers. We
were founded
in
1957 and
are headquartered in Ridgeland,
Principles of Consolidation
The consolidated
financial statements
include the accounts
of all wholly-owned
and of majority
-owned subsidiaries
over which
we exercise
control. All
significant intercompany
and
have
been eliminated
in consolidation.
The
fiscal
year
-end is on
the Saturday
closest to May
The fiscal
years ending
on May
30,
2026,
May 31,
2025,
each
weeks.
Use of Estimates
The preparation
of the consolidated
with generally accepted
principles (“GAAP”)
States of
America requires
to make estimates
that affect
reported in the
and
notes. Actual
results could differ
from
those estimates.
Cash and Cash Equivalents
The
Company
all
highly
liquid
with
a
of
three
months
or
less
when
to
be
cash
equivalents.
We
bank
that
are insured
by
the
Federal
Deposit
Insurance
up
to
$
250,000
.
The
Company
routinely
cash
with
certain
institutions
in
excess
of
federally
insured
amounts.
The
Company
has not experienced
any loss in such accounts.
manages this risk through maintaining
cash deposits
and
other highly
liquid
in high quality financial
institutions.
Available-for-Sale
has determined
that its
debt securities
are available
-for-sale investments
and are
as current
because
the
amounts
are
for
current
Available
are
carried
at
fair
value,
based
on
quoted
market
prices
as
of
the
balance
sheet
date,
with
unrealized
gains
and
losses
in
other
comprehensive
income.
The
cost of debt securities
is adjusted
for amortization
of premiums and
accretion of
discounts to maturity
and is recorded
in interest income.
regularly evaluates
changes to the
rating of its debt
securities by
credit agencies
to
assess
and
record
any
credit losses
through allowance
for
credit
losses,
limited
to
the
amount
that
fair
value
was less than
the amortized
cost basis.
There was
no
for credit losses at
May
and
May
The
cost basis
for realized
gains and
losses on
-for-sale securities
is determined
by the
specific identification
method.
Gains and
losses are recognized in other
income (expense)
as “Other,
net”
and
on
as
are
in
“Interest
income
,
net”
in
the
Trade Receivables
Trade
are stated
at
their
values,
which
include
a reserve
for
credit losses.
At May
30,
and
May
31,
2025, reserves
for credit losses
were $
and $
extends credit to customers
based
on
an
of
each
’s
and
credit
history.
Collateral
is generally
not
required.
The
Company
minimizes exposure
to
counter
party
credit
risk through
credit
and
approvals,
credit limits,
and
monitoring
procedures.
In
our
reserve
for
credit
losses,
are
assigned
an
loss
based
on
loss
as
needed
for
and
other
forward-looking
factors.
At
May
30,
and
May
31,
2025,
one
26.2
% and
28.1
% of the
trade
receivable, respectively.
Inventories of flocks,
feed, supplies, raw materials
and finished
goods are valued
at the lower
of cost or net realizable
value.
The cost
of inventories
is determined
by either the
first-in, first-out method
or the weighted-average
method.
The
cost
with
flocks,
consisting
of
chicks,
feed,
labor,
contractor
and
costs,
are
during a growing period
weeks. Flock costs
are amortized
to cost
lives of the
flocks, generally
one
to
two years
. As the amortization
period of the flocks
is relatively
short,
disclosure of
the gross
cost and
is omitted. Flock mortality
is charged to
cost of
sales as
incurred.
Plant
and Equipment
plant and
are stated
at cost.
is provided
by the
straight-line
method
useful
lives,
to
years for
buildings
and
and
to
years for
and
equipment.
Expenditures
that
extend
the
useful
life
of
the
related
assets
are capitalized.
Normal
repairs
and
are expensed
as
incurred. When
property, plant,
and equipment
are retired, sold, or otherwise
disposed of, the
asset’s carrying
amount
and related
are removed from
the accounts
and
any
gain or loss is included
in operations.
When
certain
events or
changes
in
occur,
asset
lives
may
be
and
an
may
be
performed
on
the
recoverability
of the
carrying amounts.
Investments
in Unconsolidated
Entities
The equity
method
of accounting
is used
when the
Company
can exert significant
over
an entity,
but does
not control
its
and
decisions.
Under
the
equity
method,
original
are
at
cost
and
by the
share of undistributed
earnings or
losses of these entities. Equity investments
without readily determinable
fair values,
when
the
Company
does
not
have
the
ability
to
exercise
over
the
investee,
are
at
cost,
less
impairment,
plus or minus observable
price changes.
the
excess
of
the
price
over
the
fair
value
of
the
net
assets
Goodwill is
for impairment
at
least
or
more
frequently
if
arise
by
first
a qualitative
to determine whether a quantitative
goodwill test is necessary.
After assessing
the totality of events or circumstances,
if we
it is more
likely than
a reporting
unit is
amount,
then we perform
tests to determine
the magnitude
of any
impairment.
Assets
Intangible assets
are initially recorded at fair value in business
which include franchise
rights, customer relationships,
non-compete
agreements, trademarks
and right of use intangibles.
They are amortized
over their estimated
useful lives of
to
years. The
gross
cost
and
of
assets
are
removed
when
the
amounts
are
fully
and
the asset
is no longer
in use
or the
has
expired. When certain
events
in
occur, asset
lives may be adjusted
and an impairment assessment
may be performed on the recoverability of the carrying amounts.
Indefinite life
assets
are recorded at
fair value in
and represent
brand names
and water
rights. They are not
amortized,
but are
reviewed for impairment
at
least annually
or more frequently
if impairment
arise.
Insurance Liabilities and Restricted Cash
The
Company
uses
a
combination
of
and
self-insurance
a
wholly-owned
captive
subsidiary
(the “Captive”)
coverage
for the
potential liabilities
for
workers’
auto
liability and general
risks. Liabilities
risks
that
are retained
by the
Company
are not discounted
and
are estimated,
in
part, by
claims experience,
severity
factors
actuarial
These liabilities
within
“Accrued
current
in the
Balance
Sheets and
were
$
11.4
million
and
$
8.0
million at May
and
May
The Captive
certain levels
of cash
which
are restricted
in use
to secure
the insurer’s
for workers’ compensation,
auto
liability and general
liability programs.
cash was $
6.3
$
1.0
million as of
May
30,
and
May
31,
2025,
and
within
“Prepaid
and
other
current
assets
”
in
the
Balance
Sheets.
The
Company
also maintains
medical
plans
covering substantially
all full-time
employees.
Under the
plan, the
Company
self-
insures its portion of medical claims and
uses stop-loss insurance to limit its portion of medical claims to $
275,000
per occurrence.
with
these
risks
are
in
part
by
claims
experience,
medical
cost
trends,
demographic
factors, severity
factors
actuarial
including accruals
for incurred
but not reported
claims were approximately
$
26.6
22.8
$
23.0
million in fiscal years
2026, 2025, and
2024,
The
liability recorded
for incurred
but not
claims
was
$
4.3
million
and
$
3.0
million as
of May
and
May
31,
2025,
and
are
within
“Accrued
and
other
current
in
the
Balance
Sheets.
Payable
Dividends are
accrued
at the end
of each
quarter according
to the
dividend policy
adopted
by its Board
of Directors
(“Board”)
.
The
Company
pays a
dividend to
of its
Common
Stock on
a quarterly
each quarter
reports net income attributable
,
in
with
GAAP,
in an amount
equal
to
one-third
(1/3) of such quarterly
net income.
Dividends are paid
to stockholders
of record as
of the 60th
day following the
last
day
of such
except
for the
fourth
fiscal quarter.
For the
fourth
pays dividends
to stockholders
of
record on the 65th
day after the quarter
end. Dividends are payable
on the 15th day following the record date.
Following a quarter
does not report
to Cal
Inc., the
Company
will not pay
for
profitable
quarter
until the
Company
is profitable on
a cumulative
from
of the
most
recent quarter
for which a
paid. The dividend
policy is
subject to periodic
review
by the Board.
with
our variable
dividend policy,
we will not
pay a cash
dividend to holders
Stock with respect
to our fourth
quarter
Revenue Recognition
The
Company
recognizes revenue
through
sale
of its
to
through
retail,
and
other
The
of
the
revenue
is
derived
from
or
with
based
upon
the
ordering
its
with
a
single
of
delivering
the
product.
