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| | | PART I | | |
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| Item 1. | | Business | | 5 |
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| Item 1A. | | Risk Factors | | 16 |
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| Item 1B. | | Unresolved Staff Comments | | 30 |
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| Item 1C. | | Cybersecurity | | 30 |
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| Item 2. | | Properties | | 32 |
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| Item 3. | | Legal Proceedings | | 32 |
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| Item 4. | | Mine Safety Disclosures | | 32 |
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| | | PART II | | |
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| Item 5. | | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | | 33 |
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| Item 6. | | [Reserved] | | 35 |
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| Item 7. | | Management’s Discussion and Analysis of Financial Condition and Results of Operations | | 35 |
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| Item 7A. | | Quantitative and Qualitative Disclosures About Market Risk | | 52 |
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| Item 8. | | Financial Statements and Supplementary Data | | 54 |
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| Item 9. | | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure | | 97 |
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| Item 9A. | | Controls and Procedures | | 97 |
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| Item 9B. | | Other Information | | 98 |
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| Item 9C. | | Disclosure Regarding Foreign Jurisdictions that Prevent Inspections | | 98 |
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| | | PART III | | |
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| Item 10. | | Directors, Executive Officers and Corporate Governance | | 99 |
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| Item 11. | | Executive Compensation | | 99 |
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| Item 12. | | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | | 99 |
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| Item 13. | | Certain Relationships and Related Transactions, and Director Independence | | 100 |
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| Item 14. | | Principal Accountant Fees and Services | | 100 |
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| | | PART IV | | |
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| Item 15. | | Exhibits, Financial Statement Schedules | | 101 |
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| Signatures | | | | 105 |
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Forward-Looking Statements
This report includes forward-looking statements, including, without limitation, the statements under “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The words “believes,” “belief,” “expects,” “projects,” “intends,” “anticipates,” “assumes,” “could,” “should,” “estimates,” “potential,” “seek,” “predict,” “may,” “will” or “plans” and similar references to future periods are intended to identify forward-looking statements. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance and achievements, or industry results, to be materially different from any future results, performance, or achievements expressed or implied by any forward-looking statements. We believe important factors that could cause actual results to differ materially from our expectations include the following:
| ● | our substantial leverage; |
| ● | the effects of rising costs for and/or decreases in the supply of commodities, ingredients, packaging, other raw materials, distribution and labor; |
| ● | crude oil prices and their impact on distribution, packaging and energy costs; |
| ● | our ability to successfully implement sales price increases and cost saving measures to offset any cost increases; |
| ● | intense competition, changes in consumer preferences, demand for our products and local economic and market conditions; |
| ● | our continued ability to promote brand equity successfully, to anticipate and respond to new consumer trends, to develop new products and markets, to broaden brand portfolios in order to compete effectively with lower priced products and in markets that are consolidating at the retail and manufacturing levels and to improve productivity; |
| ● | the ability of our company and our supply chain partners to continue to operate manufacturing facilities, distribution centers and other work locations without material disruption, and to procure ingredients, packaging and other raw materials when needed despite disruptions in the supply chain or labor shortages; |
| ● | the impact pandemics or disease outbreaks, such as the COVID-19 pandemic, may have on our business, including among other things, our supply chain, our manufacturing operations, our workforce and customer and consumer demand for our products; |
| ● | our ability to recruit and retain senior management and a highly skilled and diverse workforce at our corporate offices, manufacturing facilities and other work locations despite a very tight labor market and changing employee expectations as to fair compensation, an inclusive and diverse workplace, flexible working and other matters; |
| ● | the risks associated with the expansion of our business; |
| ● | our possible inability to identify new acquisitions or to integrate recent or future acquisitions, or our failure to realize anticipated revenue enhancements, cost savings or other synergies from recent or future acquisitions; |
| ● | our ability to successfully complete the integration of recent or future acquisitions into our enterprise resource planning (ERP) system; |
| ● | tax reform and legislation, including the effects of the Infrastructure Investment and Jobs Act, the Inflation Reduction Act, U.S. Tax Cuts and Jobs Act and the U.S. CARES Act, and any future tax reform or legislation; |
| ● | our ability to access the credit markets and our borrowing costs and credit ratings, which may be influenced by credit markets generally and the credit ratings of our competitors; |
| ● | unanticipated expenses, including, without limitation, litigation or legal settlement expenses; |
| ● | the effects of currency movements of the Canadian dollar and the Mexican peso as compared to the U.S. dollar; |
| ● | the effects of international trade disputes, tariffs, quotas, and other import or export restrictions on our international procurement, sales and operations; |
| ● | future impairments of our goodwill and intangible assets; |
| ● | our ability to protect information systems against, or effectively respond to, a cybersecurity incident, other disruption or data leak; |
| ● | our ability to successfully implement our sustainability initiatives and achieve our sustainability goals, and changes to environmental laws and regulations; |
| ● | other factors that affect the food industry generally, including: |
| o | recalls if products become adulterated or misbranded, liability if product consumption causes injury, ingredient disclosure and labeling laws and regulations and the possibility that consumers could lose confidence in the safety and quality of certain food products; |
| o | competitors’ pricing practices and promotional spending levels; |
| o | fluctuations in the level of our customers’ inventories and credit and other business risks related to our customers operating in a challenging economic and competitive environment; and |
| o | the risks associated with third-party suppliers and co-packers, including the risk that any failure by one or more of our third-party suppliers or co-packers to comply with food safety or other laws and regulations may disrupt our supply of raw materials or certain finished goods products or injure our reputation; and |
| ● | other factors discussed elsewhere in this report, including under Part I, Item 1A, “Risk Factors,” and in our other public filings with the Securities and Exchange Commission (SEC). |
Developments in any of these areas could cause our results to differ materially from results that have been or may be projected by us or on our behalf.
All forward-looking statements included in this report are based on information available to us on the date of this report. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. All subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements contained in this report.
We caution that the foregoing list of important factors is not exclusive. There may be other factors that may cause our actual results to differ materially from the forward-looking statements in this report, including factors disclosed under the sections of this report titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” You should evaluate all forward-looking statements made in this report in the context of these risks and uncertainties. We urge investors not to unduly rely on forward-looking statements contained in this report.
