Effective January 3, 2025, the Compensation and Human Capital Management Committee of the Board of Directors (the “Committee”) of Freshpet, Inc., a Delaware corporation (the “Company”), in consultation with its independent compensation consultant, approved the grant of performance and time-based retention awards (each, a “2025 Retention Grant”) to three of the Company’s named executive officers: (i) our Chief Executive Officer, Mr. William B. Cyr; (ii) our President and Co-Founder, Mr. Scott Morris; and (iii) our Chief Human Resources Officer, Ms. Thembeka Machaba (each of Ms. Machaba, Mr. Cyr and Mr. Morris being a “Recipient”).  The 2025 Retention Grants were awarded in the form of Restricted Stock Units (“RSUs”) in respect of the Company’s common stock, par value $0.001 per share, and were issued effective as of January 3, 2025 (the “Grant Date”) pursuant and subject to the Company’s 2024 Equity Incentive Plan.

In determining to award the 2025 Retention Grants, the Committee considered that, as of January 1, 2025, each of Mr. Cyr, Mr. Morris and Ms. Machaba had no unvested equity awards with retentive power, as a result of their last equity grants having been made in 2020, and the performance and service periods for such awards concluded on December 31, 2024.  The Committee believes that each of these executives have been critical to generating significant value creation for the Company and its stockholders, and accordingly, that Mr. Cyr’s, Mr. Morris’s and Ms. Machaba’s retention will be a key driver for the Company’s continued success and future growth.

Effective as of the Grant Date, each Recipient is awarded a 2025 Retention Grant as set forth below:

Subject to such Recipient’s continued employment with the Company as of the applicable vesting date, the Time-Based RSUs shall vest at one-third on each of the first, second and third anniversaries of the Grant Date, and the Performance-Based RSUs shall vest, if at all, based 50% upon the achievement of the Company’s three-year (FY 2025-2027) cumulative net sales goal and 50% upon the achievement of the Company’s three-year Adjusted EBITDA margin goal.  Achieving the respective threshold goal would result in 80% of the target number of Performance-Based RSUs vesting for that goal and achieving the maximum goal or higher would result in 120% of the target number of Performance-Based RSUs vesting for that goal. If the threshold goals are not achieved, no Performance-Based RSUs would vest in respect of that applicable performance condition.  In addition to the condition that each executive remain employed by the Company as of the applicable vesting date, other key features of the awards include double-trigger accelerated vesting at 100% in the event of a qualifying termination following a change in control of the Company.  There are no provisions that permit vesting in connection with executive retirement.  Each Recipient will remain eligible for participation in all other annual Company incentive plans.

The foregoing summary of the 2025 Retention Grants is a general description only and is qualified in its entirety by reference to the full text of each 2025 Retention Grant, which shall be filed with the Company’s next Quarterly Report on Form 10-Q.

SIGNATURE

 

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 hereunto duly authorized.