株探米国株
英語
エドガーで原本を確認する
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Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 10-Q
 
☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended 03/31/2023
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to  .            
Commission file number 000-20557
 
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THE ANDERSONS, INC.
(Exact name of the registrant as specified in its charter)
 
Ohio 34-1562374
(State of incorporation or organization) (I.R.S. Employer Identification No.)
1947 Briarfield Boulevard
Maumee Ohio 43537
(Address of principal executive offices) (Zip Code)

(419) 893-5050
(Telephone Number)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class:   Trading Symbol   Name of each exchange on which registered:
Common stock, $0.00 par value, $0.01 stated value   ANDE   The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ý    No  ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ý    No  ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act. 
Large accelerated filer ý Accelerated filer ☐
Non-accelerated filer ☐ Smaller reporting company ☐
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)  Yes ☐    No  ý

The registrant had 33,732,414 common shares outstanding at April 21, 2023.

Table of Contents
THE ANDERSONS, INC.
INDEX
 
  Page No.
PART I. FINANCIAL INFORMATION
PART II. OTHER INFORMATION


Table of Contents

Part I. Financial Information
Item 1. Financial Statements

The Andersons, Inc.
Condensed Consolidated Statements of Operations (Unaudited)
(In thousands, except per share data)
 
  Three months ended March 31,
  2023 2022
Sales and merchandising revenues $ 3,881,238  $ 3,977,954 
Cost of sales and merchandising revenues 3,733,227  3,858,419 
Gross profit 148,011  119,535 
Operating, administrative and general expenses 117,235  101,987 
Asset impairment 87,156  — 
Interest expense, net 16,625  10,859 
Other income, net 8,004  3,918 
Income (loss) before income taxes from continuing operations (65,001) 10,607 
Income tax provision (benefit) from continuing operations (5,884) 4,103 
Net income (loss) from continuing operations (59,117) 6,504 
Loss from discontinued operations, net of income taxes —  (554)
Net income (loss) (59,117) 5,950 
Net income (loss) attributable to noncontrolling interests (44,367) 447 
Net income (loss) attributable to The Andersons, Inc. $ (14,750) $ 5,503 
Average number of shares outstanding - basic 33,622  33,738 
Average number of share outstanding - diluted 33,622  34,279 
Earnings (loss) per share attributable to The Andersons, Inc. common shareholders:
Basic earnings (loss):
Continuing operations $ (0.44) $ 0.18 
Discontinued operations —  (0.02)
$ (0.44) $ 0.16 
Diluted earnings (loss):
Continuing operations $ (0.44) $ 0.18 
Discontinued operations —  (0.02)
$ (0.44) $ 0.16 
See Notes to Condensed Consolidated Financial Statements

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The Andersons, Inc.
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)
(In thousands)
 
  Three months ended March 31,
  2023 2022
Net income (loss) $ (59,117) $ 5,950 
Other comprehensive income (loss), net of tax:
Change in unrecognized actuarial loss and prior service cost (188) (159)
Foreign currency translation adjustments 767  98 
Cash flow hedge activity (4,796) 12,422 
Other comprehensive income (loss) (4,217) 12,361 
Comprehensive income (loss) (63,334) 18,311 
Comprehensive income (loss) attributable to the noncontrolling interests (44,367) 447 
Comprehensive income (loss) attributable to The Andersons, Inc. $ (18,967) $ 17,864 
See Notes to Condensed Consolidated Financial Statements

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The Andersons, Inc.
Condensed Consolidated Balance Sheets (Unaudited)
 (In thousands)
 March 31,
2023		 December 31,
2022		 March 31,
2022
Assets
Current assets:
Cash and cash equivalents $ 70,853  $ 115,269  $ 36,381 
Accounts receivable, net 1,125,071  1,248,878  1,050,259 
Inventories (Note 2)
 1,551,101  1,731,725  1,950,303 
Commodity derivative assets – current (Note 5)
 222,036  295,588  769,916 
Current assets held-for-sale —  2,871  20,255 
Other current assets 81,407  71,622  113,589 
Total current assets 3,050,468  3,465,953  3,940,703 
Other assets:
Goodwill 129,342  129,342  129,342 
Other intangible assets, net 95,134  100,907  111,055 
Right of use assets, net 59,209  61,890  51,821 
Other assets held-for-sale —  —  45,264 
Other assets, net 89,174  87,175  92,506 
Total other assets 372,859  379,314  429,988 
Property, plant and equipment, net (Note 3)
 678,717  762,729  772,245 
Total assets $ 4,102,044  $ 4,607,996  $ 5,142,936 
Liabilities and equity
Current liabilities:
Short-term debt (Note 4)
 $ 638,210  $ 272,575  $ 1,449,768 
Trade and other payables 768,872  1,423,633  741,124 
Customer prepayments and deferred revenue 309,546  370,524  384,723 
Commodity derivative liabilities – current (Note 5)
 107,983  98,519  216,836 
Current maturities of long-term debt (Note 4)
 85,567  110,155  54,158 
Current liabilities held-for-sale —  —  10,200 
Accrued expenses and other current liabilities 202,133  245,916  205,958 
Total current liabilities 2,112,311  2,521,322  3,062,767 
Long-term lease liabilities 35,727  37,147  31,419 
Long-term debt, less current maturities (Note 4)
 486,892  492,518  571,181 
Deferred income taxes 54,391  64,080  68,437 
Other long-term liabilities held-for-sale —  —  14,738 
Other long-term liabilities 66,311  63,160  77,173 
Total liabilities 2,755,632  3,178,227  3,825,715 
Commitments and contingencies (Note 13)
Shareholders’ equity:
Common shares, without par value (63,000 shares authorized and 34,064 shares issued for all periods presented)
 142  142  142 
Preferred shares, without par value (1,000 shares authorized; none issued)
 —  —  — 
Additional paid-in-capital 377,768  385,248  375,794 
Treasury shares, at cost (289, 446 and 61 shares at 3/31/2023, 12/31/2022 and 3/31/2022, respectively)
 (11,006) (15,043) (2,265)
Accumulated other comprehensive income 16,267  20,484  13,555 
Retained earnings 786,420  807,770  701,799 
Total shareholders’ equity of The Andersons, Inc. 1,169,591  1,198,601  1,089,025 
Noncontrolling interests 176,821  231,168  228,196 
Total equity 1,346,412  1,429,769  1,317,221 
Total liabilities and equity $ 4,102,044  $ 4,607,996  $ 5,142,936 
See Notes to Condensed Consolidated Financial Statements
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The Andersons, Inc.
Condensed Consolidated Statements of Cash Flows (Unaudited)
(In thousands)
  Three months ended March 31,
  2023 2022
Operating Activities
Net income (loss) from continuing operations $ (59,117) $ 6,504 
Loss from discontinued operations, net of income taxes —  (554)
Net income (loss) (59,117) 5,950 
Adjustments to reconcile net income (loss) to cash used in operating activities:
Depreciation and amortization 32,220  34,377 
Bad debt expense, net —  1,255 
Stock-based compensation expense 2,596  1,818 
Deferred federal income tax (8,051) (6,947)
Asset impairment 87,156  — 
Other 3,225  3,048 
Changes in operating assets and liabilities:
Accounts receivable 125,113  (215,012)
Inventories 178,010  (136,820)
Commodity derivatives 83,148  (277,761)
Other current and non-current assets (17,543) (38,810)
Payables and other current and non-current liabilities (760,292) (446,096)
Net cash used in operating activities (333,535) (1,074,998)
Investing Activities
Purchases of property, plant and equipment and capitalized software (25,470) (20,722)
Purchases of investments —  (1,333)
Purchases of Rail assets —  (3,186)
Proceeds from sale of Rail assets 2,871  248 
Other 2,792  72 
Net cash used in investing activities (19,807) (24,921)
Financing Activities
Net receipts under short-term lines of credit 363,619  796,209 
Proceeds from issuance of short-term debt —  350,000 
Payments of short-term debt —  (200,000)
Payments of long-term debt (30,251) (7,566)
Contributions from noncontrolling interest owner —  2,450 
Distributions to noncontrolling interest owner (9,980) (9,980)
Payments of debt issuance costs (5) (7,310)
Dividends paid (6,279) (6,144)
Proceeds from exercises of stock options —  5,024 
Common stock repurchased (1,671) — 
Value of shares withheld for taxes (6,616) (3,319)
Other —  393 
Net cash provided by financing activities 308,817  919,757 
Effect of exchange rates on cash and cash equivalents 109  99 
Decrease in cash and cash equivalents (44,416) (180,063)
Cash and cash equivalents at beginning of period 115,269  216,444 
Cash and cash equivalents at end of period $ 70,853  $ 36,381 
See Notes to Condensed Consolidated Financial Statements
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The Andersons, Inc.
Condensed Consolidated Statements of Equity (Unaudited)
(In thousands, except per share data)
Three Months Ended
  Common
Shares		 Additional
Paid-in
Capital		 Treasury
Shares		 Accumulated
Other
Comprehensive Income		 Retained
Earnings		 Noncontrolling
Interests		 Total
Balance at December 31, 2021
 $ 140  $ 368,595  $ (263) $ 1,194  $ 702,759  $ 235,279  $ 1,307,704 
Net income 5,503  447  5,950 
Other comprehensive income 10,822  10,822 
Amounts reclassified from Accumulated other comprehensive income 1,539  1,539 
Cash received from noncontrolling interests, net 2,450  2,450 
Distributions to noncontrolling interests (9,980) (9,980)
Stock awards, stock option exercises and other shares issued to employees and directors, net of income tax of $0 (59 shares)
 2 7,145  (2,322) 4,825 
Dividends declared ($0.180 per common share)
 (6,089) (6,089)
Restricted share award dividend equivalents 54  320  (374) — 
Balance at March 31, 2022
 $ 142  $ 375,794  $ (2,265) $ 13,555  $ 701,799  $ 228,196  $ 1,317,221 
Balance at December 31, 2022
 $ 142  $ 385,248  $ (15,043) $ 20,484  $ 807,770  $ 231,168  $ 1,429,769 
Net income (loss) (14,750) (44,367) (59,117)
Other comprehensive income (loss) (1,884) (1,884)
Amounts reclassified from Accumulated other comprehensive income (2,333) (2,333)
Distributions to noncontrolling interests (9,980) (9,980)
Stock awards, stock option exercises and other shares issued to employees and directors, net of income tax of $0 (201) shares)
 (8,087) 5,543  (2,544)
Purchase of treasury shares (49 shares)
 (1,671) (1,671)
Dividends declared ($0.185 per common share)
 (6,240) (6,240)
Restricted share award dividend equivalents 607  165  (360) 412 
Balance at March 31, 2023
 $ 142  $ 377,768  $ (11,006) $ 16,267  $ 786,420  $ 176,821  $ 1,346,412 
See Notes to Condensed Consolidated Financial Statements

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The Andersons, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)


1. Basis of Presentation and Consolidation

These Condensed Consolidated Financial Statements include the accounts of The Andersons, Inc. and its wholly owned and controlled subsidiaries (the “Company”). Controlled subsidiaries include majority-owned subsidiaries and variable interest entities (“VIEs”) of which the Company is the primary beneficiary. The portion of these entities that is not owned by the Company is presented as noncontrolling interests. All intercompany accounts and transactions are eliminated in consolidation.
Investments in unconsolidated entities in which the Company has significant influence, but not control, are accounted for using the equity method of accounting.

During the third quarter of 2021, substantially all of the assets and liabilities of the Rail segment were classified as held-for-sale in the accompanying Condensed Consolidated Balance Sheets as the Company executed a definitive agreement to sell the Rail Leasing business and announced its intent to sell the remaining Rail Repair business, which was subsequently sold in 2022. These transactions effectively constitute the entirety of what has historically been included in the Rail reportable segment. Therefore, the associated operating results, net of income tax, have been classified as discontinued operations in the accompanying Condensed Consolidated Statements of Operations for all periods presented. Throughout this Quarterly Report on Form 10-Q, with the exception of the Condensed Consolidated Statements of Cash Flows, Condensed Consolidated Statements of Equity and unless otherwise indicated, amounts and activity are presented on a continuing operations basis.

In the opinion of management, all adjustments consisting of normal and recurring items considered necessary for the fair presentation of the results of operations, financial position, and cash flows for the periods indicated have been made. The results in these Condensed Consolidated Financial Statements are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2023. An unaudited Condensed Consolidated Balance Sheet as of March 31, 2022 has been included as the Company operates in several seasonal industries.
The Condensed Consolidated Balance Sheet data at December 31, 2022 was derived from the audited Consolidated Financial Statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. The accompanying unaudited Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and notes thereto included in The Andersons, Inc. Annual Report on Form 10-K for the year ended December 31, 2022 (the “2022 Form 10-K”).


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2. Inventories

Major classes of inventories are presented below. Readily Marketable Inventories ("RMI") are agricultural commodity inventories such as corn, soybeans, wheat, and ethanol co-products, among others, carried at net realizable value which approximates fair value based on their commodity characteristics, widely available market information, and pricing mechanisms. The net realizable value of RMI is calculated as the fair value (spot price of the commodity in an exchange), less cost of disposal and transportation based on the local market. All other inventories are held at lower of cost or net realizable value.
(in thousands) March 31,
2023		 December 31,
2022		 March 31,
2022
Grain and other agricultural products (a) $ 1,112,155  $ 1,326,531  $ 1,435,763 
Energy inventories (a) 17,641  21,084  17,529 
Ethanol and co-products (a) 147,275  156,341  193,303 
Plant nutrients and cob products 274,030  227,769  303,708 
Total inventories $ 1,551,101  $ 1,731,725  $ 1,950,303 
(a) Includes RMI of $1,085.7 million, $1,308.8 million and $1,413.5 million at March 31, 2023, December 31, 2022 and March 31, 2022, respectively.


3. Property, Plant and Equipment

The components of Property, plant and equipment, net are as follows:
(in thousands) March 31,
2023		 December 31,
2022		 March 31,
2022
Land $ 38,000  $ 38,689  $ 39,183 
Land improvements and leasehold improvements 91,503  92,084  91,061 
Buildings and storage facilities 362,451  364,721  369,850 
Machinery and equipment 917,269  980,159  946,352 
Construction in progress 48,158  41,429  23,512 
1,457,381  1,517,082  1,469,958 
Less: accumulated depreciation 778,664  754,353  697,713 
Property, plant and equipment, net $ 678,717  $ 762,729  $ 772,245 

Depreciation expense on property, plant and equipment used in continuing operations was $26.2 million and $28.3 million for the three months ended March 31, 2023 and 2022, respectively.

The Company recorded a $87.2 million impairment charge for the three months ended March 31, 2023 related to ELEMENT, LLC ("ELEMENT"), the Company's joint venture ethanol plant within the Renewables segment. The plant has faced operational and market-based challenges which were exacerbated by a shift in the California Low Carbon Fuel Standard credit markets and high western corn basis. As the Company owns 51% of ELEMENT, the Company consolidates the results of ELEMENT and 49% of the impairment charge will be represented in Net loss attributable to noncontrolling interests in the Company's Condensed Consolidated Statements of Operations.



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4. Debt

Short-term and long-term debt at March 31, 2023, December 31, 2022 and March 31, 2022 consisted of the following:
(in thousands) March 31,
2023		 December 31,
2022		 March 31,
2022
Short-term debt – non-recourse $ 100,228  $ 81,475  $ 148,216 
Short-term debt – recourse 537,982  191,100  1,301,552 
Total short-term debt $ 638,210  $ 272,575  $ 1,449,768 
Current maturities of long-term debt – non-recourse $ 63,176  $ 63,815  $ 7,959 
Current maturities of long-term debt – recourse 22,391  46,340  46,199 
Total current maturities of long-term debt $ 85,567  $ 110,155  $ 54,158 
Long-term debt, less: current maturities – non-recourse $ 285  $ 414  $ 62,675 
Long-term debt, less: current maturities – recourse 486,607  492,104  508,506 
Total long-term debt, less: current maturities $ 486,892  $ 492,518  $ 571,181 

The total borrowing capacity of the Company's lines of credit at March 31, 2023, was $1,991.8 million of which the Company had a total of $1,294.9 million available for borrowing under its lines of credit. The Company's borrowing capacity is reduced by a combination of outstanding borrowings and letters of credit.