The
Company
the
is met
upon
and
of the
product
by
our
which
occurs
upon
shipment or delivery
to a customer based
on terms of the sale. Costs paid to third party
brokers to obtain
are expensed
as the
are generally less than
one year.
Revenues
are
in
an
amount
that reflects
the net
we
expect
for
of the
products. The Company
periodically offers sales incentives
or other programs
such as rebates,
discounts,
coupons, volume
-based
incentives,
guaranteed
other programs.
The
Company
records an
for costs
which
as a reduction
in revenue
at the time
of sale
using
redemption
rates
of
each
The
Company
regularly
reviews
these
and
any
between
the
costs
and
actual
realization
would be recognized
the subsequent
period.
Shipping and Distribution
Costs
to
deliver
product
to
are
in
selling,
general
and
in
the
and totaled $
108.0
93.5
$
72.7
million in fiscal
years 2026,
2025, and
2024,
Income
Taxes
Income
taxes
are
for
using
the
method.
income
taxes
reflect
the
net
tax
effects
of
between
the
amounts
and
for
and
the
amounts
used
for
income tax
purposes. The Company’s
policy with
respect to evaluating uncertain
tax positions is based upon whether management
it
is more
likely
than
not the
uncertain
tax
will
be
sustained
upon
review
by
the taxing
authorities.
The
tax
must meet
the more-likely-than
-not recognition
with consideration
given to
and probabilities of
the
outcomes
that
realized
upon
using
the
facts,
and
at
the reporting
date.
The
Company
will reflect
only
the portion
of
the
tax
benefit
that
will
be
sustained
upon
resolution
of the
position
and
on the portion of
the tax benefit
not recognized.
initially and subsequently
the largest amount
of
tax
benefit
that
is greater
than
50% likely
to be
realized
upon
with
a taxing
authority
that
has
full knowledge
of all
relevant
information.
The
Company
records
and
penalties
on
uncertain
tax
as
a
component
of
income
tax
expense.
Based
upon
assessment,
there are
no uncertain
tax
positions expected
to have
impact
on the
Business Combinations
applies the acquisition
method
of accounting,
which requires
that once
control is obtained,
all the
assumed,
amounts
interests,
at
their respective
fair values at
the
date
of acquisition.
The
excess
of
the
price
over
fair
values
of
assets
and
liabilities is
as
goodwill.
We
use
various
models
and
methods
to
the
fair
values
of
assets
and
such
as
and
bottom-up
for inventory,
cost method
and
market
for property,
relief-from-royalty
and
excess
earnings to
value intangibles.
in valuing
certain intangible
assets include,
but are not limited
to, the amount
and
timing of future
cash
flows, growth rates, discount
useful lives.
Gain (Loss)
on Involuntary
Conversions
The
Company
maintains insurance
for both
damage
and
business interruption
to catastrophic
events, such
as
fires,
hurricanes,
tornadoes
and
other acts
of God,
and
is eligible
to
participate
in U.S.
of Agriculture
(“USDA”)
indemnity
and
for
certain
losses
due
to
disease
such
as
highly
avian
(“HPAI”).
Specifically,
the Animal
Health Protection
Act authorizes
the USDA to
provide indemnity
to producers for
birds and
eggs
that
must be destroyed
during a
disease response.
received under
these programs
on the
fair
market
value
of the
poultry
and/or
eggs at the
time that
HPAI
virus
is detected
in the
flock.
Other covered
costs
include
feed,
depopulation
and
disposal costs,
and
virus elimination
costs.
The
USDA
does
not provide
indemnity
for income
or
losses
suffered
due
to
downtime
or
other
nor
for
indirect
continuing
Recoveries
received
for
damage,
and
disease
in excess
of or
the
net book
value
of damaged
assets,
including poultry,
clean-up and
demolition costs, and other direct post-event costs are recorded within
“Gain (loss) on involuntary
conversions”
in the
period received
or committed
when all contingencies
with the recoveries are
resolved.
Loss Contingencies
Certain conditions may
exist as of the date the consolidated financial statements are issued that
may result
in
a loss to the Company
but which will
only be resolved
when one or
more future events
occur or fail to occur.
and its legal
counsel
assess
such
and
such assessment
inherently
involves
an
exercise
of
judgment.
In assessing
loss
contingencies
related
to
legal
that
are pending
against
the
Company
or unasserted
claims that
may
such
legal
counsel evaluates
the perceived
merits of
any legal
or unasserted
claims as
well
as the
perceived merits
of the
amount
of relief sought or expected
to be sought
therein.
If the
of a
indicates
it is probable
that
loss has
been incurred
and
of the
can be estimated,
liability would
be accrued
financial statements.
If the assessment
indicates a potentially
material loss contingency is not probable,
but is reasonably
possible, or is
probable but
cannot
be estimated,
then
the nature
of the
liability,
together
with an
of the
range
of possible
loss
if determinable
and
material,
disclosed.
Loss contingencies
considered
remote are
not disclosed
unless they
involve
guarantees,
case
the nature
of the
would be disclosed.
the costs
of litigation as
they
are incurred.
New Accounting Pronouncements and Policies
In December
2023, the
FASB
issued ASU
-09,
Income Taxes
(Topic
Improvements
to Income Tax
. This
ASU
that
an
entity,
on
an
annual
basis,
disclose
income
tax
related
to
the
rate
reconciliation
and income
taxes paid.
The
ASU is
to enhance
the transparency
and decision
usefulness
of income
tax
ASU 2023
-09 is
periods
after
15,
The
Company
has adopted
ASU
2023-09
for the
year
ended
May
on a
prospective
basis.
See
Note 14 -
Income
Taxes
for additional
In
2024,
the
FASB
issued
ASU
-03,
Income
—
Income
—
Expense
Disaggregation
(Subtopic
220-40)
. The objective
of ASU 2024
-03 is to improve
about
a public entity’s
through additional
disaggregation
of income
in January
2025,
the FASB
further
clarified
the
date
of
ASU
-03 with
the
of ASU
-01. ASU
-03 is effective
for
annual
periods
after
15,
2026,
and
interim periods
within
annual
reporting periods
after
15,
Early
adoption
is permitted and
may
be applied
either on a
prospective
or retrospective
basis.
The
Company
is currently
the impact
of ASU 2024-03
on its consolidated
There
are no
other new
pronouncements
issued or effective
during
the fiscal
year
that had
or are expected
to
have
a
impact
on our consolidated
Note 2 – Acquisition
s
Acquisition of Creighton Brothers, LLC
on
March 2, 2026
acquired the shell egg,
foods assets of
Creighton Brothers
LLC and
Crystal Lake
LLC
(“Creighton”).
assets
include
and grading
with capacity
3.2
million layers, including
cage-free layers, and
pullets, a feed mill,
1,007
land, as
well
as an
egg products and
hard-cooked
egg processing facility located
near
Warsaw,
Indiana.
The
table
the consideration
paid
for
and
of
assets
and
assumed
at
date
Cash
paid
$
128,784
amounts
assets
and
assumed
$
16,504
and
assets
plant
& equipment
101,883
assets, net
119,337
payable
and
(553)
Total
118,784
10,000
$
128,784
Inventories consisted
of flock, feed
packaging, and
egg inventory.
Flock inventory
at carrying
value
as
that
its
value
best
its
fair
value.
Feed
and
egg
were all valued
based
prices as of
March
2, 2026.
plant
and
were
valued
the
cost
and
market
and
were
valued
the
cost
which
is
based
on
replacement
or
reproduction
costs
of
the
assets
and
any
from physical
and/or
Land
and
buildings were valued
by using a real
estate
valuation.
Goodwill recorded in
with
the Creighton acquisition
is primarily attributable
to improved efficiencies from integrating
of Creighton
of the
recognized goodwill of
$
10.0
million
as a
result of
the acquisition.
of Clean
Egg, LLC
October 10, 2025
,
certain
assets
of Clean
Egg,
LLC (“Clean
Egg”) based
in Langwood,
Texas,
for
$
23.7
million. The
assets
brown cage-free
and
layers
and
pullets
and
other
inventory,
and
related
to
its
and
egg processing
The
Company
of $
10.2
million
as a
result
of
the
The
Company
for the
as
a business
combination.
of Echo
Lake Foods,
LLC
June 2, 2025
acquired Echo
Lake
certain
related
(collectively “Echo
Lake
Foods”).