As of March 31, 2023, December 31, 2022 and March 31, 2022, the estimated fair value of long-term debt, including the current portion, was $569.0 million, $595.7 million and $633.9 million, respectively. The Company estimates the fair value of its long-term debt based upon the Company’s credit standing and current interest rates offered to the Company on similar bonds and rates currently available to the Company for long-term borrowings with similar terms and remaining maturities.

As part of the Company's ongoing covenant monitoring process, the Company determined that ELEMENT was out of compliance with its working capital covenant as of January 31, 2023, and is also out of compliance with an owner's equity ratio covenant as of March 31, 2023. In addition, ELEMENT did not make its required February 2023 debt payment and subsequently received a default notice from the lender on February 17, 2023. As such, the $62.8 million of non-recourse debt associated with ELEMENT continues to be classified in Current maturities of long-term debt as of March 31, 2023. On April 18, 2023, ELEMENT was placed into receivership.

The Company is in compliance with all other financial covenants as of March 31, 2023.


5. Derivatives

The Company’s operating results are affected by changes to commodity prices. The Trade and Renewables businesses have established “unhedged” futures position limits (the amount of a commodity, either owned or contracted for, that does not have an offsetting derivative contract). To reduce the exposure to market price risk on commodities owned and forward purchase and sale contracts, the Company enters into exchange traded commodity futures and options contracts and over-the-counter forward and option contracts with various counterparties. These contracts are primarily traded via regulated commodity exchanges. The Company’s forward purchase and sales contracts are for physical delivery of the commodity in a future period. Contracts to purchase commodities from producers generally relate to the current or future crop years for delivery periods quoted by regulated commodity exchanges. Most contracts for the sale of commodities to processors or other commercial consumers generally do not extend beyond one year.

Most of these contracts meet the definition of derivatives. While the Company considers its commodity contracts to be effective economic hedges, the Company does not designate or account for its commodity contracts as hedges as defined under current accounting standards. The Company primarily accounts for its commodity derivatives at estimated fair value. The estimated fair value of the commodity derivative contracts that require the receipt or posting of cash collateral is recorded on a net basis (offset against cash collateral posted or received, also known as margin deposits) within commodity derivative assets or liabilities. Management determines fair value based on exchange-quoted prices and in the case of its forward purchase and sale contracts, estimated fair value is adjusted for differences in local markets and non-performance risk. For contracts for which
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physical delivery occurs, balance sheet classification is based on estimated delivery date. For futures, options and over-the-counter contracts in which physical delivery is not expected to occur but, rather, the contract is expected to be net settled, the Company classifies these contracts as current or noncurrent assets or liabilities, as appropriate, based on the Company’s expectations as to when such contracts will be settled.

Realized and unrealized gains and losses in the value of commodity contracts (whether due to changes in commodity prices, changes in performance or credit risk, or due to sale, maturity or extinguishment of the commodity contract) and commodity inventories are included in cost of sales and merchandising revenues.

Generally accepted accounting principles permit a party to a master netting arrangement to offset fair value amounts recognized for derivative instruments against the right to reclaim cash collateral or obligation to return cash collateral under the same master netting arrangement. The Company has master netting arrangements for its exchange traded futures and options contracts and certain over-the-counter contracts. When the Company enters into a future, option or an over-the-counter contract, an initial margin deposit may be required by the counterparty. The amount of the margin deposit varies by commodity. If the market price of a future, option or an over-the-counter contract moves in a direction that is adverse to the Company’s position, an additional margin deposit, called a maintenance margin, is required. The margin deposit assets and liabilities are included in short-term commodity derivative assets or liabilities, as appropriate, in the Condensed Consolidated Balance Sheets.

The following table presents at March 31, 2023, December 31, 2022 and March 31, 2022, a summary of the estimated fair value of the Company’s commodity derivative instruments that require cash collateral and the associated cash posted/received as collateral. The net asset or liability positions of these derivatives (net of their cash collateral) are determined on a counterparty-by-counterparty basis and are included within current or non-current commodity derivative assets (or liabilities) on the Condensed Consolidated Balance Sheets:

(in thousands) March 31, 2023 December 31, 2022 March 31, 2022
Cash collateral paid $ 9,075  $ 64,530  $ 409,743 
Fair value of derivatives 23,040  (10,014) (144,937)
Net derivative asset position $ 32,115  $ 54,516  $ 264,806 

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The following table presents, on a gross basis, current and non-current commodity derivative assets and liabilities:
March 31, 2023
(in thousands) Commodity Derivative Assets - Current Commodity Derivative Assets - Noncurrent Commodity Derivative Liabilities - Current Commodity Derivative Liabilities - Noncurrent Total
Commodity derivative assets $ 284,879  $ 4,175  $ 13,431  $ 74  $ 302,559 
Commodity derivative liabilities (71,918) (1,024) (121,414) (2,384) (196,740)
Cash collateral paid 9,075  —  —  —  9,075 
Balance sheet line item totals $ 222,036  $ 3,151  $ (107,983) $ (2,310) $ 114,894 

December 31, 2022
(in thousands) Commodity Derivative Assets - Current Commodity Derivative Assets - Noncurrent Commodity Derivative Liabilities - Current Commodity Derivative Liabilities - Noncurrent Total
Commodity derivative assets $ 325,762  $ 1,796  $ 18,426  $ 686  $ 346,670 
Commodity derivative liabilities (94,704) (149) (116,945) (1,484) (213,282)
Cash collateral paid 64,530  —  —  —  64,530 
Balance sheet line item totals $ 295,588  $ 1,647  $ (98,519) $ (798) $ 197,918 

March 31, 2022
(in thousands) Commodity Derivative Assets - Current Commodity Derivative Assets - Noncurrent Commodity Derivative Liabilities - Current Commodity Derivative Liabilities - Noncurrent Total
Commodity derivative assets $ 637,947  $ 15,860  $ 34,798  $ 1,264  $ 689,869 
Commodity derivative liabilities (276,874) (848) (252,534) (5,759) (536,015)
Cash collateral paid 408,843  —  900  —  409,743 
Balance sheet line item totals $ 769,916  $ 15,012  $ (216,836) $ (4,495) $ 563,597 

The net pre-tax gains and losses on commodity derivatives not designated as hedging instruments are included in the Company’s Condensed Consolidated Statements of Operations for the three months ended March 31, 2023 and 2022 as follows:

  Three months ended March 31,
(in thousands) 2023 2022
Gains (losses) on commodity derivatives included in Cost of sales and merchandising revenues $ (27,568) $ 33,998 


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The Company had the following volume of commodity derivative contracts outstanding (on a gross basis) at March 31, 2023, December 31, 2022 and March 31, 2022:
March 31, 2023
(in thousands) Number of Bushels Number of Gallons Number of Tons
Non-exchange traded:
Corn 572,079  —  — 
Soybeans 50,184  —  — 
Wheat 101,663  —  — 
Oats 31,658  —  — 
Ethanol —  200,591  — 
Dried distillers grain —  —  399 
Soybean meal —  —  367 
Other 10,237  44,120  1,966 
Subtotal 765,821  244,711  2,732 
Exchange traded:
Corn 184,766  —  — 
Soybeans 76,365  —  — 
Wheat 83,618  —  — 
Oats 1,125  —  — 
Ethanol —  69,972  — 
Propane —  45,402  — 
Other —  1,134  551 
Subtotal 345,874  116,508  551 
Total 1,111,695  361,219  3,283 
December 31, 2022
(in thousands) Number of Bushels Number of Gallons Number of Tons
Non-exchange traded:
Corn 567,405  —  — 
Soybeans 56,608  —  — 
Wheat 102,716  —  — 
Oats 24,710  —  — 
Ethanol —  178,935  — 
Dried distillers grain —  —  570 
Soybean meal —  —  449 
Other 10,054  44,547  2,029 
Subtotal 761,493  223,482  3,048 
Exchange traded:
Corn 170,280  —  — 
Soybeans 46,380  —  — 
Wheat 111,567  —  — 
Oats 365  —  — 
Ethanol —  94,206  — 
Propane —  47,208  — 
Other —  588  581 
Subtotal 328,592  142,002  581 
Total 1,090,085  365,484  3,629 

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March 31, 2022
(in thousands) Number of Bushels Number of Gallons Number of Tons
Non-exchange traded:
Corn 722,719  —  — 
Soybeans 133,043  —  — 
Wheat 102,690  —  — 
Oats 45,967  —  — 
Ethanol —  214,513  — 
Dried distillers grain —  —  435 
Soybean meal —  —  550 
Other 8,697  24,565  3,078 
Subtotal 1,013,116  239,078  4,063 
Exchange traded:
Corn 267,135  —  — 
Soybeans 86,410  —  — 
Wheat 78,500  —  — 
Oats 1,815  —  — 
Ethanol —  47,082  — 
Propane —  13,356  — 
Other 110  1,470  547 
Subtotal 433,970  61,908  547 
Total 1,447,086  300,986  4,610 

Interest Rate and Other Derivatives

The Company’s objectives for using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish these objectives, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount.

The gains or losses on the derivatives designated as hedging instruments are recorded in Other comprehensive income (loss) and subsequently reclassified into interest expense in the same periods during which the hedged transaction affects earnings. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on the Company’s variable-rate debt.

At March 31, 2023, December 31, 2022 and March 31, 2022, the Company had recorded the following amounts for the fair value of the Company's other derivatives:
(in thousands) March 31, 2023 December 31, 2022 March 31, 2022
Derivatives not designated as hedging instruments
Foreign currency contracts included in Other current assets (liabilities) $ 4,260  $ (3,124) $ 1,330 
Derivatives designated as hedging instruments
Interest rate contracts included in Other current assets $ 8,265  $ 8,759  $ 805 
Interest rate contracts included in Other assets 16,779  22,641  10,223 
Interest rate contracts included in Accrued expenses and other current liabilities —  —  (1,596)
Interest rate contracts included in Other long-term liabilities (61) —  — 

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The recording of derivatives gains and losses and the financial statement line in which they are located are as follows:
Three months ended March 31,
(in thousands) 2023 2022
Derivatives designated as hedging instruments
Interest rate derivative gains (losses) included in Other comprehensive income (loss) $ (6,407) $ 16,540 
Interest rate derivative gains (losses) included in Interest expense, net 2,105  (1,443)

Outstanding interest rate derivatives, as of March 31, 2023, are as follows:
Interest Rate Hedging Instrument Year Entered Year of Maturity Initial Notional Amount
(in millions)		 Description


Interest Rate
Long-term
Swap 2019 2025 $ 98.4  Interest rate component of debt - accounted for as a hedge 2.3%
Swap 2019 2025 $ 49.2  Interest rate component of debt - accounted for as a hedge 2.4%
Swap 2019 2025 $ 49.2  Interest rate component of debt - accounted for as a hedge 2.4%
Swap 2020 2030 $ 50.0  Interest rate component of debt - accounted for as a hedge
0.0% to 0.8%
Swap 2020 2030 $ 50.0  Interest rate component of debt - accounted for as a hedge
0.0% to 0.8%
Swap 2022 2025 $ 20.0  Interest rate component of debt - accounted for as a hedge 2.6%
Swap 2022 2029 $ 100.0  Interest rate component of debt - accounted for as a hedge 2.0%
Swap 2022 2029 $ 50.0  Interest rate component of debt - accounted for as a hedge 2.4%
Swap 2023 2024 $ 50.0  Interest rate component of debt - accounted for as a hedge 3.7%



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6. Revenue

Many of the Company’s sales and merchandising revenues are generated from contracts that are outside the scope of ASC 606. Specifically, many of the Company's Trade and Renewables sales contracts are derivatives under ASC 815, Derivatives and Hedging. The breakdown of revenues between ASC 606 and ASC 815 is as follows:
Three months ended March 31,
(in thousands) 2023 2022
Revenues under ASC 606 $ 738,978  $ 677,856 
Revenues under ASC 815 3,142,260  3,300,098 
Total revenues $ 3,881,238  $ 3,977,954 

The remainder of this note applies only to those revenues that are accounted for under ASC 606.


Disaggregation of revenue

The following tables disaggregate revenues under ASC 606 by major product/service line for the three months ended March 31, 2023 and 2022, respectively:
Three months ended March 31, 2023
(in thousands) Trade Renewables Nutrient & Industrial Total
Specialty nutrients $ —  $ —  $ 69,997  $ 69,997 
Primary nutrients —  —  64,750  64,750 
Products and co-products 88,966  394,609  —  483,575 
Propane 76,523  —  —  76,523 
Other 12,590  2,348  29,195  44,133 
Total $ 178,079  $ 396,957  $ 163,942  $ 738,978 

Three months ended March 31, 2022
(in thousands) Trade Renewables Nutrient & Industrial Total
Specialty nutrients $ —  $ —  $ 93,268  $ 93,268 
Primary nutrients —  —  89,882  89,882 
Products and co-products 107,871  232,694  —  340,565 
Propane 114,503  —  —  114,503 
Other 11,531  1,215  26,892  39,638 
Total $ 233,905  $ 233,909  $ 210,042  $ 677,856 

Substantially all of the Company's revenues accounted for under ASC 606 during the three months ended March 31, 2023 and 2022, respectively, are recorded at a point in time instead of over time.

Contract balances

The balances of the Company’s contract liabilities were $118.4 million and $55.4 million as of March 31, 2023 and December 31, 2022, respectively. The difference between the opening and closing balances of the Company’s contract liabilities primarily results from the timing difference between the Company’s performance and the customer’s payment. The main driver of the contract liabilities balance are payments for primary and specialty nutrients received in advance of fulfilling our performance obligations under our customer contracts. Due to seasonality of this business, contract liabilities are built up through the first quarter in preparation for the spring application season.


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7. Income Taxes

On a quarterly basis, the Company estimates the effective tax rate expected to be applicable for the full year and makes changes, if necessary, based on new information or events. The estimated annual effective tax rate is forecasted based on actual historical information and forward-looking estimates and is used to provide for income taxes in interim reporting periods. The Company also recognizes the tax impact of certain unusual or infrequently occurring items, such as the effects of changes in tax laws or rates and impacts from settlements with tax authorities, discretely in the quarter in which they occur.

For the three months ended March 31, 2023, the Company recorded an income tax benefit from continuing operations of $5.9 million. The Company's effective tax rate was 9.1% on a loss before taxes from continuing operations of $65.0 million. The difference between the 9.1% effective tax rate and the U.S. federal statutory tax rate of 21.0% is primarily attributable to the tax impact of noncontrolling interest, state and local income taxes and nondeductible compensation. During the three months ended March 31, 2023, a discrete income tax benefit of $12.0 million was recorded on a loss before taxes of $94.7 million related to the impairment charge associated with ELEMENT and current year operations as the Company is unable to reliably estimate an ordinary loss for the year due to debt and operational constraints at ELEMENT.

For the three months ended March 31, 2022, the Company recorded income tax expense from continuing operations of $4.1 million. The Company’s effective tax rate was 38.7% on income from continuing operations of $10.6 million. The effective tax rate differs from the U.S. federal statutory tax rate of 21.0% due to the tax impact of certain discrete derivatives and hedging activities, state and local income taxes, and nondeductible compensation offset by the effect of noncontrolling interest and Federal Research and Development Credits.



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8. Accumulated Other Comprehensive Income

The following table summarizes the changes in accumulated other comprehensive income ("AOCI") attributable to the Company for the three months ended March 31, 2023 and 2022:
Three months ended March 31,
(in thousands) 2023 2022
Currency Translation Adjustment
Beginning balance $ (8,203) $ 5,631 
Other comprehensive income (loss) before reclassifications 767  98 
  Tax effect —  — 
Other comprehensive income (loss), net of tax 767  98 
Ending balance $ (7,436) $ 5,729 
Hedging Adjustment
Beginning balance $ 23,546  $ (5,335)
Other comprehensive income (loss) before reclassifications (4,302) 10,712 
Amounts reclassified from AOCI (a)
 (2,105) 2,279 
  Tax effect 1,611  (569)
Other comprehensive income (loss), net of tax (4,796) 12,422 
Ending balance $ 18,750  $ 7,087 
Pension and Other Postretirement Adjustment
Beginning balance $ 4,883  $ 640 
Other comprehensive income (loss) before reclassifications (14) 12 
Amounts reclassified from AOCI (b)
 (228) (228)
  Tax effect 54  57 
Other comprehensive income (loss), net of tax (188) (159)
Ending balance $ 4,695  $ 481 
Investments in Convertible Preferred Securities Adjustment
Beginning balance $ 258  $ 258 
Other comprehensive income (loss), net of tax —  — 
Ending balance $ 258  $ 258 
Total AOCI Ending Balance $ 16,267  $ 13,555 
(a) Amounts reclassified from gain (loss) on cash flow hedges are reclassified from AOCI to income when the hedged item affects earnings and is recognized in Interest expense, net. See Note 5 for additional information.
(b) This accumulated other comprehensive loss component is included in the computation of net periodic benefit cost recorded in Operating, administrative and general expenses.




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9. Earnings Per Share
(in thousands, except per common share data) Three months ended March 31,
2023 2022
Numerator:
Net income (loss) from continuing operations $ (59,117) $ 6,504 
Net income (loss) attributable to noncontrolling interests(a)
 (44,367) 447 
Net income (loss) attributable to The Andersons Inc. common shareholders from continuing operations $ (14,750) $ 6,057 
Loss from discontinued operations, net of income taxes $ —  $ (554)
Denominator:
Weighted average shares outstanding – basic 33,622  33,738 
Effect of dilutive awards —  541 
Weighted average shares outstanding – diluted 33,622  34,279 
Earnings (loss) per share attributable to The Andersons, Inc. common shareholders:
Basic earnings (loss):
Continuing operations $ (0.44) $ 0.18 
Discontinued operations —  (0.02)
$ (0.44) $ 0.16 
Diluted earnings (loss):
Continuing operations $ (0.44) $ 0.18 
Discontinued operations —  (0.02)
$ (0.44) $ 0.16 
(a) All net income (loss) attributable to noncontrolling interests is within continuing operations of the Company.



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10. Fair Value Measurements

The following table presents the Company’s assets and liabilities measured at fair value on a recurring basis at March 31, 2023, December 31, 2022 and March 31, 2022:
(in thousands) March 31, 2023
Assets (liabilities) Level 1 Level 2 Level 3 Total
Commodity derivatives, net (a)
 $ 32,115  $ 82,779  $ —  $ 114,894 
Provisionally priced contracts (b)
 (16,187) (52,150) —  (68,337)
Convertible preferred securities (c)
 —  —  15,410  15,410 
Other assets and liabilities (d)
 8,357  24,983  —  33,340 
Total $ 24,285  $ 55,612  $ 15,410  $ 95,307 
(in thousands) December 31, 2022
Assets (liabilities) Level 1 Level 2 Level 3 Total
Commodity derivatives, net (a)
 $ 54,516  $ 143,402  $ —  $ 197,918 
Provisionally priced contracts (b)
 (20,960) (115,377) —  (136,337)
Convertible preferred securities (c)
 —  —  16,278  16,278 
Other assets and liabilities (d)
 (209) 31,400  —  31,191 
Total $ 33,347  $ 59,425  $ 16,278  $ 109,050 
(in thousands) March 31, 2022
Assets (liabilities) Level 1 Level 2 Level 3 Total
Commodity derivatives, net (a)
 $ 264,806  $ 298,791  $ —  $ 563,597 
Provisionally priced contracts (b)
 47,505  (42,698) —  4,807 
Convertible preferred securities (c)
 —  —  15,905  15,905 
Other assets and liabilities (d)
 4,677  9,432  —  14,109 
Total $ 316,988  $ 265,525  $ 15,905  $ 598,418 
(a)Includes associated cash posted/received as collateral
(b)Included in "Provisionally priced contracts" are those instruments based only on underlying futures values (Level 1) and delayed price contracts (Level 2)
(c)Recorded in “Other assets, net” on the Company’s Condensed Consolidated Balance Sheets related to certain available for sale securities.
(d)Included in other assets and liabilities are assets held by the Company to fund deferred compensation plans and foreign exchange derivative contracts (Level 1), as well as interest rate derivatives (Level 2).

Level 1 commodity derivatives reflect the fair value of the exchanged-traded futures and options contracts that the Company holds, net of the cash collateral, that the Company has in its margin account.

The majority of the Company’s assets and liabilities measured at fair value are based on the market approach valuation technique. With the market approach, fair value is derived using prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.

The Company’s net commodity derivatives primarily consist of futures or options contracts via regulated exchanges and contracts with producers or customers under which the future settlement date and bushels (or gallons in the case of ethanol contracts) of commodities to be delivered (primarily wheat, corn, soybeans and ethanol) are fixed and under which the price may or may not be fixed. Depending on the specifics of the individual contracts, the fair value is derived from the futures or options prices quoted on various exchanges for similar commodities and delivery dates as well as observable quotes for local basis adjustments (the difference, which is attributable to local market conditions, between the quoted futures price and the local cash price). Because “basis” for a particular commodity and location typically has multiple quoted prices from other agribusinesses in the same geographical vicinity and is used as a common pricing mechanism in the agribusiness industry, the Company has concluded that “basis” is typically a Level 2 fair value input for purposes of the fair value disclosure requirements related to our commodity derivatives, depending on the specific commodity. Although nonperformance risk, both of the Company and the counterparty, is present in each of these commodity contracts and is a component of the estimated fair values, based on the Company’s historical experience with its producers and customers and the Company’s knowledge of their businesses, the Company does not view nonperformance risk to be a significant input to fair value for these commodity contracts.

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These fair value disclosures exclude RMI which consists of agricultural commodity inventories measured at net realizable value. The net realizable value used to measure the Company’s agricultural commodity inventories is the fair value (spot price of the commodity in an exchange), less cost of disposal and transportation based on the local market. This valuation would generally be considered Level 2. The amount of RMI is disclosed in Note 2. Changes in the net realizable value of commodity inventories are recognized as a component of cost of sales and merchandising revenues.

Provisionally priced contract liabilities are those for which the Company has taken ownership and possession of grain, but the final purchase price has not been established. In the case of payables where the unpriced portion of the contract is limited to the futures price of the underlying commodity or the Company has delivered provisionally priced grain and a subsequent payable or receivable is set up for any future changes in the grain price, quoted exchange prices are used and the liability is deemed to be Level 1 in the fair value hierarchy. For all other unpriced contracts which include variable futures and basis components, the amounts recorded for delayed price contracts are determined on the basis of local grain market prices at the balance sheet date and, as such, are deemed to be Level 2 in the fair value hierarchy.

The convertible preferred securities are interests in several early-stage enterprises that may be in various forms, such as convertible debt or preferred equity securities.

A reconciliation of beginning and ending balances for the Company’s fair value measurements using Level 3 inputs is as follows:
Convertible Preferred Securities
(in thousands) 2023 2022
Assets at January 1, $ 16,278  $ 11,618 
Purchases of additional investments —  3,883 
Gains included in Other income, net 802  404 
Proceeds from investments (1,670) — 
Assets at March 31, $ 15,410  $ 15,905 

The following tables summarize quantitative information about the Company's Level 3 fair value measurements as of March 31, 2023, December 31, 2022 and March 31, 2022:
Quantitative Information about Recurring Level 3 Fair Value Measurements
Fair Value as of
(in thousands) March 31, 2023 December 31, 2022 March 31, 2022 Valuation Method Unobservable Input Weighted Average
Convertible preferred securities (a)
 $ 15,410  $ 16,278  $ 15,905  Implied based on market prices N/A N/A
(a) The Company considers observable price changes and other additional market data available to estimate fair value, including additional capital raising, internal valuation models, progress towards key business milestones, and other relevant market data points.
Quantitative Information about Non-Recurring Level 3 Fair Value Measurements
Fair Value as of
(in thousands) March 31, 2023 December 31, 2022 March 31, 2022 Valuation Method Unobservable Input Weighted Average
Grain Assets (a)
 $ —  $ 9,000  $ —  Third party appraisal Various N/A
Ethanol Plant Assets (b) $ 41,673  $ —  $ —  Various Various N/A
(a) The Company recognized impairment charges on a Nebraska grain asset. The fair value of the asset was determined using third-party appraisals. These measures are considered Level 3 inputs on a nonrecurring basis.
(b) The Company recognized impairment charges on ELEMENT ethanol plant assets in Colwich, Kansas. The fair value of the assets was determined by a third-party consultant using a discounted cash flow method and a market approach. Both of these methods were given probability weightings based on management's assessment of the ethanol plant's future operations to arrive at the fair value of the ethanol plant assets. The discounted cash flow model is determined by discounting the projected free cash flows using an appropriate discount rate. Key assumptions in the projections of future cash flows used in the consultant's model included input costs (corn, natural gas, etc.), production days, and co-product premiums. The market approach analyzed enterprise value to ethanol production capacity multiples for a group of guideline public companies as well as recent mergers and acquisition transactions. Using these multiples as a baseline, the consultant applied selected multiples to the ELEMENT plant production capacity to arrive at an indicated fair value. These measures are considered Level 3 inputs on a nonrecurring basis.

The fair value of the Company’s cash equivalents, accounts receivable and accounts payable approximate their carrying value as they are close to maturity.

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11. Related Parties

In the ordinary course of business, and on an arm's length basis, the Company will enter into related party transactions with the minority shareholders of the Company's Renewables operations and several equity method investments that the Company holds, along with other related parties.

The following table sets forth the related party transactions entered into for the time periods presented:
Three months ended March 31,
(in thousands) 2023 2022
Sales of products $ 74,951  $ 86,149 
Purchases of products 15,702  26,427 

(in thousands) March 31, 2023 December 31, 2022 March 31, 2022
Accounts receivable $ 10,350  $ 12,272  $ 18,539 
Accounts payable 2,800  7,070  3,371 


12. Segment Information

The Company’s operations include three reportable business segments that are distinguished primarily on the basis of products and services offered as well as the structure of management. The Trade business includes commodity merchandising and the operation of terminal grain elevator facilities. The Renewables business produces ethanol and co-products through its five co-owned and fully consolidated ethanol production facilities as well as purchases and sells ethanol and ethanol co-products. The Nutrient & Industrial (formerly Plant Nutrient) business manufactures and distributes plant nutrient products such as agricultural inputs, primarily fertilizers and turf care products along with industrial products such as deicers, dust abatement solutions and corncob-based products. The segment was rebranded in 2023 to reflect the portfolio of market offerings in the segment. The Other category includes other corporate level costs not attributable to an operating segment and intercompany eliminations between the segments.

The segment information below includes the allocation of expenses shared by one or more operating segments. Although management believes such allocations are reasonable, the operating information does not necessarily reflect how such data might appear if the segments were operated as separate businesses. The Company does not have any customers who represent 10 percent or more of total revenues.
  Three months ended March 31,
(in thousands) 2023 2022
Revenues from external customers
Trade $ 2,877,780  $ 3,084,681 
Renewables 839,516  683,231 
Nutrient & Industrial 163,942  210,042 
Total $ 3,881,238  $ 3,977,954 

  Three months ended March 31,
(in thousands) 2023 2022
Income (loss) before income taxes from continuing operations
Trade $ 39,364  $ 3,669 
Renewables (a) (82,513) 5,962 
Nutrient & Industrial (10,438) 10,743 
Other (11,414) (9,767)
Income (loss) before income taxes from continuing operations $ (65,001) $ 10,607 
(a) Includes income (loss) attributable to noncontrolling interests of $(44.4) million and $0.4 million for the three months ended March 31, 2023 and 2022, respectively.

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13. Commitments and Contingencies

Litigation activities

The Company is party to litigation, or threats thereof, both as defendant and plaintiff with some regularity, although individual cases that are material in size occur infrequently. As a defendant, the Company establishes reserves for claimed amounts that are considered probable and capable of estimation. If those cases are resolved for lesser amounts, the excess reserves are taken into income and, conversely, if those cases are resolved for larger than the amount the Company has accrued, the Company records additional expense. The Company believes it is unlikely that the results of its current legal proceedings for which it is the defendant, even if unfavorable, will be material. As a plaintiff, amounts that are collected can also result in sudden, non-recurring income.

Litigation results depend upon a variety of factors, including the availability of evidence, the credibility of witnesses, the performance of counsel, the state of the law, and the impressions of judges and jurors, any of which can be critical in importance, yet difficult, if not impossible, to predict. Consequently, cases currently pending, or future matters, may result in unexpected, and non-recurring losses, or income, from time to time. Finally, litigation results are often subject to judicial reconsideration, appeal and further negotiation by the parties, and as a result, the final impact of a particular judicial decision may be unknown for some time or may result in continued reserves to account for the potential of such post-verdict actions.

Specifically, the Company is party to a non-regulatory litigation claim, which is in response to penalties and fines paid to regulatory entities by a previously unconsolidated subsidiary in 2018 for the settlement of matters which focused on certain trading activity. While the Company believes it has meritorious defenses against the suit, the ultimate resolution of the matter could result in a loss in excess of the amount accrued. Given the status of the claim, the Company does not believe the excess, net of the acquisition-related indemnity, is material.

The estimated losses for all other outstanding claims that are considered reasonably possible are not material.


14. Subsequent Events

On April 3, 2023, The Andersons, Inc. entered into an unsecured Term Loan Agreement (the "Loan Agreement"). The Loan Agreement provides for an 8-year loan in the amount of $100 million, with quarterly principal and interest payments. The Loan Agreement will bear interest at variable rates, which are based on the Secured Overnight Financing Rate ("SOFR") plus an applicable spread.

On April 18, 2023, ELEMENT was placed into receivership. ELEMENT is currently in an extended maintenance shutdown and future operating decisions will be made by the court-appointed receiver. As ELEMENT is consolidated under a VIE model, being placed into receivership led to a VIE reconsideration event where the Company expects to no longer be deemed to be the primary beneficiary of ELEMENT. As a result, the entity will be deconsolidated in the second quarter of 2023 and is expected to result in a gain on deconsolidation in an amount unknown at this time.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward Looking Statements

The following “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contains forward-looking statements which relate to future events or future financial performance and involve known and unknown risks, uncertainties and other factors that may cause actual results, levels of activity, performance or achievements to be materially different from those expressed or implied by these forward-looking statements. Such factors include, but are not limited to, the effects of economic, weather and agricultural conditions, regulatory conditions, competition globally and in the markets the Company serves, the ongoing economic impacts from the war in Ukraine, fluctuations in cost and availability of commodities, the effectiveness of the Company's internal control over financial reporting and the unpredictability of existing and possible future litigation. However, it is not possible to predict or identify all such factors. The reader is urged to carefully consider these risks and others, including those risk factors listed under Item 1A of the 2022 Form 10-K. In some cases, the reader can identify forward-looking statements by terminology such as may, anticipates, believes, estimates, predicts, or the negative of these terms or other comparable terminology. These statements are only predictions. Actual events or results may differ materially. These forward-looking statements relate only to events as of the date on which the statements are made and the Company undertakes no obligation, other than any imposed by law, to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Although management believes that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.

Critical Accounting Policies and Estimates

Our critical accounting policies and critical accounting estimates, as described in our 2022 Form 10-K, have not materially changed through the first quarter of 2023.