Echo
Lake
Foods is
based
in Burlington,
Wisconsin
and
produces,
packages,
markets
and
distributes prepared
foods,
including pre-cooked
omelets, folded and
scrambled egg formats,
pancakes and
waffles. The Company
accounted for
as a
The
Company
finalized
the
combination
during
the
second
quarter
of
fiscal
2026,
which
in
immaterial
measurement
period adjustments.
table
the consideration
paid
for
Foods and
and
assumed
recognized at
date
Cash
paid
$
275,406
amounts
assets
and
assumed
Cash
$
14,147
31,923
21,601
and
assets
3,131
plant
& equipment
151,697
assets
36,800
259,414
payable
and
(14,114)
Total
245,300
30,106
$
275,406
Cash and
accounts receivable
acquired along with liabilities
assumed
were valued at their carrying value
which approximates
fair
value
due to
the short
instruments.
of
raw materials,
and
finished goods.
Raw
and
supplies were
valued
at
their
value
as management
believes that
their carrying
value best
their fair value.
Finished
goods were
valued
using both the
bottom
-up and top-down
The bottom
-up approach
measures the value of inventory
as the value
created
by the
target
company
(i.e., the costs
incurred, profit
realized,
and
tangible and
assets
utilized)
pre-acquisition
date.
The
of inventory
as the
incremental
value
created
by the
market
participant
buyer as
part of
its
selling effort
to an
end customer
(i.e., the
costs
that will
be incurred,
the profit
that will
be
realized,
and the
tangible and
intangible assets
that
will
be utilized)
post-acquisition
date.
plant
and
were
valued
the
cost
and
market
and
were
valued
the
cost
which
is
based
on
replacement
or
reproduction
costs
of
the
assets
and
any
from physical
and/or
Land
and
buildings were valued
by using a real
estate
valuation.
assets
of customer
and a
trade
name.
Customer relationships
were
valued using
the
excess earnings
method
and
the trade
name
using the relief-from-royalty
method.
represents the excess
of the purchase
price of the acquired
business over
date fair value
of the net
assets
Goodwill recorded
Foods acquisition
is primarily
to projected synergies
from integrating
Foods with
of the Company.
recognized goodwill of
$
30.1
million as a
acquisition,
all of which is deductible
for tax
purposes.
recorded transaction
costs of $
thousand in the first quarter of fiscal 2026
and $
6.6
million in the fourth
quarter
of fiscal 2025, respectively,
as a result of the Echo Lake
Foods acquisition,
within “Selling,
general
expenses”
in the
of Deal-Rite
Feeds, Inc. Assets
February 3, 2025
,
acquired certain assets of Deal-Rite Feeds, Inc. and certain
of its
(“Deal-Rite”)
for
$
4.7
The
assets
two
feed
mills,
storage
usable
grain,
vehicles,
related
and
a retail
feed
sales
located
in North
The
assets
will
produce
and
deliver
feed
to
our
nearby
facilities. The Company
for the
as a
plant
and
were valued
the cost
which is based
on replacement
or reproduction
costs
of
and
any
resulting from physical
and/or
Goodwill recorded
with the Deal-Rite acquisition
is primarily attributable
to improved efficiencies from integrating
the assets of
Deal-Rite
with the operations
of the Company.
recognized goodwill of $
1.0
million as a
of ISE America, Inc. Assets
June 28, 2024
, the
Company
all of
the
shell
egg
and
egg
breaking
of ISE
America,
certain
of its
(“ISE”).
The assets
facilities with
a capacity
at the time of acquisition
4.7
million laying hens,
1.0
million cage-free,
and
1.2
million
pullets,
feed
mills,
4,000
land,
inventories
and
an
egg
products breaking
assets
also include an
customer distribution
network across
the Northeast
and
Mid-Atlantic states, and
in
Maryland,
New
Jersey,
Delaware and South
for the
as a
The
table
the
paid
for
the
ISE
assets
and
the
amounts
and
assumed
recognized at
date
Cash
paid
$
111,521
amounts
assets
and
assumed
$
20,547
plant
and
90,572
assets
111,829
payable
and
(308)
Total
$
111,521
Inventories consisted
of flock, feed
packaging, and
egg inventory.
Flock inventory
at carrying
value
as
that
its
value
best
its
fair
value.
Feed
and
egg
were all valued
based
prices as of
June 28,
plant
and
were valued
the cost
which is based
on replacement
or reproduction
costs
of
and
any
resulting from physical
and/or
Intangible assets
of customer lists
acquired. Customers
lists were valued
using the income
method
approac
h.
Other Acquisitions
and Investments
May 12, 2026
,
acquired certain assets of Van’s
Foods business of Sara Lee Frozen Bakey,
LLC (“Van’s”)
$
24.8
million. The assets acquired included trademarks
and trade names, customer
networks and inventory and
will
support
our
foods
segment
and
deliver
greater
value
across
the
supply
chain.
The
Company
for the
as an
asset
September 9, 2024
a strategic
with Crepini LLC, establishing a new egg products
foods venture. The new entity, located in Hopewell Junction, New York,
operates
as Crepini Foods LLC (“Crepini”).
The
Company
capitalized
Crepini with
$
6.75
cash
and
other assets
and
fund
working
capital
in
exchange
for
a
% interest
in
the
new
venture.
Crepini
LLC
contributed
its
assets
and
for a
% interest in the new venture.
November 30, 2024
,
the
Company
the
9.23
%
in
our
majority-owned
subsidiary,
Foods LLC.
Note 3 -
Available-for-Sale
The
presents
the
as
of
May
30,
and
May
31,
(in
May
Amortized
Cost
Gains
Losses
Fair
Value
$
12,362
$
$
—
$
12,366
paper
42,562
—
42,546
bonds
569,137
—
568,395
3,226
—
3,220
and
agency
153,172
—
152,985
bills
37,334
—
37,328
Total
current investment
$
817,793
$
$
$
816,840
May
Amortized
Cost
Gains
Losses
Fair
Value
$
21,695
$
$
—
$
21,698
paper
90,880
—
90,830
bonds
431,378
—
431,508
5,200
—
5,194
and
agency
240,655
—
240,395
bills
103,119
—
103,083
Total
current investment
$
892,927
$
$
$
892,708
Actual maturities
may
differ from
contractual
maturities as
some borrowers
have
the right to
call or
prepay
with
or
without penalties.
Contractual
of current
securities at
May
are as
follows (in thousands):
Fair Value
Within one
year
$
474,328
1-5 years
342,512
Total
$
816,840
Note 4 -
Fair Value
Measurements
The
Company
is required
to
categorize
both
and
nonfinancial
assets
and
based
on the
hierarchy.
The
fair
value
of
an
asset
is the
price
at
which
the asset
could
be
sold in
an
orderly
between
unrelated,
knowledgeable,
and willing
parties able
to engage
in the
transaction.
A liability’s
fair value is
defined as
that would
be paid to
transfer the
liability to a new
obligor in a
between such parties, not
that would be paid to
settle
the liability with
the creditor.
Level 1
- Quoted
prices in
active
markets
for identical
assets
or liabilities
Level
Inputs
other
than
quoted
prices included
in
Level 1
that
are observable
for
the
asset
or
liability,
either
directly or
indirectly,
including:
o
Quoted
prices for similar
assets
or liabilities in
active
markets
o
Quoted
prices for identical
or similar
assets
in non-active
markets
o
Inputs
other than
quoted
prices that
are observable
for the
asset
or liability
o
Inputs
derived principally from
or corroborated
by other
observable
market
data
Level
Unobservable
inputs
for
the
asset
or
that
are supported
by
little
or
no
market
and
are
to the
of the
assets
or liabilities
The disclosure
of fair
value
assets
and
that
at
cost are
as follows:
Cash and Cash Equivalents, Accounts Receivable, and
Accounts Payable
The carrying
amount
due to
the short
instruments.
Assets and
Measured
at Fair Value
on a Recurring
Basis
with the fair value
hierarchy
described
above,
the following
table
shows the fair
value
of our
financial assets
and
that are required
to be measured
at fair value on a recurring
basis as of May
30, 2026 and
May 31, 2025 (in thousands
):
May
Level 1
Level 2
Level 3
Balance
$
—
$
12,366
$
—
$
12,366
paper
—
42,546
—
42,546
bonds
—
568,395
—
568,395
—
3,220
—
3,220
and
agency
—
152,985
—
152,985
bills
—
37,328
—
37,328
Total
measured
at
$
—
$
816,840
$
—
$
816,840
—
—
21,500
21,500
Total
liabilities measured
at
$
—
$
—
$
21,500
$
21,500
May
Level 1
Level 2
Level 3
Balance
$
—
$
21,698
$
—
$
21,698
paper
—
90,830
—
90,830
bonds
—
431,508
—
431,508
—
5,194
—
5,194
and
agency
—
240,395
—
240,395
bills
—
103,083
—
103,083
Total
measured
at
$
—
$
892,708
$
—
$
892,708
—
—
21,500
21,500
Total
liabilities measured
at
$
—
$
—
$
21,500
$
21,500
securities – available
-for-sale are all classified
as Level 2 and
consist of
securities with maturities
of three
months
or
longer
when
purchased.
We
these
as
current
because
amounts
are
readily
for
current
Observable
inputs for
these securities
are yields, credit
risks, default
rates, and
volatility.
as Level
3 consists
of the
to pay
an
earnout
to Fassio
Egg Farms,
Inc.
(“Fassio”)
on the
meeting
certain
return
on
milestones
over
a
three-year
period
that
commenced
on the date
of the
in the second
quarter
The fair value
of the
is
using a discounted
cash flow
model. Key
and unobservable
inputs that require
used
in the
include weighted
average
cost of
capital,
egg
prices,
revenue
and
period
for
which
the
is
measured,
and
the
probability
assessments
with
respect
to
the
likelihood
of
achieving
the
forecaste
d
projections.
table
shows the
and
ended
in fair value
for the
consideration:
Fassio Contingent
Consideration
June 4, 2023
$
—
of Fassio
1,000
5,500
6,500
15,000
May
21,500
—
May
$
21,500
At May
30, 2026, the contingent
with accrued
expenses and
liabilities in the consolidated
balance
sheets.
Adjustments
to
the
fair
value
of
are
within
the
selling,
general
and
in the consolidated
of income.
Note 5 -
of the
May
May
Flocks, net
of amortization
$
192,673
$
166,507
Feed and
84,769
65,192
Raw materials
and
finished goods
97,823
63,971
$
375,265
$
295,670
We
grow and
maintain flocks of layers
(mature female
chickens), pullets
(female chickens
under 18 weeks
of age), and
breeders
(male and
female
chickens used
to produce
fertile eggs
to hatch
for egg production
flocks).
Our
total flock
at May 30,
May 31,
2025, consisted
14.1
11.5
million
pullets and
breeders
and
50.0
million
and
48.3
million
layers,
expensed
and
with the flocks
to cost
as follows (in thousands):
May
May
$
205,041
$
196,248
$
198,298
Mortality
11,170
10,619
10,640
Total
flock costs
charged
to cost
$
216,211
$
206,867
$
208,938
Note 6 -
Plant and Equipment
plant
and
of the
May
May
Land
and
$
176,243
$
158,627
Buildings and
835,670
722,552
and
1,085,789
876,024
Construction
-in-progress
207,006
148,621
2,304,708
1,905,824
Less: accumulated
986,373
879,140
$
1,318,335
$
1,026,684
expense was $
116.6
91.1
$
77.2
million in the fiscal years ended
May 30, 2026, May
and
June 1, 2024,
Note 7 -
in Unconsolidated
Entities
30, 2026 and
May 31,
2025,
owned
% of Specialty
Eggs,
LLC (“Specialty
Eggs”) and
of Southwest
Eggs,
LLC (“Southwest
Eggs”),
for using the equity
method
of accounting.
Eggs owns the Egg-Land’s
Best franchise
for most of Georgia and
South Carolina,
as well as a portion
of western North Carolina
and eastern
Alabama.
Southwest Specialty Eggs
owns the Egg-Land’s
Best franchise
for Arizona, southern
California and
Clark
County,
Nevada
(including Las Vegas).
Equity
method
are
in
“Other
assets”
in
the
Balance
Sheets
and
totaled
$
5.6
$
10.3
million at May
and
May
Equity in income (loss) of unconsolidated
entities of a $
1.3
million loss, $
6.2
million income,
and $
1.4
million income from these
has
been included
in
“Other,
net” in
the
2026,
2025,
and
2024,
relates to
with these unconsolidated
For the
ended
May
May
Sales to unconsolidated
$
76,130
$
110,106
$
100,553
from
75,031
76,167
63,916
Distributions
from
3,253
4,050
3,000
May
May
from
$
5,224
$
5,090
payable
to unconsolidated
Note 8 -
Goodwill and
Other Intangible
Assets
During the
fourth
quarter of
transitioned
into its new reporting
structure which
in changes
to
operating segments and
reporting units.
The goodwill of the Company’s
historical reporting units were reallocat
ed
to the
new reporting
units on a
relative fair
value
basis as
of the date
of the reorganization.
The
Company
assessed
goodwill for
before and
after the
reorganization
and concluded
that
there was no
goodwill impairment.
For
more information
regarding the
changes
to
our
in
the fourth
quarter
2026,
Note 15 –
Segment Reporting
.
The changes
in the carrying amount
of goodwill were (in thousands):
Shell
Eggs
Foods
Total
Balance
$
45,776
$
—
$
—
$
—
$
45,776
1,000
—
—
1,000
Balance
May
46,776
—
—
—
46,776
50,283
—
—
—
50,283
Balance
March
2, 2026
97,059
—
—
—
97,059
reallocation
(97,059)
13,790
53,163
30,106
—
Balance
May
$
—
$
13,790
$
53,163
$
30,106
$
97,059
Assets
The carrying
amounts
for indefinite-lived
intangibles consisted
of the
May
May
Brand
name
$
14,526
$
—
Water
rights
2,942
2,942
Total
$
17,468
$
2,942
During
fiscal
2026,
the
Company
the
Van’s
brand
name
as
part
of
the
asset
This
asset
is
as an
indefinite-lived brand
name.
assets, net,
subject
to amortization,
of the
following (in
Franchise rights
Other intangibles
Total
Balance
$
11,787
$
$
$
13,054
—
1,319
(1,596)
(353)
(209)
(2,158)
Balance
May
10,191
1,069
12,215
—
40,000
10,212
50,212
(1,595)
(3,555)
(1,615)
(6,765)
Balance
May
$
8,596
$
37,400
$
9,666
$
55,662
For
assets
subject
to
amortization,
the
gross
amounts
and
are
as
follows
(in
May
May
Gross carrying
Gross carrying
amount
amount
Amortizable
assets:
Franchise rights
$
27,979
$
(19,383)
$
29,284
$
(19,093)
41,700
(4,300)
1,700
(745)
Other intangibles
11,981
(2,315)
1,769
(700)
Total
$
81,660
$
(25,998)
$
32,753
$
(20,538)
No significant
residual value is estimated
for these intangible assets.
Aggregate amortization
expense for fiscal years 2026,
2025,
and 2024
totaled $
6.8
2.2
million and $
2.2
million, respectively.
expenses is classified in “Selling,
general
and
”
in the accompanying
The
table
presents
the
total
expense
of
assets
for
the
five
succeeding
years
(in
For fiscal year
expense
$
7,735
7,665
7,602
7,512
6,351
Thereafter
18,797
Total
$
55,662
Note 9 -
Employee
Benefit Plans
KSOP
The
Company
a
KSOP covering
all employees
(the
“Plan”).
The
Company
contributes
% of
eligible
plus discretionary
amounts,
with
vesting
immediately.
Cash
to
the
Plan
were
$
7.0
$
5.5
$
4.3
million
in
fiscal
2026,
2025,
and
2024,
The Plan
Company
stock in the
open
market
using Company
and
dividends.
Deferred Compensation
and Other Postretirement
Plans
maintains several
and other postretirement
plans for
certain
and a
select group
of
and
highly compensated
employees of
The liability
related
to
these
was
$
6.7
$
4.1
May 30,
and May
and is classified
within “Accrued
current
and
“Other
in
Balance
Sheets. The
related
expense
for these
plans
was $
1.1
1.5
$
1.2
million in fiscal 2026,
and
2024,
Note 10
- Credit Facility
For
fiscal
years
2026,
and
2024,
expense
was
$
$
and
$
related
fees on
the Credit Facility described
below.