Executive Overview

Our operations are organized, managed and classified into three reportable business segments: Trade, Renewables and Nutrient & Industrial. Each of these segments is generally based on the nature of products and services offered and aligns with the management structure.

The agricultural commodity-based business is one in which changes in selling prices generally move in relationship to changes in purchase prices. Therefore, increases or decreases in prices of the agricultural commodities that the business deals in will have a relatively equal impact on Sales and merchandising revenues and Cost of sales and merchandising revenues and a much less significant impact on Gross profit. As a result, changes in Sales and merchandising revenues between periods may not necessarily be indicative of the overall performance of the business and greater emphasis should be placed on changes in Gross profit.

The Company has considered the potential impact that the book value of the Company’s total shareholders’ equity briefly exceeded the Company’s market capitalization at the beginning of the first quarter for impairment indicators. Management ultimately concluded that an impairment triggering event had not occurred. The Company believes that the January share price was not an accurate reflection of its current value as conditions are currently strong in the agriculture space with a positive long-term outlook. Management believes that the market’s impact on the Company’s equity value does not actually reflect the impact of these external factors on the Company. As a result of prior period tests, reviews of current operating results and other relevant market factors, the Company concluded that no impairment trigger existed as of March 31, 2023.

Trade

The Trade segment’s first quarter operating results improved from the prior year as the segment benefited from good elevation margins in its assets, and strong merchandising results across the portfolio. Its well-positioned animal feed ingredients and organic food and specialty inventories also generated good margins, particularly in its newly acquired ingredients business based in Canada. All three lines of business within the segment exceeded the first quarter of prior year, which was negatively impacted by significant domestic basis depreciation as a result of the war in Ukraine.

Agricultural inventories on hand were 99.6 million and 188.9 million bushels at March 31, 2023 and March 31, 2022, respectively. These bushels consist of inventory held at company-owned or leased facilities, transload inventory, in-transit inventory, and third-party held inventory. Total Trade storage space capacity at company-owned or leased facilities, including temporary pile storage, was approximately 180 million bushels at March 31, 2023, which was comparable to the prior year.
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As the spring planting season gets underway in the Midwest, commodity prices have moderated from the highs of last spring but stocks remain relatively low from a historical perspective. With a balanced portfolio of merchandising and grain assets, the Company is well-positioned to optimize both volatility and crop dislocation as well as a potential shift with larger production and carry markets.

Renewables

The Renewables segment's first quarter operating results decreased from the prior year as the Company took an impairment charge on the ELEMENT joint venture, which was placed into receivership following the end of the quarter. Ethanol crush margins were challenged moving into the year, but rallied late in the quarter during the spring maintenance season, as driving demand has picked up and corn prices have moderated. The merchandising businesses including renewable diesel feedstocks continue to deliver solid results, but were impacted by lower values, partially due to delays in renewable diesel plant startups.

Our eastern corn belt production facilities remain well-positioned for corn supply and ethanol crush margins have strengthened further after the close of the quarter. Renewable diesel production capacity should continue to increase leading to further demand and growth in our feedstock merchandising business.

Ethanol and related co-products volumes for the three months ended March 31, 2023 and 2022 were as follows:
Three months ended March 31,
(in thousands) 2023 2022
Ethanol (gallons shipped) 186,566  197,318 
E-85 (gallons shipped) 9,519  6,715 
Vegetable oils (pounds shipped) (a)
 261,655  163,920 
DDG (tons shipped) (b)
 529  501 
(a) Includes corn oil, soybean oil, and other fats, oils, and greases.
(b) DDG tons shipped converts wet tons to a dry ton equivalent amount.

Nutrient & Industrial

The Nutrient & Industrial segment's first quarter operating results decreased from the record prior year results. Nutrient prices continued to decline during the quarter which led customers to delay purchases in the current year. In contrast, nutrient prices rose to historical levels after the onset of the war in Ukraine in 2022 leading to record first quarter results in the segment. With strong farmer income and planted acres anticipated to be high, second quarter volumes are expected to improve, but some of the margin decline is not likely to be recovered.

Storage capacity at our Ag Supply Chain and Specialty Liquids facilities, including leased storage, was approximately 447 thousand tons for dry nutrients and approximately 512 thousand tons for liquid nutrients at March 31, 2023, which is similar to the prior year.

Tons of product sold for the three months ended March 31, 2023 and 2022 were as follows:
Three months ended March 31,
(in thousands) 2023 2022
Ag Supply Chain 170  157 
Specialty Liquids 82  92 
Engineered Granules 63  107 
Total tons 315  356 

In the table above, Ag Supply Chain represents facilities principally engaged in the wholesale distribution and retail sale and application of primary agricultural nutrients such as bulk nitrogen, phosphorus, and potassium. Specialty Liquid locations produce and sell a variety of low-salt liquid starter fertilizers, micronutrients for agricultural use, and specialty products for use in various industrial processes. Engineered Granules include a variety of corncob-based products and facilities that primarily manufacture granulated dry products for use in specialty turf and agricultural applications.


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Other

Our “Other” activities include corporate income and expense and cost for functions that provide support and services to the operating segments. The results include expenses and benefits not allocated to the operating segments and other elimination and consolidation adjustments.


Comparison of the three months ended March 31, 2023 with the three months ended March 31, 2022 including a reconciliation of GAAP to non-GAAP measures:
  Three months ended March 31, 2023
(in thousands) Trade Renewables Nutrient & Industrial Other Total
Sales and merchandising revenues $ 2,877,780  $ 839,516  $ 163,942  $ —  $ 3,881,238 
Cost of sales and merchandising revenues 2,760,602  823,713  148,912  —  3,733,227 
Gross profit 117,178  15,803  15,030  —  148,011 
Operating, administrative and general expenses 71,980  8,904  24,132  12,219  117,235 
Asset impairment —  87,156  —  —  87,156 
Interest expense (income), net 11,817  3,097  2,182  (471) 16,625 
Other income, net 5,983  841  846  334  8,004 
Income (loss) before income taxes from continuing operations $ 39,364  $ (82,513) $ (10,438) $ (11,414) $ (65,001)
Income (loss) before income taxes attributable to the noncontrolling interests —  (44,367) —  —  (44,367)
Non-GAAP Income (loss) before income taxes attributable to the Company from continuing operations $ 39,364  $ (38,146) $ (10,438) $ (11,414) $ (20,634)
  Three months ended March 31, 2022
(in thousands) Trade Renewables Nutrient & Industrial Other Total
Sales and merchandising revenues $ 3,084,681  $ 683,231  $ 210,042  $ —  $ 3,977,954 
Cost of sales and merchandising revenues 3,017,062  668,040  173,317  —  3,858,419 
Gross profit 67,619  15,191  36,725  —  119,535 
Operating, administrative and general expenses 59,543  7,890  25,325  9,229  101,987 
Interest expense (income), net 8,187  1,767  1,461  (556) 10,859 
Other income (expense), net 3,780  428  804  (1,094) 3,918 
Income (loss) before income taxes from continuing operations $ 3,669  $ 5,962  $ 10,743  $ (9,767) $ 10,607 
Income (loss) before income taxes attributable to the noncontrolling interests —  447  —  —  447 
Non-GAAP Income (loss) before income taxes attributable to the Company from continuing operations $ 3,669  $ 5,515  $ 10,743  $ (9,767) $ 10,160 

The Company uses Income (loss) before income taxes attributable to the Company from continuing operations, a non-GAAP financial measure as defined by the Securities and Exchange Commission, to evaluate the Company’s financial performance. This performance measure is not defined by accounting principles generally accepted in the United States and should be considered in addition to, and not in lieu of, GAAP financial measures. Management believes that Income (loss) before income taxes attributable to the Company from continuing operations is a useful measure of the Company’s performance because it provides investors additional information about the Company's operations allowing evaluation of underlying business performance and period-to-period comparability. This measure is not intended to replace or be an alternative to Income (loss) before income taxes from continuing operations, the most directly comparable amounts reported under GAAP.


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Trade

Operating results for the Trade segment increased by $35.7 million from the prior year. Sales and merchandising revenues decreased by $206.9 million and cost of sales and merchandising revenues decreased by $256.5 million for an increased gross profit impact of $49.6 million. The decrease in sales and merchandising revenues and cost of sales and merchandising revenues can be equally attributed to decreases in both commodity prices and volumes, as the war in Ukraine resulted in sharp price increases in the prior year and the rising interest rate environment in the current year has led to closer monitoring of working capital levels resulting in lower volumes of commodities traded. The $49.6 million increase in gross profit was mainly related to the performance of both the assets and merchandising businesses. The asset-based business contributed approximately $24 million to gross profit as it recorded approximately $17 million worth of insurance proceeds and receivables during the quarter from a fire at a Michigan grain asset in December of 2022, combined with the basis depreciation triggered by the war in Ukraine in the prior year that did not recur in 2023. The merchandising business contributed approximately $20 million to gross profit as well-positioned inventories generated strong margins.

Operating, administrative and general expenses increased by $12.4 million from the same period of prior year. The increase from the prior year is primarily related to approximately $6.2 million of higher labor, benefits and incentives, with about half from business growth and half from wage inflation. Trade also incurred an additional $3.5 million in insurable clean-up costs in the current quarter related to a fire at a Michigan grain asset.

Interest expense increased by $3.6 million due to rising interest rates on the Company's short-term line of credit compared to the prior year.

Other income, net increased by $2.2 million from the same period of 2022. The increase was primarily attributable to foreign currency losses of $1.6 million that did not recur in 2023.

Renewables

Operating results for Renewables decreased by $43.7 million from the same period of prior year. Sales and merchandising revenues increased by $156.3 million and cost of sales and merchandising revenues increased by $155.7 million compared to prior year. As a result, gross profit was comparable to the prior year. The vast majority of the increase to sales and merchandising revenues and cost of sales and merchandising revenues is the result of increased ethanol and renewable feedstock volumes as the price of these commodities were consistent with the prior period. Although gross profit remained consistent from the prior period, the ethanol plants and third-party merchandising businesses performed slightly lower than prior year from weaker ethanol crush margins and higher input costs which was offset by an improvement of unrealized mark-to-market adjustments from the prior year.

Operating, administrative and general expenses increased by $1.0 million from the prior year as a result of increased labor expenses and higher contracted services costs.

An asset impairment charge of $87.2 million related to the ELEMENT ethanol plant in Colwich, Kansas was recorded in the current year. As ELEMENT is a consolidated subsidiary of the Company, the entire impairment charge is represented in Asset impairment. The portion of the charge attributable to the noncontrolling interest is approximately $44.4 million which is captured in Loss before income taxes attributable to the noncontrolling interests within the Condensed Consolidated Statements of Operations.

Interest expense increased by $1.3 million due to rising interest rates on the Company's short-term line of credit compared to the prior year.

Nutrient & Industrial

Operating results for the Nutrient & Industrial segment decreased by $21.2 million compared to record results in the same period of the prior year. Sales and merchandising revenues decreased $46.1 million and cost of sales and merchandising revenues decreased by $24.4 million resulting in decreased gross profit of $21.7 million. The decrease in sales and merchandising revenues and cost of sales and merchandising revenues was mainly due to the reset of fertilizer prices from the record high prices resulting from an already tight supply market and exaggerated by the war in Ukraine in the first quarter of 2022. In addition to a decrease in fertilizer prices of almost 60%, volumes are also down approximately 10% as customers continue to be patient making purchases in a market of falling prices and wet weather through the first quarter of 2023. Gross profit decreased year-over-year by approximately $16.8 million due to margin decreases and $4.9 million from decreases in sales volumes.
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Operating, administrative and general expenses decreased by $1.2 million mainly due to reduced incentive compensation when compared to the record first quarter results in the prior year.

Interest expense increased by $0.7 million due to due to rising interest rates on the Company's short-term line of credit compared to the prior year.

Other

Other expenses increased by $1.6 million from the same period last year. The increase in expenses was primarily driven by $1.2 million of higher health insurance claims from the Company's self-funded medical insurance plan in the current year.

Income Taxes

For the three months ended March 31, 2023, the Company recorded an income tax benefit from continuing operations of $5.9 million. The Company's effective tax rate was 9.1% on a loss before taxes from continuing operations of $65.0 million. The difference between the 9.1% effective tax rate and the U.S. federal statutory tax rate of 21% is primarily attributable to the tax impact of noncontrolling interest, state and local income taxes and nondeductible compensation. During the three months ended March 31, 2023, a discrete income tax benefit of $12.0 million was recorded on a loss before income taxes of $94.7 million related to the impairment charge associated with ELEMENT and current year operations as the Company is unable to reliably estimate an ordinary loss for the year due to debt and operational constraints at ELEMENT.

For the three months ended March 31, 2022, the Company recorded income tax expense from continuing operations of $4.1 million. The Company's effective tax rate was 38.7% on income from continuing operations of $10.6 million. The effective tax rate differs from the U.S. federal statutory tax rate of 21.0% due to the tax impact of certain discrete derivatives and hedging activities, state and local income taxes, and nondeductible compensation offset by the effect of noncontrolling interest and Federal Research and Development Credits.

The Company’s subsidiary partnership returns are under federal tax examination by the Internal Revenue Service (“IRS”) for the tax years 2015 through 2018, respectively. The Company’s subsidiary is under federal tax examination by the Mexican tax authorities for tax year 2015. The IRS and Mexican tax authorities’ examinations could potentially be resolved within the next 12 months. The resolution of these examinations could change our unrecognized tax benefits and favorably impact income tax expense by a range of $3.5 million to $8.7 million.



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Liquidity and Capital Resources

Working Capital
At March 31, 2023, the Company had working capital from continuing operations of $938.2 million, an increase of $70.3 million from the prior year. This increase was attributable to changes in the following components of current assets from continuing operations and current liabilities from continuing operations:

(in thousands) March 31, 2023 March 31, 2022 Variance
Current Assets from Continuing Operations:
Cash and cash equivalents $ 70,853  $ 36,381  $ 34,472 
Accounts receivable, net 1,125,071  1,050,259  74,812 
Inventories 1,551,101  1,950,303  (399,202)
Commodity derivative assets – current 222,036  769,916  (547,880)
Other current assets 81,407  113,589  (32,182)
Total current assets from continuing operations $ 3,050,468  $ 3,920,448  $ (869,980)
Current Liabilities from Continuing Operations:
Short-term debt 638,210  1,449,768  (811,558)
Trade and other payables 768,872  741,124  27,748 
Customer prepayments and deferred revenue 309,546  384,723  (75,177)
Commodity derivative liabilities – current 107,983  216,836  (108,853)
Current maturities of long-term debt 85,567  54,158  31,409 
Accrued expenses and other current liabilities 202,133  205,958  (3,825)
Total current liabilities from continuing operations $ 2,112,311  $ 3,052,567  $ (940,256)
Working Capital from Continuing Operations $ 938,157  $ 867,881  $ 70,276 

Current assets from continuing operations as of March 31, 2023 decreased $870.0 million in comparison to those as of March 31, 2022. This decrease was noted mainly in inventories and current commodity derivative assets. The decreases in those accounts can largely be attributed to the stabilization of agricultural commodity prices in the current year in comparison to the significant increases in the prices of agricultural commodities, including fertilizer, that the Company transacts in the ordinary course of business in the same period of the prior year.

Current liabilities from continuing operations decreased $940.3 million from the prior year mainly due to the decreased utilization of the Company's short-term revolving credit line. The decreased use of the short-term revolving credit line is due to the stabilization of commodity prices in the year compared to the severe increase in commodity prices in the same period of the prior year, as well as a strategic focus on managing short-term debt in light of the rising interest rate environment.

Sources and Uses of Cash
Three Months Ended
(in thousands) March 31, 2023 March 31, 2022
Net cash used in operating activities $ (333,535) $ (1,074,998)
Net cash used in investing activities (19,807) (24,921)
Net cash provided by financing activities 308,817  919,757 

Operating Activities
Our operating activities used cash of $333.5 million and $1,075.0 million in the first three months of 2023 and 2022, respectively. The decrease in cash used was primarily due to the decreased working capital needs quarter over quarter driven by significant increases in agricultural commodity prices in the prior year. When the changes in operating assets and liabilities are removed, along with approximately $17.4 million in insurance proceeds and receivables for damaged inventory from a fire at a Michigan grain asset in December of 2022, cash provided by operating activities was consistent with the prior period.


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Investing Activities
Investing activities used cash of $19.8 million through the first three months of 2023 compared to $24.9 million in the prior period. Although spending for the purchases of property, plant and equipment increased by approximately $5 million, cash used in investing activities decreased from the prior year as the proceeds from the sale of legacy Rail assets, insurance proceeds and the proceeds from the sale of an investment were more than enough to offset the increased spending in property, plant and equipment.
We expect to invest approximately $125 million in property, plant and equipment in 2023, with spending split evenly between growth projects and maintaining our current facilities.

Financing Activities
Financing activities provided cash of $308.8 million and $919.8 million for the three months ended March 31, 2023 and 2022, respectively. This decrease from the prior year was due to the significant increase in agricultural commodity prices in the prior period and the related need for short-term borrowings. Agricultural commodity prices have decreased in the current year and the Company is operating in a much more stable pricing environment in 2023 which is putting much less pressure on the Company's short-term borrowings.
The Company is party to borrowing arrangements with a syndicate of banks that provide a total of $1,991.8 million in borrowing capacity. Of the total capacity, $341.7 million is non-recourse to the Company. As of March 31, 2023, the Company had $1,294.9 million available for borrowing with $220.8 million of that total being non-recourse to the Company.

The Company paid $6.3 million in dividends in the first three months of 2023 compared to $6.1 million paid in the prior period. The Company paid dividends of $0.185 and $0.18 per common share in January of 2023 and 2022, respectively. On February 17, 2023, the Company declared a cash dividend of $0.185 per common share payable on April 24, 2023, to shareholders of record on April 3, 2023.

Certain of our long-term borrowings include covenants that, among other things, impose minimum levels of working capital and a minimum ratio of owner's equity. The Company has concluded that in relation to the $62.8 million non-recourse credit agreement associated with the ELEMENT operations, that ELEMENT was out of compliance with its working capital covenant as of January 31, 2023, and is also out of compliance with an owner's equity ratio covenant as of March 31, 2023. Additionally, ELEMENT did not make a required debt payment in February 2023, subsequently received a default notice from the lender on February 17, 2023, and was ultimately placed into receivership on April 18, 2023. As such, the Company continues to classify the total $62.8 million of non-recourse debt under the ELEMENT credit agreement as a current maturity of long-term debt as of March 31, 2023. The Company is in compliance with all other covenants as of March 31, 2023. In addition, certain of our long-term borrowings are collateralized by first mortgages on various facilities. Our non-recourse long-term debt that is currently classified in Current maturities of long-term debt in the Condensed Consolidated Balance Sheets as described above, is collateralized by ELEMENT plant assets.

Because the Company is a significant borrower of short-term debt in peak seasons and the majority of this is variable rate debt, increases in interest rates could have a significant impact on our profitability. In addition, periods of high grain prices and/or unfavorable market conditions could require us to make additional margin deposits on our exchange traded futures contracts. Conversely, in periods of declining prices, the Company could receive a return of cash.
Management believes the Company's sources of liquidity will be adequate to fund operations, capital expenditures and service indebtedness.

At March 31, 2023, the Company had standby letters of credit outstanding of $38.6 million.
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Item 3. Quantitative and Qualitative Disclosures about Market Risk

For further information, refer to our Annual Report on Form 10-K for the year ended December 31, 2022. There were no material changes in market risk, specifically commodity and interest rate risk during the three months ended March 31, 2023.


Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures
Based on an evaluation under the supervision and with the participation of the Company’s management, the Company’s principal executive officer and principal financial officer have concluded that the Company’s disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act were effective as of March 31, 2023 to provide reasonable assurance that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms and (ii) accumulated and communicated to the Company’s management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting

There were no changes in the Company’s internal control over financial reporting during the first quarter of 2023, identified in connection with management’s evaluation required by paragraph (d) of Rules 13a-15 and 15d-15 under the Exchange Act that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
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Part II. Other Information

Item 1. Legal Proceedings

The Company is subject to legal proceedings and claims that have not been fully resolved and that have arisen in the ordinary course of business. Except as described in Part I, Item 1 of this Form 10-Q in the Notes to Condensed Consolidated Financial Statements in Note 13, “Commitments and Contingencies,” in the opinion of management, there was not at least a reasonable possibility the Company may have incurred a material loss, or a material loss greater than a recorded accrual, concerning loss contingencies for asserted legal and other claims.

The outcome of litigation is inherently uncertain. If one or more legal matters were resolved against the Company in a reporting period for amounts above management’s expectations, the Company’s financial condition and operating results for that reporting period could be materially adversely affected.


Item 1A. Risk Factors

The business, financial condition and operating results of the Company can be affected by a number of factors, whether currently known or unknown, including but not limited to those described in Part I, Item 1A of the 2022 Form 10-K under the heading “Risk Factors,” any one or more of which could, directly or indirectly, cause the Company’s actual financial condition and operating results to vary materially from past, or from anticipated future, financial condition and operating results. Any of these factors, in whole or in part, could materially and adversely affect the Company’s business, financial condition, operating results and stock price. The information presented below updates, and should be read in conjunction with, the risk factors in Part I, Item 1A. “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.


Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Periods
Total Number of Shares Purchased(a)
 Average Price Paid Per Share
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (b)
January 2023
 82,728  $ 34.30  49,351  $ 85,608,170 
February 2023
 109,418  44.74  —  85,608,170 
March 2023
 12,133  45.63  —  85,608,170 
Total 204,279  $ 40.56  49,351  $ 85,608,170 
(a) During the three months ended March 31, 2023, the Company acquired shares of common stock held by employees who tendered owned shares to satisfy tax withholding obligations along with common stock repurchased as a part of the Company's Repurchase Plan.
(b) As of August 20, 2021, the Company was authorized to purchase up to $100 million of the Company’s common stock (the "Repurchase Plan") on or before August 20, 2024. As of March 31, 2023, $14.4 million of the $100 million available to repurchase shares had been utilized. The Repurchase Plan does not obligate the Company to acquire any specific number of shares. Under the Repurchase Plan, shares may be repurchased in privately negotiated and/or open market transactions, including under plans complying with Rule 10b5-1 under the Exchange Act.

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Item 6. Exhibits
Exhibit Number Description
10.01
10.02
10.03
10.04
31.1*
31.2*
32.1**
101** Inline XBRL Document Set for the Condensed Consolidated Financial Statements and accompanying notes in Part I, Item 1, “Financial Statements” of this Quarterly Report on Form 10-Q.
104**
Inline XBRL for the cover page of this Quarterly Report on Form 10-Q, included in the Exhibit 101 Inline XBRL Document Set.
* Filed herewith
** Furnished herewith

Items 3, 4, and 5 are not applicable and have been omitted.

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Signatures
Pursuant to the requirements 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.
 
THE ANDERSONS, INC.
Date: May 4, 2023 /s/ Patrick E. Bowe
Patrick E. Bowe
President and Chief Executive Officer
Date: May 4, 2023 /s/ Brian A. Valentine
Brian A. Valentine
Executive Vice President and Chief Financial Officer

The Andersons, Inc. | Q1 2023 Form 10-Q | 32
EX-10.01 2 exhibit1001formofrestricte.htm EX-10.01 Document

Exhibit 10.01
THE ANDERSONS, INC. AMENDED AND RESTATED
2019 LONG-TERM INCENTIVE COMPENSATION PLAN

RESTRICTED STOCK UNIT GRANT NOTICE

Upon execution by the individual listed below (“Participant”) of this Restricted Stock Unit Grant Notice (the “Grant Notice”), The Andersons, Inc., a Ohio corporation, (the “Company”), hereby grants to Participant the number of Restricted Stock Units set forth below (the “RSUs”) pursuant to the Company’s Amended and Restated 2019 Long-Term Incentive Compensation Plan (the “Plan”). Participant acknowledges and agrees that the RSUs are subject to the Terms and Conditions attached hereto as Exhibit A (the “Terms and Conditions”) and the provisions of the Plan. Any terms not defined in this Grant Notice shall have the meanings ascribed in the Plan and the Terms and Conditions.
Participant: #ParticipantName#
Grant Date: #GrantDate#
Total Number of RSUs:
#QuantityGranted#
Purchase Price: $0.00
Vesting Schedule:
Subject to the Terms and Conditions, one third of the RSUs shall vest over the next three years per the vesting schedule below, provided Participant has not had a Termination prior to such date. #VestingDateandQuantity#

By his or her signature and the Company’s signature below, Participant agrees to be bound by the provisions of the Plan, the Terms and Conditions, and this Grant Notice. Participant has reviewed the Plan, the Terms and Conditions and this Grant Notice in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Grant Notice and fully understands all provisions of the Plan, the Terms and Conditions, and this Grant Notice. Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questions arising under the Plan, the Terms and Conditions, and this Grant Notice. Participant hereby acknowledges receipt of a copy of the Plan and the Terms and Conditions and that Participant has read the Plan, the Terms and Conditions and this Grant Notice carefully and fully understands their contents.
THE ANDERSONS, INC.:    
Holder:
 PARTICIPANT:
By:

Name: #Signature#
Name: Teresa M. Scott Date: #AcceptanceDate#
Title: Director, Corporate Human Resources
Address: 1947 Briarfield Blvd.
Maumee, Ohio 43537

|

EXHIBIT A
TO RESTRICTED STOCK UNIT GRANT NOTICE
TERMS AND CONDITIONS TO THE RESTRICTED STOCK UNIT
PURSUANT TO THE
THE ANDERSONS, INC. AMENDED AND RESTATED 2019 LONG-TERM INCENTIVE COMPENSATION PLAN
Pursuant to The Andersons, Inc. Amended and Restated 2019 Long-Term Incentive Compensation Plan, as amended from time to time (the “Plan”) and the Restricted Stock Unit Grant Notice (the “Grant Notice”), “Participant,” as identified in the Grant Notice, has been granted that number of Restricted Stock Units set forth in the Grant Notice (the “RSUs”). By execution of the Grant Notice, Participant has acknowledged and agreed that the RSUs are subject to the terms and conditions set forth herein (the “Terms”).
WHEREAS, it has been determined that it would be in the best interests of the Company to grant the RSUs to Participant.
NOW, THEREFORE, in consideration of the mutual covenants and promises hereinafter set forth and for other good and valuable consideration, the parties hereto hereby mutually covenant and agree as follows:
1.Incorporation By Reference; Plan Document Receipt
. The Terms are subject in all respects to the provisions of the Plan (including, without limitation, any amendments thereto adopted at any time and from time to time unless such amendments are expressly intended not to apply to the Terms provided herein), all of which provisions are made a part of and incorporated herein as if they were each expressly set forth herein. Any capitalized term not defined herein shall have the same meaning as is ascribed thereto in the Plan. In the event of any conflict between these Terms, the Plan or the Grant Notice that is not specifically resolved by the express terms of the Terms or the Grant Notice, the Plan shall control.
2.Grant of Restricted Stock
Units. The Company grants to Participant, as of the Grant Date specified in the Grant Notice, the number of RSUs specified in the Grant Notice. Each RSU represents the right to receive one (1) share of Common Stock on the date it vests. Unless and until the RSUs will have vested, Participant will have no right to payment of any such RSU. Prior to actual payment of any vested RSUs, such RSUs will represent an unsecured obligation of the Company, payable (if at all) only from the general assets of the Company. Any RSUs that vest will be paid to Participant in shares of Common Stock, subject to Participant satisfying any applicable tax withholding obligations. RSUs shall be paid in shares of Common Stock as soon as practicable after vesting (but in no event later than two and a half (2 ½) months following the end of the year in which vesting occurs). Except as otherwise provided by the Plan, Participant agrees and understands that nothing contained in these Terms provides, or is intended to provide, Participant with any protection against potential future dilution of Participant’s interest in the Company for any reason, and no adjustments shall be made for dividends in cash or other property, distributions or other rights in respect of any such shares, except as otherwise specifically provided for in the Plan or these Terms. Subject to Section 4 hereof, Participant shall not have the rights of a stockholder in respect of the shares underlying this Award until unrestricted shares are delivered to Participant.

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3.Vesting
(a)General. Subject to Article XI of the Plan, the RSUs shall become vested as described in the Grant Notice. There shall be no proportionate or partial vesting during the period prior to the vesting date and all vesting shall occur only on the vesting date set forth in the Grant Notice, subject to Participant’s continued service with the Company on the applicable vesting date.
(b)Certain Terminations Prior to Vesting
. Unless otherwise provided in the Grant Notice, Participant’s right to vest in any of the RSUs shall terminate in full and be immediately forfeited upon Participant’s Termination for any reason.
4.Dividends and Other Distributions
. If any dividends or other distributions are paid with respect to the Common Stock of the Company while Participant holds the RSUs and prior to the time that the RSUs become vested in accordance with the Grant Notice, Participant shall be entitled to receive such dividends and other distributions attributable to the shares of Common Stock underlying the RSUs in the form of additional shares of Common Stock upon settlement; provided that, the right to receive any such additional shares of Common Stock with respect to dividends or other distributions will be subject to the same vesting requirements and settlement terms as the underlying RSUs. The amount of such additional shares of Common Stock will be determined by multiplying (i) the total amount of dividends actually paid on a share of Common Stock prior to the date that the RSUs become vested in accordance with Grant Notice, by (ii) the number of RSUs that become vested in accordance with the terms of the Grant Notice, and then dividing such total by the Fair Market Value of the Common Stock on the last trading day prior to the applicable vesting date, as determined by the Committee.
5.Non-Transferability
. Any attempt to sell, exchange, transfer, assign, pledge, encumber or otherwise dispose of or hypothecate in any way any of the RSUs, or the levy of any execution, attachment or similar legal process upon the RSUs prior to the vesting date or contrary to the terms and provisions of the Plan, shall be null and void and without legal force or effect.
6.Governing Law
. All questions concerning the construction, validity and interpretation of these Terms and the Grant Notice shall be governed by, and construed in accordance with, the laws of the State of Ohio, without regard to the choice of law principles thereof.
7.Entire Agreement; Amendment
. These Terms, together with the Grant Notice and the Plan, contains the entire agreement between the parties hereto with respect to the subject matter contained herein, and supersedes all prior agreements or prior understandings, whether written or oral, between the parties relating to such subject matter. The Committee shall have the right, in its sole discretion, to modify or amend these Terms from time to time in accordance with and as provided in the Plan. These Terms may also be modified or amended by a writing signed by both the Company and Participant. The Company shall give written notice to Participant of any such modification or amendment of these Terms as soon as practicable after the adoption thereof.
A-2
|4869-8899-8461.1

8.Notices
. Any notice hereunder by Participant shall be given to the Company in writing and such notice shall be deemed duly given only upon receipt thereof by the General Counsel, the Director of Corporate Human Resources, or any other administrative agent designated by the Committee. Any notice hereunder by the Company shall be given to Participant in writing and such notice shall be deemed duly given only upon receipt thereof at such address as Participant may have on file with the Company.
9.Acceptance. Participant may forfeit the RSUs if Participant does not execute the Grant Notice (which, for the avoidance of doubt, accepts and acknowledges these Terms) within a period of 30 days from the date that Participant receives the Grant Notice (or such earlier period as the Committee shall provide).
10.Transfer of Personal Data
. Participant authorizes, agrees and unambiguously consents to the transmission by the Company (or any Subsidiary) of any personal data information related to the RSUs awarded under the Grant Notice for legitimate business purposes. This authorization and consent is freely given by Participant.
11.Compliance with Laws
. The issuance of the RSUs or unrestricted shares pursuant to the Grant Notice shall be subject to, and shall comply with, any applicable requirements of any foreign and U.S. federal and state securities laws, rules and regulations (including, without limitation, the provisions of the Securities Act, the Exchange Act and in each case any respective rules and regulations promulgated thereunder) and any other law, rule, regulation or exchange requirement applicable thereto. The Company shall not be obligated to issue the RSUs or any of the shares pursuant to the Grant Notice and these Terms if any such issuance would violate any such requirements. As a condition to settlement of the RSUs, the Company may require Participant to satisfy any qualifications that may be necessary or appropriate to evidence compliance with any applicable law or regulation.
12.Section 409A
. The Grant Notice and these Terms and the grant of Awards thereunder are intended to comply with Section 409A of the Code or an exemption thereunder and shall be construed and interpreted in a manner that is consistent with the requirements for avoiding additional taxes or penalties under Section 409A of the Code. Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided pursuant to the Grant Notice and these Terms comply with Section 409A of the Code and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by the Participant on account of non-compliance with Section 409A of the Code..
13.Binding Agreement; Assignment
. These Terms shall inure to the benefit of, be binding upon, and be enforceable by the Company and its successors and assigns. Participant shall not assign (except in accordance with the Plan) any part of the Grant Notice or these Terms without the prior express written consent of the Company.