On November 15, 2021,
we entered into an Amended
Credit Agreement (as amended,
the “Credit Agreement”) with
a
five-year
term, expiring
15, 2026. The
for
a
senior secured
revolving
credit facility
(the
“Credit
Facility”
or “Revolver”)
in
an
initial
amount
of up
to
$
which
a $
million
sublimit
for
the
of standby
letters
of
credit
and
a $
million
sublimit
for
swingline
loans.
The
Credit
Facility
also
an accordion
feature
permitting,
consent of
BMO Harris
Bank N.A.
(the “Administrative
Agent”),
in
the
Credit
Facility
in
the
up
to
$
million
by
adding
one
or
more
incremental
senior
secured
term
loans
or
one
or
more
times
the
revolving
commitments
under
the
Revolver.
No
amounts
were
borrowed
under
the
Credit
Facility as of
May 30,
2026 or May
31, 2025 or during
or fiscal
- The Company
had $
5.9
million of outstanding
standby
letters of credit issued under
the Credit Facility
at
May
.
On May
26,
2023, we
entered
First Amendment
(the “First
Amendment”)
to the
Credit
Agreement,
which replaced
the
London Interbank
Offered Rate
interest rate benchmark
with the secured overnight
financing rate
as administered
by the Federa
l
Reserve
Bank of
New York
or a
successor
administrator
of the
secured overnight
financing
rate (“SOFR”).
The
rate in
with loans
made
is based
on, at
election,
either the
Term
SOFR
Rate plus
the Applicable
Margin
or the Base
Rate plus the
Applicable
Margin.
The
“Adjusted Term
SOFR”
means
to any
tenor, the
per annum
rate equal
to the
sum of
(i)
Term
SOFR as defined
in the Credit Agreement
plus (ii)
0.10
% (10 basis
points);
provided, if
Term
SOFR determined
as provided
above
shall ever
be less
than
the Floor,
then
Adjusted Term
SOFR shall
be deemed to be the Floor.
The “Floor” means
the rate per annum
of interest equal to
0.00
%. The “Base
Rate” means
a fluctuating
rate per
annum
equal to the highest of (a)
the federal funds
rate plus
0.50
% per annum,
(b) the prime rate of interest
by the
Administrative
Agent, and
(c) the
Term
SOFR for
a
one
-month tenor
plus
1.00
%. The
“Applicable
Margin”
means
0.00
% to
0.75
% per annum
for Base Rate
Loans and
1.00
% to
1.75
% per annum
for SOFR
Loans, in
each case
depending
upon the
Total Funded
Debt
to Capitalization
Ratio for the Company
at the quarterly pricing date.
will
pay a commitment
fee on the unused portion of the Credit
Facility payable
quarterly from
0.15
% to
0.25
%, in
each case depending
upon
the Total
Funded
Debt to Capitalization
Ratio
for the
Company
at
the quarterly
pricing date.
On
March
25, 2025,
entered
Second
Amendment
(the “Second
Amendment”)
to
the
Credit Agreement.
Under
the
Credit Agreement,
a
Change
of
Control
is an
event
of default.
The
Second
Amendment
amended
the definition
of
Change
of
Control
to exclude
from
that
definition the
(the
“Class
A
Conversion”)
of
all outstanding
shares
of the
Class A Common
Stock into
Common
Stock which occurred
on April 14, 2025.
The Credit Facility is guaranteed
by substantially all the current and future
wholly-owned direct
and indirect domestic
of
the
Company
(the
“Guarantors”),
and
is
secured
by
a
first-priority
perfected
in
all
of
the
and the Guarantors’ accounts, payment
intangibles, instruments (including promissory notes),
chattel paper,
(including farm
products)
and
deposit accounts
maintained
with the Administrative
Agent.
The
customary
covenants,
including restrictions
on the
incurrence
of liens,
incurrence
of additiona
l
debt, sales
and
other fundamental
changes and
investments.
The Credit Agreement
of
two financial
covenants:
(i) a maximum
Total Funded
Debt
to Capitalization
Ratio tested
quarterly of
no greater
than
%; and
(ii) a requirement
Minimum Tangible
Net Worth
at all times
of $
Million
plus
% of net income (if
is
positive)
less
permitted
restricted
for
each
fiscal
quarter
after
27,
The
Credit
Agreement
also
customary
events of default
and customary
remedies upon the
occurrence
of an event
of default, including
acceleration
of the
amounts
due under
the Credit Facility and
foreclosure of
the collateral
securing the Credit Faci
lity.
terms
of the
Credit
Agreement,
payment
of dividends
Company
’s current dividend
policy of
one-
third of the
Company
’s net income,
with
GAAP,
and payment
of other dividends or
repurchases
by the
Company
of its capital
stock is allowed,
as long
as after
giving effect
to such
or repurchases
no default
has
occurred and
is continuing
and the sum
of cash
of the Company
and its subsidiaries
plus availability
under
the Credit Facility
equals
at
least $
At May
we were in compliance
with the covenant
of the
Credit Agreement.
Note
- Equity
On April
14, 2025,
all
4.8
million shares
of Class
A
Common
Stock were
converted
into
Common
Stock. Upon
the conversion
of the
Class A Stock, the
Company
was no longer a
controlled company
rules of The Nasdaq
Stock Market.
25, 2025,
the Board
a
$
million
program
authorizes
the Company,
in
discretion, to repurchase
Common
Stock from time to time for an
aggregate purchase
price up to
$
million
(exclusive
of
any
fees,
taxes,
commissions
or
other
related
to
such
repurchases),
subject
to
market
actual
timing, number
and value
program
will
be determined
by management
in its discretion
and
will depend
on a
number
of
but not
limited to,
the
market
price of
the
Common
and
1,571,950
and
551,876
shares during fiscal
2025, respectively,
30, 2026, the
Company
had remaining authorization
to purchase up to
$
320.7
million under
the repurchase
Authorized
stock
of
10,000,000
shares,
with
a
par
value
of
$
0.01
,
of
which
no
shares
were
issued
and
as of
May
and
May
Note 12
- Net Income per
Common
Share
Basic net income per
Foods, Inc. is based
on the weighted average
shares of Common
Stock (and
when they were outstanding,
shares of Class A
Common
Stock) outstanding. All shares of Class A Common
Stock were
converted
into Common
Stock on April 14, 2025.
Diluted
per share attributable
is based on
weighted-
average
Common
Stock outstanding
during the relevant
period adjusted
for the
dilutive effect
of share
-based
awards.
table provides a reconciliation
of the numerators
and denominators
used to determine basic and
diluted net income
per common
(amounts
in thousands,
except
data):
May
May
Numerator
$
318,112
$
$
276,282
Less: Net income
1,430
(1,816)
(1,606)
to Cal
Inc.
$
316,682
$
$
277,888
Denominator
Weighted-average
common
shares outstanding,
basic
47,650
48,719
48,717
Effect
of dilutive securities
of restricted
shares
Weighted-average
common
shares outstanding,
diluted
47,781
48,891
48,873
per common
to Cal
Inc.
Basic
$
6.65
$
25.04
$
5.70
Diluted
$
6.63
$
24.95
$
5.69
Note 13
– Stock-Based
Compensation
The
stock-based
plan,
the Amended
Cal
Inc. 2012
Omnibus Long
-Term
Plan (the
“LTIP
Plan”),
for
the granting
of equity
-based
awards
such as
restricted
stock,
stock
units and
stock options
.
Awards
may
be granted under
the LTIP
Plan to any employee,
any non
-employee member
of the Board,
and
any
consultant
who
is a
natural
person
and
services to
us or
one
of
our
(except
for
incentive
stock
be granted
only
to our
employees).
As of
May
30,
2026,
number
for issuance
was
719,234
, and
may
be authorized
but unissued
shares or
shares. Common
Stock issued
from
shares under
the plan
was
89,867
shares,
47,700
shares and
86,803
shares for
and
2024,
Stock
stock
LTIP
Plan
vests
three years
from
the grant
date,
or upon
death
or disability,
change
in
control, or
(subject to certain
requirements).
The restricted
stock contains
no other service
or performance
stock is
awarded
in the
name
of the
recipient and,
except
for the
right of
disposal, constitutes
issued and
shares of the
Common
Stock for
all corporate
during the period of
restriction including the right to receive
dividends. Compensation
expense is a fixed amount
based on the grant date closing price and is amortized
on a straight-line basis
vesting period.
Forfeitures
are recognized
as they
occur.
Total
stock-based
expense related to
the restricted
stock was
$
5.3
$
4.5
$
4.4
fiscal
2026,
and
2024,
Our unrecognized
expense as
of non-vested
shares was
$
9.0
May 30,
and $
8.0
May
.
The
unrecognized
expense
will
be
to stock
expense
over a
period
of
2.1
years.
A summary
of our
and
related
for our restricted
stock is as follows:
Shares
Average
Grant
Date Fair Value
277,954
$
49.38
Granted
47,700
109.97
Vested
(108,058)
41.32
Forfeited
(4,879)
54.86
May
212,717
$
66.93
Granted
89,867
76.47
Vested
(88,519)
55.61
Forfeited
(5,063)
83.85
May
209,002
$
75.42
Performance-Based
Long-Term
Awards
June
1, 2025,
the
Company
a new
-based long-term
incentive
award
under
our
program,
which provides
for
awards
of performance
share units
(“PSUs”)
to certain
key
executives.
Pursuant
to
these awards,
certain
officers have
the opportunity
Common
Shares after
a three-year
period contingent
on (a)
the executive’s
service
through the
period, except
as otherwise
in the
award agreement,
and
(b)
the
achievement
of specific
goals tied
to
the
two equally
weighted
measures:
the
EBITDA and relative total stockholder
return compared
to a peer group. Depending
on the level
of achievement
of these two
over
the performance
period, the PSUs
will pay
out between
% and
% of the
target
award.
Total
expense
as a
performance-based
program
was $
in fiscal 2026.
Our unrecognized
expense as a result
of non-vested
shares in
the performance-based
program was $
at May 30, 2026
.
The unrecognized compensation
expense will be amortized
to stock compensation
expense over a period
of
2.0
years.
A summary
of our
and
related
for our
performance-based
awards
is as follows:
Shares
Average
Grant
Date Fair Value
May
—
$
—
Granted
9,260
101.95
May
9,260
$
101.95
Note 14
- Income Taxes
Income
Tax
Provision
The components
of our
income
tax
provision (benefit)
were (in thousands):
ended
May
May
Current:
Federal
$
29,749
$
312,000
$
83,721
State
(4,220)
61,340
9,640
25,529
373,340
93,361
Deferred:
Federal
59,739
12,703
(7,371)
State
7,624
(1,133)
(2,301)
67,363
11,570
(9,672)
Total
income
tax
$
92,892
$
384,910
$
83,689
Deferred Taxes
The tax
effects
of significant
creating deferred
tax
assets
and
were (in thousands):
May
May
tax
assets:
Accrued
$
3,985
$
3,620
State
loss carryforwards
income
Right of
use - asset
3,334
Other
12,969
13,239
Total
tax
assets
21,203
17,869
tax
liabilities:
plant
and
$
(180,377)
$
(128,789)
(49,478)
(35,041)
in affiliates
(1,618)
(2,205)
Right of
use - liability
(3,358)
(240)
Other
(8,244)
(6,245)
Total
tax
(243,075)
(172,520)
Net deferred
tax
$
(221,872)
$
(154,651)
The company
had income tax
net operating loss carryforwards
related to its
state operations
$
thousand as of
May
30, 2026.
The loss carryforwards
are not
subject
to expiration.
On July 4, 2025,
H.R. 1, informally known
as the One Big Beautiful
Bill Act ("The Tax
Act"), was enacted.
The Tax Act extends
and makes
permanent
several key
provisions of
the Tax
Cuts and
Jobs Act of
previously set to
expire as of
31,
- The impacts
of the Tax Act are
reflected in our
results for
the year ended May
and had
no material impact
on our
income
tax
expense
or effective
tax
rate.
Reconciliation
of the U.S. Federal
Statutory Rate
to the
Rate
The
Company
has
elected
to
prospectively
adopt
the
guidance
in ASU 2023
-09,
Income
Taxes
(Topic
740):
Improvements
to
Income
Taxes
. The
following table
is a
reconciliation
of the
U.S. federal
to the
total
tax
rates for
the year
ended
May
with the guidance
in ASU
2023-09
end May
Amount
Percent
U.S. federal
tax
rate
$
86,226
21.0
%
State
and
local income
taxes*
4,290
1.1
Tax
credits
(251)
(0.1)
Nontaxable
or nondeductible
items
2,627
0.7
Provision for
income
taxes
$
92,892
22.7
%
*State taxes
in
Georgia, Florida,
Mississippi, and
Texas
made up the majority (greater than
50%) of the tax effect
in
this category.
table
is a reconciliation
of the
U.S.
federal statutory
tax rate to the
total effective
tax rate for
the years
ended May
and
with guidance
prior to the adoption
of ASU 2023-09
end
May
Statutory
federal
income
tax
$
337,042
$
75,931
State
income
taxes,
net
47,169
5,798
Other,
net
1,960
$
384,910
$
83,689
Income
Tax
table is a summary
of income taxes
paid (net of refunds) by jurisdiction
to the disclosure requirements
of
ASU 2023-09
for the
year
ended
May
end
May
Federal
$
89,583
State
30,344
Income
tax
$
119,927
We
paid
income
taxes, net
of refunds,
of $
119.9
426.2
$
35.1
million during
fiscal
years 2026,
2025,
and
2024,
we had
no
significant unrecognized
tax benefits.
We
accrued
and paid
no
interest or penalties
during
or 2025
related
to uncertain
tax
positions.
We
to income
tax
in many
jurisdictions
within
We
are
not
under
audit
by the
Revenue
Service
or
by
any
state
and
local
tax
authorities.
Tax
periods
for
all
years
with
fiscal
year
remain
open
to
examination
by federal
and
state
taxing jurisdictions
to which we are subject.
Note 15
– Segment
previously managed
its
as
one
and reportable
segment.
in the
of 2026,
the
Company
revised its
to
change
the
manner
its
is managed,
which reflects
a
focus
on
product categories
rather
than
on a
basis.
As a result,
three
segments:
Shell
Eggs,
Shell
Eggs,
and
Foods.
The
,
which
include
co-pack
hard
-cooked
other
activities,
are not
reportable segments,
as defined by
the applicable accounting
standard
.
All
prior fiscal year
periods
recast to reflect the
.
The
Shell
Eggs
segment
of
the
and
sold as conventional
shell eggs, which includes our
brands
and
Sunny Meadow®.
The Specialty
segment
of the production,
packaging, marketing
of shell eggs sold as cage
-free, nutritionally
organic, brown, pasture
eggs. This segment
our
brands
Eggs
® and
as well
as
branded
from
our membership
of Eggland’s
Best, Inc. cooperative
which includes
Best®
and
Land O’ Lakes®.
Foods
The
Foods
segment
of the
,
and
of
foods
such
as
egg
folded
and
egg
formats
,
and
wraps.
This segment
Van
’s®
and
operating segment
s
are determined
on the
basis of our organizational
structure and
that
is regularly
reviewed
by our Chief
Decision
Maker
(“CODM”).
CODM
is Sherman
Miller,
President
and Chief
Officer.
Segment
income
is
utilized
during
our
forecasting
process
to
assess
profitability,
strategic
and
capital
investments.
The
CODM
compares
actual
of segment
segment
income
to
prior period
periodic forecasts
to assist with assessing
and
deciding how to allocate
resources.
The accounting
policies of the segments are generally the same
as those presented in
Note 1 - Summary of Significant Accounting
Policies
.
Segment SG&A represents
direct costs
with
each segment
for
mar
keting, delivery and employee
costs.
Other
– segment
income
segment
income
from other
such
as co-pack
hard
-cooked
other business
that
do not
individually
meet
the quantitative
thresholds for
separate
disclosure.
SG&A
such
as
payroll
related
legal
and
professional
fees,
and
other expenses
that
are not
used to
measure
segment
income
and
is managed
at
the corporate
office.
sales represent
sales between segments
as part of our vertical integration.
sales from the Conventional
and
Shell
Egg
are
sales
related
to
our
non-reportable
egg
or
hard
-cooked
and Specialty
Shell Egg intersegment
sales are transferred
at discounted
fixed rates
to account
for undergrad
es and
yield loss,
market
rates, or at
costs.
does not report total assets by segment as operations
are highly
integrated,
and assets
are shared amongst
The CODM does
not assess
or allocate
resources based
on segment
assets.