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|4869-8899-8461.1

14.Headings
. The titles and headings of the various sections of these Terms have been inserted for convenience of reference only and shall not be deemed to be a part of these Terms or the Grant Notice.
15.Counterparts
. The Grant Notice and these Terms may be executed in one or more counterparts, each of which shall be deemed to be an original, but all of which shall constitute one and the same instrument.
16.Further Assurances
. Each party hereto shall do and perform (or shall cause to be done and performed) all such further acts and shall execute and deliver all such other agreements, certificates, instruments and documents as either party hereto reasonably may request in order to carry out the intent and accomplish the purposes of the Grant Notice, these Terms and the Plan and the consummation of the transactions contemplated thereunder.
17.Severability
. The invalidity or unenforceability of any provisions of these Terms in any jurisdiction shall not affect the validity, legality or enforceability of the remainder of the Terms in such jurisdiction or the validity, legality or enforceability of any provision of these Terms in any other jurisdiction, it being intended that all rights and obligations of the parties hereunder shall be enforceable to the fullest extent permitted by law.
18.Acquired Rights
. Participant acknowledges and agrees that: (a) the Company may terminate or amend the Plan at any time subject to the limitations contained in the Plan or these Terms; (b) the grant of RSUs made under the Grant Notice is completely independent of any other award or grant and is made at the sole discretion of the Company; and (c) no past grants or awards (including, without limitation, the RSUs granted under the Grant Notice) give Participant any right to any grants or awards in the future whatsoever.
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EX-10.02 3 exhibit1002formofperforman.htm EX-10.02 Document

Exhibit 10.02
THE ANDERSONS, INC. AMENDED AND RESTATED
2019 LONG-TERM INCENTIVE COMPENSATION PLAN

EPS PERFORMANCE SHARE UNIT GRANT NOTICE

Upon execution by the individual listed below (“Participant”) of this EPS Performance Share Unit Grant Notice (the “Grant Notice”), The Andersons, Inc., an Ohio corporation, (the “Company”), hereby grants to Participant the opportunity to earn the number of Shares set forth below (the “Target PSUs”), subject to increases and decreases as set forth below (the final earned amount of Shares being the “Vested PSUs”), pursuant to the Company’s Amended and Restated 2019 Long-Term Incentive Compensation Plan (the “Plan”). Participant acknowledges and agrees that the Target PSUs are subject to the Terms and Conditions attached hereto as Exhibit A (the “Terms and Conditions”) and the provisions of the Plan. Any terms not defined in this Grant Notice shall have the meanings ascribed in the Plan and the Terms and Conditions.
Participant: #ParticipantName#
Grant Date: #GrantDate#
Total Number of Shares of Target PSUs:
#QuantityGranted# Shares, subject to increases and decreases for performance pursuant to the Vesting Schedule set forth below
Performance Period: The Performance Period for the PSUs granted hereunder shall be the three-year period beginning January 1, 2023 and ending December 31, 2025.


Vesting Schedule:
The Target PSUs shall vest following the conclusion of the Performance Period based on the Company’s three-year cumulative fully diluted earnings per share (“EPS” or, the “Performance Goal”) computed under Generally Accepted Accounting Principles (GAAP) during the Performance Period, in accordance with the Vesting Chart below as certified by the Committee. The Committee shall certify the level of cumulative EPS achievement following the end of the Performance Period and prior to settlement of the Vested PSUs. The Committee reserves the right to adjust the number of Vested PSUs to reflect extraordinary transactions that impact EPS in its sole discretion. Subject to any such adjustment, no Target PSUs will be considered Vested PSUs if the Company’s cumulative EPS during the Performance Period is less than $6.26. Participant must remain continuously employed by the Company or any of its Subsidiaries through January 2 of the calendar year following the end of the Performance Period to be eligible to fully vest in and receive any payment of the Vested PSUs. In the case of death, Disability or Retirement, Target PSUs will be prorated to reflect final performance for the period as well as the period of employment.
Vesting Chart For purposes of this Grant Notice, the “Vested PSU Payout Percentage” provided below shall be multiplied by the Target PSUs in determining the number of Vested PSUs. Linear interpolation shall be used to determine Vested PSUs earned between goal points listed in the chart below rounded to the nearest whole number of PSUs

Vested PSU Payout Percentage
Performance Goals
Three-year (2023 - 2025)
Cumulative EPS

Maximum (200%)
$10.17 and above

Target (100%)
$8.76

Threshold (20%)
$6.26

0%
Below $6.26








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By his or her signature and the Company’s signature below, Participant agrees to be bound by the provisions of the Plan, the Terms and Conditions, and this Grant Notice. Participant has reviewed the Plan, the Terms and Conditions and this Grant Notice in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Grant Notice and fully understands all provisions of the Plan, the Terms and Conditions, and this Grant Notice. Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questions arising under the Plan, the Terms and Conditions, and this Grant Notice. Participant hereby acknowledges receipt of a copy of the Plan and the Terms and Conditions and that Participant has read the Plan, the Terms and Conditions and this Grant Notice carefully and fully understands their contents.

THE ANDERSONS, INC.:    Holder:
 PARTICIPANT:
By:

Name: #Signature#
Name: Teresa M. Scott Date: #AcceptanceDate#
Title: Director, Corporate Human Resources
Address:
1947 Briarfield Blvd.
Maumee, OH 43537
3
4858-9782-4061.1

EXHIBIT A
TO EPS PERFORMANCE SHARE UNIT GRANT NOTICE
TERMS AND CONDITIONS TO THE EPS PERFORMANCE SHARE UNIT GRANT NOTICE
PURSUANT TO THE
THE ANDERSONS, INC. AMENDED AND RESTATED 2019 LONG-TERM INCENTIVE COMPENSATION PLAN
    Pursuant to The Andersons, Inc. Amended and Restated 2019 Long-Term Incentive Compensation Plan, as amended from time to time (the “Plan”) and the EPS Performance Share Unit Grant Notice (the “Grant Notice”), “Participant,” as identified in the Grant Notice, has been granted that number of PSUs set forth in the Grant Notice (the “PSUs”). By execution of the Grant Notice, Participant has acknowledged and agreed that the PSUs, and the number of Shares ultimately awarded thereto, are subject to the terms and conditions set forth herein (the “Terms”).
WHEREAS, it has been determined that it would be in the best interests of the Company to grant the PSUs to Participant.
NOW, THEREFORE, in consideration of the mutual covenants and promises hereinafter set forth and for other good and valuable consideration, the parties hereto hereby mutually covenant and agree as follows:
1.Incorporation By Reference; Plan Document Receipt. The Terms are subject in all respects to the provisions of the Plan (including, without limitation, any amendments thereto adopted at any time and from time to time unless such amendments are expressly intended not to apply to the Terms provided herein), all of which provisions are made a part of and incorporated herein as if they were each expressly set forth herein. Any capitalized term not defined herein shall have the same meaning as is ascribed thereto in the Plan. In the event of any conflict between these Terms, the Plan or the Grant Notice that is not specifically resolved by the express terms of the Terms or the Grant Notice, the Plan shall control.
2.Grant of Performance Stock Units. The Company hereby grants to Participant, as of the Grant Date specified in the Grant Notice, the number of PSUs specified in the Grant Notice, with the actual number of shares of Common Stock to be issued pursuant to the Grant Notice contingent upon satisfaction of the vesting and performance conditions described in the Grant Notice, subject to Section 4. Except as otherwise provided by the Plan, Participant agrees and understands that nothing contained in these Terms provides, or is intended to provide, Participant with any protection against potential future dilution of Participant’s interest in the Company for any reason, and no adjustments shall be made for dividends in cash or other property, distributions or other rights in respect of the shares of Common Stock underlying the PSUs, except as otherwise specifically provided for in the Plan or these Terms.
3.Performance Goals and Vesting of PSUs. Subject to Article XI of the Plan, the Performance Period and Vesting Schedule for the PSUs shall be set forth in the Grant Notice.
4.Certain Terminations Prior to Vesting. Participant’s right to vest in any of the PSUs shall terminate in full and be immediately forfeited upon Participant’s Termination for any reason; provided that, in the event of Participant’s Termination due to Participant’s death, Disability or Retirement (each, a “Special Termination”), Participant’s number of PSUs shall be adjusted by multiplying the number of Target PSUs by a fraction, the numerator of which is the number of months of service (rounded to the nearest whole month) from the first month of the performance period through the date of such Special Termination, and the denominator of which
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is the total number of months in the Performance Period. Such adjusted number of Target PSUs shall remain outstanding and eligible to become Vested PSUs subject to the level of satisfaction of the applicable Performance Goals, as determined in accordance with the Grant Notice.
5.Rights as a Stockholder. Participant shall have no rights as a stockholder (including having no right to vote or to receive dividends) with respect to the Common Stock subject to the PSUs prior to the date the Common Stock is delivered to Participant in accordance with Section 6 herein. Notwithstanding the foregoing, if any dividends or other distributions are paid with respect to the Common Stock of the Company while Participant holds the PSUs and prior to the time that the PSUs become vested in accordance with the Grant Notice, Participant shall be entitled to receive such dividends and other distributions attributable to the shares of Common Stock underlying the Vested PSUs in the form of additional shares of Common Stock upon settlement; provided that, the right to receive any such additional shares of Common Stock with respect to dividends or other distributions will be subject to the same vesting requirements and settlement terms as the underlying PSUs.. The amount of such additional shares of Common Stock will be determined by multiplying (a) the total amount of dividends actually paid on a share of Common Stock prior to the date that the Vested PSUs are settled in accordance with these Terms, by (b) the number of Vested PSUs, and then dividing such total by the Fair Market Value of the Common Stock on the last day of the Performance Period, as determined by the Committee.
6.Payment of Vested PSUs. Vested PSUs, rounded to the nearest whole share, shall be delivered to Participant in the form of an equal number of shares of Common Stock, together any additional shares deliverable pursuant to Section 5 hereof, rounded to the nearest whole unit. Vested PSUs will be paid as soon as practicable after vesting (but in no event later than two and a half (2 ½) months following the end of the year in which vesting occurs). Prior to actual payment of any Vested PSUs, such PSUs will represent an unsecured obligation of the Company, payable (if at all) only from the general assets of the Company. Provided, however, that pursuant to the Plan, the Committee may settle PSUs in another form, such as in cash, at its discretion. PSUs that do not become Vested PSUs shall be immediately forfeited and Participant shall have no further rights thereto.
7.Change in Control Prior to Vesting. Participant’s right to vest in any PSUs following a Change in Control shall depend on (i) whether the PSUs are assumed, converted or replaced by the continuing entity, and (ii) the timing of the Change in Control within the Performance Period, in each case as follows:
(a)In the event the PSUs are not assumed, converted, or replaced by the continuing entity following the Change in Control (as determined by the Committee), the number of Target PSUs shall immediately become Vested PSUs.
(b)In the event that the PSUs are assumed, converted, or replaced by the continuing entity following the Change in Control (as determined by the Committee), the number of Target PSUs that become Vested PSUs shall be determined following the conclusion of the Performance Period in accordance with the level at which the Performance Goals are satisfied, determined in accordance with the Grant Notice, and subject to Participant’s continued employment through the last day of the Performance Period.
(c)Notwithstanding the foregoing, in the event of a Qualifying Termination (as defined below) of Participant that occurs within three (3) months prior to or twenty-four (24) months following the Change a Control and prior to the end of the Performance Period, Participant’s PSUs shall not expire immediately upon such Termination and instead the number of Target PSUs shall become Vested PSUs immediately upon the date of the Qualifying Termination (or, if later, the date of such Change in Control), as applicable, provided, however
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that Participant must execute and not revoke a general release of claims against the Company in a form reasonably satisfactory to the Committee within forty-five (45) days following such Qualifying Termination or, if later, by the date of the Change in Control. For the avoidance of doubt, in the event a Change in Control has not occurred prior to the Qualifying Termination and does not occur within twenty-four (24) months following a Qualifying Termination, any unvested PSUs outstanding at such time shall immediately expire. For purposes of this Section, “Qualifying Termination” means Participant’s Termination by the Company or a Subsidiary, other than for Cause and other than due to Participant’s explicit request, death or Disability.
8.Entire Agreement; Amendment. These Terms, together with the Grant Notice, the Plan and any severance or change in control agreement, contains the entire agreement between the parties hereto with respect to the subject matter contained herein, and supersedes all prior agreements or prior understandings, whether written or oral, between the parties relating to such subject matter. The Committee shall have the right, in its sole discretion, to modify or amend these Terms from time to time in accordance with and as provided in the Plan. These Terms may also be modified or amended by a writing signed by both the Company and Participant. The Company shall give written notice to Participant of any such modification or amendment of these Terms as soon as practicable after the adoption thereof.
9.Notices. Any notice hereunder by Participant shall be given to the Company in writing and such notice shall be deemed duly given only upon receipt thereof by the General Counsel, the Director of Corporate Human Resources, or any other administrative agent designated by the Committee. Any notice hereunder by the Company shall be given to Participant in writing and such notice shall be deemed duly given only upon receipt thereof at such address as Participant may have on file with the Company.
10.Acceptance. Participant may forfeit the PSUs if Participant does not execute the Grant Notice (which, for the avoidance of doubt, accepts and acknowledges these Terms) within a period of 30 days from the date that Participant receives the Grant Notice (or such earlier period as the Committee shall provide).
11.No Right to Service. Nothing in these Terms shall interfere with or limit in any way the right of the Company or its Subsidiaries to terminate Participant’s service at any time, for any reason and with or without Cause.
12.Transfer of Personal Data. Participant authorizes, agrees and unambiguously consents to the transmission by the Company (or any Subsidiary) of any personal data information related to the PSUs awarded under the Grant Notice for legitimate business purposes. This authorization and consent is freely given by Participant.
13.Compliance with Laws. The grant of PSUs and the issuance of shares of Common Stock pursuant to the Grant Notice shall be subject to, and shall comply with, any applicable requirements of any foreign and U.S. federal and state securities laws, rules and regulations (including, without limitation, the provisions of the Securities Act, the Exchange Act and in each case any respective rules and regulations promulgated thereunder) and any other law, rule regulation or exchange requirement applicable thereto. The Company shall not be obligated to issue the PSUs or any shares pursuant to the Grant Notice or these Terms if any such issuance would violate any such requirements. As a condition to the settlement of the PSUs, the Company may require Participant to satisfy any qualifications that may be necessary or appropriate to evidence compliance with any applicable law or regulation.
14.Section 409A. The Grant Notice and these Terms and the grant of Awards thereunder are intended to comply with Section 409A of the Code or an exemption thereunder and shall be construed and interpreted in a manner that is consistent with the requirements for
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4858-9782-4061.1

avoiding additional taxes or penalties under Section 409A of the Code. Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided pursuant to the Grant Notice and these Terms comply with Section 409A of the Code and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by the Participant on account of non-compliance with Section 409A of the Code.
15.Binding Agreement; Assignment. These Terms shall inure to the benefit of, be binding upon, and be enforceable by the Company and its successors and assigns. Participant shall not assign (except in accordance with the Plan) any part of the Grant Notice or these Terms without the prior express written consent of the Company.
16.Headings. The titles and headings of the various sections of these Terms have been inserted for convenience of reference only and shall not be deemed to be a part of these Terms or the Grant Notice.
17.Counterparts. The Grant Notice and these Terms may be executed in one or more counterparts, each of which shall be deemed to be an original, but all of which shall constitute one and the same instrument.
18.Further Assurances. Each party hereto shall do and perform (or shall cause to be done and performed) all such further acts and shall execute and deliver all such other agreements, certificates, instruments and documents as either party hereto reasonably may request in order to carry out the intent and accomplish the purposes of the Grant Notice, these Terms and the Plan and the consummation of the transactions contemplated thereunder.
19.Severability. The invalidity or unenforceability of any provisions of these Terms in any jurisdiction shall not affect the validity, legality or enforceability of the remainder of the Terms in such jurisdiction or the validity, legality or enforceability of any provision of these Terms in any other jurisdiction, it being intended that all rights and obligations of the parties hereunder shall be enforceable to the fullest extent permitted by law.
20.Acquired Rights. Participant acknowledges and agrees that: (a) the Company may terminate or amend the Plan at any time subject to the limitations contained in the Plan or these Terms; (b) the grant of PSUs made under the Grant Notice is completely independent of any other award or grant and is made at the sole discretion of the Company; and (c) no past grants or awards (including, without limitation, the PSUs granted under the Grant Notice) give Participant any right to any grants or awards in the future whatsoever.