Segment results, including
the significant expense
categories regularly provided
to the CODM, are provided below (in thousand
s):
ended
May
Shell
Eggs
Foods
Total
$
1,309,557
$
1,049,228
$
244,802
$
2,603,587
sales
38,519
21,230
—
59,749
Total
segment
sales
1,348,076
1,070,458
244,802
2,663,336
1,059,179
777,920
185,370
2,022,469
72,256
110,994
25,550
208,800
$
216,641
$
181,544
$
33,882
$
432,067
income
19,044
SG&A
(108,353)
Gain on involuntary
8,819
Loss on
fixed assets
(1,391)
income
350,186
net
60,818
Income
before
income
taxes
$
411,004
ended
May
Shell
Eggs
Foods
Total
$
2,703,502
$
1,126,601
$
4,050
$
3,834,153
sales
52,357
28,350
—
80,707
Total
segment
sales
2,755,859
1,154,951
4,050
3,914,860
1,393,212
717,411
4,511
2,115,134
72,644
103,938
1,658
178,240
$
1,290,003
$
333,602
$
(2,119)
$
1,621,486
income
42,091
SG&A
(127,141)
Loss on
(156)
Gain on disposal
assets
income
net
66,603
Income
before
income
taxes
$
1,603,142
ended
Shell
Eggs
Total
$
1,226,903
$
863,297
$
2,090,200
sales
20,389
10,322
30,711
Total
segment
sales
1,247,292
873,619
2,120,911
970,031
648,236
1,618,267
63,560
89,188
152,748
$
213,701
$
136,195
$
349,896
income
33,566
SG&A
(94,516)
Gain on involuntary
23,532
Loss on
fixed assets
(26)
income
312,452
net
47,519
Income
before
income
taxes
$
359,971
table
shows the reconciliation
of net
sales to consolidated
results (in thousands):
Ended
May
May
Total
$
2,603,587
$
3,834,153
$
2,090,200
sales
308,045
427,732
236,243
Total
$
$
$
Other
– segment
sales
represent
sales
from
our
non-reportable
which
co-pack
sales,
egg
product
sales, hard
-cooked
eggs and other
business activities.
Revenue primarily
derives from
sales
table
revenue
disaggregated
by segment
and
by sales channel
May
Retail
Other
Total
$
1,099,245
$
193,614
$
16,698
$
1,309,557
952,556
92,343
4,329
1,049,228
Foods
92,031
104,157
48,614
244,802
sales
245,415
60,269
2,361
308,045
$
2,389,247
$
450,383
$
72,002
$
May
Retail
Other
Total
$
2,247,913
$
424,133
$
31,456
$
2,703,502
1,022,253
98,508
5,840
1,126,601
Foods
4,050
—
—
4,050
sales
337,489
89,347
427,732
$
3,611,705
$
611,988
$
38,192
$
Retail
Other
Total
$
1,007,282
$
210,423
$
9,198
$
1,226,903
835,826
25,879
1,592
863,297
sales
198,943
36,972
236,243
$
2,042,051
$
273,274
$
11,118
$
Retail customers
include
and regional grocery
store chains,
club
stores, and
servicing independent
in
the
U.S.
include
that
sell
food
and
related
items
to
restaura
nts, healthcare
and
education
facilities and
hotels.
Walmart
Inc. (including
Sam’s Club)
for
30.0
%,
33.6
% and
34.0
% of net sales dollars
2026,
2025,
and
2024,
Note 16
- Commitments
and Contingencies
In re Shell
Eggs Litigation
Since
2025,
the
Company
has
been
named
as
a
defendant
in
several
filed
in
federal
courts
alleging
identical claims,
including:
(1) the
following lawsuits
in the
Southern
District of
Indiana:
(a) King Kullen
Grocery
Co., Inc. v. Cal
-Maine Foods, Inc.,
et al., Case No. 1:25
-cv-2274, (b) Nineteenseventynine
LLC d/b/a
The Breakfast
Joynt v. Cal-
Maine
et
-cv-2301, (c)
Taylor
Egg Products,
Inc. v.
Cal
Inc., et
No. 1:25-
cv-2554,
(d) Hudson
v.
Cal
Inc. et al.,
Case
-cv-02573, (e) Brandon
Huyler v.
Cal
Inc.,
et
al., Case No. 1:26
-cv-00135, and
(f) Gloria
Emery,
Carol Goldberg,
and Casey
Whalen v. Cal
-Maine Foods, Inc.,
et al., Case No.
1:26-cv-00135;
(2) the
in the
Northern
of
Illinois: (a)
Birchmans
Parisian,
LLC (d/b/a
Lisciandro's
Restaurant)
v. Cal
Inc.,
et al., Case
No.
1:25
-cv-14030, (b)
Phil-N-Cindy's
Lunch,
Inc. v.
Cal
Inc.,
et al., Case
-cv-14082, (c) Yell
-O-Glow
v.
Cal
Inc., et
-cv-15084, and
(d)
Tariq
Habash,
Delia Govea, Andrew
Phillips,
and
Catalina
Torres v.
Urner
Barry
Publications,
Inc.,
Cal
Inc.,
et
No.
1:25
-cv-14112;
(3) the following
in the
Western
of Wisconsin:
(a) Matthew
Edlin v.
Cal
-Maine
et al., Case No. 3:25
-cv-946, and (b) India Price, Lakia Session,
and Karen Solomon
v. Cal
Inc., et al.,
Case
No.
3:25
-cv-1016;
and (4)
a
lawsuit in
the Western
of Missouri:
Ryan
v. Cal
Inc.,
et al.,
Case
No.
4:25-cv-00999.
The
allege
that
the
along
with
other
egg
and
associations,
conspired to artificially
inflate the prices of
shell eggs nationwide, primarily
through manipulation
of industry price
benchmarks
(such as
the Urner
Barry
Egg Index
and
Eggs Clearinghouse,
Inc. spot
market),
coordinated
supply
during
the calendar
year
highly pathogenic
avian
(“HPAI”)
outbreak.
In each
case, the
plaintiff
seeks
certification
of
a
putative
class
of
either
direct
or
indirect
purchasers,
monetary
damages,
relief,
attorneys’
fees, and, in some cases, restitution under Section 1 of the Sherman
Act, 15 U.S.C. § 1 (the “Sherman Act”) and various
state
and
protection
statutes.
10, 2026,
the
Joint
Panel on
Multidistrict
Litigation
issued a
Transfer
Order,
consolidating
the above
actions and
transferring
them to the Western
District of Wisconsin
for pre-trial proceedings.
An initial judicial
conference took
place
on May
8,
2026,
where
entered
an
initial
case
order, setting
forth
deadlines
for
the
complaints
and initial
briefing
to be filed.
No discovery
has taken
place in any of
the actions.
disputes plaintiffs’
allegations
in each
actions
and
intends to
vigorously defend
itself in these actions.
Civil Investigative
Demand
In March
2025,
received a
Civil Investigative
Demand
(“CID”) from
the
U.S. Department
of
Justice
(“DOJ”) in
with
an
to
whether
there
was
a
violation
of
the
laws
through
alleged
anticompetitive
conduct
by and among egg producers.
In August 2025,
received a subpoena
from the State of New
York
requesting information
and documents
related to its investigation
of anticompetitive
conduct
and
high egg
prices in the egg
and in
March 2026, the
Company
received a similar subpoena
from the State of Washington
related
to its investigation
of anticompetitive
conduct
and high egg prices
in the egg
various
states’
attorneys
general sought
to join
the DOJ’s
or requested
access
to the
confidential
disclosures by the
Company
to the
DOJ.
On or about
June 25, 2026,
entered into an
with the DOJ
and 17
states’ attorneys
general to resolve
the
investigation,
subject to applicable
court approvals
and procedures.
denied all wrongdoing or violations of law and
no fines
or penalties
were assessed
against
In connection
with
the agreement,
agreed to implement
certain
and
measures,
to donate
million eggs
to food
banks
and
non-profits,
and
to pay
$
1.5
million to
the settling
states
to resolve the
matter.
The
State
of Washington
did not
join
in
this settlement
and
continues to
comply
State
of Washington’s
subpoena
and cooperate
with
its investigations.
cannot predict the eventual
scope, duration or outcome
of the State
of Washington’s
and
is unable to
or range of
losses, if any,
at
this time.
Kraft Foods
Global, Inc.
et al. v.
United Egg
Producers,
Inc. et al.
25,
2008,
the
Company
was named
as one
of several
in numerous
cases
involving the
U.S.
shell
egg
The
Company
settled all
of
these
cases,
except
for
the
claims
plaintiffs
who
sought
substantia
l
damages
allegedly arising from the purchase
of egg products (as opposed to shell eggs). These remaining
plaintiffs are Kraft Food
Global,
Inc.,
General
Mills, Inc.,
and
Nestle
USA,
Inc. (the
“Egg Products
Plaintiffs”)
and,
until
was
reached
as described
below, The Kellogg
13, 2019, the case with
the Egg Products
Plaintiffs was remanded
from
a multi
-district litigation proceeding in the
United States District
Court for the Eastern
District of Pennsylvania,
In re Processed Egg Products
Antitrust Litigation,
MDL
No.
2002,
to
the
United
States
Court
for
the
Northern
of
Illinois,
Kraft
Foods
Global,
Inc.
et
al.
v.
United
Egg
Producers, Inc. et al., Case No. 1:11
-cv-8808, for trial.
The Egg Products Plaintiffs
alleged that
and other defendants
violated
Section
1 of the
Sherman
Act, by
agreeing
to limit
the production
of eggs
and
thereby
illegally to
raise the
prices
that
plaintiffs
paid
for processed
In particular,
the Egg
Products Plaintiffs
attacked
certain
features
of the
United
Egg
Producers
animal
-welfare guidelines and
program
used by
and
many
other egg producers.
On October
24,
2019, the
Company
entered into a confidential
with The Kellogg
Company
dismissing all
claims
against the
Company
for an amount
that did not
have a
material impact
on
or results
of
On
11,
2019,
a
stipulation
for
dismissal
was
filed
with
the
court,
and
on March
28,
2022,
the
court
dismissed
with prejudice.
The trial
of this case
began on
October 17,
- On
1, 2023,
the jury
returned
a decision
awarding
the Egg
Products
Plaintiffs
$
17.8
million
in damages.
On November
6, 2024,
entered
a final
judgement
against the
Company
defendants,
jointly and severally, totaling $
43.6
million after trebling. On December 4, 2024, the Company
filed a renewed
motion
for judgment
as a matter
of law or for a new trial, and
a motion to alter or amend
the judgment. On December
13, 2024, the
court
granted
defendants’
20, 2024
motion to
stay enforcement
of the
and
entered
an
agreed order
requiring the
to post security during
post-judgment
and appeal,
and stayed
proceedings to
enforce
the judgment
until
the disposition
of the
post-judgment
motions
and
appeals. On
17, 2024,
posted
a bond
in the
approximate
amount
of $
23.9
million, representing
a portion
of the
total
bond
to preserve
the
right to
appeal
the trial
court’s
decision. Another defendant
posted a bond for the remaining amount.
On November 19, 2025, the plaintiffs filed
a motion
to lift stay of proceedings on
attorney’s
fees and costs, and on December
5, 2025, the defendants
filed their
response in opposition
to such motion. The court has
not ruled on this motion. The Company
intends to continue to vigorously defend
the claims asserted
by the
Egg Products Plaintiffs.
If the
jury’s
decision
is ultimately
upheld,
jointly
and
severally
liable
with
other defendants
for treble
damages,
or
$
43.6
subject
to
credit
for
certain
settlements
with
previous
settling
defendants,
plus
the
Egg
Product
Plaintiffs’ reasonable
attorneys’
fees. During our second
2024, we recorded
an accrued
expense of $
19.6
million
in selling,
general
expenses in
Condensed
and classified
as other noncurrent
Condensed
Balance Sheets. Although less
than
the bond posted
by
the
the
accrual
our
of
the
proportional
share
of
the
damages
award, excluding the Egg Product Plaintiffs’ attorneys’
fees that we believe would be approximately
offset
by the credits
noted above.
We have
entered into a judgment
and joint defense
with the other defendants
remaining in the
case. Our
accrual
may
change
to the
extent
we are successful
in further proceedings
in the litigation.
State of
Oklahoma Watershed
Pollution Litigation
On June
18,
2005,
of Oklahoma
filed suit,
in the
United
States
Court for
the Northern
of Oklahoma,
against Cal
-Maine Foods, Inc. and
Tyson Foods,
Inc., Cobb
-Vantress,
Inc., Cargill, Inc., George’s,
Inc., Peterson
Farms, Inc. and
Simmons
of their affiliates.
The State of Oklahoma
claims that
through the disposal
of chicken
litter the
polluted
the
Illinois River
Watershed.
This
watershed
water
to
eastern
Oklahoma.
The
complaint
sought
relief and monetary
damages, but the claim
for monetary
damages was dismissed
by the court.
Cal
Inc.
discontinued
in the
watershed
in or
around
Since the
began,
%
of the membership
interests of Benton County
Foods, LLC,
which is an ongoing commercial shell egg operation
within the Illinois
River
Watershed.
Benton
County
Foods,
LLC
is
not
a
defendant
in
the
litigation.
We
also
have
a
number
of
small
that
operate
in the area.
The non-jury
trial in
the case began
in September
2009 and
concluded in
February 2010.
On January
18, 2023, the court
entered
findings of
fact and
conclusions
of law
in favor
of the
State of
Oklahoma.
The court
found
the defendants
jointly and severally
liable for state
law nuisance, federal common
law nuisance, and state
law trespass. The court also found the producers
vicariously
liable
for the
actions
producers. On
June
12, 2023,
the
court ordered
the parties
to mediate,
but the
mediation
was unsuccessful.
On June
26, 2024, the
district
court denied
defendants’
motion to dismiss
the case.
13, 2024,
a
status
hearing
was
held
and
scheduled
an
evidentiary
hearing
for
3,
2024,
to determine
whether
any
legal
remedy is available
based on the now 15-year-old record and changed circumstances
of the Illinois
River watershed. On December
9, 2025,
entered
a final judgment
imposing
$
420,000
in total penalties
for all
and awarding
certain non
-monetary
remedies, including injunctive
relief. Pursuant
to the final
judgment,
is
to pay
$
70,000
in penalties.
The judgment
also entitles
of Oklahoma
to an award
of attorneys’
fees and
costs in
an amount
to
be determined
at
a later
date.
The
relief provides
for,
among
other things,
a special
master to
oversee
an investigation,
develop
a remediation
plan
subject
to court
and
provide ongoing
monitoring
of remediation
projects,
the
costs
of which
will
be
paid
jointly
and
severally by
the defendants.
The defendants
are required to fund $
million within
5 days
of appointment
of the special master,
and
ongoing funding
of $
million any
time the
fund
is below $
million. This
funding obligation
is expected
to
continue for the
30 years
term. The defendants
are in
discussions of a potential expense
sharing agreement;
however, the Company
does
not currently
expect
to
have
share
of
the
funding.
The
relief also
certain
annual
on future
within
the Illinois
River Watershed,
removal
of
litter,
storage, transportation,
disposal and
future
land
applications.
On January
2, 2026, the Company filed its
notice of appeal
to the United States Court of Appeals for the Tenth Circuit. On January
16, 2026,
the district
court stayed
the monetary
portions of the
judgement
but declined
to stay
the injunctive
portions. Effective
July 10, 2026, the Company
and all
other defendants
entered into a settlement agreement
with
the State of Oklahoma
that provides
for
the payment
of funds
by the
into an
environmental
relief fund,
certain
on the
application
of
chicken
litter in the IRW
reporting measures.
The agreement
remains subject
to applicable court approvals
and
and
is not expected
to have
impact
on the
or results of operations
.
Other Matters
In addition
to the
above,
is involved
in various
other claims
and litigation
incidental
to its
the
outcome
of these matters
cannot
be determined with certainty, management,
upon the advice
of counsel, is of the opinion that
the
final outcome
should not
have
effect
on the
position.
Note 17
– Subsequent
Events
July 10, 2026
, the
Company
the
Best®
territory in
the
for
$
million. The
gives us
the exclusive
right to
and
sell
Best®
and
Lakes®
branded
eggs in
Maine,
Massachusetts,
New Hampshire,
Rhode
Island,
and
select key areas
in Vermont,
New York, and
Connecticut.
ITEM
CHANGES
IN AND
DISAGREEMENTS
WITH
ACCOUNTANTS
ON
ACCOUNTING
AND
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.