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4858-9782-4061.1
EX-10.03 4 exhibit1003formofperforman.htm EX-10.03 Document

Exhibit 10.03
THE ANDERSONS, INC. AMENDED AND RESTATED
2019 LONG-TERM INCENTIVE COMPENSATION PLAN

TSR PERFORMANCE SHARE UNIT GRANT NOTICE

Upon execution by the individual listed below (“Participant”) of this TSR Performance Share Unit Grant Notice (the “Grant Notice”), The Andersons, Inc., an Ohio corporation, (the “Company”), hereby grants to Participant the opportunity to earn the number of Shares set forth below (the “Target PSUs”), subject to increases and decreases as set forth below (the final earned amount of Shares being the “Vested PSUs”), pursuant to the Company’s Amended and Restated 2019 Long-Term Incentive Compensation Plan (the “Plan”). Participant acknowledges and agrees that the Target PSUs are subject to the Terms and Conditions attached hereto as Exhibit A (the “Terms and Conditions”) and the provisions of the Plan. Any terms not defined in this Grant Notice shall have the meanings ascribed in the Plan and the Terms and Conditions.
Participant: #ParticipantName#
Grant Date: #GrantDate#
Total Number of Shares of Target PSUs:
#QuantityGranted# Shares, subject to increases and decreases for performance pursuant to the Vesting Schedule set forth below
Performance Period: The Performance Period for the PSUs granted hereunder shall be the three-year period beginning January 1, 2023 and ending December 31, 2025.


Vesting Schedule:
The Target PSUs shall vest following the conclusion of the Performance Period based on the Company’s annualized total shareholder return (“TSR” or, the “Performance Goal”), as further defined below, relative to the annualized TSR of the Russell 3000 Index, (the “Comparator Group”) computed during the Performance Period and certified by the Committee as described below. The number of PSUs that become vested based upon the level of satisfaction of the Performance Goal are referred to herein as “Vested PSUs”

For purposes of this Agreement, “TSR” for the Company shall mean (i) the sum of (x) the average stock price at the end of the Performance Period plus (y) the value of all dividends paid during the Performance Period if those dividends had been reinvested in additional shares of stock on the date of payment, divided by (ii) the average stock price at the beginning of the Performance Period, annualized as a compound annual rate of return. “TSR” for the Comparator Group shall mean the average index price at the end of the Performance Period divided by the average index price at the beginning of the Performance Period, expressed as a compound annual percentage rate of return. When computing TSR for the Company and the Comparator Group, the average stock or index price at the beginning of the Performance Period will be the average closing stock or index price over the trading days in the month immediately preceding the start of the Performance Period (December 2022), and the average stock or index price at the end of the Performance Period will be the average closing stock or index price over the trading days in the last month of the Performance Period (December 2025)

The Committee shall certify the level of TSR achievement following the end of the Performance Period and prior to settlement of the Vested PSUs. Subject to potential adjustment by the Committee as described below, no PSUs will be considered Vested PSUs if the Company’s annualized TSR during the Performance Period is more than twelve (12) percentage points below the Comparator Group’s annualized TSR during the Performance Period. Participant must remain continuously employed by the Company or any of its Subsidiaries through January 2 of the calendar year following the end of the Performance Period to be eligible to fully vest in and receive any payment of the Vested PSUs except as otherwise specifically provided for in the Plan, this grant Notice or the Terms and Conditions attached hereto. The Committee reserves the right to adjust the number of Vested PSUs to reflect extraordinary transactions or events which impact TSR as it determines in its sole discretion.
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4863-8639-4941.1

Vesting Chart For purposes of this Grant Notice, the number of Vested PSUs, if any, for the Performance Period shall be determined in accordance with the chart below corresponding to the Company’s annualized TSR relative to the Comparator Group’s annualized TSR (the “Vested PSU Payout Percent”):

Goal
Achievement
Company’s Annualized TSR Relative to Comparator Group’s Annualized TSR
Vested PSU Payout Percent



% of Target PSUs if Company TSR is Positive
% of Target PSUs if Company TSR is Negative

Maximum
+18 percentage points or more above Target
200%
100%

Above Target
For every +1 percentage points Company TSR is above Target
100% plus 5.56% of target
100%

Target
Comparator Group’s Annualized TSR
100%
100%

Below Target
For every -1 percentage points Company TSR is below Target
100% less 5% of target
100% less 5% of target

Threshold
-12 percentage points below
Target
40%
40%

Below Threshold
More than -12 percentage points below Target
0%
0%




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4863-8639-4941.1

By his or her signature and the Company’s signature below, Participant agrees to be bound by the provisions of the Plan, the Terms and Conditions, and this Grant Notice. Participant has reviewed the Plan, the Terms and Conditions and this Grant Notice in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Grant Notice and fully understands all provisions of the Plan, the Terms and Conditions, and this Grant Notice. Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questions arising under the Plan, the Terms and Conditions, and this Grant Notice. Participant hereby acknowledges receipt of a copy of the Plan and the Terms and Conditions and that Participant has read the Plan, the Terms and Conditions and this Grant Notice carefully and fully understands their contents.

THE ANDERSONS, INC.:    Holder:
 PARTICIPANT:
By:

Name: #Signature#
Name: Teresa M. Scott Date: #AcceptanceDate#
Title: Director, Corporate Human Resources
Address:
1947 Briarfield Blvd.
Maumee, OH 43537
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4863-8639-4941.1

EXHIBIT A
TO TSR PERFORMANCE SHARE UNIT GRANT NOTICE
TERMS AND CONDITIONS TO THE TSR PERFORMANCE SHARE UNIT GRANT NOTICE
PURSUANT TO THE
THE ANDERSONS, INC. AMENDED AND RESTATED 2019 LONG-TERM INCENTIVE COMPENSATION PLAN
    Pursuant to The Andersons, Inc. Amended and Restated 2019 Long-Term Incentive Compensation Plan, as amended from time to time (the “Plan”) and the TSR Performance Share Unit Grant Notice (the “Grant Notice”), “Participant,” as identified in the Grant Notice, has been granted that number of PSUs set forth in the Grant Notice (the “PSUs”). By execution of the Grant Notice, Participant has acknowledged and agreed that the PSUs, and the number of Shares ultimately awarded thereto, are subject to the terms and conditions set forth herein (the “Terms”).
WHEREAS, it has been determined that it would be in the best interests of the Company to grant the PSUs to Participant.
NOW, THEREFORE, in consideration of the mutual covenants and promises hereinafter set forth and for other good and valuable consideration, the parties hereto hereby mutually covenant and agree as follows:
1.Incorporation By Reference; Plan Document Receipt. The Terms are subject in all respects to the provisions of the Plan (including, without limitation, any amendments thereto adopted at any time and from time to time unless such amendments are expressly intended not to apply to the Terms provided herein), all of which provisions are made a part of and incorporated herein as if they were each expressly set forth herein. Any capitalized term not defined herein shall have the same meaning as is ascribed thereto in the Plan. In the event of any conflict between these Terms, the Plan or the Grant Notice that is not specifically resolved by the express terms of the Terms or the Grant Notice, the Plan shall control.
2.Grant of Performance Stock Units. The Company hereby grants to Participant, as of the Grant Date specified in the Grant Notice, the number of PSUs specified in the Grant Notice, with the actual number of shares of Common Stock to be issued pursuant to the Grant Notice contingent upon satisfaction of the vesting and performance conditions described in the Grant Notice, subject to Section 4. Except as otherwise provided by the Plan, Participant agrees and understands that nothing contained in these Terms provides, or is intended to provide, Participant with any protection against potential future dilution of Participant’s interest in the Company for any reason, and no adjustments shall be made for dividends in cash or other property, distributions or other rights in respect of the shares of Common Stock underlying the PSUs, except as otherwise specifically provided for in the Plan or these Terms.
3.Performance Goals and Vesting of PSUs. Subject to Article XI of the Plan, the Performance Period and Vesting Schedule for the PSUs shall be set forth in the Grant Notice.
4.Certain Terminations Prior to Vesting. Participant’s right to vest in any of the PSUs shall terminate in full and be immediately forfeited upon Participant’s Termination for any reason; provided that, in the event of Participant’s Termination due to Participant’s death, Disability or Retirement (each, a “Special Termination”), Participant’s number of PSUs shall be adjusted by multiplying the number of Target PSUs by a fraction, the numerator of which is the number of months of service (rounded to the nearest whole month) from the first month of the performance period through the date of such Special Termination, and the denominator of which
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is the total number of months in the Performance Period. Such adjusted number of Target PSUs shall remain outstanding and eligible to become Vested PSUs subject to the level of satisfaction of the applicable Performance Goals, as determined in accordance with the Grant Notice.
5.Rights as a Stockholder. Participant shall have no rights as a stockholder (including having no right to vote or to receive dividends) with respect to the Common Stock subject to the PSUs prior to the date the Common Stock is delivered to Participant in accordance with Section 6 herein. Notwithstanding the foregoing, if any dividends or other distributions are paid with respect to the Common Stock of the Company while Participant holds the PSUs and prior to the time that the PSUs become vested in accordance with the Grant Notice, Participant shall be entitled to receive such dividends and other distributions attributable to the shares of Common Stock underlying the Vested PSUs in the form of additional shares of Common Stock upon settlement; provided that, the right to receive any such additional shares of Common Stock with respect to dividends or other distributions will be subject to the same vesting requirements and settlement terms as the underlying PSUs.. The amount of such additional shares of Common Stock will be determined by multiplying (a) the total amount of dividends actually paid on a share of Common Stock prior to the date that the Vested PSUs are settled in accordance with these Terms, by (b) the number of Vested PSUs, and then dividing such total by the Fair Market Value of the Common Stock on the last day of the Performance Period, as determined by the Committee.
6.Payment of Vested PSUs. Vested PSUs, rounded to the nearest whole share, shall be delivered to Participant in the form of an equal number of shares of Common Stock, together with any additional shares deliverable pursuant to Section 5 hereof, rounded to the nearest whole unit. Vested PSUs will be paid as soon as practicable after vesting (but in no event later than two and a half (2 ½) months following the end of the year in which vesting occurs). Prior to actual payment of any Vested PSUs, such PSUs will represent an unsecured obligation of the Company, payable (if at all) only from the general assets of the Company. Provided, however, that pursuant to the Plan, the Committee may settle PSUs in another form, such as in cash, at its discretion. PSUs that do not become Vested PSUs shall be immediately forfeited and Participant shall have no further rights thereto.
7.Change in Control Prior to Vesting. Participant’s right to vest in any PSUs following a Change in Control shall depend on (i) whether the PSUs are assumed, converted or replaced by the continuing entity, and (ii) the timing of the Change in Control within the Performance Period, in each case as follows:
(a)In the event the PSUs are not assumed, converted, or replaced by the continuing entity following the Change in Control (as determined by the Committee), the number of Target PSUs shall immediately become Vested PSUs.
(b)In the event that the PSUs are assumed, converted, or replaced by the continuing entity following the Change in Control (as determined by the Committee), the number of Target PSUs that become Vested PSUs shall be determined following the conclusion of the Performance Period in accordance with the level at which the Performance Goals are satisfied, determined in accordance with the Grant Notice, and subject to Participant’s continued employment through the last day of the Performance Period.
(c)Notwithstanding the foregoing, in the event of a Qualifying Termination (as defined below) of Participant that occurs within three (3) months prior to or twenty-four (24) months following the Change a Control and prior to the end of the Performance Period, Participant’s PSUs shall not expire immediately upon such Termination and instead the number of Target PSUs shall become Vested PSUs immediately upon the date of the Qualifying Termination (or, if later, the date of such Change in Control), as applicable, provided, however
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that Participant must execute and not revoke a general release of claims against the Company in a form reasonably satisfactory to the Committee within forty-five (45) days following such Qualifying Termination or, if later, by the date of the Change in Control. For the avoidance of doubt, in the event a Change in Control has not occurred prior to the Qualifying Termination and does not occur within twenty-four (24) months following a Qualifying Termination, any unvested PSUs outstanding at such time shall immediately expire. For purposes of this Section, “Qualifying Termination” means Participant’s Termination by the Company or a Subsidiary, other than for Cause and other than due to Participant’s explicit request, death or Disability.
8.Entire Agreement; Amendment. These Terms, together with the Grant Notice, the Plan and any severance or change in control agreement, contains the entire agreement between the parties hereto with respect to the subject matter contained herein, and supersedes all prior agreements or prior understandings, whether written or oral, between the parties relating to such subject matter. The Committee shall have the right, in its sole discretion, to modify or amend these Terms from time to time in accordance with and as provided in the Plan. These Terms may also be modified or amended by a writing signed by both the Company and Participant. The Company shall give written notice to Participant of any such modification or amendment of these Terms as soon as practicable after the adoption thereof.
9.Notices. Any notice hereunder by Participant shall be given to the Company in writing and such notice shall be deemed duly given only upon receipt thereof by the General Counsel, the Director of Corporate Human Resources, or any other administrative agent designated by the Committee. Any notice hereunder by the Company shall be given to Participant in writing and such notice shall be deemed duly given only upon receipt thereof at such address as Participant may have on file with the Company.
10.Acceptance. Participant may forfeit the PSUs if Participant does not execute the Grant Notice (which, for the avoidance of doubt, accepts and acknowledges these Terms) within a period of 30 days from the date that Participant receives the Grant Notice (or such earlier period as the Committee shall provide).
11.No Right to Service. Nothing in these Terms shall interfere with or limit in any way the right of the Company or its Subsidiaries to terminate Participant’s service at any time, for any reason and with or without Cause.
12.Transfer of Personal Data. Participant authorizes, agrees and unambiguously consents to the transmission by the Company (or any Subsidiary) of any personal data information related to the PSUs awarded under the Grant Notice for legitimate business purposes. This authorization and consent is freely given by Participant.
13.Compliance with Laws. The grant of PSUs and the issuance of shares of Common Stock pursuant to the Grant Notice shall be subject to, and shall comply with, any applicable requirements of any foreign and U.S. federal and state securities laws, rules and regulations (including, without limitation, the provisions of the Securities Act, the Exchange Act and in each case any respective rules and regulations promulgated thereunder) and any other law, rule regulation or exchange requirement applicable thereto. The Company shall not be obligated to issue the PSUs or any shares pursuant to the Grant Notice or these Terms if any such issuance would violate any such requirements. As a condition to the settlement of the PSUs, the Company may require Participant to satisfy any qualifications that may be necessary or appropriate to evidence compliance with any applicable law or regulation.
14.Section 409A. The Grant Notice and these Terms and the grant of Awards thereunder are intended to comply with Section 409A of the Code or an exemption thereunder and shall be construed and interpreted in a manner that is consistent with the requirements for
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avoiding additional taxes or penalties under Section 409A of the Code. Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided pursuant to the Grant Notice and these Terms comply with Section 409A of the Code and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by the Participant on account of non-compliance with Section 409A of the Code.
15.Binding Agreement; Assignment. These Terms shall inure to the benefit of, be binding upon, and be enforceable by the Company and its successors and assigns. Participant shall not assign (except in accordance with the Plan) any part of the Grant Notice or these Terms without the prior express written consent of the Company.
16.Headings. The titles and headings of the various sections of these Terms have been inserted for convenience of reference only and shall not be deemed to be a part of these Terms or the Grant Notice.
17.Counterparts. The Grant Notice and these Terms may be executed in one or more counterparts, each of which shall be deemed to be an original, but all of which shall constitute one and the same instrument.
18.Further Assurances. Each party hereto shall do and perform (or shall cause to be done and performed) all such further acts and shall execute and deliver all such other agreements, certificates, instruments and documents as either party hereto reasonably may request in order to carry out the intent and accomplish the purposes of the Grant Notice, these Terms and the Plan and the consummation of the transactions contemplated thereunder.
19.Severability. The invalidity or unenforceability of any provisions of these Terms in any jurisdiction shall not affect the validity, legality or enforceability of the remainder of the Terms in such jurisdiction or the validity, legality or enforceability of any provision of these Terms in any other jurisdiction, it being intended that all rights and obligations of the parties hereunder shall be enforceable to the fullest extent permitted by law.
20.Acquired Rights. Participant acknowledges and agrees that: (a) the Company may terminate or amend the Plan at any time subject to the limitations contained in the Plan or these Terms; (b) the grant of PSUs made under the Grant Notice is completely independent of any other award or grant and is made at the sole discretion of the Company; and (c) no past grants or awards (including, without limitation, the PSUs granted under the Grant Notice) give Participant any right to any grants or awards in the future whatsoever.


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4863-8639-4941.1
EX-10.04 5 exhibit1004formofrestricte.htm EX-10.04 Document

Exhibit 10.04
THE ANDERSONS, INC. AMENDED AND RESTATED
2019 LONG-TERM INCENTIVE COMPENSATION PLAN

RESTRICTED STOCK UNIT GRANT NOTICE

Upon execution by the individual listed below (“Participant”) of this Restricted Stock Unit Grant Notice (the “Grant Notice”), The Andersons, Inc., an Ohio corporation, (the “Company”), hereby grants to Participant the number of Restricted Stock Units set forth below (the “RSUs”) pursuant to the Company’s Amended and Restated 2019 Long-Term Incentive Compensation Plan (the “Plan”). Participant acknowledges and agrees that the RSUs are subject to the Terms and Conditions attached hereto as Exhibit A (the “Terms and Conditions”) and the provisions of the Plan. Any terms not defined in this Grant Notice shall have the meanings ascribed in the Plan and the Terms and Conditions.
Participant: #ParticipantName#
Grant Date: #GrantDate#
Total Number of RSUs:
#QuantityGranted#
Purchase Price: $0.00
Vesting Schedule:
Subject to the Terms and Conditions, the RSUs shall vest on the date of the 2023 annual shareholder meeting, provided Participant has not had a Termination prior to such date.

By his or her signature and the Company’s signature below, Participant agrees to be bound by the provisions of the Plan, the Terms and Conditions, and this Grant Notice. Participant has reviewed the Plan, the Terms and Conditions and this Grant Notice in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Grant Notice and fully understands all provisions of the Plan, the Terms and Conditions, and this Grant Notice. Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questions arising under the Plan, the Terms and Conditions, and this Grant Notice. Participant hereby acknowledges receipt of a copy of the Plan and the Terms and Conditions and that Participant has read the Plan, the Terms and Conditions and this Grant Notice carefully and fully understands their contents.
THE ANDERSONS, INC.:    Holder:
 PARTICIPANT:
By:

Name: #Signature#
Name: Teresa M. Scott Date: #AcceptanceDate#
Title: Director, Corporate Human Resources
Address: 1947 Briarfield Blvd.
Maumee, Ohio 43537

|

EXHIBIT A
TO RESTRICTED STOCK UNIT GRANT NOTICE
TERMS AND CONDITIONS TO THE RESTRICTED STOCK UNIT
PURSUANT TO THE
THE ANDERSONS, INC. AMENDED AND RESTATED 2019 LONG-TERM INCENTIVE COMPENSATION PLAN
Pursuant to The Andersons, Inc. Amended and Restated 2019 Long-Term Incentive Compensation Plan, as amended from time to time (the “Plan”) and the Restricted Stock Unit Grant Notice (the “Grant Notice”), “Participant,” as identified in the Grant Notice, has been granted that number of Restricted Stock Units set forth in the Grant Notice (the “RSUs”). By execution of the Grant Notice, Participant has acknowledged and agreed that the RSUs are subject to the terms and conditions set forth herein (the “Terms”).
WHEREAS, it has been determined that it would be in the best interests of the Company to grant the RSUs to Participant.
NOW, THEREFORE, in consideration of the mutual covenants and promises hereinafter set forth and for other good and valuable consideration, the parties hereto hereby mutually covenant and agree as follows:
1.Incorporation By Reference; Plan Document Receipt
. The Terms are subject in all respects to the provisions of the Plan (including, without limitation, any amendments thereto adopted at any time and from time to time unless such amendments are expressly intended not to apply to the Terms provided herein), all of which provisions are made a part of and incorporated herein as if they were each expressly set forth herein. Any capitalized term not defined herein shall have the same meaning as is ascribed thereto in the Plan. In the event of any conflict between these Terms, the Plan or the Grant Notice that is not specifically resolved by the express terms of the Terms or the Grant Notice, the Plan shall control.
2.Grant of Restricted Stock Unit
. The Company grants to Participant, as of the Grant Date specified in the Grant Notice, the number of RSUs specified in the Grant Notice. Each RSU represents the right to receive one (1) share of Common Stock on the date it vests. Unless and until the RSUs will have vested, Participant will have no right to payment of any such RSU. Prior to actual payment of any vested RSUs, such RSUs will represent an unsecured obligation of the Company, payable (if at all) only from the general assets of the Company. Any RSUs that vest will be paid to Participant in shares of Common Stock. RSUs shall be paid in shares of Common Stock as soon as practicable after vesting (but in no event later than two and a half (2 ½) months following the end of the year in which vesting occurs). Except as otherwise provided by the Plan, Participant agrees and understands that nothing contained in these Terms provides, or is intended to provide, Participant with any protection against potential future dilution of Participant’s interest in the Company for any reason, and no adjustments shall be made for dividends in cash or other property, distributions or other rights in respect of any such shares, except as otherwise specifically provided for in the Plan or these Terms. Subject to Section 4 hereof, Participant shall not have the rights of a stockholder in respect of the shares underlying this Award until unrestricted shares are delivered to Participant.


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3.Vesting
(a)General. Subject to Article XI of the Plan, the RSUs shall become vested as described in the Grant Notice. There shall be no proportionate or partial vesting during the period prior to the vesting date and all vesting shall occur only on the vesting date set forth in the Grant Notice, subject to Participant’s continued service on the Board on the applicable vesting date.
(b)Certain Terminations Prior to Vesting
. Unless otherwise provided in the Grant Notice, Participant’s right to vest in any of the RSUs shall terminate in full and be immediately forfeited upon Participant’s Termination for any reason.
4.Dividends and Other Distributions
. If any dividends or other distributions are paid with respect to the Common Stock of the Company while Participant holds the RSUs and prior to the time that the RSUs become vested in accordance with the Grant Notice, Participant shall be entitled to receive such dividends and other distributions attributable to the shares of Common Stock underlying the RSUs in the form of additional shares of Common Stock upon settlement; provided that, the right to receive any such additional shares of Common Stock with respect to dividends or other distributions will be subject to the same vesting requirements and settlement terms as the underlying RSUs. The amount of such additional shares of Common Stock will be determined by multiplying (i) the total amount of dividends actually paid on a share of Common Stock prior to the date that the RSUs become vested in accordance with Grant Notice, by (ii) the number of RSUs that become vested in accordance with the terms of the Grant Notice, and then dividing such total by the Fair Market Value of the Common Stock on the last trading day prior to the applicable vesting date, as determined by the Committee.
5.Non-Transferability
. Any attempt to sell, exchange, transfer, assign, pledge, encumber or otherwise dispose of or hypothecate in any way any of the RSUs, or the levy of any execution, attachment or similar legal process upon the RSUs prior to the vesting date or contrary to the terms and provisions of the Plan, shall be null and void and without legal force or effect.
6.Governing Law
. All questions concerning the construction, validity and interpretation of these Terms and the Grant Notice shall be governed by, and construed in accordance with, the laws of the State of Ohio, without regard to the choice of law principles thereof.
7.Entire Agreement; Amendment
. These Terms, together with the Grant Notice and the Plan, contains the entire agreement between the parties hereto with respect to the subject matter contained herein, and supersedes all prior agreements or prior understandings, whether written or oral, between the parties relating to such subject matter. The Committee shall have the right, in its sole discretion, to modify or amend these Terms from time to time in accordance with and as provided in the Plan. These Terms may also be modified or amended by a writing signed by both the Company and Participant. The Company shall give written notice to Participant of any such modification or amendment of these Terms as soon as practicable after the adoption thereof.
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8.Notices
. Any notice hereunder by Participant shall be given to the Company in writing and such notice shall be deemed duly given only upon receipt thereof by the General Counsel, the Director of Corporate Human Resources, or any other administrative agent designated by the Committee. Any notice hereunder by the Company shall be given to Participant in writing and such notice shall be deemed duly given only upon receipt thereof at such address as Participant may have on file with the Company.
9.Acceptance. Participant may forfeit the RSUs if Participant does not execute the Grant Notice (which, for the avoidance of doubt, accepts and acknowledges these Terms) within a period of 30 days from the date that Participant receives the Grant Notice (or such earlier period as the Committee shall provide).
10.Transfer of Personal Data
. Participant authorizes, agrees and unambiguously consents to the transmission by the Company (or any Subsidiary) of any personal data information related to the RSUs awarded under the Grant Notice for legitimate business purposes. This authorization and consent is freely given by Participant.
11.Compliance with Laws
. The issuance of the RSUs or unrestricted shares pursuant to the Grant Notice shall be subject to, and shall comply with, any applicable requirements of any foreign and U.S. federal and state securities laws, rules and regulations (including, without limitation, the provisions of the Securities Act, the Exchange Act and in each case any respective rules and regulations promulgated thereunder) and any other law, rule, regulation or exchange requirement applicable thereto. The Company shall not be obligated to issue the RSUs or any of the shares pursuant to the Grant Notice and these Terms if any such issuance would violate any such requirements. As a condition to settlement of the RSUs, the Company may require Participant to satisfy any qualifications that may be necessary or appropriate to evidence compliance with any applicable law or regulation.
12.Section 409A
. The Grant Notice and these Terms and the grant of Awards thereunder are intended to comply with Section 409A of the Code or an exemption thereunder and shall be construed and interpreted in a manner that is consistent with the requirements for avoiding additional taxes or penalties under Section 409A of the Code. Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided pursuant to the Grant Notice and these Terms comply with Section 409A of the Code and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by the Participant on account of non-compliance with Section 409A of the Code.
13.Binding Agreement; Assignment
. These Terms shall inure to the benefit of, be binding upon, and be enforceable by the Company and its successors and assigns. Participant shall not assign (except in accordance with the Plan) any part of the Grant Notice or these Terms without the prior express written consent of the Company.


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14.Headings
. The titles and headings of the various sections of these Terms have been inserted for convenience of reference only and shall not be deemed to be a part of these Terms or the Grant Notice.
15.Counterparts
. The Grant Notice and these Terms may be executed in one or more counterparts, each of which shall be deemed to be an original, but all of which shall constitute one and the same instrument.
16.Further Assurances
. Each party hereto shall do and perform (or shall cause to be done and performed) all such further acts and shall execute and deliver all such other agreements, certificates, instruments and documents as either party hereto reasonably may request in order to carry out the intent and accomplish the purposes of the Grant Notice, these Terms and the Plan and the consummation of the transactions contemplated thereunder.
17.Severability
. The invalidity or unenforceability of any provisions of these Terms in any jurisdiction shall not affect the validity, legality or enforceability of the remainder of the Terms in such jurisdiction or the validity, legality or enforceability of any provision of these Terms in any other jurisdiction, it being intended that all rights and obligations of the parties hereunder shall be enforceable to the fullest extent permitted by law.
18.Acquired Rights
. Participant acknowledges and agrees that: (a) the Company may terminate or amend the Plan at any time subject to the limitations contained in the Plan or these Terms; (b) the grant of RSUs made under the Grant Notice is completely independent of any other award or grant and is made at the sole discretion of the Company; and (c) no past grants or awards (including, without limitation, the RSUs granted under the Grant Notice) give Participant any right to any grants or awards in the future whatsoever.
19.Deferral Plan. If Participant is eligible, and if Participant has made the appropriate election, to defer all or a portion of the shares of Common Stock deliverable hereunder into the [Deferral Plan] (the “Deferral Plan”), then the shares of Common Stock that would otherwise be deliverable hereunder and are subject to such election, instead of being delivered to Participant, shall be credited to Participant’s account and distributed in accordance with the terms of the Deferral Plan and Participant’s deferral election thereunder.



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EX-31.1 6 exhibit311q12023.htm EX-31.1 Document

Exhibit 31.1
Certifications
I, Patrick E. Bowe, certify that:
1. I have reviewed this report on Form 10-Q of The Andersons, Inc.
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
  a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;
  b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
  c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
  d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
  a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
  b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

May 4, 2023
 
/s/ Patrick E. Bowe
Patrick E. Bowe
Chief Executive Officer

EX-31.2 7 exhibit312q12023.htm EX-31.2 Document

Exhibit 31.2
Certifications
I, Brian A. Valentine, certify that:
1. I have reviewed this report on Form 10-Q of The Andersons, Inc.
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
  a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;
  b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
  c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
  d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
  a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
  b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

May 4, 2023
 
/s/ Brian A. Valentine
Brian A. Valentine
Executive Vice President and Chief Financial Officer

EX-32.1 8 exhibit321q12023.htm EX-32.1 Document

Exhibit 32.1
The Andersons, Inc.
Certifications Pursuant to 18 U.S.C. Section 1350
In connection with the Quarterly Report of The Andersons, Inc. (the “Company”) on Form 10-Q for the quarter ended March 31, 2023, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned officers of the Company certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to such officer’s knowledge:
(1)The Report fully complies with the requirements of 13(a) or 15(d) of the Securities Exchange Act of 1934, and
(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.

May 4, 2023
/s/ Patrick E. Bowe
Patrick E. Bowe
Chief Executive Officer
/s/ Brian A. Valentine
Brian A. Valentine
Executive Vice President and Chief Financial Officer
A signed original of this written statement required by Section 906 has been provided to The Andersons, Inc. and will be retained by The Andersons, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.